E66: $FB's big drop, Rogan/Spotify mess, Xi/Putin meetup & supply chain issues with Ryan Petersen

00:00:00.000 | the fact that sacks his greatest moment in life was beating Peter

00:00:03.700 | TL in a multi game chess. You ever see that picture of? Yeah,

00:00:07.860 | of him with his arms raised? I can't believe he beat Pete. I

00:00:12.120 | mean, tell us about that moment.

00:00:13.260 | Nick, show that picture of sacks. I mean, listen, here's

00:00:15.220 | what I say when I saw when I saw that picture. I had a couple

00:00:18.660 | thoughts. Number one. I've seen this picture somewhere else. And

00:00:22.980 | then number two is oh my god, it was on NBC's to catch a

00:00:25.920 | predator. I mean, I have never seen sacks happier. I like the

00:00:32.760 | birth of his children. Oh my god, this moment. I'll tell you

00:00:36.480 | that was the day of PayPal's IPO. And so we did a party in

00:00:40.020 | the it was like a keg party in the parking lot. That was the

00:00:42.180 | extent of the celebration. And Peter did a 10 rule off. He did

00:00:46.500 | a 10 game simultaneous, which means he's playing against 10

00:00:49.120 | people at the same time. And he goes board to board makes his

00:00:51.880 | move. And I was the only one out of the 10 that beat him. And

00:00:54.520 | somebody I guess I

00:00:55.720 | maxed out on the left. I put money down I put like 20 bucks

00:00:58.980 | down or something on the game, which is a foolish thing to do

00:01:00.940 | against Peter because he's like a chess master. And and I

00:01:06.380 | somehow I won and you can see I've got the money in my hands

00:01:09.580 | raised. Look at the look on Peter Thiel's face. It's losing.

00:01:13.420 | Look at the look on P I mean, he's so angry. He and he but he

00:01:17.620 | sees the joy in your face and he can't process it.

00:01:21.340 | And look at Max Max's to my right and roll off. And there are

00:01:25.500 | some

00:01:25.700 | happy pure joy.

00:01:27.320 | Yeah. But this was a few seconds before Peter smashed all the

00:01:31.400 | pieces off the board. And

00:01:33.740 | yeah, he flipped the board.

00:01:35.940 | He always does that when he loses. And his motto is when you

00:01:39.580 | call him a sore loser. He says show me a good loser and I'll

00:01:41.700 | show you a loser.

00:01:42.620 | Wow, such a great line. But I just want to also comment on the

00:01:46.820 | pleats on saxes pants and how high that waist and the cell

00:01:52.940 | phone holster.

00:01:53.600 | Yeah.

00:01:53.780 | That's all I got.

00:01:54.500 | I didn't see zoom in on the

00:01:55.580 | black. Is that a blackberry? It just

00:01:58.460 | keeps giving.

00:01:59.180 | This is free iPhone guys. This is like I mean, this is like

00:02:02.460 | late 90s.

00:02:03.500 | The gift that keeps on giving. I do have to say Roloff's hair

00:02:06.500 | game. I mean, strong hair.

00:02:08.960 | Roloff's always had incredible hair. His hair is incredibly

00:02:11.580 | great hair to this day.

00:02:12.740 | Incredible thick. Yeah, it's still thick.

00:02:14.180 | Never noticed.

00:02:16.640 | Let your winners ride.

00:02:19.580 | Rain man David Sacks.

00:02:22.460 | Going home.

00:02:24.860 | And it said we open source it to the fans and they've just gone

00:02:28.460 | crazy with it.

00:02:29.180 | Love you guys.

00:02:29.740 | I'm going all in.

00:02:33.380 | All right, everybody. Welcome to another episode of the all in

00:02:36.860 | podcast. With us again today the dictator Chamath Palihapitiya,

00:02:41.420 | Rain Man, David Sacks, and the Sultan of Science, formerly known

00:02:48.140 | as the Queen of quinoa. He's out of that business. David

00:02:52.660 | Friedberg. We got a lot on the agenda.

00:02:54.840 | However, one thing that we've had a hard time figuring out is the

00:02:59.940 | state of the supply chain. And it's confounding. It seems like

00:03:05.280 | nobody knows what the hell they're doing. But there's one

00:03:08.040 | guy who's been on Twitter. And we happen to know him. He's he's

00:03:11.460 | been on my pod and Friedberg knows him. And his name is Ryan

00:03:14.880 | Peterson. And he's a bit of an expert on this. And we thought

00:03:18.420 | we'd have a bestie guestie come on. We don't do this too often.

00:03:21.580 | Maybe it's the third or fourth bestie guestie. And

00:03:24.400 | Welcome to the pod, Ryan Peterson from Flexport.

00:03:28.780 | What's up, guys?

00:03:29.520 | Thanks for having me on.

00:03:30.200 | What's up, Ryan?

00:03:31.260 | Ryan, did you tell Olivia you were doing the show today?

00:03:33.220 | No, I didn't tell her.

00:03:34.960 | So, she's a huge fan.

00:03:36.660 | Don't tell her!

00:03:37.440 | Where is she right now?

00:03:37.980 | Is she like not there?

00:03:39.060 | She was in the room next door, but I told her,

00:03:41.760 | leave me alone, I'm doing a podcast.

00:03:42.600 | She knows I'm doing a podcast.

00:03:43.380 | She doesn't know which one.

00:03:44.040 | That's awesome.

00:03:44.880 | She's a super fan.

00:03:46.160 | She's a very big fan.

00:03:46.900 | She's literally wearing the Wet Your Beaks hoodie right now.

00:03:49.500 | That's awesome.

00:03:49.840 | Fantastic.

00:03:50.200 | By coincidence, she doesn't know I'm on the show.

00:03:52.000 | Fantastic.

00:03:53.340 | So, you're not going to tell her, right?

00:03:54.500 | She's just going to watch my next show and you're going to be on it?

00:03:56.460 | We'll listen to it.

00:03:57.800 | Yeah, we'll probably listen to it together tonight whenever it comes out.

00:04:00.140 | Ryan, what is the state now?

00:04:01.840 | Should we be worried about the supply chain?

00:04:03.920 | Is it getting better?

00:04:05.000 | Is it getting worse?

00:04:05.740 | What's 2022 going to look like?

00:04:07.140 | Yeah.

00:04:07.460 | I mean, I think the supply chain means a lot of things,

00:04:09.620 | and it'll depend on what your industry is, what's really happening.

00:04:12.660 | But it goes for everything from manufacturing products,

00:04:15.480 | which means sourcing all the subcomponents like semiconductors,

00:04:18.740 | through logistics and final delivery all the way to a customer store.

00:04:23.140 | And we're flexible.

00:04:24.460 | Our focus on that is sort of picking goods up from factories around the world

00:04:27.600 | and delivering them into fulfillment centers all over the world.

00:04:30.520 | So, kind of that global mile is what we sometimes call it.

00:04:33.520 | There, you're seeing real disruption.

00:04:35.720 | And it starts really with the pandemic shift in consumer behavior,

00:04:40.500 | where people started buying more goods because they couldn't go to restaurants

00:04:43.740 | and travel and things.

00:04:44.800 | And so, a lot of spend shifted onto goods.

00:04:47.340 | And imports are up almost 20% imported container volumes.

00:04:51.280 | So, that's the start of it all.

00:04:53.120 | And then what we learned is our infrastructure is dilapidated

00:04:57.160 | and unable to handle a 20% increase.

00:04:59.540 | And by infrastructure, I mean the number of ships in the world,

00:05:02.500 | the capacity of throughput of the ports, the number of trucks,

00:05:07.880 | and availability of trucks and chassis, which is the trailers that haul containers around.

00:05:12.300 | We just didn't have enough of these things or the port capacity.

00:05:15.560 | You know, like, look at American ports operate.

00:05:18.140 | This is, I just learned the statistic pretty recently,

00:05:19.780 | and I keep saying it because it appalls me.

00:05:21.320 | Our ports operate with a lower 3.5% capacity.

00:05:23.020 | We don't have more throughput and productivity level than Mombasa, Kenya.

00:05:26.600 | And you know, we just do not have modern port infrastructure.

00:05:30.620 | Rotterdam has been fully automated for 20 years.

00:05:33.360 | So, if they want to run 24/7 and keep containers flowing through the port,

00:05:37.780 | they can do that with self-driving trucks and everything.

00:05:40.380 | Is that a technology issue, or do you think that's a regulatory capture and union issue?

00:05:44.460 | Like a labor issue, like a labor--

00:05:46.420 | The tech is there, you know, it's existed for a long, long time.

00:05:49.040 | It's really about labor, getting together with management, negotiating these things.

00:05:53.000 | And allowing it to happen.

00:05:54.300 | And the way that our ports are run is, it's pretty crazy when you look at it.

00:05:58.840 | They treat labor as a fungible commodity.

00:06:01.180 | As in the port terminal operators will say, "I need this many workers tomorrow."

00:06:06.480 | And the union provisions that many workers.

00:06:08.840 | But there's different people every day doing operating complex, you know, heavy machinery that you can't--

00:06:16.800 | Like the number one thing in business is like, what did we learn today?

00:06:20.180 | And how are we going to do better tomorrow?

00:06:21.980 | Every day with your team?

00:06:22.980 | But if it's a new team every day, like that's not even possible.

00:06:26.280 | So I don't know how you can drive a productivity improvement when it's different workers every single day of the week.

00:06:30.480 | Right.

00:06:31.300 | So wait, they're not full-time employees?

00:06:33.000 | They're like staffed by the hour?

00:06:34.440 | They're union workers.

00:06:35.940 | They're paid by-- they have annual contracts.

00:06:38.200 | The union decide who goes to work every day and who gets shifts.

00:06:41.200 | Yeah, and where.

00:06:42.120 | And so they'll show up at different terminals.

00:06:43.880 | And there's like 15 different terminals.

00:06:45.260 | So they just kind of move around, do different jobs.

00:06:46.780 | So it's essentially what we saw on the waterfront.

00:06:49.500 | Yeah.

00:06:49.860 | Where like the union decides you get to work today.

00:06:52.160 | These other people didn't.

00:06:52.980 | They're like, oh, we're going to work tomorrow.

00:06:54.360 | And then they're like, oh, we're going to work tomorrow.

00:06:55.360 | And then they're like, oh, we're going to work tomorrow.

00:06:56.360 | And then they're like, oh, we're going to work tomorrow.

00:06:56.480 | And then they're like, oh, we're going to work tomorrow.

00:06:56.520 | And then they're like, oh, we're going to work tomorrow.

00:06:56.560 | Even going further back in supply chains to manufacturing centers,

00:07:00.360 | how much are you hearing about and seeing kind of labor shortages?

00:07:05.220 | Because people are out for COVID and hey, someone's sick.

00:07:07.920 | They got to take 10 days off.

00:07:09.320 | And when, you know, 10% of the employees get sick and they lose 10 days of work,

00:07:13.120 | the facility sees a decline in productivity to, you know, 70, 80% of normal.

00:07:18.000 | And then, you know, all of the output of that facility goes way down.

00:07:21.360 | I mean, you know, are you hearing about more of that stuff happening,

00:07:23.820 | particularly during this kind of Omicron wave where the real effect of that

00:07:28.860 | hasn't really hit the supply chain system yet?

00:07:31.080 | And we're still kind of seeing a buildup of,

00:07:33.620 | you know, of demand.

00:07:36.580 | And we don't you know, we haven't really kind of hit the problems.

00:07:39.120 | So for the last 18 months, China had this total zero tolerance policy

00:07:44.600 | and was very successful in keeping COVID out of out of their country.

00:07:48.520 | And so manufacturing just kept running as if not

00:07:51.300 | no problem in China, which is the majority of this manufacturing.

00:07:54.220 | With Omicron, you're starting to see that it is still taking hold in a zero tolerance policy.

00:07:59.980 | We haven't yet seen like major shutdowns and waves of shutdowns,

00:08:03.520 | but a little bit you're seeing that here and there.

00:08:06.320 | The zero tolerance policy has shown up, for example, at least twice

00:08:11.120 | where one port worker in a Chinese port got COVID

00:08:16.120 | and they shut the whole port down for like three weeks.

00:08:17.960 | Yeah, that's crazy.

00:08:19.200 | Really extreme.

00:08:20.000 | I mean, U.S. workers have been getting.

00:08:21.240 | They're getting COVID nonstop and the ports keep operating even at, you know,

00:08:24.780 | we have lower level of productivity, but they'll shut the whole port down.

00:08:27.280 | That happened both at Yantian, which is the largest port in China or second largest,

00:08:30.880 | and Ningbo, which is the third largest.

00:08:32.760 | So it's been very, very disruptive.

00:08:35.340 | It's also happened at the airports over there.

00:08:36.960 | So that's something I'll definitely keep an eye on here over the next couple of months

00:08:40.880 | or even next couple of weeks.

00:08:42.680 | Are we still having this like we're ordering too many goods and we're backed up?

00:08:47.220 | Or is it that we're backed up for six months just trying to fulfill all those pandemics?

00:08:51.180 | What's the state of the backlog today, if you could describe it?

00:08:55.680 | So volumes are high, but they're sort of flat.

00:08:58.680 | Year over year, they're flat now.

00:09:00.020 | They're much higher than pre-pandemic, but they're pretty much flat year over year.

00:09:03.600 | And that's what has me so worried here is that you have increasing delays, even though

00:09:08.140 | the input's the same.

00:09:09.140 | And we have a complex system where the same amount of inputs coming in, but the delay

00:09:12.780 | is getting longer and longer.

00:09:14.680 | That's a very worrisome sign.

00:09:15.680 | Like if you're ever building a technology system, you're building this system and you're

00:09:21.120 | sending the same amount of bits in and performing the job is taking longer and longer.

00:09:26.360 | That would be a very alarming sign that you're going to want to send some of your best engineers

00:09:30.380 | in here to debug this thing.

00:09:31.700 | But I think we're seeing that because a lot of companies, people don't realize when they

00:09:35.060 | buy capital equipment, like machines that are either sold to end users or machines that

00:09:40.620 | are used in their own production systems, capital equipment is typically assembled last

00:09:45.120 | minute.

00:09:46.120 | It's not like there are companies that own huge pieces of equipment and then they ship

00:09:49.000 | them and they just get plugged in and turned on.

00:09:51.060 | And that's the way that we're seeing the components associated with them.

00:09:53.080 | And in businesses I've been involved in over the last couple of years, we've got a lot

00:09:56.320 | of lab businesses and hardware businesses.

00:09:58.680 | And just getting capital equipment has been like delays like we've never seen.

00:10:02.660 | It's like a year to a year and a half or something that used to take four to six weeks to arrive.

00:10:06.760 | Because the company that makes that equipment is having delays with each of their component

00:10:10.800 | suppliers.

00:10:11.800 | And then all of this stuff backs up into the system and it plays out where the end user

00:10:14.620 | is now stuck waiting a year, year and a half, and the business doesn't make progress.

00:10:18.000 | And a lot of hardware companies in Silicon Valley right now are facing...

00:10:21.000 | There's a lot of hardware companies that are facing these significant shortages, where

00:10:22.760 | they can't get the equipment they need to ship product to their customers.

00:10:26.940 | And they're sitting around burning money every month.

00:10:29.220 | And so the result will actually show up down the road, when all of a sudden they miss revenue

00:10:34.240 | three, four quarters down the road.

00:10:36.700 | And that's why I've been saying for a couple of shows now, that the biggest thing I'm concerned

00:10:41.100 | about is when the revenue shortfalls start to hit the companies that are dependent on

00:10:44.960 | these supply chains, but you don't actually see the revenue shortfall for a couple of

00:10:48.380 | quarters after the supply chain problems hit them.

