SPEAKER_00: i found out about a free bird purchase that it's just you were there chamombe you heard what he bought what did i buy pickles the quinoa what was it no no sax you missed this because you're you are a sunbird now and the rest of us are snowbirds over the holidays but the three of us have been hanging out skiing having dinner for a couple of weeks and we had a little wives dinner

SPEAKER_04: and one of the wives was complaining about the suits freeberg's purchasing oh my god so free

SPEAKER_05: burgers do you have pictures of the radiation suits i don't have pictures of the radiation

SPEAKER_07: here i'm trying to find them but radiation suits i thought you're going to talk about like brioni suits or something no radiation suits you know how you went into full scale panic mode and you

SPEAKER_09: during covet and you had your whole outfit your hazmat suit friedberg just because he's panicked about nuclear proliferation has bought suits for his entire family

SPEAKER_11: thousands of dollars of radiation suits and nuclear fallout and he bought one for his dog

SPEAKER_13: dogs dogs dogs dogs sorry dogs for monty and daisy i should send you guys the photo of the bunker i mean

SPEAKER_15: i've got it all taken care of you need a bunker first right i think that's underway as well how do

SPEAKER_16: you get to your bunker freeberg with with the pilots that you'll be asking to leave their families or will you be protecting them with the guns that were stolen from your house

SPEAKER_18: at least you'll have the thousands of pickles you've made

SPEAKER_20: i didn't know friedberg was a prepper did you know this sax because sax has a little prep no

SPEAKER_16: sax freeberg was howling because he was so mad he made like thousands and thousands of pickles

SPEAKER_12: and nobody would eat them including himself because they were so terrible you literally bought a radiation pod for your dogs yeah so they that's their air filter on the right

SPEAKER_24: so that they don't breathe in the nuclear fallout cloud i kind of like the the prepping thank you sir yeah it's good you guys don't understand there's a reason evolution happens in moments of what we call punctuated equilibrium there's a massive

SPEAKER_29: event and certain you know things survive and then that becomes the proliferant species going forward

SPEAKER_30: this is the moment be ready you're saying paranoid rich white guys are going to survive the nuclear holocaust that's what you're saying paranoid rich white tech guys are going to make it to the other

SPEAKER_32: side got it how exciting exciting what a great future what a future that are like we'd rather die

SPEAKER_34: that touches my erogenous zones just the idea of it when sax and freeberg are the only two

SPEAKER_12: reproducting males left delicious can you imagine the gene pool it's like literally this is like some

SPEAKER_40: dystopian science fiction this is like a black mirror episode you'll have the pastiest preppers

SPEAKER_41: in the world hasty preppers to inherit the earth

SPEAKER_11: welcome back to the program everybody it is the new year but it's the same squad your four besties

SPEAKER_53: are here chamath palihapatiya he is now not just the dictator he is chairman dictator calling in from the slopes with his beautiful burt sweater that's a great sweater it's a major turtleneck going on there and we have david friedberg also uh looks like he's on the slopes and he is wearing his oh hollow his oh hollow not mahalo oh hollow hat he is branding here on the all in podcast sneaking in a

SPEAKER_11: little branding for his new startup that he is the ceo of david sax is with us of course and he cleaned up he cleaned up a little bit here the hair was getting out of control we had a lot of commentary on

SPEAKER_07: the hair apparently you cleaned up shop i pivoted from the the jefferson to the gecko all right so

SPEAKER_11: everybody loves when we do our predictions and so we're going to start off 2024 big year for us we got a lot going on here and all in and we're going to just do some predictions here so let's get started

SPEAKER_53: we're going to kick it off with sax doing his prediction for the biggest political winner in 2024

SPEAKER_59: sax who do you have what's your prediction for who's going to be the biggest winner in 2024 we're bracing yeah

SPEAKER_58: well you're going to love this jay cowl but my my prediction for biggest political winner in 2024

SPEAKER_07: is vladimir putin 2023 last year was the year that putin turned it all around he stabilized his economy after the west attempt to sanction him to his knees tried to collapse his economy we issued basically an arrest warrant from the international criminal court he has gained the upper hand militarily in ukraine i think that 2024 will be a year of him consolidating gains in ukraine potentially making new gains i think that the the stalemate narrative that our media has propagated about ukraine will be exposed as a lie i think the russians are in fact winning that war and what you're seeing is that his successful stance against the west in ukraine has only made him more influential throughout the global south and in the brics countries countries that oppose american dominance and dollar hegemony see him as the man with a plan as a bit of a conquering hero and i think as project ukraine falls apart in 2024 it's only going to reinforce that sense that he's the big

SPEAKER_24: winner sex did you see that argentina said they're not going to join bricks and that some have said

SPEAKER_62: that was a bit of a blowback on the bricks effort to end dollar hegemony and do you think it's really

SPEAKER_07: impactful or is it just a one-off i think it's a one-off i mean mille won in a big surprise there because the country's economy has been such a basket case and he is very pro-american pro-israel pro-west and so he has distance argentina from from bricks but i think that's a little bit of a one-off the larger issue is that the whole global south now is really resisting the collective west in a number of different ways and so our influence and dominance is slowly declining across the world and there's many examples of that so we can get into it throughout this show just to be clear with

SPEAKER_66: the audience you're not rooting for putin here you're just predicting he's the biggest winner i'm

SPEAKER_07: not rooting for it to happen i've got other answers here that i think are negatives as well i wish we had made a peace deal and avoided this whole ukraine war i think that was a gigantic mistake by the west yeah so yeah you've been clear about that yeah we have put putin in this position to be the victor because we plunged into a war without thinking it through and the truth is we can't give ukraine enough aid to have them actually win this war so we've contributed massively to putin being this victor and you know it was fiona hill who is a russia hawk in the foreign policy establishment who pointed out in a speech i think over the past year that the global south is using this ukraine war as a proxy to

SPEAKER_72: rebel against the west so in the same way that we're using ukraine as a proxy against russia she said the global south was using russia as a proxy against the west as a way to basically dethrone american hegemony all over the world and that that's a very negative trend so if you had ukraine

SPEAKER_74: and putin in under seven minutes for this episode if you bet the under you win freeberg who's your

SPEAKER_53: prediction for the biggest political winner in politics for 2024 i'm going to go with independent

SPEAKER_24: third party in the us we saw the stats last week i think we reviewed them with a poll that showed

SPEAKER_62: that 60 plus percent of people are claiming interest in a third party or an independent effort outside of the traditional dem republican split and if you look at in 1992 ross perot got 18 to 19 of the general election vote rfk jr is obviously running on an independent ticket this year we'll see if he can even get on the ballot in a bunch of states but i think that whether it's him or the interest in developing a third party uh in the us that there may be a big winner this year that challenges the the traditional two-party split in this country all right and chamath who do you got for your biggest

SPEAKER_78: political winner in same independent centrists i think this election starts the breakdown of the two

Chamath Palihapitiya: party system same same look at that rfk this week actually just got added to the utah ballot i think

SPEAKER_84: that this could be the most meaningful long-lasting change that we see in american politics is this is

SPEAKER_24: amazing from from the rfk candidacy i mean how many people do you guys know that we're republicans that don't want to be republicans anymore or we're democrats and don't want to be democrats anymore it's really

SPEAKER_88: like most so many people i know more of the latter i know more of the latter actually than i do right

SPEAKER_84: yeah that's true too yeah that's what i think i think republicans are still firmly established i think people are embarrassed to be a democrat right now interestingly i also picked the dark horse

SPEAKER_11: presidential candidate who will beat treasonous and corrupt aka trump and biden i think we're gonna actually see some dark horse candidate maybe beat these two in the rematch that nobody wanted wow that's crazy three of the four of us picked the same thing no coordination beforehand yes and this is

SPEAKER_94: done blind folks and and nick has my notes here so he can he can uh vouch for me here and just to go back and look at 2023 what we predicted sachs you said asian american college applicants were going

SPEAKER_91: to be your biggest winner in politics that actually turned out to be pretty prescient right yeah i mean

SPEAKER_07: i was betting on court cases overruling affirmative action and that's exactly what happened is that supreme court ruled against affirmative action and college admissions saying that it unlawfully

SPEAKER_65: discriminated against asian americans so yeah that worked out exactly right so that's a great