00:10:50.940 | And just this quarter with the quarterly earnings, we're now seeing that the company yesterday

00:10:54.940 | that reported called Ingredion, their big food ingredients company, and they just reported

00:11:00.280 | how supply chain problems have now backed up to effect and the stock was down like 10%,

00:11:04.820 | 11% yesterday.

00:11:05.820 | And this is like a very stable, very mature, third largest producer of starch in the United

00:11:11.720 | States.

00:11:12.720 | And their business got totally hammered, but it took a while before that hit them.

00:11:16.720 | And so, you know, it feels to me, Ryan, I mean, correct me if I'm wrong, but like, a lot of

00:11:20.880 | the business level and market level risk isn't going to show up for a while after these supply

00:11:26.580 | chain problems really persist within their organization.

00:11:29.300 | This is the thing that has me most concerned is what's happened is it's now taking 115

00:11:36.180 | days on average across our customer base, from when the factory says, hey, these goods

00:11:40.880 | are ready, come pick them up, to when they finally get delivered to a warehouse in the

00:11:45.500 | United States.

00:11:46.500 | It's 115 days.

00:11:47.500 | Before the pandemic, that was 50.

00:11:49.880 | And 50 even felt hot.

00:11:50.820 | Like, the ship is only taking 15 days.

00:11:52.580 | Like, what the heck is going on?

00:11:54.060 | A lot of inefficiency, a lot of customs processing, hard to find a truck, et cetera, even in normal

00:11:59.340 | times.

00:12:00.440 | When you go to 115, all of a sudden, these companies are so much less agile, like, because

00:12:06.200 | you've placed the orders and you're expecting…

00:12:08.520 | Forecasting demand is so hard.

00:12:10.140 | And now you're forecasting demand for twice as long of a time period.

00:12:13.420 | You've already placed all that inventory.

00:12:14.720 | If your demand goes down, guess what?

00:12:15.940 | You've already ordered the goods.

00:12:16.940 | So I'm really worried that we're going to find out in six months or in two months, you're

00:12:20.760 | going to find out in some time period in the future here that people have ordered way too

00:12:23.980 | many goods, that these companies expected demand to stay high and keep booming.

00:12:28.460 | At some point, consumers start going to restaurants and start traveling a lot more.

00:12:32.480 | You get pre-COVID consumption patterns, and all these companies get stuck with way too

00:12:37.340 | much inventory that they paid way too much to ship and get delivered, and they can't

00:12:41.160 | sell it.

00:12:42.160 | And so I'd be very worried for middle market kind of retail, direct-to-consumer, e-comm,

00:12:47.380 | these types of businesses that aren't very sophisticated in demand planning.

00:12:50.700 | You end up with way too much inventory.

00:12:52.660 | I think that there's been this weird dispersion, actually.

00:12:55.580 | And I think that these supply chain issues are not broadly distributed.

00:12:59.960 | So if you bear with me for a second, if you watch the earnings reports, I don't know how

00:13:04.040 | closely you watch them, Ryan, this past couple of weeks, but Apple and Tesla basically said,

00:13:09.160 | "It's kind of reasonably well managed, particularly on the chip side."

00:13:13.500 | And we see the whole thing easing Q4, Q1 of next year.

00:13:16.920 | Amazon last night basically said, "Yeah, there's some toughness in the system.

00:13:20.640 | But we think it's sort of like, you know, reasonably achievable."

00:13:25.260 | And they're past it.

00:13:26.560 | And so it seems like the bigger companies who have influence were able to manage through

00:13:30.780 | it.

00:13:31.780 | These smaller companies, to your point, who really do rely on many actors in the supply

00:13:37.220 | chain have been really thrown left and right.

00:13:39.880 | They probably don't know where demand really is.

00:13:42.000 | So is that sort of the more nuanced actual the way that it's running out?

00:13:45.880 | Yeah.

00:13:46.880 | And it's sort of, it's very interesting to see this flip.

00:13:50.580 | Biggest companies paid the least for freight because they buy the most freight.

00:13:53.780 | So they negotiate good rates.

00:13:55.500 | Now they're paying the most.

00:13:57.300 | And the biggest companies for a reason, they have the best businesses.

00:13:59.880 | They either have the best margins, the best, you know, they just built something that people

00:14:03.020 | want at scale to be huge.

00:14:05.200 | Well when times are tough and you need to spend extra to prioritize your freight, to

00:14:10.940 | get loaded, to sign a contract and make sure that these ship owners and airlines honor

00:14:16.960 | their commitments and serve up, step up, it's the big companies that can afford it.

00:14:20.520 | And so they're not paying extra for freight, but they're getting around these problems.

00:14:24.440 | And freight is a really interesting market because it's pretty inelastic.

00:14:29.080 | Like you're either going to ship the thing or you're not.

00:14:32.180 | Whatever the price is, you're probably still shipping it.

00:14:34.340 | And so like, I haven't ever looked at an Apple at this level, but I'm sure that if you did,

00:14:39.320 | you'd see that it's a, the percent they spend on freight is just negligible.

00:14:43.360 | So if they doubled it, it wouldn't matter.

00:14:45.040 | But to Chamath's point, it seems like, and I think we're seeing this a lot, the bigger

00:14:48.460 | companies can actually afford to integrate their supply chain.

00:14:50.460 | Whereas before it didn't make sense to vertically integrate.

00:14:53.880 | Like I think Walmart announced that they've spent like 11 or $12 billion kind of rebuilding

00:14:58.060 | their supply chain themselves.

00:15:00.040 | Apple obviously has captive facilities all the way down to the fab where they're driving

00:15:04.180 | the whole supply chain from fab to components.

00:15:06.980 | All these Foxconn facilities that are operated for them are captive facilities.

00:15:10.700 | But the Tesla obviously has a very deeply integrated supply chain team.

00:15:14.840 | Whereas GM probably relied on subs who relied on subs who relied on subs.

00:15:18.780 | And that's why GM delivered like no electricity.

00:15:20.400 | They're not electric cars, but Tesla was able to keep volume up.

00:15:23.700 | The guys that are winning are the ones that are integrating supply chains.

00:15:27.560 | And do you think that that kind of becomes a persistent solution here where, you know,

00:15:31.220 | bigger companies, their competitive advantage becomes, Hey, we're going to own our whole

00:15:34.480 | supply chain all the way through.

00:15:35.480 | We're going to own more of the infrastructure all the way through like Amazon's done with

00:15:38.720 | delivery vans and ultimately be able to kind of, you know, have a true competitive advantage

00:15:43.280 | because of this disruption that's going on right now.

00:15:45.400 | Yeah, potentially.

00:15:46.400 | I mean, I think my vision for Flexport is that we become that layer and we allow, you

00:15:50.340 | know, small businesses, medium sized businesses to get access to world-class logistics services

00:15:54.860 | and get them, you know, sort of almost be a union that can represent them at the table

00:15:58.100 | against these bigger guys.

00:16:01.040 | I think it's very interesting to see a company's like the biggest companies have gone out and

00:16:05.460 | chartered their own ships.

00:16:07.100 | Totally wild experiment to watch for my, my way.

00:16:09.580 | I sit here with popcorn.

00:16:11.020 | You're bringing up a really important effect of all of this, which is what happens now

00:16:15.120 | in six or nine months to your point, when the consumption of hard physical assets turns

00:16:20.280 | towards the consumption of services, which it typically does, right?

00:16:23.880 | If you revert back to the mean here, you know, people aren't going to be buying as many Pelotons

00:16:28.440 | and all of that stuff because they bought them all right.

00:16:30.740 | They bought all the physical goods they need.

00:16:33.220 | And to your point, these companies have over ordered all this inventory.

00:16:37.300 | Actually Peloton is a perfect example because they basically shut down their entire supply

00:16:40.760 | chain last at the end of this past quarter and essentially said our inventory turns will

00:16:45.280 | be more than enough to meet, you know, existing demand for the foreseeable future.

00:16:49.700 | That's an enormous.

00:16:50.220 | Capital problem that these companies now all of a sudden will face, right?

00:16:54.000 | So like the next step beyond all of the supply chain issues could be, um, and I think Saks

00:16:58.800 | has been talking about this a lot, like a, a pretty bad recession.

00:17:01.720 | If these companies have all this inventory and they don't know how to get working capital.

00:17:05.160 | Yeah.

00:17:06.160 | It'd be real ugly.

00:17:07.160 | And, and the other, the other factor is the price has gone crazy.

00:17:09.440 | So the price of shipping a container long run, like I've been in this business and been

00:17:14.160 | a customer of this business for 20 years and you're, you can just rule of thumb.

00:17:17.160 | It costs you 2000 bucks to ship a container from China to the world.

00:17:20.160 | To the west coast during, um, 2016, that price collapsed.

00:17:25.100 | So you have these boom and bust cycles of an asset market 2016, it was 550 bucks.

00:17:31.060 | Last year was $20,000.

00:17:32.060 | So it's up 10 X over normal.

00:17:35.060 | It's up 40 X over or more right over just a few years ago.

00:17:40.880 | And what, what that's done is create a real barrier to entry.

00:17:44.340 | Like for a DDC e-comm business used to be able to just go to China, find some product,

00:17:49.100 | put your slap, your label on it.

00:17:50.100 | And go sell it on Amazon.

00:17:51.140 | And you were in business.

00:17:52.840 | And it was like a huge number of people doing this right now.

00:17:56.360 | You have to come up.

00:17:57.360 | If you want to ship 10 containers, it used to be, you needed 20 grand.

00:18:00.040 | Now you need 200 grand.

00:18:01.440 | That's like, that's a real barrier to entry.

00:18:04.080 | So actually I've talked to some companies in this space.

00:18:07.300 | We're really happy.

00:18:08.300 | Like if you have an established business, you're like, great.

00:18:10.480 | Now it's much harder for Joe Schmo to show up in China and start competing with me.

00:18:14.740 | So I was really surprised to hear that.

00:18:16.440 | I thought that was, I guess, pretty sophisticated tape.

00:18:18.040 | What dollar point?

00:18:20.040 | Does air freight compete with containers?

00:18:23.820 | Because when we start hearing about chips, I was always wondering, and again, I'm no

00:18:27.280 | expert, but putting a bunch of chips on a plane versus putting them in a container,

00:18:31.920 | given how much those chips are valued by a Tesla, whoever's putting them into a car.

00:18:38.040 | What's the breaking point?

00:18:40.280 | Certainly, but air freight price has just gone in line and it's gone up five X as well.

00:18:44.420 | And one thing to remember is that 50% of all the world's air freight flies in the belly

00:18:48.040 | of passenger planes.

00:18:49.980 | So that could kind of horrify you if you're ever flying on a passenger plane from East Asia,

00:18:53.760 | but to the United States, there's probably a whole bunch of stuff down in that belly.

00:18:57.220 | And those are grounded.

00:18:58.460 | So the supply of air-

00:19:00.120 | Why are they grounded?

00:19:02.120 | Nobody's flying to China right now.

00:19:03.120 | Oh, I see.

00:19:04.120 | So because there's no-

00:19:05.120 | Those passenger planes.

00:19:06.120 | Now we're seeing kind of the backlog play into commodity cycles, right, Ryan?

00:19:08.820 | So we're seeing like a lot of these commodities because of these discontinuities in these

00:19:13.460 | supply chains, suddenly commodity prices are spiking all over the place.

00:19:17.920 | And I mean, do we think that that settles down?

00:19:19.920 | Do we think it kind of continues for the foreseeable future until this all works its way out?

00:19:24.920 | Yeah.

00:19:25.920 | I mean, I'm not the right person to ask about commodity prices.

00:19:27.940 | Maybe Chamath has a view on that, but on the logistics market, I don't see it sorting itself

00:19:32.320 | out for the next year, for the next couple of years.

00:19:35.340 | In fact, you've warned that it might get worse, right?

00:19:37.680 | I mean, I saw on Bloomberg, you said that there could be a union strike in maybe October.

00:19:42.460 | What are the prospects for that?

00:19:44.140 | And what happens if that takes place?

00:19:45.860 | So it's on July 1st of this year.

00:19:47.860 | July, okay.

00:19:48.860 | The West Coast Union.

00:19:49.860 | It's called the ILWU.

00:19:52.740 | That union extends from the southern border, so from Mexico all the way to Alaska, and

00:19:57.120 | it includes Canada.

00:19:58.580 | So the whole West Coast of the United States is run by this one union at the ports.

00:20:02.280 | And their contract expires on July 1st.

00:20:06.360 | And in years past, so the last time this happened was in 2015.

00:20:09.640 | This is a contract that was signed then and extended at some point.

00:20:12.620 | But in 2015, they had a three-month period where nobody could import anything on the

00:20:17.060 | West Coast.

00:20:18.620 | And some major companies…

00:20:19.800 | Some major companies missed Christmas that year.

00:20:21.200 | So that's July 1st.

00:20:23.980 | Typically there's kind of slowdowns in the months leading up to that.

00:20:27.400 | And we've already had slowdowns for a couple of years with hundreds of ships are now waiting

00:20:32.160 | offshore.

00:20:33.260 | So yeah, I can't make a prediction.

00:20:35.940 | This is slowdown basically a negotiating tactic by the unions?

00:20:39.120 | In the past, it has been.

00:20:40.120 | I'm not convinced that that's what we've seen over the last year versus…

00:20:43.840 | There are legitimate problems staffing, people getting COVID, et cetera.

00:20:47.460 | So is there a role for presidential leadership in…

00:20:49.740 | Sorting out these union issues or just sorting out the issues with the port more generally

00:20:54.900 | or avoiding a strike in July?

00:20:56.900 | I mean, it seems to me that if Biden wants to get reelected, this inflation supply chain

00:21:03.600 | issues are pretty top of mind and in the news and are going to be on people's…

00:21:08.420 | You want to be seen doing things.

00:21:09.420 | And I do think there are things that can be done.

00:21:11.200 | So yeah, there's a role.

00:21:13.860 | And as far as union negotiations, Biden's probably pretty as equipped as any president's

00:21:19.080 | ever been to negotiate with the union and get them to play nice and not screw up his

00:21:23.340 | reelection with a strike.

00:21:26.060 | He's known as a union friendly president and go sit down and do a deal with them where

00:21:30.300 | Trump would probably never be able to do a deal with the union because they know that

00:21:33.300 | they're sort of natural adversaries.

00:21:34.780 | So there's something there.

00:21:37.840 | There's a lot more to be done.

00:21:38.840 | And I got into some arguments with people that are like, "That's not in the president's

00:21:42.620 | power to do such and such."

00:21:44.020 | I'm like, "Yeah, but he's the president of the United States.

00:21:46.120 | Pick up the phone.

00:21:47.120 | You can do things that aren't legally in your power.

00:21:48.240 | Just by asking him to do it."

00:21:48.240 | Yeah.

00:21:48.320 | Yeah.

00:21:48.420 | power just by asking for favors and other people do them. Negotiating with union is a good example.

00:21:54.780 | Convincing to change the zoning laws in LA so you can stack containers higher would be another.

00:22:01.100 | Yeah, that's not the president of the United States jurisdiction. But if he calls the mayor

00:22:04.880 | of LA or the city council- Can you explain that? So what does that mean?

00:22:08.340 | So in Southern California, you can't stack a container more than too high in a truckyard

00:22:13.720 | by law. We got no place to put these containers.

00:22:17.960 | But is that a danger issue or is that like a site issue, sight lines?

00:22:21.580 | I assume a little bit of both. So I think there's some safety issues, although they're

00:22:25.140 | stacked six high all over the world. So that's not that legitimate in my view.

00:22:29.100 | And in California, it's what, four or something?

00:22:32.140 | Two, too high.

00:22:33.300 | It's too high. Oh, wow.

00:22:35.060 | At the truckyards. At the port, you see them stacked six high, but in the truckyards,

00:22:38.540 | two is the limit.

00:22:39.400 | Okay.

00:22:40.180 | And so they're also an eyesore, especially in California. Containers are a sign of free

00:22:46.480 | enterprise.

00:22:47.500 | And it's just the people in California can't stand to see them.

00:22:50.340 | Right.

00:22:51.340 | They really just object to the idea of capitalism in their neighborhood like that.

00:22:55.540 | But there could be like some kind of temporary waiver that we do just to get through all

00:23:00.560 | of this backlog, which is to say, okay, let's just ease all of these small little things

00:23:05.460 | that slow the process down just to get all these ships, you know, unloaded, right? Off

00:23:11.440 | into the world where they need to be. And then we could revert back to what we are after

00:23:15.620 | things, you know, kind of normalized.

00:23:17.040 | Yeah. So we did that. So like I wrote about this, this zoning law and what's happening then is if

00:23:23.480 | you can't stack the container three high, there's nowhere to put that third container. So you leave

00:23:28.520 | it on the trailer. And now you have one less trailer in rotation serving the port to unload.

00:23:33.480 | And that's true across Southern California right now. There are thousands of trailers

00:23:36.920 | with containers on them because they're not allowed to stack them. They'll get fined if they

00:23:39.880 | do. So I tweeted about this and the city of Long Beach actually responded. I tweeted about it at 6:00

00:23:45.800 | AM by 3:00 PM.

00:23:46.580 | The city of Long Beach had changed the zoning law to allow stacking up to five high, I believe.

00:23:51.820 | I'm told the fastest response by any government to citizen action like ever.

00:23:56.300 | That's incredible. You must feel great about that.

00:23:58.460 | It was great. But unfortunately only Long Beach did that. LA never followed through.

00:24:01.740 | And there's not that many truck yards in Long Beach. A lot of them are in Los Angeles, Compton,

00:24:05.900 | Rancho Dominguez, et cetera. So.

00:24:07.420 | I saw-

00:24:08.380 | But this is the kind of thing like, yeah, Joe Biden could call these mayors and say,

00:24:11.020 | hey, let's work on this. Right?

00:24:12.220 | Yeah. But let's face it. He's super union Joe, right? Like, I mean,

00:24:16.120 | he wouldn't even say the word Tesla over the union.

00:24:17.800 | No, but Jason, isn't that more pro union? Because won't these, won't folks be working

00:24:21.720 | more and getting paid more? And I don't think there's a reluctance to pay, right? Cause clearly,

00:24:26.360 | like you're going to have to put some money into the system and where the money comes from,

00:24:29.880 | we can figure that out later. But the point is that there's a, there should be a desire to

00:24:33.720 | actually get the people on the ground to be working. Which you can do.

00:24:36.160 | There wasn't even a third shift, Ryan, right? Like that was another thing you were working on,

00:24:39.880 | on top of the stacking of these containers to get, you know, more of these, you know, to

00:24:45.660 | alleviate the problem. You were also talking about, they don't even have a third shift some

00:24:48.780 | nights, but they seem to have added a third shift. Did that become permanent or not?

00:24:52.780 | No, they do have a third shift, but nobody's showing up is the problem. So truck drivers

00:24:56.780 | don't work in the middle of the night. Warehouses aren't open in the middle of the night.

00:24:59.420 | But is that a compensation issue, Ryan? Like if we paid more, would folks show up? Like,

00:25:02.860 | is that just a supply demand issue that needs to get sorted out?

00:25:05.100 | Never underestimate incentives. There's just a lot of factors and a lot of it is, it's so easy

00:25:11.820 | to point fingers at somebody else and blame someone in the chain, right? Supply chain,

00:25:15.200 | you've got all these different people and everybody has their own opinion. You know,

00:25:19.200 | at one point I wanted to hear what the union's opinion was. What are they saying? Because

00:25:23.440 | everyone else is calling them lazy and not working hard. What's really happening? So we,

00:25:27.680 | I sent a taco truck down to the port a couple of months ago, just to, because I figured we're

00:25:33.760 | getting free tacos, they'll talk to us and that works. That's a game changer right there. Yeah.

00:25:37.360 | That really works. Well, we got, they logged it. They said we're the only

00:25:41.440 | business ever to send tacos to the port. And then they,

00:25:44.740 | they told us all about what their viewpoint was. They viewed that the truckers are screwing up that

00:25:49.960 | 50% of all the appointments where a truck is supposed to come and pick up a container,

00:25:54.320 | they're missing their appointments. Right. And because, and then, and then, so that's what sent

00:25:58.800 | me investigating, wait, why are they missing the appointments? That's when I learned, oh,

00:26:01.400 | they don't have any trailers, these chassis because they're stuck under containers and

00:26:06.800 | can't be unlocked. So a lot of it is going here. It's the supply chain. It's kind of like this,

00:26:11.040 | that metaphorical elephant in the dark room, right? And everybody sees their own aspect of it,

00:26:15.780 | but you got to synthesize all those perspectives and kind of take a systems view and see if you can

00:26:20.220 | get some real understanding. I'm not convinced I have it yet, by the way, I think it is more

00:26:24.540 | complex and I'm really beware simple narratives. If someone even including me says, oh, this is

00:26:29.540 | exactly what's happening. Like there's really a lot of complexity in all of this.

00:26:33.500 | Right. How much, how much of this is sort of the, the, the extreme end of the other spectrum, which

00:26:39.420 | is basically the us exceptionalism view that says, okay, we just need to really in-house more of the

00:26:44.700 | stuff that we need so that we don't actually have to rely on some of these arcane methods of just

00:26:50.060 | transporting goods for, you know, from point A to point B.

00:26:52.460 | In my view, that would be a shame. If we, I mean, we have the best companies in the world

00:26:56.860 | who need to be able to source raw materials, components,

00:26:59.900 | finished goods anywhere on planet earth. And we should have a modern infrastructure that

00:27:05.180 | makes that possible instead of being like, oh, we can't trade with the rest of the world. So we're

00:27:08.860 | going to be.

00:27:09.360 | Like self-sufficient, you know, we might as well go back to everybody being a farmer on subsistence

00:27:14.400 | farmer on our own land. Like, I think we should have global infrastructure. That's really great

00:27:19.040 | and seamless and makes it really easy, but you you're right. That might be an end result is

00:27:22.800 | people can't rely on these supply chains and start saying, Hey, let's manufacture at home

00:27:26.560 | or let's manufacture in Latin America. Let's manufacture closer to home. Uh, that to my

00:27:31.280 | perspective, that would be a shame. Well, I think the, I think the prod,

00:27:34.080 | the pendulum always starts from one extreme to the other. And I think the, the middle ground is

00:27:39.300 | probably that you need to have some heterogeneity, right? You have to have some amount of it. That is

00:27:43.480 | not just singularly reliant on China. Maybe it's, maybe it's to central or Latin America,

00:27:49.120 | right? Some that's domestic, but that domestic production probably has to be subsidized by

00:27:53.520 | something because we're never going to be able to run as efficiently and as cost effectively as,

00:27:58.480 | you know, cheaper international labor, you know, unless we invent something really,

00:28:03.040 | you know, um, incredible. So the balance is probably in the middle, but it's going to take us

00:28:08.800 | a long time to figure out.

00:28:09.240 | I saw a governor Abbott was pitching people on, Hey, just send your containers to Texas.

00:28:15.380 | We're cheaper and more central in the country. Is that true? Is that a solution?

00:28:20.020 | It takes much longer, costs much more when, if the union goes on strike on the West coast,

00:28:24.980 | it'll be one of your only options, bringing stuff through the canal. What you'll very quickly see is

00:28:29.860 | that the canal is going to back up. Can't move that many more ships through the canal that are

00:28:34.060 | currently going to the West coast. So a lot, and you've seen that a lot where the bottleneck just

00:28:38.620 | moves for a while last summer, the, for example, the trains that were going into Chicago, they were

00:28:46.540 | really having a hard time staffing the railroads out there. And it was taking them a long time to

00:28:50.780 | unload containers at the, at the port, at the terminals inland in Chicago and drivers, a lot of

00:28:57.100 | the truck drivers are owner operators. So these are entrepreneurs who own their own truck work for

00:29:01.980 | themselves. And they were able pre pandemic to do three loads per day at the Chicago railheads.

00:29:08.560 | Go drop it off, come back at another one, three times with the delays and the traffic jams that

00:29:13.440 | resulted, they were only able to do one a day. And so you opt out because you can go drive for

00:29:19.200 | UPS or FedEx or take your truck and do something else. So we had this huge reduction in drivers.

00:29:24.400 | And that's the kind of a feedback loop that we should all be really mindful of here,

00:29:28.880 | where a problem begets more problems and you get these positive feedback loops in the system

00:29:33.920 | that really vicious cycles. And so, you know, bottlenecks move, you know, you're going to have

00:29:38.480 | to move and you'll see as soon as they everybody started to ship to Houston, guess what Houston

00:29:41.760 | port won't be able to handle the volumes either. It's not like it's magically better just because

00:29:46.240 | it's a republican state or something. Do we need more ports? Or do we just need to run them more

00:29:50.880 | efficiently? And then who determines who runs the port because I know that they have seen some tweets

00:29:58.160 | of yours where they license the government I guess own supports, but they license it to people to have

00:30:02.720 | the franchise there. More ports better run ports and then what's the business model of ports? I'd say

00:30:08.400 | better run ports is the answer. I don't think we need more ports. You can't really create ports out

00:30:12.640 | of thin air like there's only a handful of geographic locations that actually make sense for

00:30:16.560 | a port. And we have we have great geography like the San Francisco Bay like this is probably the

00:30:22.000 | best natural harbor in the world or one of them. And the Oakland ports perfectly fine. It's who

00:30:28.320 | owns it is the city of Oakland or the city of Long Beach, the city of LA. So the local cities own the

00:30:33.600 | ports in the United States. That is a difference between United States and Europe, for example,

00:30:38.320 | it's sort of national strategic assets. They're still government owned, but it can be operated

00:30:42.960 | as a sort of public good for everybody instead of what are the odds given what's going on in Oakland

00:30:49.040 | that that's the big priority of the mayor of Oakland to like, run a better port like she's

00:30:53.360 | got a lot of other things on her on her list. And so that's one problem with our system. And

00:30:58.400 | then second, they do rent it. So the government owns it and then rents it to a private company

00:31:02.720 | that operates it. And then but those as a condition of renting the port, you must agree to hire

00:31:08.240 | the ILWU. You can't run a non union port in the United States should the government by the federal

00:31:14.000 | government by the port from Oakland by the port from Long Beach offer them some you know, trillion

00:31:18.320 | dollars or billions of dollars and buy it out from them. It's not a terrible idea. I mean, as long as

00:31:22.720 | you're forcing everyone to use union labor, it's not really like a private sector endeavors. It's

00:31:27.440 | like you can't, especially with the way that the unions run, so you can't do that much. But like,

00:31:32.480 | here's an example where technology could already made this technology, we could 10x the throughput

00:31:36.880 | of one of these ports overnight. So you can't do that much. But like, here's an example where technology could flex would already made this technology, we could 10x the throughput of one of these ports overnight.

00:31:38.160 | Which is today, a truck driver shows up looking for a specific container. He's like,

00:31:43.040 | I got this container number. So they have to make an appointment at that hour. And as I said,

00:31:46.960 | they're missing 50% of their appointments. Well, on the back end inside the port, they got to go

00:31:50.800 | find that container in this in the needle in the haystack and make sure it's at the front during

00:31:56.000 | that one hour when the guy shows up for it. And you could we already have this tech to make it

00:32:00.720 | what we call a free flow stack, where you just have this the truck pulls up and you give them

00:32:06.160 | the first the first container off the

00:32:08.080 | line. And then the mobile app tells them where to take it. And he doesn't have to come for a specific

00:32:13.040 | container. And if you did that, you just be every 30 seconds coming out of here instead of every 1015

00:32:17.760 | minutes, you'd easily 10x the throughput and this is we already have this tag. So it's a matter of

00:32:24.160 | implementation deployment. And how do you get around a lot of people that don't really want

00:32:28.720 | to see better running ports. And it's pretty sad to sit where I sit, they don't benefit from better

00:32:34.720 | running ports. Although it's a good point. Although at the back end,

00:32:38.000 | they they suffer from higher prices and inefficiency and not getting the things they

00:32:41.600 | want on time. Well, if you listen to Elon talk about unions and why Tesla is not a union shop,

00:32:47.120 | it's got nothing to do with wages. You know, he said, we'll pay you the union rate or better.

00:32:52.160 | And it's not about mistreatment, because he said, Listen, if someone mistreats you, we're gonna have

00:32:57.440 | a no assholes rule, and we'll get rid of them. The issue is inflexibility, right? He wants to drive

00:33:02.480 | continuous process improvement at Tesla. And he can't do that with a union shop, because every chain

00:33:07.920 | chain has to be negotiated. And then if there is a worker who's not living up to the performance

00:33:12.640 | bar, you can't get rid of them. And they can't repurpose workers and have them work a different

00:33:16.880 | line. So that's why Elon has always resisted being a union shop, not the wages, not mistreatment,

00:33:22.320 | purely inflexibility. And it seems like that's what you're seeing in the ports as well is we

00:33:28.240 | can't drive changes and improvements because everything's so highly contractually negotiated.

00:33:33.280 | That's my editorial comment. Ryan, what do you think about that?

00:33:36.960 | Ryan Cragun: No, I mean, it's a

00:33:37.840 | it's kind of it's worth studying a little history here is that like, you know, we went through the

00:33:41.680 | container revolution in the 60s and 70s, and the union agreed to it. And they that dramatically

00:33:47.680 | transformed the waterfront that these guys like, you see photographs from that era, they would

00:33:51.360 | put it on their back, like burlap sacks full of stuff, like hauling it on and off these,

00:33:56.880 | these ships and the kind of load them by hand. It was a real art and it was a massive employment

00:34:01.760 | driver. And we've still barely recovered from this, like the West Side Highway in New York is

00:34:06.480 | finally like a nice park. Ryan Cragun:

00:34:07.760 | But it sat there for 50 years, like dilapidated piers and ugly ass buildings. And some of those

00:34:13.120 | are still there. San Francisco waterfront still mostly like that south of the Bay Bridge,

00:34:17.600 | it's still like these old dilapidated buildings. So it's kind of funny to see how long it takes like

00:34:22.000 | that infrastructure to change. But there was a and I don't know, I'm not like the world's expert

00:34:27.600 | on this history. But somehow they convinced the union to adopt containerization, which is about

00:34:32.320 | it's far more radical than anything we would be proposing now, in how you would change their

00:34:36.560 | workflow. Ryan Cragun:

00:34:37.680 | Or change their work like that was complete change where it's really

00:34:41.280 | these giant automated or these giant cranes that replace the worker.

00:34:45.520 | Ryan Cragun: Couldn't Biden deploy his commerce secretary

00:34:47.920 | or I mean, isn't there some cabinet official he could deputize to say go solve this problem,

00:34:52.080 | go bring the parties together?

00:34:53.280 | San Francisco Waterfront: Yeah, and I think I suspect that'll happen over

00:34:55.680 | the coming months because July 1 is pretty bad timing for a midterm election if they were to

00:35:00.000 | go on strike. And I think he's got a lot of incentive to make sure that doesn't happen.

00:35:04.320 | Ryan Cragun: He does have the incentive. It just seems like I mean, you've been tweeting about this

00:35:07.600 | for months, that nobody's paying attention to the administration. I mean, we've all been reading

00:35:12.320 | your tweetstorm saying like someone in Washington really should be paying attention to these ideas.

00:35:16.480 | San Francisco Waterfront: This spans over two administrations now,

00:35:18.640 | right, Ryan? Both administrations have been out to lunch on this. They've been focused on it.