SPEAKER_98: prediction i think chamath you had perhaps the best prediction of even the entire show last year your

SPEAKER_11: spread trade long nikki and short desantis that paid off in spades well done there freeberg you had mbs and saudi have the most important year in their modern era not actually pretty pressing as well they seem

SPEAKER_24: to be yeah i mean if you look at let me just post this this was this journal article that came out in march if you guys remember this when saudi was considering accepting yuan instead of dollars for sales

SPEAKER_62: of oil to china and then in august the us ramped up pressure on saudi arabia to sell oil in dollars not yuan let me just pull this up for you guys which was obviously the follow-on story where the us tried to counter the actions which is continuing obviously today where there's a back and forth and saudi as i mentioned last week i think is in this really interesting central pivot position between all of these competing major nuclear powers and fighting for influence and this is a big story and it will

SPEAKER_68: continue to be this year and modernizing society that photo of the fist bump i mean what a mistake that was where biden just gratuitously insulted mbs compare that to the photo of putin visiting the

SPEAKER_07: middle east and meeting shaking hands with mbs which happened just a few weeks ago and compare the welcome that putin got in saudi arabia and i think uae to the welcome that biden got it's just two completely different levels it was a very warm embrace on both sides i think it was uae they literally had a parade for him where they had uh the colors of the russian flag up everywhere so you know we've tried to portray putin as this global pariah we've tried to turn him into this global pariah but it's not working because of the way that he is defeating the collective west in ukraine i think that it's given him enormous cachet and influence in the global south and much of the developing world which would like to stand up to american dominance or or at least is tired of american dominance and if you

SPEAKER_62: double click on that article the second one i sent on washington trying to negotiate with the saudis you know quote behind the scenes but obviously this all comes out they're asking assurances that riad will use dollars not yuan to price oil sales assurances that saudi won't allow china to build military bases in the kingdom and limitations on saudi arabia using technology developed by china and in exchange the us will protect saudi will provide military protection and will help them develop a nuclear program which is an incredible demand so obviously this is an unresolved point but this becomes a pivot moment for saudi arabia they may become a nuclear power use this as leverage as the us continues to try and keep dollar hegemony alive and my prediction last year was that trump would get

SPEAKER_94: indicted win the nomination and then agree not to run in order to get a pardon or something in that vein

SPEAKER_109: and looks like i'm going to get two of those three correct we'll see on the pardon he has been indicted obviously uh and he is looks like a lock to win the nomination but we'll see i don't it seems

SPEAKER_94: like nikki ellie's doing okay you'll see biggest political loser of 2024 is what we're going to do next jamoth last year you picked desantis i picked desantis that was a pretty easy one sacks you picked

SPEAKER_109: california also a pretty easy one we know that california's gotten demolished because specifically

SPEAKER_07: california went from having a 76 billion dollar surplus in 2022 to a 68 billion dollar deficit

SPEAKER_119: now yeah it's bonkers yeah i don't think any of those were as obvious as they were in january of last year i think desantis was leading he was collecting a lot of big checks and california hadn't imploded and i and everybody knew that they were on be under pressure but nobody expected to be i think this swift so all right i don't think those were obvious i think those were actually pretty

SPEAKER_11: decent picks okay that's a good argument and then freeberg you picked uh debt issues for emerging nations debt markets start to unravel imf steps in i'm not sure i have enough information to check

SPEAKER_127: in on that one yet any thoughts freeberg before we go on to our predictions for biggest loser i don't

SPEAKER_62: think we had any big unwindings like i had expected but these problems are bubbling and persist you know obviously argentina took a big step with the election there that one was one of the countries that was most at risk of having a big event last year but chamath who's your prediction for

SPEAKER_00: biggest political loser in 2024 the cokes i think on a dollar basis they are the largest

SPEAKER_119: spender in republican politics they have been and they have been the most consistent negative indicator of value and so if you just want to fade a trade i think you can pretty easily just find where the those old school republicans are putting their money and just kind of short it and right now as much as i was sort of long the haley spread trade in 2023 i would probably now short that trade in 24.

SPEAKER_135: okay switching it up mostly because of the cokes freeberg who do you well sax will like this one but i

SPEAKER_62: think ukraine might be the biggest loser this year as attention shifts to the brewing conflict in the middle east during an election year like the us is facing continuing this funding of this ukraine russia conflict with us dollars is becoming a more unpopular issue for people to support and so i think because of all these these competing interests and the political pressure the us will probably not have the uh resources to commit to ukraine i think ukraine's shot at being in nato is going to fade away and unfortunately it seems like the country may be left behind by the end of this year sax what do you got well i totally agree with that and i would just

SPEAKER_07: add demographic decline or even collapse uh they've lost something like half a million soldiers in terms of casualties they also something like 10 million people have fled the country i read recently that there's only about 20 million people left in the country and half of them are pensioners so it's not even clear that the working population the country's gonna be able to support the pensioners and of course the war isn't close to being over yet so there's going to be even more destruction that happens so i i agree with that that pick i up leveled my answer a little bit here to have the collective west as the biggest political loser and ukraine is a big part of that obviously this huge bet that the collective west made in terms of pressuring and challenging putin in ukraine has completely crapped out but i would also go much further than that you look at what's happening in israel and gaza right now and i don't think that israel's invasion of gaza is going well at all and again just stepping back these answers don't reflect my desire for what i want to have happen it just reflects my honest assessment of who the the losers

SPEAKER_72: are going to be and i just think that israel's invasion is is not going well it does not look like they're going to be able to militarily achieve their objective of destroying hamas admiral kirby who's the pentagon spokesperson even said that the other day which was a pretty amazing admission at the same time israel is creating a huge humanitarian crisis in gaza something like over 20 000 palestinians have already been killed over 50 000 wounded something like 1.8 million of them have been displaced and it doesn't look like it's going to let up anytime soon as a result of this israel is facing i think a huge amount of condemnation internationally it is becoming a bit of a global pariah so that is not going well for america and the west and then you're going to have a whole bunch of elections this year both in the u.s and in europe i think that there's going to be tremendous disruption things are really not going well in europe right now um large parts of europe are in recession as a result of losing cheap russian gas this is particularly true of germany and i think there's going to be some big shake-ups in the european parliament and i wouldn't be surprised if there was similar shake-ups in in the u.s election as

SPEAKER_74: well all right and i picked for my biggest political loser i was going to go with the american voter but i'm hoping that the american voters make better choices and maybe we see some alternative candidates

SPEAKER_94: as we said in the last one and i went with netanyahu here i think and again this is just my assessment this isn't what i want to occur in the world obviously but every major israeli poll is just

SPEAKER_109: suggesting that they want him out and they put the odds vox puts the odds of his ouster at 75 percent and obviously yeah gaza is not going well and it feels like there is a massive shift in terms of what was early support and obvious support for the terror attacks that occurred on 10-7 and any reasonable person would be supportive of that too hey maybe what's happening in gaza is not helping the situation and needs to be resolved and maybe a different approach has to occur and so i think netanyahu

SPEAKER_11: is going to be the biggest loser in 2024. all right let's go on to the biggest business winner of 2024 back to business last year last year in 2023 i predicted laid off tech workers starting startup

SPEAKER_94: companies would be the big winner chamot you predicted relativity space 3d printing rocket company and sax you picked america's natural gas industry freeberg open ai wow a lot of good choices there i think opening eye was a huge winner in 2023 yeah freeberg even with the chaos so i would say so that was a

SPEAKER_05: good massive revenue the highest market cap gain of the year probably yeah 30 to 90 billion yeah american

SPEAKER_94: natural gas industry that really actually cooked in uh 2023 yeah sax yeah it has a new record so good prediction yeah good pick all right so let's go right to 2024 predictions freeberg you haven't let us off yet so you're gonna lead up be the lead off batter here what do you got i'm going with commodities

SPEAKER_24: businesses which i know isn't speaking a specific business but there's a lot of ways to play it and i

SPEAKER_62: think there's a big commodities boom that's coming back in 2024 there's been a lot of under investment relative to demand over the past call it 18 to 24 months coming out of covet and with rising interest rates a lot of folks have been selling down inventory and there now needs to be a build back up on inventory and supply there's also a bunch of cash coming into the commodities markets that was sitting in treasuries as yields go down that cash is coming back so building the base back up rebuilding stockpiles and supplies coming out of the past 18 months obviously economic activity is strong and robust so commodities businesses are going to see a killer 2024. Chamath what do you got i think the biggest