00:35:22.800 | Ryan Cragun: The union is a really big issue that's going to come up this summer. In my view,

00:35:25.840 | an even bigger issue that's gotten even less attention, which is on January 1 of next year,

00:35:31.120 | January 1, 2023, which is tomorrow in shipping terms, that all the ships in the world will have

00:35:37.520 | to reduce their carbon emissions by 13%. And these are internal combustion engine.

00:35:43.440 | San Francisco Waterfront: Sorry, Ryan, hold on a second. Wait,

00:35:47.280 | just explain what that means by who's mandating that and how is that enforceable and why does

00:35:52.400 | that have to… Ryan Cragun:

00:35:53.600 | It's the International Maritime Organization. It's part of the United Nations and it's the group that

00:35:58.000 | is overseeing global ocean freight. It's the regulatory body for ocean freight in the world.

00:36:02.480 | And it's a United Nations group. So any member state of the United Nations must follow the rules

00:36:07.440 | of the IMO and they've all said they will. And so the IMO has said all existing ships in the world

00:36:12.880 | must reduce their carbon emissions by 13%. And again, it's an internal combustion engine. We

00:36:17.440 | don't know how to make it 13% more carbon efficient or we would have done that already.

00:36:20.560 | San Francisco Waterfront: Can you actually buy indirect offsets? Can you go and buy some

00:36:23.440 | Amazonian rainforest credits and offset the… Ryan Cragun: No, you can't offset it. And it's

00:36:28.320 | not about the fleet either. So some of these fleets have LNG, liquid, natural gas. So the

00:36:34.240 | fleet might be more efficient, but it's not. It's down to the individual ship and it has to

00:36:37.360 | be… So there is one way to reduce the emissions of the ship and that's to go slower. And if you

00:36:42.880 | go 30% slower, then you can achieve a 13% reduction in carbon emissions. Well, if you look at it on a

00:36:48.960 | per container basis, by the way, it's the same amount of carbon emitted because the ship is

00:36:53.280 | still carrying the same number of containers, just going slower. But it will reduce the supply of

00:36:57.920 | shipping capacity and slow everything down another 30%. That takes place January 1st, 2023. It's

00:37:03.840 | getting very little attention, but to my view, it's going to be massively disruptive if we slow

00:37:07.280 | everything down, reduce the capacity of the network that much further, prices are going to

00:37:11.840 | go to the moon. And it's really asinine law because it doesn't actually achieve any carbon reduction.

00:37:18.080 | Robert Leonard : The fuel type, correct me if I'm wrong,

00:37:19.920 | is this like MGO, MDO, it's dirtier fuel? Is that correct? That's used in containers?

00:37:24.000 | Ryan Cragun: So the same group, IMO, actually passed a new law January 1st of 2020. It was

00:37:31.840 | supposed to be a huge deal in our industry and then COVID hit and we all ignored it. But that

00:37:37.200 | was the worst kinds of fuel, sulfur. Used to be you could have this bunker fuel that was up to 3%

00:37:42.800 | sulfur, which led to crazy amounts of sulfuric acid, which is apparently 15 times worse than

00:37:47.680 | carbon as a greenhouse gas. So that was eliminated and now it's still ugly bunker fuel, but it's not

00:37:54.720 | like it used to be. The reputation is probably still carried over from pre-2020.

00:37:58.240 | Robert Leonard : Got it. If you could wave your magic wand as we wrap up here

00:38:01.760 | and change two or three things that to you seem like layups, and I think you hinted

00:38:07.120 | at them in order, what would be the changes just based on your intuition and your knowledge of the

00:38:11.840 | supply chain? What two or three things are the layups we got to do right now?

00:38:15.600 | Ryan Cragun: I think first off, it's got to start with metrics. If you care about something,

00:38:20.880 | measure it. The metric that the government's been using for ocean freight delays has been

00:38:26.320 | how many ships are waiting offshore at the port of Long Beach. And this is one of the most mischievous,

00:38:32.800 | I don't know if it was just outright fraud or incompetence, but one of the worst things

00:38:37.040 | I've seen from a government in terms of PR is they pass this rule that the ships have to wait 150

00:38:42.800 | miles offshore so that the pollution wouldn't hit LA. Reasonable, good. But then they kept using the

00:38:50.160 | same metric for how many ships are waiting right outside the port. And it went way down and they

00:38:54.880 | started celebrating that success. So let's actually use the right metric, which is how

00:38:59.360 | long is it taking cargo to transport? You can't just hide the ships and celebrate that there's no

00:39:03.840 | ships there. So if we get the government- Robert Leonard :

00:39:06.960 | You're saying that the government pushed the ships beyond the measurement window and then

00:39:10.480 | said they don't exist? Ryan Cragun:

00:39:11.680 | Yes. The transportation secretary and the port of LA director got up there,

00:39:16.240 | these government officials- Robert Leonard :

00:39:17.040 | That's like when I went to an XL sweater to hide my gut and I was like, "I'm thin."

00:39:20.960 | Ryan Cragun: Yeah.

00:39:21.600 | Robert Leonard : Better to look at the scale.

00:39:23.600 | Ryan Cragun: So if we at least get them focused on the right metric,

00:39:26.960 | which I think we have the best metric right now, we call it the Flexport Ocean Timeliness Indicator.

00:39:31.680 | It's how long is it taking the cargo from when the factory says it's ready to when it can be delivered,

00:39:36.880 | now any solution that we create, we have a metric. We know, okay, there's a KPI here.

00:39:41.120 | Robert Leonard : Door to door?

00:39:41.760 | Ryan Cragun: Yeah, door to door.

00:39:43.360 | Robert Leonard : You mentioned the transportation secretary was

00:39:45.120 | part of that press conference where they're taking credit for changing the metric. So

00:39:48.320 | I assume that's Buttigieg who's in charge of dispersing the $1.2 trillion infrastructure bill.

00:39:53.600 | Is there any money in the infrastructure bill to solve this problem?

00:39:56.240 | Ryan Cragun: There's $17 billion allocated to ports.

00:40:00.720 | I went and read it and I couldn't find any money that was going to be spent on building ports. It

00:40:06.800 | was like, study this.

00:40:08.400 | Robert Leonard : Here's the crazy thing. We just had this

00:40:10.240 | trillion dollar infrastructure bill that's supposed to modernize and update the infrastructure of the

00:40:13.840 | country. It's doing nothing to solve the most pressing supply chain issue in the country,

00:40:19.120 | which is the bottleneck at the ports, which is driving inflation,

00:40:21.760 | which is causing interest rate increases and wrecking the economy.

00:40:24.320 | Ryan Cragun: There's a term in Washington, which is called the Christmas tree bill.

00:40:27.840 | The infrastructure bill is an example of that, which is this is not a directed shot on goal.

00:40:32.480 | What this is, is a random tree that you go and hang

00:40:36.720 | a little things on top of and eventually the whole thing is covered. It looks beautiful from afar,

00:40:41.760 | but when you get really close to it, it's a little bit chaotic and you don't understand

00:40:45.680 | what's going on. To your point, the fact that Ryan can say there's $17 billion allocated to

00:40:51.520 | something like ports, but it's unclear to him who's an expert in this space where that money

00:40:56.000 | goes and how it's spent, gives us zero chance of figuring this out.

00:40:59.520 | Robert Leonard : Yeah. It's things like, oh, each state must create a supply chain readiness report

00:41:06.400 | about ... It's like, what? What are you talking about? Singapore put $20 billion

00:41:10.640 | to build a bad-ass automated port. That's a reasonable thing to do. Let's spend $20 billion,

00:41:19.600 | make the most automated, amazing port in the world. That'd be a good use of government money,

00:41:23.680 | but to then create studies and consultants, I don't know that any of it's going to hit the

00:41:27.600 | ground in a shovel. Ryan Cragun:

00:41:28.560 | So you're saying that $17 billion that goes to

00:41:31.440 | studies and consultants could actually get redirected and we could pick a port where there's

00:41:36.320 | an amenable city and actually completely modernize it to set the example of what

00:41:40.800 | modern shipping should look like in the United States that at a minimum matches what's happening

00:41:44.960 | in the rest of the world. Robert Leonard :

00:41:46.000 | Yeah. I think that'd be pretty awesome and doesn't seem to me like science fiction. Like

00:41:49.360 | the government wants to build a port, who's going to stop the government from building a port?

00:41:51.840 | Ryan Cragun: That seems too logical and too obvious, Ryan.

00:41:54.560 | Robert Leonard : Well, we could have the ports compete for

00:41:56.800 | who gets to get that $20 billion and be the modernized port. Like Amazon held that competition.

00:41:59.760 | Ryan Cragun: Well, if you put ... To your point, Jason,

00:42:01.840 | put the mayors in competition and see which mayor wants this in their backyard.

00:42:05.200 | Robert Leonard : Yeah.

00:42:05.520 | Ryan Cragun: Does Greg Abbott?

00:42:06.240 | Robert Leonard : Does Greg Abbott want it? Does Long Beach

00:42:07.440 | want it? Does Oakland want it? Who wants to fight to be the most modern port? That should be-

00:42:11.200 | Ryan Cragun: DeSantis wants it. I'll tell you that.

00:42:12.800 | Robert Leonard : DeSantis and Miami. Yeah, exactly.

00:42:14.640 | Ryan Cragun: I'm sure DeSantis and Greg Abbott want it. I don't know that California's two

00:42:18.640 | incredible ports want it. And those are the two that are closest to China, by the way. Spoiler

00:42:23.200 | alert. Jason Wong:

00:42:23.600 | You guys remember when Google Fiber ran that competition and they got mayor of Pittsburgh

00:42:27.360 | to swim in a frozen lake and it was awesome, right? Like government, yeah, please bring us stuff.

00:42:32.720 | Robert Leonard : So yeah, I think ... I don't know,

00:42:36.160 | I have a lot of faith. Even if that came around, it would take five, six years, right? Even if it

00:42:38.800 | was done right, you don't get a port overnight. There are some very simple solutions like this,

00:42:42.960 | changing the zoning law, adopting technology to go with a free flow-

00:42:46.320 | Jason Wong : Metrics.

00:42:46.800 | Robert Leonard : ... out of the port,

00:42:47.840 | put some metrics in here, have someone focus on this. A key part of problem solving is make sure

00:42:54.000 | the problem doesn't get worse. So let's assign someone to go work with the union and the company

00:42:59.680 | terminal operators, make sure that they don't go on strike. And then someone needs to go look at

00:43:04.080 | this IMO UN thing and figure out how to do it. Jason Wong :

00:43:06.080 | Yeah. And then figure out if the United States is really going to go through with that,

00:43:07.680 | because it's pretty crazy. Robert Leonard :

00:43:09.120 | Well, listen, Ryan, you've been incredibly generous with your time and knowledge and

00:43:12.720 | your leadership watching you as a CEO and a leader go out there on a boat and go visit and buy the

00:43:21.120 | fricking tacos and actually boots on the ground, figure this out. Like the country owes you a debt,

00:43:26.880 | the world owes you a debt to really keep this problem down to first principles and figure it

00:43:32.320 | out. And our government should be taking notes and really the other leaders who are importing,

00:43:36.000 | whether it's Apple or Tesla, it'd be great for all of them to be supporting you. I don't know if

00:43:40.160 | they've reached out, but maybe a half dozen of you can then sit with this administration and the next

00:43:45.840 | one and just tell them where to point the money cannon because it doesn't seem like they know

00:43:49.920 | where to point it. Jason Wong :

00:43:50.800 | We have a lot of people in Washington that listen to this pod. Please just reach out to Ryan.

00:43:55.520 | Robert Leonard : Just reach out to Ryan and have lunch and

00:43:57.680 | just sit there and buy tacos for these poor people. Jason Wong :

00:44:02.960 | Let Ryan buy you a taco, guys. Robert Leonard : Ryan, bring your taco truck

00:44:05.920 | to Washington. Ryan Cragun :

00:44:06.720 | One of the big common denominators of both business and politics is that leaders have

00:44:10.400 | to focus on the right problems. And when they're not focused on the right problems,

00:44:13.600 | like bad things happen. And we know that inflation is a huge problem. The Fed now is raising rates or

00:44:20.160 | projecting raising rates very quickly, which is creating, it was created a huge market downturn.

00:44:24.800 | It's a very blunt instrument. It could cause a downturn or a recession. So that's the big problem.

00:44:30.640 | And yet there are specific solutions and fixes to the inflation problem by updating or modernizing

00:44:35.840 | the ports that Ryan suggested. But who's focusing on it? And now the problem is thrown together.

00:44:39.520 | Jason Wong : And they'd be more strategic, right,

00:44:40.800 | Sachs? It'd be a more strategic sniper shot as opposed to this blunt instrument, like you're

00:44:44.800 | saying. Robert Leonard :

00:44:45.040 | Right, exactly. And so what have they been focusing in Washington on? Definitely not this.

00:44:50.960 | Jason Wong : Absolutely.

00:44:52.400 | Robert Leonard : And then I see Ryan post these

00:44:53.760 | suggestions on Twitter and then all these people come in and they're all fatalistic. Oh,

00:44:57.440 | well, the president can't do anything. Jason Wong :

00:44:59.920 | Of course the president can. Emergency war time, actually.

00:45:02.720 | Robert Leonard : If there was ever a time for presidential leadership, this would be it. What I

00:45:05.200 | worry about is the president can't do anything. Jason Wong :

00:45:05.760 | Yeah. Robert Leonard :

00:45:05.840 | Is that if you're the union leader and you know that you've got Biden in the White House,

00:45:09.840 | who's always going to take their side, why wouldn't you make your demands more unreasonable?

00:45:13.920 | Jason Wong : Yeah, they should be asking for triple time to keep it open overnight.

00:45:16.400 | Robert Leonard : Why wouldn't they? Do you really, if you're the

00:45:18.640 | leader of that union, do you really believe that Biden's going to break your strike? No way.

00:45:22.640 | Jason Wong : No way. Ask for quadruple time. Yeah, just make it painful.

00:45:26.880 | Jason Wong : You should make the most-

00:45:28.080 | Robert Leonard : Of the crisis.

00:45:29.040 | Jason Wong : Egregious ask possible. I mean,

00:45:31.360 | this is your max leverage right now. Robert Leonard :

00:45:32.960 | Max leverage. Jason Wong :

00:45:33.920 | Never waste the crisis. Robert Leonard :

00:45:35.680 | This is your time. All right, man. Listen, Ryan, thanks a lot. Great bestie guest appearance.

00:45:39.920 | Jason Wong : Appreciate it, man. Ryan, thanks.

00:45:40.720 | Ryan Neuhofel : My pleasure. I'm a big fan of the show,

00:45:42.320 | so being a bestie guest, he means a lot to me. So thanks to you guys.

00:45:44.720 | Jason Wong : Yeah, and we'll continue the discussion,

00:45:46.320 | perhaps, at the All In Summit in May.

00:45:47.840 | Robert Leonard : Exactly.

00:45:48.480 | Jason Wong : See you in Miami. Facebook stock has dropped

00:45:51.520 | over 25% after reporting negative user growth for the first time and not only $10 billion,

00:45:59.200 | or maybe even $12 billion lost a year on their AR, VR headsets and project,

00:46:05.600 | but also a $10 billion decrease in projected 2022 revenue thanks to Apple's privacy features.

00:46:13.120 | Jason Wong : I guess we got to go to you first,

00:46:14.480 | Chamath.

00:46:14.800 | Chamath Nani: Well, also PayPal. PayPal dropped 25% too.

00:46:16.640 | Robert Leonard : Yeah, we have to pay. And then Snapchat had a whipsaw back and forth.

00:46:21.280 | But Chamath, when you see this, you called this with your spread trade.

00:46:24.960 | Maybe you could walk us through what you saw, whatever it was, three, four, five months ago,

00:46:29.840 | and then what you're seeing now. And at this level, with $250 billion wiped off the market cap, what do

00:46:35.520 | you think about the future of this as a trade and as a company?

00:46:38.960 | Chamath Nani: Well, I think the trade did what it was supposed to do, which is in a period of a lot

00:46:42.880 | of volatility, I saw an opportunity to just reduce my risk exposure. Look, I'm generally long, very

00:46:52.000 | risky assets, right? I mean, all of us are in the business of building companies that have huge

00:46:58.400 | volatility because all of our companies generate earnings very far in the future. And so, in the

00:47:05.440 | November of last year, I was trying to figure out what I could do to shield myself. And the reason I

00:47:12.720 | wanted to shield myself was because I saw Elon and Jeff in part selling, but also I saw that clearly

00:47:18.400 | we were going to go through a period where that high growth tech was going to trade down. So,

00:47:24.080 | I sold some of that high growth tech. But then I also wanted to figure out a way where I could be

00:47:29.120 | less exposed to some of that volatility by continuing to hold what I had. And the best way that

00:47:35.360 | I figured out how to do that was to do the spread trade. And so, what I saw at the time was that

00:47:41.200 | there is one business above all others that I think is immune amongst big tech from any sort of

00:47:48.160 | real long-term issues, and that's Microsoft. And I think David expressed the reason well, is that

00:47:53.120 | it's an enterprise business now. Politicians generally don't tend to care about enterprise

00:47:58.000 | businesses. They have enormous longitudinal growth in front of them, and they're able to do

00:48:04.000 | things on the margins. Chamath Nani:

00:48:05.280 | Specifically around M&A to keep building their business with very little oversight. And we saw

00:48:10.800 | this because they had the courage to do this Activision deal just a few weeks ago. If you

00:48:16.080 | could imagine, again, no other company in big tech could even dare try to do a $70 billion acquisition

00:48:22.320 | because of the scrutiny. So, Microsoft-

00:48:23.360 | In this climate, it was a bold move. Yes. Yeah.

00:48:25.840 | Chamath Nani: I think it's not a bold move. I actually think it says the obvious, which is

00:48:29.680 | Microsoft is beyond the level of regulatory scrutiny that the rest of big tech actually has

00:48:34.480 | because they are- David Elikwu:

00:48:35.200 | Yeah. Chamath Nani:

00:48:36.240 | They're not the best of both worlds. They're both a platform because of Android, but then where they

00:48:41.840 | are at risk of being an app, they have an incredible deal with Apple that blunts that effect.

00:48:47.120 | And so, when Apple talks about all their push to privacy, you still have this very specific

00:48:53.280 | relationship, and Facebook called it out in their earnings release. They said, "We believe that

00:48:58.720 | Google has preferential treatment relative to the market. We believe that Google has a

00:49:05.120 | better chance of being a better partner and more competitive to the rest of the internet in that

00:49:10.960 | Apple deal because they pay Apple $15 or $20 billion a year."

00:49:14.640 | David Elikwu: And for people who don't know, that's for search. The default search on your

00:49:17.840 | iPhone goes to Google. Google pays $15 billion to Apple, and the accusation, explain the accusation

00:49:25.920 | there of why that would give them preferential in case people don't get off the dots.

00:49:28.880 | Chamath Nani: Well, if you're paying somebody $15 or $20 billion a year, they're less likely to do bad things to you. They may do bad things to other people, but they're not going to do as many bad things to you.

00:49:35.040 | David Elikwu: Yeah.

00:49:35.280 | Chamath Nani: That allegation from Zuck, yeah.

00:49:36.720 | David Elikwu: Well, no, I don't believe the allegation, but I think that general character,

00:49:41.120 | that general thing is true. You're not going to screw over your partners. You're going to screw

00:49:44.960 | over other people before you screw over your partners. Whether this applies here,

00:49:49.120 | it'll have to be borne out in some kind of lawsuit or state AGs or blah, blah, blah.

00:49:53.120 | But anyways, I think the point is that every other company has a lot more headwinds than

00:50:00.400 | Microsoft and Google and big tech. And then the third thing is, was a market observation

00:50:04.960 | from Gavin Baker, which I thought was incredibly brilliant. And what he said was, when you see a

00:50:11.200 | drawdown, meaning when the markets go down, it'll affect high growth tech first. It ended up

00:50:18.560 | touching a bunch of other areas second, like biotech. But he said this key thing, which is

00:50:24.480 | big tech will be the last to crack, but when they do, they are going to get shot. And so I spent a

00:50:30.720 | bunch of time just trying to figure out when big tech gets cracked, who's going to get cracked the

00:50:34.320 | hardest?

00:50:34.880 | And I just kind of wanted to create a spread between those who were the most inoculated

00:50:40.720 | to those that were the most at risk. As it turned out, Netflix puked it up,

00:50:44.640 | Facebook puked it up. Amazon actually got really crushed, even though this past

00:50:49.200 | day, they had a pretty decent rally because of their earnings, but they really got crushed.

00:50:54.000 | So in any event, the trade is what the trade is. The bigger thing is what is going on at Facebook.

00:50:58.640 | And I think what you see are three really important headwinds that Facebook called out explicitly.

00:51:04.800 | One is that when they talked about usage, kind of flattening and starting to decay,

00:51:10.800 | what they're really talking about is TikTok. And I think what we learned is that TikTok

00:51:17.360 | is an enormous threat, and a huge competitive force now in the consumer social app ecosystem.

00:51:23.360 | The second is that Facebook is fundamentally an app that sits inside of an ecosystem

00:51:30.080 | that is subject to the rules of the platform owner. And that's Apple and Google.

00:51:34.720 | And so this IDFA change, so the change in how you can track advertisers,

00:51:39.120 | Facebook said is going to have a $10 billion impact in 2022.

00:51:42.800 | And then the third thing, which was more implicit, is in order for them to grow, if you can't grow

00:51:50.000 | organically, the only other way to grow is inorganically. And unfortunately, as we're seeing,

00:51:54.000 | the regulatory focus on this company is really enormous. And so it was a pretty watershed moment

00:52:04.640 | for the company. And so that's why I think that this is a very important step for the company.

00:52:09.120 | I mean, you know, we're in a very, very, very, very difficult time right now to really be able to

00:52:13.280 | do anything about it. And I think that's one of the things that is really important is that we have

00:52:17.040 | to be able to get the people who are in the business to actually be able to do it. And I think

00:52:21.280 | that's one of the things that we've been trying to do for a long time is to be able to get the people

00:52:26.480 | who are in the business to be able to do it. And I think that's one of the things that we've been

00:52:29.600 | trying to do for a long time is to be able to get the people who are in the business to be able to do it.

00:52:30.640 | Yeah, I mean, it's a bubble move. Because look, when you're in an upmarket,

00:52:36.800 | and the market is super frothy, we had in hindsight last year was a giant asset bubble

00:52:41.920 | funded by all this liquidity coming out of the Fed and the federal government. So yeah, in a bubble

00:52:47.760 | like that all investors care about is the growth story. And so Facebook went all in on the story

00:52:53.680 | around metaverse, but in the cold light of day, you know, once the once the sun came up, yeah, once the

00:53:00.560 | punch bowl has been taken away, and you're in the hangover, and you're in sort of a very volatile

00:53:04.480 | potentially packed it in. Yeah, bear market, investors go wait a second, you know, this

00:53:09.440 | VR division is losing 10 billion a year, it might even be 12, by the way, because they

00:53:14.800 | said it was a little higher. So they lost 6 billion last year, they lost 10 billion this

00:53:18.800 | year. So the losses are escalating. And so in that kind of market, investors are like,

00:53:23.600 | wait a second, do I do I want to invest in a company that whose future is that unclear?

00:53:30.480 | I mean, if you look at this, at this market, we've seen that the growth stocks are down 60. Today's

00:53:36.080 | an update yesterday was a horrible day. So they're bouncing around 60 70% down off the highs in early

00:53:43.200 | November, okay, but the things are only down like 14%, or something like that, right. But Facebook

00:53:49.120 | basically took themselves out of the the sort of the the market leader bucket and put themselves

00:53:54.720 | in the growth bucket. But treat us like Peloton. We're speculating, why would they want to do that?

00:54:00.400 | It's a terrible strategic decision you're saying?

00:54:02.800 | Well, it was a it was a decision. It was the kind of decision where you look back with 2020

00:54:07.200 | hindsight, and you say, Look, that kind of decision could only be made in a bubbly,

00:54:10.960 | frothy market, you would never make that decision in the kind of down market you have today and

00:54:15.360 | other decisions look stupid as well. So PayPal was just down 25%. Okay, why was it down? Yeah,

00:54:22.480 | well, they just well, no growth in users, it was mostly on the forecast.

00:54:26.480 | And yeah, they're they revised their forecast down considerably. And of course, they tried

00:54:30.320 | to blame it on the economy. But other companies, you know, Amazon just had a huge beat relative

00:54:36.960 | expectations. Yeah, they're up 15% today. So not everybody is blaming the macroeconomic picture the

00:54:42.960 | way that PayPal did any event. My point is, you go back six months ago. And you know, what was

00:54:48.400 | PayPal doing? I wrote a story for Barry Weiss, for her substack about how PayPal was taking the lead

00:54:55.680 | in financial deplatforming. They were working with the ADL and the SPLC to kick

00:55:00.240 | to just to identify groups to kick off their platform. So that's what management was spending

00:55:04.560 | their cycles on figuring out how not to grow how to kick people off their platform and trying to

00:55:09.440 | figure out how to get more people on it. Sounds familiar. Who else is trying to get

00:55:13.200 | a platform? It's the kind of thing you do. When you're in a frothy market, and your stock is up,

00:55:18.160 | and you're just triumphant, you can waste your management cycles on stuff like that. Now their

00:55:22.960 | stock is down 25%. You have to wonder, Gee, do we wish we had spent our time on other things?

00:55:28.240 | Okay, so Friedberg, I have a question.

00:55:30.160 | I have a question for you about the future. Obviously, Facebook has bet the farm on meta,

00:55:34.800 | they're betting on VR, and I guess eventually AR or what collectively is called XR. And then we have

00:55:41.120 | news that Apple has a seemingly brilliant goggles product coming out. Developers are getting into it

00:55:48.720 | and they are the masters of hardware. So now, Zuckerberg has decided he will be on a collision

00:55:54.880 | course with a company that just took $10 billion in revenue from them by doing the non tracking.

00:56:00.080 | And that is the masters of hardware. So we have this collision course coming. And then

00:56:06.560 | just two weeks ago, Google said, Hey, by the way, remember that Google Glass thing?

00:56:10.160 | We're not giving up on VR AR either. And of course, Microsoft, we all know, has their HoloLens.

00:56:16.960 | So when we look at that four horse race, if you were to bet and rank who's going to win, Apple,

00:56:22.880 | goggles, Google Glass, whatever they're gonna call the new thing HoloLens and Meta's Oculus, who's

00:56:29.520 | going to win? And what do you how do you look at that competition between the big four?

00:56:33.040 | I don't know if that's a race you want to be in.

00:56:34.880 | So I like that answer. Race to nowhere. Have you guys used the Oculus Quest device?

00:56:42.080 | Absolutely. I have two of them. Try. Oh, my.

00:56:44.720 | Have you played the games where you like move continuously through space? And like,

00:56:49.280 | when you do that, it's like you're gonna throw up. You're gonna throw up. I mean,

00:56:53.760 | I'm not sure that this notion that that becomes the new computing modality is like a fair and true

00:56:58.640 | notion. But I think that's a good thing. I think that's a good thing. I think that's a good thing.

00:56:59.440 | And so, you know, there may it may end up becoming kind of a niche entertainment device,

00:57:04.960 | almost like a Nintendo switch where there's a, you know, a mode when you're using it,

00:57:09.120 | but I'm not sure it replaces traditional static two dimensional computing in front of you.

00:57:14.000 | The jury's still out. I don't see like a computer sentiment that says these things will

00:57:18.480 | ultimately kind of prevail over the current mode. So, you know,

00:57:23.760 | if it does work, who would win? In your mind? Who's got the best chance? Well, let's assume,

00:57:29.360 | we're all going to use it every day for two hours as our desktop, we're going to put it on,

00:57:33.440 | we're going to find workout apps to use whatever it's going to become. Let's let's assume,

00:57:38.080 | you know, that I think you just answered your own question in, in, in all of these things,

00:57:43.360 | when you build hardware, I think you can take a lot of parallels from what happened in the PC

00:57:47.040 | space. If you have commoditized PC manufacturers, Compaq, Dell, IBM, right, there are innumerable

00:57:54.400 | number of 1000s of companies that made PCs, the value created to the application layer to

00:57:59.280 | the operating system. And the people that can actually build ecosystems are typically the ones

00:58:04.800 | that win. And the people that already have an ecosystem and all they have to do is port somebody

00:58:10.160 | from, you know, platform A to platform B has a meaningful advantage over somebody that has to

00:58:15.600 | convince you to come to a new platform altogether. And so you know, if you're a Microsoft, and you

00:58:20.960 | have 1000s or hundreds of 1000s of developers, or if you're Google, and you have hundreds of

00:58:26.080 | 1000s of developers, or if you're Apple, and you have millions of developers,

00:58:29.200 | it's just a smaller bridge to cross in order to convince them to vote for one extra endpoint

00:58:34.480 | iOS versus Android, you know, versus Microsoft. And by the way, it seems like the obvious

00:58:40.400 | transition, whereas like Facebook is like, you got to go build all this stuff.

00:58:44.400 | And Apple made an incredibly important set of decisions a few years ago, which I didn't think

00:58:50.320 | a lot of people talked about, but they had an OS tree that was branching far too widely, right?

00:58:56.560 | They had a different OS tree, right? And they had a different OS tree, right?

00:58:59.120 | Yeah, they had a different operating system for the phones, they had a different operating system

00:59:03.120 | for iPads, desktop for watches. And they started to try to converge and shoehorn these things into

00:59:10.640 | a set of basic primitives, so that it's more controllable. And I suspect the reason is because

00:59:16.080 | that gives them more optionality to go into a car to go into a headset, without having to do an

00:59:22.320 | entire developer, we've been

00:59:23.680 | better than that. It's a great point you bring up because they also started investing in their own

00:59:28.000 | chipset. And I think that's a great point. And I think that's a great point. And I think that's

00:59:29.040 | a great point. And I think that's a great point. And I think all of that chipset innovation gives

00:59:31.680 | them a dramatic advantage in having smaller batteries and more processing power in a headset

00:59:37.760 | if it does work, which what chips does what chip asset does Facebook have none. So I don't want to

00:59:43.680 | I don't think we should say that Facebook is down and out. But let's just qualify what we think can

00:59:48.160 | win. So that's one thing. The other thing to remember is when you look at the PC industry,

00:59:52.160 | how did Intel become so dominant part of what Intel was able to do to out compete AMD and everybody

00:59:58.640 | else was that program called Intel inside, which is effectively these co marketing pass through

01:00:03.440 | dollars that they would use to actually give an incentive for Dell and for Compaq and for all these

01:00:09.360 | other folks to basically build to spec. And that was the wind tell monopoly, right, Microsoft and

01:00:14.480 | Intel. If you play that out in VR, what you really need is just a bag full of cash. Because if you

01:00:20.320 | give developers a subsidized incentive to build for your platform, they'll do it. So then,

01:00:25.120 | again, if you rank the companies, you just need to look at how much can they do? How much can they do?

01:00:28.240 | How much cash do they have? Because those with the most cash have so again, I think the best way to

01:00:32.960 | think about this is how many developers do you have today? How much cash do you have today? How

01:00:37.840 | much cash will you have in the future? And you can probably rank and just do a reasonable expected

01:00:43.040 | value to think about who has the best chance of winning assuming the platform is roughly equal.