SPEAKER_84: business winner in 2024 is going to be the bootstrapped startup and or the profitable startup but

SPEAKER_155: the best will probably be the bootstrapped profitable startup and i think the reason

Chamath Palihapitiya: is that we are underestimating how cheap it's going to be to copy an existing business in 2024

SPEAKER_84: and so if you assume that these models are going to get 10 and 100 times better and you assume the cost of compute is going to get 10 and 100 times cheaper and you assume the cost of energy is going to get 10 times cheaper you're no longer measuring in decades when a company will be subject to disruption i think you're measuring it in frankly months and so i think you're going to be able to create these companies for very cheap and essentially have them attack an existing business which has upside on economics because they have just a lot of people and a lot of processes that these gpts can replicate for essentially free so if you're profitable you have

SPEAKER_158: the chance to survive and i think if you are unprofitable i think that you're going to be under

SPEAKER_159: a lot of pressure i think it's a great pick that's exactly what i'm seeing on the field in the early

SPEAKER_116: stage sax who's your prediction for a biggest business winner of 2024 who do you predict is going

SPEAKER_07: to be the biggest business winner i'm predicting andrel for its roadrunner product which it announced last year and this is a drone interceptor so it basically intercepts drones it's built for ground based air defense and the reason i say this is because if you saw recently what was happening in the red sea with the houthis the u.s was having to use two million dollar air defense missiles to shoot down two thousand dollar drones and that is not sustainable so right now we have a huge problem with asymmetric warfare where our adversaries are using very cheap missiles very cheap drones swarms of them and they force us to exhaust our air defenses which are just way too expensive on

SPEAKER_78: a unit basis hundreds of thousands of dollars do you think yeah i think that's right i think the

SPEAKER_07: roadrunner system costs hundreds of thousands of dollars but it can be it's reusable so it's not

SPEAKER_163: like you just send one up to take out one if it doesn't blow up if it does blow up i don't think

David Sacks: you reuse it it basically takes off it loiters this is uh basically a ai system where it's self self

SPEAKER_07: driving i guess you will it has operators but and then it returns back to its base station after it's used it's not like a kamikaze type drone it's actually a drone killer oh really i think it is i

SPEAKER_98: think it do dual purpose it can either intercept and blow something up or it can return back to base but we'll have to check in on that hey and shout out to our friend palmer lucky come back on the program

SPEAKER_172: in the time we miss you shout out to our boy are you an investor sax in uh andrew no i'm not i'm not

SPEAKER_173: an investor but i think i would be yeah you know so they raised a ton of money palmer great job yeah

SPEAKER_94: no palmer we'll all buy actually i'm building a position right now i've been buying secondary

SPEAKER_05: in uh andrew and for me i was gonna go with startups again really buying secondary shares and andrew i've been building a large position in angel yes i'm i'm trying to get to a two percent ownership

SPEAKER_98: position so i can join the board so i've been uh yeah using so shout out to my guy we're lucky

SPEAKER_177: i am gonna go with for my biggest winner in 2024 training data owners like the new york times reddit

SPEAKER_98: x twitter youtube etc i think what we learned in 2023 was that the language models are starting to hit parity very quickly and that the real value is going to be in and it may even become commodities and open source may win the day so then i think the winner is folks who have the training data and i'm actually proposing a new business model for these language models i think now that we've seen this new york times an open ai lawsuit i think there's a really great outcome here which is a market-based

SPEAKER_74: solution where if you have a chat gpt account you can log in and federate with your new york times

SPEAKER_94: subscription or you know any other subscription and then it gives you the tier of chat gpt for with the new york times and so that could be a win-win for everybody or they could obviously pay a licensing fee and so i think this is going to be an amazing turnaround for the entire content industry if the language models respect copyright owners and come up with a sustainable system where every year copyright holders can get some money in exchange for using their training data whether it's on images or

SPEAKER_62: content so i'm very bullish on accumulate a two percent position in open ai through secondary

SPEAKER_109: purchases and get them to do that on the board it's only two billion yeah no i think yeah i mean we didn't bring this up because it's broke over the the holiday break but i think sam altman's doing a great job of telling people he wants to do the right thing and we discussed previously the licensing

SPEAKER_183: deal they did with business insider and the parent company of it axel springer what do you think the

SPEAKER_98: deal with new york times will look like i think it's going to be a nine-figure settlement

SPEAKER_94: for previous stuff and then an ongoing licensing fee in order to have the new york times in their training data and then you'll be able to say hey what does the new york times think of this

SPEAKER_98: right you could actually do queries about the new york times in it and i think the new york times will come up with a license that everybody can use their data if they pay this yearly fee if you stop

SPEAKER_29: paying the yearly fee then you can't train on it and we're in uncharted territory you're saying there's going to be a new york times model and a non-new york times model well i think you could do two

SPEAKER_05: different things one you could do new york times could make their own model right but they could

SPEAKER_98: fork their model or just to the user interface say if you want to query new york times information and have that as part of your results you have to have a new york times account right so if you say i want the best coffee machines or what's the best coffee equipment it says oh if you had wire cutter and a subscription to new york times we would include the wire cutter results and this idea that technologists can't do citations has been proven absolutely incorrect there are language models out there that are using citations all the time open ai i think will wind up losing the case

SPEAKER_185: if it goes to them out i think they're going to pay a big licensing fee to your question chamah my

SPEAKER_80: prediction then is that if this happens this is not my pick but i'm just going to tell you

SPEAKER_84: i suspect that what happens is you'll get these yearly licensing fees and then one year the new york times just falls off a cliff and when it comes time to renegotiate then open ai says no and

SPEAKER_98: and they won't have a choice well i mean it's possibility but if you think about the disney characters you know let's i don't know if you saw nintendo and disney characters you know making stuff on dolly or other things if you make derivative works on that and you want to have that feature as part of your image creator you just have to have a licensing fee and so i think there's a win-win here to be had and i'm really interested to see the market-based solution because i don't think this is a napster situation where like open ai gets shuts down because opening eyes too savvy

SPEAKER_79: the big difference between napster and this is there the content universe was limited and small here

SPEAKER_84: it's infinite and unlimited and so how do you pay anything to anybody without i just think it's like without direct attribution of revenue which is basically impossible you're kind of making a value judgment which i don't think makes any sense i think i think doing a revenue licensing deal is impossible when you get into the weeds when these business people sit down and actually start

SPEAKER_187: to try to figure out the bid ask i don't know as a rational coherent business person what you would

SPEAKER_11: model in order to present the number yeah so one suggestion would be what percentage of the model's

SPEAKER_98: creation was using the new york times data and i think people say one to two percent of the original chat gpt was built off a trading data was new york times and then if they waited that heavily each

SPEAKER_74: month like let's say they said new york times is an authoritatively five times more important than these other sources that could be upwards of five to ten percent of the authority of that model yeah

SPEAKER_16: but yes it's not easy but what's the cause yeah but what's the cause for the like are you telling me that like the music industry has this it's going to be like a 30 40 cost of goods you could say that

SPEAKER_05: chat gpt or let's say apple i predict apple will do this right they'll do a language model where they say 50 of the revenue that we generate from queries or subscriptions goes to the people we built it

SPEAKER_94: off of or the licensees sure why not why not they're already the music industry already does that would

SPEAKER_84: guarantee the death of the startup ecosystem and it would guarantee the lock-in of big tech

SPEAKER_94: no i don't think so you could build models that don't have the data and you could build models with it so it'll be a choice by the person who builds the model and synthetic data might make it so you

SPEAKER_127: don't need the new york times from off it's early days for synthetic data i don't have an opinion

SPEAKER_118: i'm just reacting to this idea that 50 of cogs then all of a sudden these aren't software companies

SPEAKER_16: you know these software companies will have a gross margin of like 30 yeah well what does spotify pay

SPEAKER_206: for music you know so the same argument is made for spotify you know or netflix that's the difference

SPEAKER_84: it's limited in scope meaning there's there's only ever one hit song from rihanna that matters or jay-z or whomever pick taylor swift and so it's a very scoped content universe and so you can ascribe value much easier because then the user goes and actually listens to that song over another this is about something that's happening under the water line where you don't know how the iceberg is it's