01:00:48.080 | Now, if the if the if the if the company on that list with the fewest developers and the least

01:00:53.440 | money has a superior device, if that device is superior enough,

01:00:57.840 | they can overcome those things, right? And Facebook has the least money and Facebook has

01:01:02.640 | the least if you have rough parity. I think the person with the most money and the most developers

01:01:08.400 | sacks, Facebook has the least developers, they have no relationship with developers. In fact,

01:01:14.720 | they kind of screwed them over with Facebook connect a couple times they have the least money,

01:01:18.560 | but they do have the largest user base of profiles. So does that give them some advantage here? And

01:01:24.960 | how would you rank who's going to win? Who's going to lose? Well, I think, you know, I think,

01:01:27.440 | I think it gives them an advantage and to Tomas framework of porting over their app

01:01:31.840 | onto whatever the you know, dominant platforms gonna be, but probably it's the operating system

01:01:37.760 | players who are probably gonna be able to extend their operating system into this new, you know,

01:01:42.080 | VR AR world, probably. What I wonder about is, would Facebook have been better off if

01:01:47.280 | they're going to run a $10 billion a year money losing division that's highly speculative?

01:01:52.560 | Would they have been better off gambling that on building their own phone? Or

01:01:57.040 | maybe their own like forked version of an Android phone with that? And the reason why I say that is

01:02:01.840 | the project that I started, I was about to say, we've now seen we've now seen,

01:02:07.200 | let's not redig that. Well, they're losing, they're losing 10 billion a year now, because

01:02:10.960 | this one permissions change that Apple has made, right, because they're completely dependent on

01:02:16.000 | Apple's operating system for a big portion of their revenue. So what is their defense against

01:02:20.880 | that? I mean, they're really pretty helpless. If you look just to make a comparison, if you

01:02:24.720 | look at the strategic brilliance of

01:02:26.640 | Google, what was it first of all, after they came up with this cash cow, the idea of search,

01:02:31.600 | and then they combined it with the sort of keyword auction they got from overture, they said that,

01:02:36.720 | listen, the next strategic move is we can't let anybody disintermediate us. So what they do,

01:02:41.520 | they started moving upstream. The first the first sort of upstream player was the portal, right? So

01:02:46.880 | they start competing against Yahoo, they gave away Gmail, then it was the browser. So it was

01:02:51.520 | Microsoft Explorer. So they gave away Chrome, then it was the operating system, they gave away

01:02:55.600 | Androids, they said,

01:02:56.240 | we're not going to let anybody else be upstream of us. And so they started replacing all those

01:03:01.360 | layers of the stack, giving away free products with

01:03:03.920 | Office, right?

01:03:04.560 | Yeah, sorry. And a good free product.

01:03:06.800 | Yeah, great. I mean,

01:03:07.840 | all those have billions of users.

01:03:09.280 | I'll also say a big part of the monetization lock in was Google then extended into the publishers

01:03:14.640 | very quickly with the acquisition of AdSense. And the publishers then allowed Google to offer the

01:03:19.440 | greatest CPM that those publishers could have over any other advertising network. And as a result,

01:03:24.800 | Google built their network and then built their advertiser base. And they effectively, you know,

01:03:29.360 | got this huge lock in. The only disruptive threat to Google was what Facebook did, which is to create

01:03:35.520 | demographic profiles where instead of targeting ads based on keyword or search intent, you could

01:03:40.800 | now target ads based on demographic and then Facebook took it a step further and did retargeting.

01:03:46.240 | So basically following you across multiple sites, but Facebook always knew.

01:03:49.920 | And as we just discovered, that was always going to be a weak point for them because they were

01:03:53.440 | dependent upon...

01:03:54.400 | Yeah.

01:03:54.900 | ...hardware devices that were going to let them do that tracking across apps and across sites.

01:03:59.040 | And that's why Google always had this kind of key, you know, lock in advantage that,

01:04:03.120 | you know, will persist. And the network is just so big on both sides, you can't compete.

01:04:07.520 | To Sachs' thought bomb, if they had invested in a phone,

01:04:11.200 | let's say they made $1,000... Let's say they made a phone with a bomb of $800 or something.

01:04:16.000 | They just did this, by the way. Just remember the Fire TV, the Fire Phone.

01:04:18.720 | The Fire didn't work out.

01:04:19.120 | And he gave a bunch of great speeches. You can watch these and what happened with that. And just,

01:04:23.360 | you know, despite...

01:04:24.000 | Despite his extraordinarily large user base, his committed,

01:04:27.280 | loyal users, all these reasons, his magical, talented technical team, he hired the best people.

01:04:33.040 | He also tried to do the same with search, by the way, with A9. And remember,

01:04:36.400 | Apple also tried to do the same with search. All these guys tried to kind of compete.

01:04:40.160 | It's not easy to execute. Yeah.

01:04:41.360 | It's not easy to execute. And you get a lock in with the network value, but you also get a lock

01:04:45.200 | in with the talent. And you know, this was a really hard thing to pull off and you have to get

01:04:49.120 | it all right.

01:04:49.680 | So let me ask Chamath a question based on what Sachs said. Should they have deployed $10 billion

01:04:53.600 | into phones? If we go back two years and they did deploy $10 billion into phones,

01:04:58.320 | they take an $800 bomb, which is probably what the best iPhone cost. I think it costs $700 for

01:05:03.120 | Apple to make and they still have for $1,500. They could basically give the phone away for

01:05:07.520 | half price, maybe give it away for $400 or $500.

01:05:10.000 | That's what Fire Phone was.

01:05:10.960 | And if they gave away for $400 and you had to be a Facebook user, you buy it,

01:05:14.960 | they get the credit card of the person. That would be... They could put 25 million phones

01:05:19.280 | into the market every year.

01:05:20.240 | That's what Amazon thought and it didn't work.

01:05:22.160 | I don't think that moves the needle.

01:05:23.200 | So you don't think it would work?

01:05:24.560 | It didn't create a better user experience for users. Users got a better experience with the

01:05:28.080 | iPhone and then they got a better experience with Android.

01:05:30.960 | The window of time was in 2009, 10 and 11 when there wasn't lock-in. And you know,

01:05:38.480 | I think that's been well discussed about what we were doing and what we tried to do. So there's

01:05:43.680 | no point rehashing it.

01:05:44.480 | But why did Facebook give that up? Because there was an initiative, right?

01:05:47.280 | It was. It wasn't that. It was, it came down to, you know, an ask that I made,

01:05:52.800 | that we didn't get and it didn't happen. So it didn't happen.

01:05:55.760 | And we'll leave it at that.

01:05:56.560 | Yeah, by the way, I'm not saying that would have been successful.

01:06:00.240 | I'm just saying...

01:06:01.120 | Neither did I. We didn't get to the starting line, so we'll never know.

01:06:03.200 | Yeah. In fact, I think it's unlikely that it would have worked because I'm not sure

01:06:05.920 | exactly what Facebook's value prop would have been. My point is just, if you're going to lose

01:06:08.800 | $10 billion a year on a division, wouldn't it be better for it to be something strategically vital

01:06:14.560 | as opposed to something that feels a little bit optional?

01:06:17.360 | Even if the majority chances you don't win, the question is if you had a 20, 30, 35%

01:06:22.400 | chance of being a player in smartphones, would you take that chance? And I think you have no

01:06:27.600 | choice but to take that chance and it would be worth it, the expected value.

01:06:30.480 | Yeah. One thing I'll say in defense of Facebook is I think that all of this like antitrust

01:06:34.960 | scrutiny is a little bit ridiculous today. And it looks pretty ridiculous. And let me just explain

01:06:40.400 | why. Like, it seems that capitalism is pretty much working as intended, because if you looked

01:06:46.000 | at Google's results, if you looked at Snap's results, at Pinterest's results, at Amazon's

01:06:52.000 | results, there is a vibrant and growing advertising ecosystem. By no means could you

01:06:57.360 | claim that Facebook has any real monopoly on that, number one. And when you fold in TikTok,

01:07:02.560 | it's absolutely true. And then if you think about the usage curve of TikTok, there's a check and

01:07:07.920 | balance there on usage. And so anybody that thinks that Facebook is a monopoly today, I think is a

01:07:14.080 | little misguided. So really, I think what politicians need to do today, February 4th, is be

01:07:21.600 | more honest about what they really care about, which is really around Section 230, and the

01:07:25.840 | misinformation, disinformation, fears that they have related to Facebook's distribution power.

01:07:30.480 | Because now, if you're going to try to legislate this company, it's really unfair. Like,

01:07:34.400 | especially going back 10 years to litigate an acquisition, you'd never do that to any other

01:07:39.200 | company that is sort of maybe on the back half of their growth cycle. It just doesn't make any sense.

01:07:44.640 | It would be like going after Google now for the YouTube acquisition.

01:07:47.040 | Amazon reported $31 billion of advertising revenue.

01:07:50.640 | Crazy.

01:07:51.200 | There is a vibrant, diverse advertising ecosystem. Facebook is not in control of

01:07:56.480 | that ecosystem. And so trying to legislate them as a monopoly in that ecosystem is insane today.

01:08:01.680 | What do you think, Sachs? Do you think this regulation is based on the fact that Facebook

01:08:06.880 | kicked off Trump and is scaring politicians over actual competitive reality?

01:08:11.280 | I think that politicians are using the threat

01:08:14.240 | of regulation to try and drive the speech policies they want on these social networks. That's

01:08:20.800 | what's really going on. I mean, the merits of the case.

01:08:22.800 | So you agree with me. It's nothing to do with the business.

01:08:25.280 | Yeah, look, who should get regulated on antitrust grounds? Apple. You know, Apple is,

01:08:30.160 | and maybe Google.

01:08:30.960 | Why?

01:08:31.600 | Well, they're the big monopolists. I mean, they control the operating system. I mean, those guys-

01:08:34.640 | 90% of search.

01:08:35.680 | And I would say Amazon with respect to the verticals where they're competing with their own-

01:08:41.280 | Basics.

01:08:41.920 | Yeah, basics.

01:08:42.880 | With the basics. Exactly. So in other words, when you control an operating system, and then there's

01:08:47.040 | developers or other, you know, downstream players-

01:08:50.400 | Two choices.

01:08:50.800 | On that ecosystem, you have to treat them fairly. You can't privilege your own policy to then

01:08:55.200 | dominate vertical after vertical. So there are real antitrust concerns with those three companies,

01:09:00.320 | but Facebook way less so. And yet they get the brunt of the attacks. Why? Because the people

01:09:06.160 | in Washington are trying to coerce Facebook into controlling what they call misinformation,

01:09:10.640 | which is really just speech they don't like. And that is highly inappropriate.

01:09:14.560 | Perfect segue. Last week, we didn't jump into the Rogan Spotify debate. Maybe we should have,

01:09:20.560 | but we'll talk about it now with a lot more context. Obviously, Neil Young and some other

01:09:26.080 | folks that were pulling our music off, Joni Mitchell, whatever, some actual high profile

01:09:31.120 | blogger said they don't want to be on there. And then Joe Rogan and Daniel Ek both decided to talk

01:09:37.200 | about this. Joe Rogan said, "Listen, I'm a comedian. I don't prepare for these interviews.

01:09:42.560 | And I just see where they go. But this show has gotten very influential. It's the number one

01:09:48.480 | podcast in the world. It's got a ridiculous number of people watching it. It's got a ridiculous number

01:09:49.600 | of people watching it. It's got a ridiculous listenership. So maybe I should have it right

01:09:54.080 | now. Maybe I should have it labeled. And maybe I should have people on afterwards. And maybe I

01:09:59.760 | should do some extra fact checking. I thought it was the best non-pology, explainology of an

01:10:07.120 | apology." Because he did say, "I'm sorry if you don't like it." But he did kind of say that he

01:10:12.000 | would do better. And then Daniel Ek said, and then I'll let you guys comment. Daniel Ek said, "Listen,

01:10:19.200 | I'm a comedian. I don't care if you don't like it. I'm not a comedian. I'm not a comedian. I'm not a

01:10:24.160 | comedian." And then he said, "I'm sorry if you don't like it. I'm not a comedian." And so, you

01:10:27.200 | know, I think it's a good thing that the show is not a show. And I think that's a good thing. And I

01:10:33.120 | think that's a good thing. And I think that's a good thing. I think that's a good thing. And I think

01:10:35.120 | that's a good thing. I think that's a good thing. I think that's a good thing. I think that's a good

01:10:35.520 | thing. I think that's a good thing. I think that's a good thing. I'm curious what you thought,

01:10:36.960 | Friedberg on the non-pology and culpability for someone like Joe Rogan having guests on who are

01:10:44.880 | anti-vax or, you know, maybe are debatable in terms of science, because yeah, he is a comedian.

01:10:51.920 | But as he says, like, the show is kind of big now. So maybe I should do a little fact checking. What

01:10:55.680 | do you think he should do when he has scientists and people and people on?

01:10:59.280 | I'll make two points. One is I don't think that journalism is regulated, in the sense that,

01:11:04.480 | you know, we have freedom of speech. So anyone can stand up and they can say, I have this belief,

01:11:09.200 | or I have discovered this fact. And you may not actually hold that belief. And that fact may not

01:11:14.480 | be true. But you're still allowed to stand up and say it. And you're still allowed to have someone

01:11:18.080 | come on and say it. And so I don't think that there's any disclosure obligation. He's putting

01:11:22.240 | on a show. It's the same as any new show or entertainment show. I don't think that there's

01:11:25.680 | a clear line or boundary. I mean, what the heck do we do here? We've all got opinions. We try and

01:11:30.160 | talk about the news. We talk about our perspectives on the future. You know, what the heck is it that

01:11:35.040 | we're doing here? You know, there's no kind of clear line there. So I don't think that he has any

01:11:38.640 | obligations to do anything he doesn't want to do, except if and when his audience tells him,

01:11:42.960 | or the listeners that he cares about,

01:11:44.080 | tell him his customers tell him, this is what we expect and want from you. And then he responds to

01:11:48.560 | his customers. That's the way the market works. And that's the way the enterprise system should

01:11:52.240 | work. I think the separate bigger question here, that's really important and worth noting.

01:11:56.560 | You know, and I just want to speak about this for one second.

01:12:00.240 | All of the great internet companies started with this notion that they were creating

01:12:04.320 | democratization, that they were creating access to information that didn't exist,

01:12:08.640 | whether it's access to media or access to search results or access to the content

01:12:13.680 | or whatever that may not have been available to you. And that was a driving force for the

01:12:17.440 | entrepreneurs and the founders that started all these businesses. And all of them had these very

01:12:21.440 | idealistic points of view that we're not going to censor, we're not going to take a point of view,

01:12:25.760 | we're not going to put our foot down and say what is and isn't going to be displayed or shown or

01:12:29.040 | made available to our users. We're going to let users choose what they want to get access to and

01:12:33.280 | what they want to hear and listen to. And in all these cases, from Google,

01:12:37.200 | to YouTube, to Twitter, and now to Spotify, the idea of being just an access, a platform,

01:12:43.280 | for access is proving to be wrong. All of them are de facto publishers, they ultimately have to

01:12:48.560 | make decisions about what they do and don't let on the platform. And de facto, if you let something

01:12:53.120 | on the platform, you're giving it permission, you're giving it a voice, you're giving it

01:12:56.480 | amplification, and you're giving it access. And so all of them are now getting caught up in this

01:13:01.200 | problem that I don't think anyone from Larry or Sergey, or Jack Dorsey or Daniel Eck ever wanted

01:13:08.240 | to be in. They all wanted to be these democratization platforms. And now they're finally

01:13:12.880 | finding that there is no way to avoid being treated like a publisher and a publisher has

01:13:17.280 | someone that's called an editor, and an editor decides what is and isn't put on that publishing

01:13:21.840 | platform, as has always been the case in old media. And now in new media, they're all kind

01:13:26.080 | of stumbling into this problem. And they're not set up for it. And it's creating issues where

01:13:30.240 | people on the right are saying you're censoring us. And people on the left are saying you're not

01:13:33.680 | giving us access to information we want. And it's, you know, it's just kind of the I think the

01:13:38.560 | transition that none of them expected, but we're all seeing happen.

01:13:40.960 | Shamath, if

01:13:42.720 | Daniel Eck is giving $100 million to Joe Rogan, can he claim listen, it's just we're a platform

01:13:50.240 | when you know, listen, we're on Spotify as well, but they don't pay us. Doesn't it change the

01:13:55.840 | relationship when they give him the 100 million? Or can Daniel say, you know, intellectually,

01:14:00.880 | honestly, like, Hey, listen, we're not responsible for this. I mean, they're backing up the Brinks

01:14:04.480 | truck. And they're promoting it like heck. Are they a publisher or not in your mind?

01:14:09.200 | I read yesterday that Barack and

01:14:12.080 | Michelle Obama's deal with Spotify just expired, and they're going to shop it, I suspect that

01:14:18.240 | somebody will pay them 10s of millions of dollars to produce content. That's not illegal. And it's a

01:14:26.800 | sign of a free market that's working. Spotify has a business to run. And that business is to get

01:14:34.560 | content in front of the users that are paying them a lot of money on a monthly basis to get access to

01:14:40.800 | that stuff. And so it's a big deal. And I think that's a big deal. And I think that's a big deal.

01:14:41.680 | And so who are we to say how Spotify should run their business? I think you have a choice.

01:14:46.240 | Neil Young expressed his choice. There was a person in the New York Times, she took her podcast off of

01:14:51.920 | Spotify. Yep.

01:14:53.120 | There are subscribers that probably left, but then there are also subscribers that probably joined.

01:14:57.840 | Yep. And paid. Yeah, and paid. And so the reality is, that's the free market, being allowed to

01:15:05.200 | choose and being allowed to vote with their feet. And I think that all sides of that are in the right.

01:15:11.840 | So I think Spotify should be allowed to run their business. I think Joe Rogan should be allowed to

01:15:17.120 | say what he wants. If Spotify chooses to put a disclaimer in front of that podcast, that's

01:15:21.600 | their right. That's good too. And if Joe Rogan decides that he wants to have point counterpoint

01:15:27.680 | across podcasts or within a podcast, that's laudable as well. And that should be his

01:15:33.200 | decision. But I don't think people should be forced to make these decisions by law,

01:15:36.880 | because I think we get into a very slippery slope, because you don't totally understand

01:15:41.200 | the incentives of the lawmaker there. And we have a free market, as you're

01:15:44.800 | pointing out, Shamath. The free market is working perfectly.

01:15:48.000 | Well, there's a lot of people who don't like this free market.

01:15:50.080 | More important than the free market, we have a founding document of principles that

01:15:53.680 | we all agree to. Yes. Yeah, and unfortunately, there's a lot of people who don't agree to it.

01:15:57.280 | And that says we have a right. If you're talking about the First Amendment-

01:15:58.160 | All right, so here we go. Let's go to our constitutional attorney,

01:16:01.680 | counselor. Take us there. If you're talking about the principle of free speech, there's a lot of people who don't believe it.

01:16:06.680 | That's the problem. First of all, you have this geriatric hippie-

01:16:10.400 | Whoa, whoa, whoa.

01:16:11.200 | Can I finish? Let me finish my rant, J. Cal, then you can get in, okay?

01:16:15.040 | Okay, rant away, rant away.

01:16:15.920 | You got this geriatric hippie-

01:16:17.520 | I love Neil Young. I love Neil Young.

01:16:18.560 | No, you know what happened here? Wait, sorry, Sax, just there. That was J. Cal

01:16:21.920 | saying, "Oh shit, he's going to get a bell-claster clip and he got tilted."

01:16:24.960 | It's a bell-claster clip. I got to interrupt.

01:16:26.240 | He had to interrupt you there. That's really brutal, J. Cal.

01:16:30.240 | Fuck the bell-catchers. Go ahead, bell-catchers.

01:16:32.000 | I thought you were talking about Joe Biden. Can I explain?

01:16:36.480 | Go ahead, Sax.

01:16:37.320 | Can I actually explain what happened? Because I think, frankly, you guys are completely missing it.

01:16:40.120 | The wheel of censorship broke on Joe Rogan this week. They tried to Alex Jones him and it failed,

01:16:46.280 | okay? First, you have this geriatric hippie, Neil Young, who somehow has turned into a narc,

01:16:52.040 | and he plants a flag and he tries to get all these people behind him. And the very online

01:16:56.520 | crowd says, "Yes, we got to cancel Rogan." And then you got Jen Psaki from the White House

01:17:01.320 | weighing in, bringing in the coercive power of the administration on the side of censorship,

01:17:06.280 | okay? And what happens? Rogan comes out with his non-apology, like you said, and he seems so

01:17:11.440 | reasonable. He's a guy who's inquisitive. He's on the side of just asking questions. He's on the side

01:17:16.720 | of balance. He says, "Yeah, look, I want to present both sides of the issue." And everybody was like,

01:17:22.240 | "There is no reason to be censoring this guy. Rogan is an everyman. And if they would censor him,

01:17:27.360 | they would censor every man." And that is why there was an enormous backlash to it.

01:17:32.080 | And everybody has opposed this. And so, I think this is the week that this

01:17:36.080 | ridiculous idea of censorship has broke. Now, it would be nice if everybody, to Shamath's point,

01:17:41.720 | did agree with this principle, but they don't. The fact of the matter is, J. Cal,

01:17:46.880 | that censorship is now the official position of the Democrat party. And you see it in the

01:17:52.460 | poll numbers. There was a great tweet that Glenn Greenwald posted where he showed the

01:17:58.040 | polling numbers on this. So, okay, you go back to the days of the Obama administration,

01:18:03.380 | both Democrats and Republicans agreed

01:18:05.880 | that the US government and tech companies should not get involved in this type of censorship. But

01:18:11.520 | today, there's been a bifurcation. Democrats or lean Democrats versus Republicans who lean

01:18:17.160 | Republicans. It's 65-28 in favor of government taking steps to restrict info online. And it's

01:18:24.240 | 76-37 Democrats versus Republicans on tech companies. So, the First Amendment is no longer

01:18:31.020 | a consensus. And that is fundamentally the issue. But I got to tell you, I think there is a

01:18:35.680 | backlash against this. And I think that most of the country now, and I think this is where they

01:18:41.320 | went too far, is that Rogan is not Alex Jones. He's not Trump. He's not Milo Yiannopoulos. He

01:18:47.740 | seems like a reasonable guy. He is the biggest figure in independent journalism. He gets 11

01:18:52.180 | million viewers every week. And I think there's a lot of people, especially young people,

01:18:56.560 | who are going, "This has gone too far." And by the way, I do not think Obama ever

01:19:01.060 | would have made this political blunder of effectively denouncing Rogan because Obama

01:19:05.480 | tried to appeal to young voters. And I think Jen Psaki, by putting the administration on the

01:19:11.180 | side of the censorship, they've made a huge mistake. And the same week, we saw that Tucker

01:19:16.820 | Carlson now gets more young Democrats listening to his show than CNN and MSNBC. And I'm telling

01:19:23.780 | you, this is the reason why. Okay, Henry, you can put in the

01:19:26.480 | roaring crowd of applause at this point. The best thing that I saw.

01:19:31.940 | I'm telling you, Jay Kyle, you got big problems in the Democrat—

01:19:35.280 | I'm an independent.

01:19:36.420 | There are now more Tucker Democrats, okay, among the key young demographic than CNN Democrats.

01:19:42.660 | In your writer's room or on Tucker's writer room? Which one?

01:19:45.060 | Yeah, I'm a Tucker Democrat, Jay Kyle.

01:19:46.800 | You are a Tucker. You are. You love Obama. You love Clinton. I think what's happening is,

01:19:52.440 | I mean, and Chamath, you've said this over and over again.

01:19:54.960 | Chamath?

01:19:55.800 | I'm sorry. Chamath Palihapitiya. You had on one side,

01:19:59.940 | the right lost their mind and the alt-right, now they've come a little bit more center. And then,

01:20:05.080 | you may not have the Democrats have lost their minds. The fact that anybody can't look at Joe

01:20:10.960 | Rogan and say, he's a comedian. He worked on a show where they fed people shakes of blended insects,

01:20:17.740 | feel factor, and he's taking mushrooms. And he's like, why are you taking me so seriously?

01:20:22.240 | Well, wait, I think you're being—

01:20:23.440 | I don't understand.

01:20:23.740 | Hold on. I think you're being super dismissive of Joe Rogan. I think he's actually, as Sac said,

01:20:28.360 | a pretty reasonable, curious person. And then yeah, he does the stuff that everybody else does.

01:20:33.220 | But he doesn't prepare for the show. He literally

01:20:34.880 | said, I don't prepare for the show. I don't do any preparation.

01:20:37.220 | Maybe he does, or maybe he doesn't.

01:20:38.300 | No, he said explicitly he doesn't. And he fact checks in real time. So you got to keep your

01:20:42.500 | expectation at a certain level with Joe Rogan, I think. And that's not a dig.

01:20:46.460 | I think that that's implausible to believe. I know that that's what he said. But, you know,

01:20:50.060 | 11 million people a week, $100 million deal. I do suspect that he does some sort of preparation. I

01:20:55.060 | don't think he's a, he's completely winging it. Okay.

01:20:57.820 | He literally said he wings it. But okay.

01:20:59.820 | I understand that. But I think that's not the point.

01:21:02.680 | Okay.

01:21:03.280 | Okay. The point is,

01:21:04.680 | whether he prepares or not, the excuses and sorry, the dog ate my homework. It's Hey, listen,

01:21:09.840 | I have a right to have this guy on my show. Just like I have the right to have this other guy on

01:21:14.760 | my show. You can listen to both and then you can decide for yourself.

01:21:18.120 | You could change the channel.

01:21:19.560 | Okay, that's the important point. So Jason, I would not like try to make this whole

01:21:22.940 | argument about whether he was prepared or unprepared as the excuse. It's whether you

01:21:27.120 | believe there's a fundamental right to free speech, or whether you believe that people

01:21:31.180 | who disagree, can disavow people and get them canceled and get them fired.

01:21:34.480 | I obviously don't agree. I don't agree. Anybody should be canceled. I think he should keep

01:21:38.760 | going.

01:21:39.760 | Whatever Rogan's level of preparation, which I think is actually pretty high, the people

01:21:42.880 | who are accusing him of putting out misinformation are far more guilty of it themselves. And

01:21:47.280 | I think one of the best points in Rogan's non apology, as you called it is he said,

01:21:52.720 | listen, a lot of the things that we used to consider misinformation are now the truth.

01:21:58.400 | For example,

01:21:59.400 | we talked about it on the show. Yeah,

01:22:00.400 | well, we've been ahead of the curve and calling all this stuff out. You know, we could have

01:22:03.280 | been accused of misinformation.

01:22:04.280 | So examples, the lab leak theory, used to be considered misinformation, cloth masks,

01:22:09.600 | not doing anything. Listen, Dan Bongino was kicked off YouTube, two weeks before the CDC

01:22:14.180 | for saying that Dan Bongino, he's a pretty big conservative commentator. Okay, he's got

01:22:19.180 | an audience of millions. You can be dismissive, but a lot of people like him, J Cal. But look,

01:22:23.240 | my point is, he was kicked off YouTube for saying cloth masks don't work. Then the CDC

01:22:27.920 | comes out two weeks later, and says the same thing.

01:22:30.000 | Right. I think that's a valid point.

01:22:31.560 | Yeah. Well, it's the key point.

01:22:32.560 | I personally don't agree with that. I think that's a valid point. I think that's a valid

01:22:33.560 | point.

01:22:34.560 | I personally like, you know, for example, we've talked about this thing where like,

01:22:36.740 | if you look at like the top distributed links on Facebook, who do you see Ben Shapiro, Dan

01:22:41.080 | Bongino, you know, bright,

01:22:43.480 | Joe Rogan,

01:22:44.480 | right?

01:22:45.480 | Yeah.

01:22:46.480 | My takeaway with all of these things is there are people of those things, if I listened

01:22:48.600 | to I'd probably find abhorrent. But there are people there that are probably I would

01:22:52.680 | be, you know, I would, I would, I would, they would appeal to me. In all cases, they should

01:22:57.460 | all exist, though, because the whole point is, let me spider my way through this stuff

01:23:00.960 | and figure out for myself.

01:23:02.360 | Yeah.

01:23:03.360 | What doesn't work.

01:23:04.360 | Yeah, more speech is the best counter.

01:23:06.440 | The summary of this that makes the most sense is, Elon tweeted this out, Nick, you can put

01:23:10.560 | this because I gave you the image, but it's a it's a meme of Neil Young, where it says,

01:23:15.120 | if you won't censor the guy I don't like, I won't let you listen to keep on rocking

01:23:20.020 | in a free world.

01:23:21.020 | Paradoxical.

01:23:22.020 | And, and it's, and it's just so true, which is like, on the one hand, you know, you are

01:23:26.920 | a standard bearer. Now, maybe what we should really do is talk about what has happened

01:23:32.080 | to this boomer generation.

01:23:33.160 | Yeah.

01:23:34.160 | Over the last 50 years where they were, you know, sex, drugs, rock and roll, no war in

01:23:39.600 | Vietnam, let's fight for our rights, let's fight for equality,

01:23:42.660 | then punk rock.

01:23:43.660 | Yeah, you know, no, I'm talking about just those those those folks back then, who are

01:23:48.060 | now 50 years later, you know, sitting on $70 trillion of wealth, and who are basically

01:23:53.700 | like, you can't say this, you can't say that, don't do this, don't do that.

01:23:57.060 | Wear masks, don't leave your house.

01:23:59.360 | You know, yeah, they're scared because they're old.

01:24:02.960 | Or you're getting from a pangolin.

01:24:03.960 | Yeah, you know, this is I mean, that generation, I think we all have some soul searching to

01:24:08.780 | do about what happened to that generation.

01:24:10.520 | I think they're scared because they're old and they and they feel like they're gonna

01:24:12.740 | die from COVID.

01:24:13.740 | Is it that generation? Or is it the fact that every generation rebels against the prior

01:24:17.900 | and ultimately becomes conservative? And you know, that's the maybe that's just how life

01:24:22.220 | goes.

01:24:23.220 | I don't think they become conservative. I think they've become authoritarian. What happened

01:24:26.760 | is they're now in power, the boomers are in power, they've been making the decisions for

01:24:31.760 | last 20 years.

01:24:32.760 | I think there is enormous popular discontent with the way the country's been run over the

01:24:37.200 | last two decades, the futile pointless wars in the Middle East, the debt, the economy,

01:24:42.780 | the unfairness that it goes on and on.

01:24:45.340 | And what and especially with COVID. I mean, this COVID policy over the last two years

01:24:48.360 | has been a fiasco. And the point of this censorship of misinformation is to suppress the debate.

01:24:55.260 | I mean, what ultimately is the point on take, for example, COVID of saying that people cannot

01:25:00.240 | take a point of view it is to stifle the debate.

01:25:02.560 | It's to prevent an honest debate on these issues. And the people who have an interest

01:25:08.180 | in doing that are the people who are in charge and are failing. And if you gave people the

01:25:12.760 | information they would be voted out of office.