SPEAKER_74: both there are things under the model that do it and then there's also quoting stuff and that's really where the new york times got their caught them with their hand in the cookie jar is that when

SPEAKER_98: it was regurgitating information and giving the results it was quoting deeply new york

SPEAKER_210: times proprietary content and so that's that's where there's like a you're you're right about the training data but you you might be wrong about the the output that could be fixed right they could

SPEAKER_29: train models and they could they could exclude storing any proprietary data you can create a filter that says the model can't store any of this data but it can still be trained or can't use it right so

SPEAKER_05: if you say what's the best coffee machine it can't use the new york times wire cut of data and i i bet

SPEAKER_94: you that sam waltman has already built a model without it i guarantee you they've already built a for an emergent press here in case of emergency here's the 4.5 model in case they got an injunction which would be highly unlikely but if they did get an injunction they just say okay here's 4.5 it doesn't use the new york times training data so this is all uncharted territory as we all know i think we got everybody's business predictions okay and drill commodities training data and bootstrap profitable startups what a great cohort there let's go on to biggest business losers in 2024 2023 chamath said google search as measured by profitability engagement sac said the consumer freeberg said capital intensive series bcs and d growth companies that's pretty pretty good winner there and i said white collar workers without hard skills also known as surplus elites any feedback on

SPEAKER_62: those boys as your winner i'll give you my prediction for 24. please yes go ahead vertical sas companies i think are going to get smacked this year and i i mentioned this i don't i can't i think we talked about this step off off the show but or if we talk about on the show i apologize but like i think these tools to write code no code tools co-piloting tools and the ability for engineers to get 20 50 100 x more productive to build custom applications for their enterprise are so incredibly powerful i mentioned this to you guys i know of a couple vertical sas businesses that some of my companies use the software and they're getting off the software because they've built homegrown solutions at a very low cost very low touch way and i'm seeing that so frequently now i think this is a real threat to vertical sas businesses that can charge thousands of dollars per seat per year that are getting disrupted by the ability for companies now to very cheaply and quickly build homegrown solutions using a lot of the generative tools that are out there

SPEAKER_68: sax your prediction my prediction for biggest business loser in 24 is is actually the german economy

SPEAKER_07: there's two big problems there first is that the loss of cheap russian gas has really cut the legs out from under the german industrial model their entire economy is based on industrial output and cheap russian gas was sort of at the foundation of that as you guys know someone blew up the north stream pipeline i think that has really hurt the german economy and then second the german car industry has been massively impacted by a sudden glut of cheap cars coming from china so if you look at the chinese automotive industry it's really exploded in the last few years and auto exports is one of you know it's one of the biggest products that germany manufacturers and with german costs going up and chinese costs coming down this is not a very good place for them to be so i think double whammy for germany

SPEAKER_216: do you have the biggest business loser in 2024 i am going to say that 24 is the peak in terms of

SPEAKER_84: valuations of the valuations of professional sports oh and i will give you four examples in 2023 that i think

SPEAKER_224: were in some very concerning for pro sports franchise values as of today the first was you had an upstart

SPEAKER_84: competitor to a league that came out of nowhere used money to overcome the ability to attract stars players i'm talking about the live tour versus the pga and then essentially force the pga into merger talks with them the second was you had a country use their balance sheet to basically try to jump start their own professional sports business in this case it was soccer the country was saudi arabia and the players were ronaldo and messi they got one but not the other the third was the explosion of nil inside the ncaa you have people in college now making more in some cases than the same player in a professional sports context so they're making millions of dollars to be in college and then the fourth which may not seem like it's related but there was an article in the wall street journal i think recently about a meaningful uptick in churn amongst all the streamers netflix hulu all of these companies amazon who are the only folks with in a position to actually have the balance sheet to keep paying a premium for professional sports rights so i think when you put that all together you can start to see that there's been a tipping point in enterprise values the acceleration we've seen over the last decade has slowed down so i would say that 2024 is going to be the year of peak pro sports values okay

SPEAKER_94: starts to come down and i went with smartphones smartphone manufacturers are facing a major slowdown consumers obviously love their phones and use them constantly but people are skipping a generation of phones and if you look at apple's revenue they're having a very hard time getting people to upgrade and so i think that's going to flatten out they will keep trying to squeeze money out of it i don't know what you guys spent on your iphone 15 if you got it but i i always buy the top of the line and i think it was 14 or 1500 this time and when i got the accountants they said oh is this a new laptop i said no it's a new phone but i think this is going to slow down and people will during austerity they're going to skip two or three versions of it i know i skipped for the first time i skipped the 14 this time around so i'm going with smartphone manufacturers and apple would be obviously the tip of that spear let's keep moving our next prediction biggest business deal of 2024 biggest business deal of 2024 i went with uh last year my prediction was amazon getting into healthcare maybe they buy peloton or roman hymns and they have been getting into healthcare a bunch more and my my wild card was a ccp divesting of tick tock that didn't happen chamap you went starlink goes public in a spin out from spacex at 75 billion that didn't happen but starlink is doing fantastic sax you said a deal between

SPEAKER_127: putin and xi and then freeberg you said petro for one trade the saudi china trade any thoughts on the

SPEAKER_07: predictions there doesn't look like anybody nailed it well no actually putin and xi did make a deal their ties have never been stronger and the trade between those two countries keeps increasing as a

SPEAKER_65: result of the fact that we pushed russia into china's arms so that absolutely happened and what

SPEAKER_127: your prediction this year sacks biggest business deal sacks what do you got my biggest business deal

SPEAKER_07: is whatever the fed decides to do to replace or extend btfp the bank term funding program um remember that the btfp which is what the fed used to bail out the regional banking system last year and was it like march or april it was only supposed to last for one year it's supposed to be a temporary program but i do not think that the balance sheets of regional banks are healthy enough to survive without this continued liquidity from this program so i think the fed's gonna have to do something to either replace the program extend the program they're gonna have to do something and i think that regional banks are still in pretty bad shape with you know impaired commercial debt portfolios and they need this liquidity as long as the yield curve remains inverted so i think the fed is gonna try and somehow figure out a program to keep these guys liquid until they can de-invert the yield curve and i think the fed's trying to massage all of this into place without

SPEAKER_01: there being a recession seems like they'll be able to do it chamath what do you got i'm gonna go with the same thing i think i was just off by your starlink will go public fascinating i like it and i had a

SPEAKER_94: similar theme my wild card my wild card last year that the ccp would divest of tick tock i'm going to say this year that i think tick tock goes public and they'll be under pressure from different political

SPEAKER_109: factions to get the ccp off the board so i'm going to go with by dance taking going public or tick tock

SPEAKER_94: spinning out and going public some some version of that freeberg what do you got for this year we got some continuation bets here from jake allen yeah i would keep going with my petro you on trade

SPEAKER_24: bet i don't think that the us is going to let saudi become a nuclear power but

SPEAKER_62: so maybe leave that one outstanding but i think rights holder is getting licensing deals for generative ai or there's going to be a couple of blockbuster deals this year great where you'll see like disney license out a chunk of their library so people can generate on-demand video games or content or

SPEAKER_24: i don't know you guys remember this company in the early 2000s called zazzle do you remember that company yeah what was that printed stuff on mugs yeah and they had a big deal with disney where the idea was you could put any character in any way you want on any

SPEAKER_62: piece of like t-shirt or mug or whatever merch yeah and it was like merch and it was a big deal i think we see that again with generative ai this year where you can take for example a character from a movie and generate them in an image so anyone that has an interesting content rights will start to license it out and get a lot of value from it absolutely because a couple

SPEAKER_74: big deals like that this year okay most contrarian belief of 2024 i went american exceptionalism

SPEAKER_98: source i think i i like that prediction from last year ahead chamath you said inflation doesn't fall off a cliff as fast as people want sax says the bromance between biden and zelinski comes to an

SPEAKER_94: end freeberg you said 2023 marks the beginning of the end of the u.s dollar as the global reserve

SPEAKER_254: currency i nailed that one um it didn't fall off a cliff it didn't what was inflation in the first

SPEAKER_255: quarter of 2023 just kidding it fell off oh i'm like yeah i'm like wait a second it's like what the