01:25:15.460 | If you look when I asked what are the specific claims that either Joe Rogan or his guest

01:25:20.100 | made that people are objecting to a lot of the people who are objecting and wanted him

01:25:23.440 | censored really didn't know. And one of them was he said early on, I don't know for a young

01:25:28.900 | person who's in shape if I would advise them to take the vaccine.

01:25:32.360 | I know a lot of people who have that position, which is like if you're young, and I think

01:25:36.560 | actually Freeburg, you might have said, mRNA, early on in this podcast is a very new technology.

01:25:42.220 | And I could see people wanting to wait and see. Did you not say that? I don't want to

01:25:46.400 | get you canceled here. But I think we did have that discussion.

01:25:48.120 | How can we not have that conversation?

01:25:50.300 | That's a valid conversation. mRNA is a new technology, right, Freeburg? You should think

01:25:54.700 | about it. And we should be cautious.

01:25:56.920 | Don't draw me into your cancel.

01:25:59.360 | That's why I said we I just changed it to we were talking about that.

01:26:02.160 | Don't you remember that discussion we had like, when I asked you, I think, mRNA, what

01:26:05.740 | do you think of this versus the regular one, the J&J?

01:26:08.220 | I think generally, we've seen science being used as a way as a term to discredit what

01:26:18.980 | I think would arguably and typically be scientific principles, which is inquiry, challenging

01:26:23.500 | hypotheses, and having, you know, vigorous debate to resolve to some sort of objective

01:26:30.280 | truth. Otherwise, you're having some sort of

01:26:31.960 | subjective belief. And more often than not, we've seen politicians and others grab on

01:26:36.580 | to the term science and saying, this is science, it says this, when in fact, the process of

01:26:42.120 | science is inquiry, and it is to challenge, you know, again, a hypothesis and what might

01:26:48.200 | be kind of a thesis.

01:26:50.400 | So So yeah, I think generally, this has been a pretty scary time to watch, because it's

01:26:55.980 | almost like gaslighting, you know, it's like, hey, you know, you're using the term science

01:27:00.640 | to discredit.

01:27:01.760 | The notion of science. It's been pretty brutal. I sent you guys this this cartoon link, by

01:27:06.580 | the way, it's so funny.

01:27:07.580 | Oh, I just got an old left versus the modern left. It's a Volkswagen bus with a bunch of

01:27:12.800 | hippie dippy flowers. And it says free speech, free love 1971. No CIA screw the establishment

01:27:19.980 | resist authority. And then it shows like a modern SUV. With 2021. It says masks up by

01:27:26.160 | heart the CDC, obey the establishment, no free speech, do what you're told obey, basically.

01:27:31.560 | You have another poll you want to share sex?

01:27:34.060 | Well, yeah, this is a really interesting one. It says a majority of voters 55% say COVID

01:27:38.920 | should be treated as an endemic disease, while a majority of Democrats say it should be continued

01:27:42.740 | continue to be treated as an emergency. And then there was a similar poll, the Monmouth

01:27:46.620 | poll just came out where 89% of Republicans 71% of independents say that it's time we

01:27:53.920 | accept we accept COVID is here to say we need to get on with our lives only 40% of Democrats.

01:27:58.900 | So the reality is that the rest of the population is not going to be able to get on with their

01:28:01.360 | lives. The rest of the country, I think, has moved on, it's ready to move on. The split

01:28:05.780 | is not between Democrats, Republicans anymore. It's within the Democratic Party, the Democratic

01:28:09.880 | Party is now divided on this question of whether we should move on as a country past COVID.

01:28:17.200 | Half of the Democratic Party still believes that COVID should be treated as this emergency.

01:28:20.600 | Do you think that it's cut by age? Do you think there's a bias by age?

01:28:24.360 | For sure. For sure. I think yes, absolutely.

01:28:26.440 | Older people are more scared. Yeah.

01:28:27.440 | But I think I think the media and the party they programmed their soldiers to be

01:28:31.160 | you know, to treat COVID as an emergency and they can't deprogram them. And this is why

01:28:35.100 | I think we're seeing Tucker's Tucker is now the biggest demographic among young Democrats.

01:28:41.400 | That's insane to me. It's insane. The idea that idea is insane.

01:28:45.060 | This does not bode well for the on top of everything else that's happening in the country.

01:28:48.100 | This is not bode well for the Democrats in November. And then you had this crazy thing

01:28:52.840 | at the you know, the Magic Johnson party at that.

01:28:57.160 | Oh, that was the best.

01:28:58.160 | I held my breath. I took a picture of Magic Johnson. I held my breath so I wouldn't.

01:29:00.960 | Yeah.

01:29:01.960 | Get the virus.

01:29:02.960 | With Garcetti and Newsom. Newsom claimed.

01:29:03.960 | It's the new I didn't inhale.

01:29:04.960 | Yeah, exactly. And then Newsom says that he was only photographed at the exact moment

01:29:10.560 | where he took off his mask for two seconds. You know.

01:29:12.740 | You know what? If you go to the ski slopes, there is nobody with a mask on and nobody's

01:29:17.400 | enforcing it and no restaurants and this is in democratic country. Everybody has moved

01:29:21.660 | on at this point. Everybody's willing to.

01:29:23.400 | But why haven't they? Why haven't why haven't Newsom and Garcetti?

01:29:26.200 | The media and the politicians because they're virtual signaling and they want to keep power.

01:29:29.760 | But to who?

01:29:30.760 | That's that's the point. Well, I think they're dumb. They should.

01:29:33.480 | I think they're afraid of their own voters.

01:29:34.480 | Yeah, they should just take the reopen. But wouldn't taking the reopening position get

01:29:38.780 | you more voters at this point? People are tired of this. They want to move on. Doesn't

01:29:43.100 | make any sense. They're making a bad political decision.

01:29:44.760 | I think they're beholden to their base. That's the point is I think I think the whole country

01:29:48.540 | has moved on. Even most Democrats have moved on, but the democratic base has not moved

01:29:52.540 | on. And that is why, you know, Newsom and and Garcetti have to pay lip service to this.

01:29:57.360 | Well, I mean, and these guys have been telling everybody got to wear a mask, got to wear

01:30:00.560 | a mask, got to wear a mask.

01:30:01.560 | They're not wearing masks. And let's face it, they weren't wearing masks at the French

01:30:04.980 | French Laundry. They have never worn masks. They've been throwing their own parties with

01:30:07.940 | no masks or a bunch of hypocrites. The whole lot of them. All right. In other news, Xi

01:30:13.480 | Jinping and Putin got together and they're apparently besties. Here's the quote some

01:30:17.940 | actors representing but the minority on the international scale. And that's us continue

01:30:23.660 | to advocate unilateral approaches to addressing international issues and resort to force the

01:30:30.360 | internal affairs of other states infringing their legitimate rights and interests and

01:30:35.720 | incite contradictions, differences and confrontation. The statement said, I am willing to work with

01:30:42.960 | President Vladimir Putin to plan a blueprint and guide the direction of Sino Russian relations

01:30:49.300 | under new historical conditions.

01:30:52.780 | Mr. Xi said he added that China and Russia should act like big countries as they intensify

01:31:00.160 | coordination on fighting the Coronavirus pandemic, yada yada. Any feedback from our squad?

01:31:07.280 | I mean, you could have rewritten that press release as you know, we will. We want to try

01:31:13.120 | to destroy US hegemony and replace it with ourselves.

01:31:17.660 | This is the beginning of the end of US cultural and economic influence globally or dominance

01:31:23.560 | rather influence it globally. And I think that it's, you know, something that we've

01:31:28.600 | talked about quite a lot.

01:31:29.960 | I think that, you know, I mentioned in the prediction episode that I thought that Putin

01:31:33.360 | was going to play a major role this year. And, and, you know, he's clearly not just,

01:31:41.540 | you know, out for his own interests, but he's going to play a really important role in China's

01:31:45.000 | rise to economic and cultural dominance.

01:31:48.280 | You agree Chamath? Is this the sign that they're going to be running the show? Or does this

01:31:53.200 | look like something else to you?

01:31:54.200 | No, no, no, I don't think that there's a show to run. I think the point is that there was

01:31:59.760 | a first among equals for the last many decades in the world order where, you know, America

01:32:05.780 | was it was that first among equals. And I think what they're saying is that it's time

01:32:10.660 | for that to change. And, and, and they're going to tie that to their ability to influence

01:32:18.480 | foreign policy in countries the way that we have historically. So you know, this is sort

01:32:23.600 | of basically putting a marker on the table that says, this is going to be about, you

01:32:29.560 | know, a different cohort of people that are also going to have an equal say. And if you

01:32:33.820 | think about where this all plays out, it's always in economics, right? And this is where

01:32:37.920 | again, you have to think about what China has done, which is they have while we were

01:32:42.020 | fighting wars, you know, putting trillions of dollars into the Middle East, they took

01:32:46.380 | their trillion dollars and bought resources all through Africa.

01:32:50.000 | Yep.

01:32:51.000 | Right.

01:32:52.000 | They built infrastructure.

01:32:53.000 | They bought infrastructure all through South America. They put infrastructure all through

01:32:56.780 | Southeast Asia, you know, that say, call it 15 trillion dollars.

01:32:59.360 | That's a $30 trillion gap, that's going to create a resource imbalance that they will

01:33:08.400 | use to create even more influence in the future. And we have to figure out a way to counteract

01:33:12.120 | that.

01:33:13.120 | Sachs, what do you think? Is this a changing moment in the world order? Should we be worried

01:33:18.060 | that these two dictators are going to act in unison, and then maybe one gets the Ukraine

01:33:24.420 | one gets Taiwan? Is this like really earth shattering news? Or is it just a matter of

01:33:29.160 | news? Or do you think it's saber rattling and not that big of a deal?

01:33:32.920 | Well, I think it's a dramatic statement and photo that was was put out. It was a continuation

01:33:38.000 | of what we've seen where they have, you know, Xi and Putin have been getting and Russia

01:33:42.280 | and China, they've been getting friendlier and friendlier. What saddens me and sort of

01:33:46.680 | sickens me as really an American patriot who would like to see the American world order

01:33:51.060 | continue is the way that we have blundered and created this this type of situation. So,

01:33:58.960 | to Jamal's point, first of all, we wasted 20 years trying to do nation building in the

01:34:03.320 | Middle East, six, we spent wasted $6 trillion on that. How did China you know, lose by not

01:34:11.560 | being part of that they benefited they were building Belt and Road while we were, you

01:34:15.240 | know, engaged in this foolish interventions in the Middle East. And now more recently

01:34:20.880 | with Putin, we've really driven Putin into Xi's arms because we keep threatening to

01:34:26.920 | add Ukraine to NATO, which is not

01:34:28.760 | something that's in America's interest, if we would just give up on that position or

01:34:33.740 | just reaffirm that Ukraine should not be admitted to NATO would enormously help diffuse tensions

01:34:39.420 | with Russia. And by the way, your your point that these are dictators or natural allies,

01:34:43.240 | that's not, that's not historically been true.

01:34:45.900 | So during the days of the Soviet Union, you know, you had Nixon and Kissinger make the

01:34:50.400 | great opening to Mao and China and we were able to cultivate a relationship there because

01:34:57.780 | China and Russia

01:34:58.560 | were natural antagonists. And it was a major move in the Cold War that we were able to

01:35:04.080 | cultivate Mao and we did so even though he was a dictator with blood on his hands. So

01:35:08.860 | now Russia and China are not natural allies. We should be doing a better job of not so

01:35:17.000 | thoroughly alienating Putin that he is rushing into Xi's arms. That's the blunder I see here.

01:35:22.180 | By the way, after this summit, they're going to meet with Iran. There's a tripartite

01:35:28.360 | I think access of dictators. This is like the Legion of Doom.

01:35:32.820 | We need to be playing our cards a lot in a much smarter way.

01:35:35.420 | Yeah, and he's a player cards. What is the strategy? I mean, look, we want the American

01:35:40.880 | led world order to continue, but we got to be much more selective about picking and choosing

01:35:45.620 | our battles. Yeah, Iraq, Afghanistan, Syria, Libya, they were huge mistakes. And now on

01:35:50.800 | top of it, what about Ukraine? What's that?

01:35:54.320 | Looking forward, like you keep bringing up the past. What's the look forward strategy

01:35:57.160 | in your mind?

01:35:58.160 | The look forward strategy I think is to diffuse and deescalate the situation in Ukraine exactly

01:36:02.160 | the way Obama did it, which is to recognize that America does not have a vital national

01:36:07.020 | interest the way that Russia does.

01:36:08.660 | Then how do you handle Taiwan?

01:36:09.660 | Hold on. To reaffirm that the nations of the caucuses that have border disputes with Russia,

01:36:15.660 | Ukraine, Moldova, Georgia, they are not eligible candidates for NATO at the present time. Kick

01:36:21.440 | that can down the road by 10 years. Okay.

01:36:24.160 | We talked about that last episode.

01:36:25.160 | Taiwan is a much more complicated situation. I do think we have a vital national interest.

01:36:27.960 | There.

01:36:28.960 | Got it. Okay. So two very different situations. I agree. I actually agree with you. Yeah. Yeah.

01:36:33.300 | I think Taiwan we have to hold the line. Yeah, we have a responsibility in the United States.

01:36:37.640 | And I think we're starting to do it. So I think there is good news where, you know,

01:36:41.160 | part of the strategic vital interest for Taiwan is because they have critical resources that

01:36:45.240 | we need. And we depend on and specifically those are semiconductors. You know, we have

01:36:50.540 | now I think allocated, you know, 50 $100 billion of capital of capex across a bunch of companies

01:36:56.680 | that have committed to building domestic.

01:36:57.760 | Domestic capability. And so we have to make sure we follow through on that. And that's

01:37:01.900 | successful. And the reason is that it gives us optionality, it allows us to breathe, it

01:37:06.260 | allows us to actually make rational decisions and be patient in our decision making. And

01:37:10.720 | I think that's going to be really important over the next 10 or 20 years. And so we have

01:37:14.440 | to invest in the United States. So the solution to all of these things is we cannot be overly

01:37:19.440 | dependent on any one country, any one shipping lane, any one product, any one natural resource,

01:37:26.060 | you just can't do that anymore.

01:37:27.560 | We have to be strong at home. And we have to build strong relationships with other countries.

01:37:32.000 | And yeah, I think I think we've got a an operating philosophy here. All right, listen, let's

01:37:36.100 | wrap there. We'll see everybody on the next episode for the dictator Chamath Palihapitiya,

01:37:42.660 | the Sultan of Science, David Friedberg, and the Rain Man himself triumphant versus Peter

01:37:49.020 | Thiel and that PayPal match. Great moment. David Sachs.

01:37:53.560 | Love you, boys.

01:37:54.560 | Love you besties.

01:37:55.560 | Bye bye.

01:37:56.560 | Bye.

01:37:57.360 | Bye-bye!

01:37:57.940 | We'll let your winners ride.

01:38:00.940 | Rain Man, David Sack.

01:38:03.800 | And it said, we open-sourced it to the fans, and they've just gone crazy with it.

01:38:10.600 | Love you, Westies.

01:38:11.460 | Queen of Kinwa.

01:38:12.860 | Besties are gone.

01:38:20.820 | That's my dog taking a notice in your driveway.

01:38:24.400 | Oh, man.

01:38:27.920 | My avatars will meet me at 20 something.

01:38:30.180 | We should all just get a room and just have one big huge orgy, because they're all just useless.

01:38:33.780 | It's like this sexual tension that they just need to release somehow.

01:38:36.920 | Wet your feet.

01:38:39.480 | Wet your feet.

01:38:41.680 | We need to get merch.

01:38:44.520 | I'm doing all in.

01:38:46.680 | I'm doing all in.

01:38:54.660 | you

E66: $FB's big drop, Rogan/Spotify mess, Xi/Putin meetup & supply chain issues with Ryan Petersen

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