SPEAKER_177: are you talking about yeah sorry you're confusing me i'm like really wait a second i think you get the jib kramer or the uh professor galloway moment for that prediction yeah i think you might have missed

SPEAKER_98: that one by a bit all right what do you got chamath for this year what do you got most contrarian

SPEAKER_16: belief of 2024 i think the enterprise value of open ai goes down oh okay i don't think it has anything to do with open ai i think it has everything to do with the rest of the industry i think i think there's

SPEAKER_84: a couple of factors at play similar to what i just said earlier but if you actually try to use these tools which now i have been in my sort of day job as as ceo i've been trying to build models sunny's

Chamath Palihapitiya: been helping me my takeaway are two things number one is the latency right now amongst all these ai

SPEAKER_84: tools makes building production quality code absolutely impossible so you can't have apis where you take 30 40 50 seconds in between a request to get data back it's that's ridiculous these

Chamath Palihapitiya: need to be non-starter yeah 50 30 40 70 milliseconds second is the actual cost of a million tokens

SPEAKER_84: on any of these platforms is economically untenable if you're trying to build something so whether it's

Chamath Palihapitiya: amazon whether it's together ai whether it's open ai it's extremely extremely expensive so i think that capitalism would tell you that if these two things are true you should expect people to arbitrage that opening and so if you see cloud services come out that allow you to basically get millisecond latency

SPEAKER_263: batch size one on the one hand and second where you have pricing for a million tokens at sort of

Chamath Palihapitiya: 10 20 cents those folks and they'll need to build their own custom hardware to do it but those folks will multiply the capability of this market by a thousand x and i think when that happens the open source models really proliferate proprietary models and closed models go under pressure and the existing economics of how you make money today will get reallocated to those different players and i think in that it's going to be very hard for existing folks i i would say the same is probably true for nvidia the folks that have won up until today to maintain a multiple of market cap in this

SPEAKER_84: next year if that happens and so my prediction is that will happen and as a result the enterprise values of of those companies and i think opening i will be the most obvious will go down people buying

SPEAKER_266: secondary at 90 billion right now will be underwater next year although it's again they have to believe

Chamath Palihapitiya: that the revenue composition today is sustainable and if you look under the hood half the revenue is consumers paying subscriptions the other half the revenue our enterprise is paying for essentially some version of aws yes but the problem is that version of aws is economically non-functional it's unsustainable it's way too expensive and it's way too slow and by the way that's just not an open ai problem it's an entire industry problem and so if this industry is really going to be real it needs to be literally dirt cheap and as close to zero as possible the minute that that happens that revenue goes away so then they're just left with the subscription people and by the way the people that provide that will be the ones that have the hardware to enable that thousand xing of the cost which

SPEAKER_197: is azure aws no no no i think these are startups that are building proprietary hardware oh okay wow so

SPEAKER_05: there's another prediction freeberg what do you got 2024 prediction most contrarian belief okay so

SPEAKER_62: i don't think we're past the conflict escalation stage i think things are only gonna continue to mount so a lot of the theater that we see on a global stage is more fundamentally driven by these big cycles that we're in so i think a big one and a kind of tactical one i think the big one that's contrarian is that there's an increased probability of a nuclear weapon being used for the first time in conflict and i think that that's conditioned on the fact that there are declining military supplies there's declining appetite and capacity to support traditional conflict meat grinder type conflicts that that we're seeing sprout up everywhere right now and we're not everywhere but in a lot of places and you could see a moment where as i mentioned in the past someone gets backed into a corner and a tactical low-yield nuclear weapon gets used and i think that when you do that it opens up the gates to hell so it's a little scary that's why you know we all joking aside that's why you bought the radiation suits and and by the way i don't think this is a high probability and i'm not joking it's i don't think it's a high probability i think it's like one you know call it one to two percent chance something like this happens but it's 10x where it was five years ago and so that's my outcome of this is terrifying yeah it's such a significant event that it's it's definitely one to kind of be thoughtful about um and then the other one that i kind of said was tactical is i think there's a risk that turkey gets challenged to leave nato that a lot of what's going on right now where turkey is siding with hamas this has obviously been talked about and rumored about for a long time there's no real mechanism by the way for kicking a member out of nato but i'll share with you guys there's a lot of political commentary that turkey cannot be a trusted ally and obviously that now you know turkey is siding with folks who are actual threats uh to the west the us incentive is you don't want to see turkey with the biggest one of the biggest armies in europe run into russia's arms you're going to try to keep them in nato but there is a real risk that you start to see the first fracturing of nato happen with turkey being asked to leave or some negotiation on something that happens this year so that that's one that i keep an eye on that is certainly not top of anyone's mind but it certainly begins to beg the question of the uh the importance of nato what do you got sacks

SPEAKER_96: your most contrarian belief can i first just make a comment on last year's pick yes if it's okay so i

SPEAKER_07: you know last year i felt like i was going out on a limb predicting a rift in the bromance between biden and zelinski because that relationship seems so tight and with about four days left in the year there was this article that came out in politico that says the biden administration is quietly shifting its strategy in ukraine the article basically says that the administration wants to go on the defensive and i think pretty clearly it wants a ceasefire and a frozen conflict it wants to get this conflict sort of out of the way swept under the rug before the election season really cranks into high gear and the problem they have is that zelinski does not want to negotiate a ceasefire with russia that would involve ukraine losing territory so there is now a rift between maybe not biden himself but let's say biden operatives the biden administration and what zelinski wants and i

SPEAKER_72: think this will be a theme in 2024 is how do you reign in zelinski after you've been telling the public for

SPEAKER_07: the last two years that our job is to support whatever zelinski wants and your prediction for this year so my prediction for for this year is that the soft landing gets very bumpy i think that over the last two months of the year i think markets got super optimistic they started pricing in big fed rate cuts you know let's call it one and a half percent so we had this huge stock market rally in november december and i think there's generally a very strong belief that the fed will be able to pull off the soft landing i'm not necessarily saying that there's going to be a recession i just you know i feel like i predicted 10 of the last two recessions so i keep basically predicting recession when there's not one but i do think that there's just been too much too soon of this euphoria and i just think that this year is going to be a lot bumpier than that both politically and economically so i think there's just a little bit too much euphoria and over optimism right now i'm tempted to go again with

SPEAKER_98: american exceptionalism i think i nailed that last year america just had an amazing year in 2023 while

SPEAKER_94: xi jinping made unforced errors and getting rid of capitalism in his country and nobody's starting companies there on stock market falling apart real estate falling apart and now he's coming back to america as we saw when he had a summit with biden asking people please come back and invest again huge unforced error and i think russia with a huge unforced error losing hundreds of thousands of their citizens their young people to a senseless war for no reason and losing customers in the west like germany as you pointed out sacks i think american exceptionalism will continue to soar but i don't want to pretty take the same prediction so i also consider two other options apple making huge gains in generative ai and then streaming services rightsizing and becoming highly profitable and having a rebound between those two i think i'm going to go with apple as my contrarian belief i think apple is going to

SPEAKER_109: become a player in ai the end of the year maybe they reboot siri but they're going to figure something out and i think they're not going to remain on the sidelines when it comes to ai so i'm going to go

SPEAKER_94: with apple making huge gains in generative ai or ai in general maybe a new siri coming soon best performing asset of 2024 in 2023 i went with seed stage investing i think i'll be proven right in five years but that's kind of hard to prove in the short term chamath you said cash and the front end of the yield curve it's actually what we short term t-bills as well and freeberg you went with

SPEAKER_127: semiconductor capital equipment oil gas services pharma infrastructure anybody have thoughts on their

SPEAKER_115: predictions from last year ash was pretty good at five percent no kidding right as good as it gets yeah this is not a lot of motivation to enter the markets when you're earning five five and a half

SPEAKER_210: percent risk-free okay so let's do our 20 24 equipment up 60 percent amazing it's good year good

SPEAKER_109: freeberg well what do you got what's your prediction for best performing asset of this coming year

SPEAKER_283: oh i took the uranium etf ura easy money whether it plays out in the next 12 months or over time i'm not

SPEAKER_62: sure it's just an inevitability a lot of folks have this bet on this trade on it's it's kind of an inventory that we have to see it's a it's an index on businesses that benefit from mining and producing nuclear power mining uranium producing nuclear power china's building up 450 nuclear power stations as we talked about there's a lot of esg driven demand and a lot of conflict driven demand a big shift underway a lot of deregulatory effort underway globally to try and get nuclear back on track nuclear power back on track so these companies are going to benefit from this pig macro

SPEAKER_210: cycle so it's a and this is a an existing etf or you're saying you you roll one no it's called

SPEAKER_62: uranium it's a uranium tracking etf ura is the ticker i like that a lot incentive certainly has

SPEAKER_287: changed i do a lot of esoteric general statements this one i thought i'd go a little specific i like

SPEAKER_05: it i mean it's it's a great prediction and sentiment has certainly changed here in the u.s

SPEAKER_62: by the way that trade has been on right so since i'll just tell you guys it bottomed out in march of this year at 19 bucks it's up 50 percent since then and in the last five years you know it's up 2x

SPEAKER_102: but plenty of room to run if you look at the underlying assets that btf tracks chamath what do you got best performing asset of 2024 what's your prediction i have to do it with the

SPEAKER_224: worst performing asset of 2024 because it's a bit of a spread trade so i'm going to take the public

Chamath Palihapitiya: software index tech stock index and my short is going to be the private tech software companies

SPEAKER_119: the late stage mostly sas companies and i think we've all talked about the reasons why but i think that the terminal valuations are getting reset in the public markets i don't think the growth rates are

SPEAKER_84: there in the private companies and so you're going to have a reset on valuation in many cases that reset may just be that they stay at the same valuation three years later even after doubling revenue or more the problem is you will have taken another 30 dilution between now and then because of all the stock-based comp that these private companies give out so long the public tech cycle

Chamath Palihapitiya: short the private late stage tech cycle expecting a valuation contraction in the ladder what do you got

SPEAKER_74: sacks what do you think is going to be the best performing asset of 2024 well i'm really not sure

SPEAKER_07: about this so i would urge nobody to actually trade on this but this is not investment advice be clear none of this is investment advice yeah i'm not i'm not trading on this on these predictions so you shouldn't either my guess here just a guess is energy is energy stocks energy prices could be among the top performers of 2024 just because there's so much risk of conflict breaking out now and escalating so i agree with freeberg that there are huge risks of escalation in the middle east the ukraine war is still going on i think not enough attention is being paid to what's happening between venezuela and guiana venezuela is basically attempting to annex guiana's offshore oil reserves which are huge this is basically just pure theft ethiopia also has tense relationships with a few of its neighbors and i could easily see there being a war that breaks out between ethiopia and egypt or ethiopia and eritrea and then that could spill over and create further disruption in the red sea we also still have this unresolved issue of the hoodies and of course you have neocons praying for war with iran as they always do john bolden just published another piece saying that we had to go to war with iran so there's just so many ways that the conflict could

SPEAKER_276: escalate and create i think a spike in the price of oil all right you know i'd love to i in my heart

SPEAKER_94: of hearts i believe the best performing asset will still be seed stage startups but i'm going to go with consumer comfort services i think as austerity measures and this whether we have a soft landing or a recession it's clear the consumers have spent all their money so they're going to go for small luxuries like doordash airbnb uber small things to have great experiences and i'm talking my book in two out of those three which i own shares in but i think consumers are going to keep treating themselves to getting some doordash or uh you know getting an airbnb and going to japan or whatever it happens to be so

SPEAKER_127: consumer comfort services is my pick for the best performing asset of 2024. worst performing asset

SPEAKER_98: let's go right on to worst performing asset we're cooking with oil worst performing asset i went with

SPEAKER_94: energy chamapo and tech energy junk debt sax went with office hours in san francisco and fritberg went with

SPEAKER_297: consumer credit wow i think we nailed it in almost all those cases here

SPEAKER_127: what do we got for 2024 it's actually got a 2024 prediction of worst performing asset again this is

SPEAKER_07: not investing advice yeah so i'm not going to trade on this so just take it with a grain of salt but i would bet against the magnificent seven just because i believe that what goes up must come down and the hotter they are the harder they fall i'm not saying that the magnificent seven are actually going to go down i'm just saying that the s p 493 are going to catch up a little bit so i would book this as a spread trade where i would bet on the s p 493 over the magnificent seven because again i just think that there's got to be some catching up here and the huge gains made by the magnificent seven were really based on story you know based on ai and i don't see why those gains should be limited to the magnificent seven if ai is going to play such a big role in the economy chamath i too when you predicted

SPEAKER_94: earlier about opening i losing some value my worst performing asset in 2024 is llm startups i believe they've been massively overvalued and i believe open source is making an incredible run at them and i think they're going to hit parity and there's too many players this is like having 15 search engines or 20 amazons there's just too many players and there's too much parity the prices make no sense and i think they're all going to come down by you know 50 60 70 80 percent in terms of their valuations and that won't get marked in their books but that will be the reality of where their stocks will trade on the

SPEAKER_127: private markets freeberg what's your worst performing asset worst performing just based on what i

SPEAKER_62: shared earlier i would go short vertical sas vertical software companies and long cloud providers that have ai tools and platforms that will allow enterprises to build custom applications in a low cost low code way and so you could obviously pick the companies that would go in that bucket go along those those

SPEAKER_07: cloud bucket and go short the vertical bucket is there like a per seat price threshold that you think would kind of demarcate the companies that you think are at risk in other words like i invest in plenty of sas companies that sell seats at five ten bucks per seat per month i'm just like very

SPEAKER_306: skeptical they're not going to yeah that it's worth an enterprise as well to recreate that software

SPEAKER_62: no and so i'll give you an example that there's a vertical software provider we're paying five grand per seat per year right now and we look at that and we're like okay it's basically a data management tool for our particular vertical let's just go recreate that and did it very quickly very low cost and we're going to replace it cut that out i don't want to say that but yeah is it so it's it's like you know very specific very expensive but i mean sex you could probably see the same thing happen in sales crm type tools that are obviously also very expensive and how much is a data receipt how much

SPEAKER_312: do you pay five grand per person five grand per year so that's basically and every employee over

SPEAKER_62: four hundred dollars a seat per month like 100 employees so we're paying like 500 grand and so one of our software engineers is like this spins up a replacement for we're going to roll it out in q1

SPEAKER_306: okay so is there is there like a per seat per month price that you think starts to where it doesn't

SPEAKER_314: work is it 50 bucks what is the number i i i mean i do the math but yeah it shouldn't be in the range

SPEAKER_62: that it's at for sure but a lot of these guys where they had a monopoly and it wasn't worth the company's time to try and invest in software at the price point that they were charging they found a market now the market has to compress so i'm not saying that the companies go away but i do think pricing compression is going to hurt these businesses a lot if you pay could pay 50 000 for the

SPEAKER_05: same software instead of 500 you would not have spun it up yourself so there is a reasonable number

SPEAKER_98: between those two correct and that reasonable number might be 250 or something but and here's

SPEAKER_84: the thing that we need to also factor in which is that freeberg's companies that engineer could also then just release that product for everybody else to use at 10 cents and everybody else will then use it

SPEAKER_86: because it'll be good enough and that and that 80 solution will take over the will take over the market yeah that's my point there's going to be pricing compression this is the thing like i think

SPEAKER_84: that people underestimate how deflationary this whole thing is it's like yeah exactly it's like

SPEAKER_80: two to three orders of magnitude more deflationary than people have any inkling of yep interestingly i

SPEAKER_74: had uh dave and hanmeyer hansen on this week in startups and they're releasing something called

SPEAKER_94: once.com where they're going to charge for software one time like we used to do and their first product is a slack killer and so the idea of paying per seat for slack what they're planning to do is just charge

SPEAKER_210: you you know 8.95 no you find a hosting company so it's going to be okay so it's like old school

SPEAKER_322: it's old school it's old school it's old school on-prem software on-prem and then you pay you pay an

SPEAKER_24: upgrade fee when you upgrade the software basically i think they're going to paying them like a

SPEAKER_07: maintenance percentage that's why yeah just so you got to know old school enterprise software right

SPEAKER_24: the pricing model was the revenue model was always built that when you did a sale you would make

SPEAKER_62: on average 20 of the revenue per year in update fees and so now and then everything switched to

SPEAKER_07: sass which would just continue support maintenance all that kind of stuff so it's never they say it's

David Sacks: one time it's one time for the software but if you want to stay up to date and get support and patches

SPEAKER_62: and all that kind of stuff yeah and the old school enterprise software model was always like figure 20 of the install cost right and by the way this is one of the reasons why oracle made so much

SPEAKER_07: money is they did a roll up of all these old school on-prem software companies that weren't growing but the maintenance fees were just rolling in forever yep and they rolled all that stuff up and

SPEAKER_94: then probably raised the fees i mean for me you know when you have a 20-person company 50-person company the slack fees don't seem like a big deal but when you get to you know when you're spending 500 000 or a million dollars a year on something like slack you know then maybe you would consider other options and i know people at large organizations that have done that because there's an open

SPEAKER_207: source competitor to it so that does exist in the world okay but what freeberg is bringing up is

Chamath Palihapitiya: like why would you support 500 000 to million dollar a year opex for software i mean can you really put

SPEAKER_84: a model together that shows that that's somehow accretive to you especially if you're a money losing startup it just doesn't make any logical sense i understand that it happens and the fact that that

SPEAKER_62: software sass companies have been able to make 80 to 90 margins and grow on that it has created the best business model in history but i think what may become apparent now is that the sas business model is really a temporary phenomenon that existed between ubiquity of the internet and the development of ai and low-cost low-code tools for developing software yeah it was an arbitrage of the dearth of

SPEAKER_197: engineers it was the gross margin that was correlated to the life now and now now that the work that

SPEAKER_24: software engineers could have done has been automated into software itself you are going to see a lot of

SPEAKER_86: of that arbitrage say differently freeberg you could say like the number of engineers has now multiplied by a million fold that's right and now everyone has them available so then the gross

SPEAKER_62: margins were not going to be 90 the gross margins may be 30 right and so so everything gets competed away and pricing goes down pricing gets compressed and that's why this is a big macro trend for me like i'm and i'm just seeing it across every company everyone's rethinking whether or not to pay

SPEAKER_86: the seat fees for all different types of software tools by the way the the part of that which is

Chamath Palihapitiya: economically true is if you look at every other category in the economy and you look at the gross margin profile of businesses that are not pure play tech we have grown up and we've monetized this belief that tech companies not only can start at 80 to 90 percent but stay there indefinitely stay there yeah they should be at 40 not even every other market can start off in the 50 60 70 percent when they're nascent but capitalism competes away those margins down to 30 to 40 percent right and a best in class business generates 20 to 25 percent EBITDA margins on a sustained basis yeah so if you believe that the average best run company is a 35 gross margin business with 20 to 25 free cash flow margins

SPEAKER_86: tech stocks have a long way to go down exactly exactly software software companies yeah software

SPEAKER_338: companies but if it's priced below the cost of you rebuilding it then you're not you're just it's a

Chamath Palihapitiya: buyer no no no but jason the point is the point is like when somebody does that so friedbrook's company did that work he doesn't even need to need want to make a profit from that software to just say anybody else can use this i have an auto gpt that will basically configure myself to you if you want to use it and now that n plus first company who's starting up with two or three people can now raise an order of magnitude less money and will write the gpt that connects to his and now has this

SPEAKER_187: so this is my point where like it just it's it's it's just a race to the bottom yeah all right last

SPEAKER_11: year for our most anticipated trend chamath and i both picked austerity feels like that came to

David Sacks: fruition you're kidding right we did not see any austerity we uh added like two trillion to the

SPEAKER_206: debt 34 trillion i was talking about consumers and and companies and individuals consumers didn't

SPEAKER_07: didn't uh cut either i mean they kept spending and in fact credit card debt is now at the highest level

SPEAKER_206: it's ever been so where's the austerity i think it's happening right now where people are maxed out you're already starting to see it happen with travel in some of those areas but uh yeah we could

SPEAKER_94: be off by six months on this one uh sachs you said trump's influence in the gop wayne's that was definitely wrong yeah that was special thinking freeberg cell gene therapy for you wishful for

SPEAKER_07: you too no that's true i mean over again you don't want him as your candidate well i can explain that i mean at the end of 2022 we had that election that was supposed to be a red wave and it turned into a red puddle remember that and it was a loser reason yeah it was a big loser for the gop and a lot of the candidates i'd say in particular the candidates who had been endorsed and supported by trump ended up losing not doing very well so and then by contrast it seemed like the one part of the country where the republicans have done incredibly well was in florida where obviously de santis won by like 20 points and added seats to their majority in the legislature so it seemed like going into the year that de santis was kind of the heir apparent and trump's influence would wane but like you said that may have been wishful thinking as clearly not what's happened but a big part of the reason why trump's influence is greater than ever is because of all this lawfare all these indictments against him and this prosecution and persecution of him by biden and his minions it's really i think galvanized the base to support

SPEAKER_74: trump freeberg we last year you said cell gene therapy becoming more mainstream how did that one

SPEAKER_161: pan out your prediction most invested trend i heard about mainstream but i mean we're seeing

SPEAKER_362: we've seen more approvals this year it's been good i mean steady steady pace of i saw the sickle cell

SPEAKER_62: product come out sickle cell came to market yep there's a few more that got approved so in cell therapy so it's great yeah we're seeing good progress there and i remember there's like over a thousand in clinical so there's this tidal wave coming to market soon of cell and gene therapies they're going to have a profound effect on a lot of disease conditions so really exciting

SPEAKER_364: freeberg you want to continue and tell us what you're most anticipated so this year i'm really

SPEAKER_62: excited uh based on the progress we've seen in 2023 of predictive models ai driven discovery of novel molecules materials and methods of production in biopharma in chemical engineering lots of new materials and new drugs that are actually coming out of software not coming out of brute force wet lab discovery processing and then we're also seeing these really amazing generative systems on production processes in chemistry that are going to unlock all of these new products and

SPEAKER_24: grow up costs going back to the deflationary point not only does this introduce new products into the world that are going to benefit humanity but it reduces the cost of making them and reduces the

SPEAKER_62: footprint of making them so there's a lot of great benefit coming from these predictive modeling tools that's starting to percolate its way into these industries so i'm excited about seeing what comes to

SPEAKER_24: market this year i'm sure we're going to have the science corner at some point this year that says look at this amazing new thing that was discovered in software and it works

SPEAKER_00: and it's going to be really cool okay what do you got chamath for your most anticipated trend of 2024

SPEAKER_16: what are you most anticipating chamath i think this is the most important year for bitcoin that has ever

SPEAKER_84: existed we are probably days away from a series of etfs being approved and so this is the moment for bitcoin to to use that old term cross the chasm and really see mainstream adoption where our parents and our grandparents understand what it is can buy it and then do buy it and i think that if all of this comes to pass bitcoin will be a part of the traditional financial lexicon by the end

SPEAKER_268: of 2024 so that is my most anticipated trend of the year what do you got sacks for your most

SPEAKER_07: anticipated trend of the year sacks which is a pretty good one i think there's a version of that same thing in ai i mean i i it's hard to know exactly what all the advancements are going to be in ai but you know when we look back on it in five or ten years it's going to be pretty clear that the exponential pace of advancement in ai continued and so i can't say exactly what those breakthroughs are going to be this year but there certainly are going to be some and i think we'll see those innovations continue to percolate down to more and more of the average sort of mainstream consumer

SPEAKER_94: sacks once again you and i are simpatico i picked my most anticipated trend of 2024 as efficiency in the form of ai advances and outsourcing basically a lot of americans don't want to work or they want to work from home or they want high salaries we have record low unemployment thanks to biden i'm joking but all of this is forcing people to build robots ai and software to route around you know and make things more efficient and i think the number one trend i'm seeing from startups and they tend to adopt this stuff early is outsourcing to all other geographies around the world for work because it's so easy once you have a work from home philosophy or paradigm at your company well adding somebody from portugal manila argentina canada is the same as adding somebody from outside of new york city or silicon valley or la but you can do so at a third

SPEAKER_98: of the price for somebody maybe who really wants the work and so i think efficiency is my most anticipated trend but in the form of ai and outsourcing okay now media everybody loves we do our most anticipated media for 2024 for last year i had oppenheimer wow that was great chamath you had dune part two that was delayed sacks you also had oppenheimer what did you think of oppenheimer sax did it deliver for you

SPEAKER_07: have you seen it i thought it was good not great it was very long and it kind of went on and on yeah it's not a movie i need to see a second time let's put it that way okay and freeberg you said

SPEAKER_98: generative ai based media for this year i'm i have to confess i have inside information so my prediction is going to be the winner it turns out our favorite dj

SPEAKER_373: is dropping a new album in 2024 and i got a release track so my most anticipated media i'll just play the

SPEAKER_115: the unreleased track here what is this according to nasa there's a new look at uranus

SPEAKER_382: this is young spielberg coming at you the summer jam of the year

SPEAKER_386: the new album from young spielberg dropping that's the lead title track uranus coming at you

SPEAKER_94: that's a banger that's going to be i think that that's going to carry it's going to be the summer anthem the new album from young spielberg dropping that's the lead title track uranus coming at you i also am looking forward to gladiator 2 is coming out really scott lucius the nephew of commodus is a grown man it's going to be awesome i hope and netflix's three body problem if you haven't read the books they're great and that's being done by the game of thrones guys that's going to come out in

SPEAKER_392: march and that's going to be awesome dnd anyway three body problem gladiator ran out they were kind

SPEAKER_396: of yeah they were kind of on their own there and the show kind of declined it was a terrible last

SPEAKER_98: season in this case the three body problem is a complete series and it's it's mind-blowing in terms of its epicness sex what's your most anticipated media of 2024 is there a putin biography

SPEAKER_210: coming out is it alex jones's biography 10 part series on netflix what are you looking forward to

David Sacks: well i i agree with you about gladiator 2 we actually have similar tastes in movies i'm also

SPEAKER_07: looking forward to house of the dragon season two oh yes but one project i will give a little plug to is jimmy sony's book the founders which is the story of paypal and the entrepreneurs who shaped silicon valley yes that came out in 2022 the reason i'm mentioning it is because i optioned this book along with jack selby who's another paypal mafia alum who has a film company and so we've optioned this and we have just made a deal with drake's company called dream crew to turn this into some sort of television series could be done as a docu wait did you say drink the musician drake yeah he actually has a very successful production company called dream crew they're the producers of euphoria which is this huge hit oh sure on hbo terrifying so they've decided to it is kind of a terrifying show

SPEAKER_408: if you have kids it's terrifying it is it is terrifying incredible show but terrifying it's

SPEAKER_07: an incredible show but terrifying and yeah it is scary in any event it's a big hit so they produce a lot of not just music but television content they're very interested in the story and so we're partnering with them to create a tv show so hopefully that comes together this year are you in production

SPEAKER_409: this year on it or is it no it's going to development this year and then hopefully you

SPEAKER_411: get any credit sex yeah oh how much does it cost for the rest of us to get ep credits

SPEAKER_413: 50 50 grand yeah is it a 50 grander or is it not just a little this is this is uh this is gonna

SPEAKER_210: be an expensive one oh really well who's your dream is it hbo is a dream or netflix yeah who funds

SPEAKER_72: production ultimately a studio would make this right you would want hbo or netflix i take it those are

SPEAKER_266: the top two in terms of making high quality stuff they'd be really good yeah it doesn't have to be

SPEAKER_72: those two but they'd be good it could be amazon prime i mean there's a lot of these and who are

SPEAKER_418: you hoping plays a young sax who would play a good question good question that's a good question who

SPEAKER_16: would play a young david sax what's the name of the guy that's dating zendaya what's what's his name tom holland how about that tom holland oh peter parker peter parker yeah how about millie bobby

SPEAKER_423: brown for you only one guy can play a young sex that it would be ryan gossip well you guys are

SPEAKER_425: really shooting the moon with this hmm tom holland's interesting jakel's busy on the internet right

SPEAKER_30: now he's gonna give you no i'm looking i'm looking on the internet for a young actor to play you sex

SPEAKER_302: well we'll we'll let the audience come back to that you let the audience decide who plays a young sex

SPEAKER_373: yeah chavaf you looking forward to anything in uh media in 2024 did you have anything for us to uh

SPEAKER_80: look out for jimmy donaldson mr beast added a hundred million subscribers on youtube in 2023

SPEAKER_84: more than two times the next largest channel and if you watch his content mr beast channel it's incredible and that has become event-based viewing now for hundreds of millions of people so i am

SPEAKER_119: really excited to see what production value gets cranked out in 2024 from these guys but my that's my most anticipated media is uh mr beast and free bird anything you're looking forward to in the media

SPEAKER_62: space in 2024. i mean i put ai generated news which i think has become like an interesting have you guys seen these where there's like a broadcaster that just tells you the news and they're like naked i haven't seen that no that was the thing in the early days of theater right wasn't there like

SPEAKER_79: naked news or something yeah no that was like i'm getting from the news that was like naked news where like these people would be like in in the process of undressing as they as they like read the

SPEAKER_94: news it was so stupid oh really it was really dumb but i it did capture people's imagination naked news you could basically watch newscasters naked read the news i do think you're going to

SPEAKER_62: see a lot of this real-time generative video that's going to take as its input uh news feeds and develop some understanding and then present it back to you in whatever visual format you want and so you'll have your own personal newscaster presenting you the stuff that's interesting and be like no no tell me less about the middle east tell me more about wall street tell me more about tech and you can basically interact with it and curate your own personal news feed whether that's through video or through text or through audio you can have it presented to you any way you want so i'm really excited for the day that that happens so i don't have to doom scroll through twitter all the time to get news and i can have you know a personally curated newscaster to your point one of the

SPEAKER_84: things that one of the tasks that i had this year was to kind of like take a model and learn how to fine-tune it and sunny and i we took uh stable diffusion and there's a mod to it called juggernaut

Chamath Palihapitiya: excel which basically produces no the most beautiful people you've ever seen like under any boundary condition it doesn't matter what prompt you give handsome the people that it generates are the most stunningly symmetrically beautiful people and all it's going to take to your point is just put this stuff together next year and you'll have these people that capture your attention and can keep

SPEAKER_187: your attention and they'll tell you the news or whatever and you can just say skip you can say

SPEAKER_62: tell me more you can say go back you can say hey i want to hear more like double click on that story and interact with it it's going to be incredible i do think it's it's going to happen in 2024 where a series of products will come out that start to look like this and it'll get in terms of

Chamath Palihapitiya: the objective news if that as they're telling the news you can have another agent that's basically scoring it and telling you how biased it is yeah by the way i'll tell you a crazy story yesterday after jason jason took nat and i out yesterday we had an epic day it was incredible good times i was totally gassed skiing and so i took a nap and i fell asleep for like 40 minutes and i woke up

SPEAKER_16: and i turned on the tv and i watched cnn for 20 minutes have you guys watched cnn

David Friedberg: i can't watch more than a minute it is so bad it is all network news yeah well never know it's really

Chamath Palihapitiya: bad jason like how biased it is and just how inaccurate it is if you were to watch it for an hour a day you would have this totally lopsided view of what's going on in the world that is completely not accurate but here's my here's my point there's nobody fact-checking cnn just like there's nobody really fact-checking fox news but my thought is these models and these ai tools should

SPEAKER_86: be the thing that presents objective news and then actually just tells the truth i disagree i think

SPEAKER_24: what will happen is people will bias this the the delivery to what they want to hear and you'll end up having something that's going to become more of an echo chamber for you i want to hear more about how x y or z is so great i want to hear less about the stuff that i don't agree with and you're going to curate your news to exactly what's happened with social media so i don't know if that's

SPEAKER_62: necessarily how this will evolve because people don't like to hear what they don't believe or what they

SPEAKER_98: don't already know i mean they don't want to hear the truth yeah they want to hear the truth that speaks to them yeah their version of the truth they want to be emotionally titillated you know it's about time i let you guys know that we ran an experiment right now chamath and freeberg i did

SPEAKER_94: this with sax's permission but sax's participation here today was actually his ai this is an ai version of sax that we programmed ai sax can you reveal yourself and and what training data went into this version of ai sax can you can you give us something about your training data ai sax what training data

SPEAKER_280: was used if this is a bit you want to do you're going to have to give me more heads up that would

SPEAKER_460: be hilarious though if we actually trained like a sax model and we had him come on and we tried to fool

SPEAKER_29: the audience can we just do a quick round table if you guys were to summarize your in one word or two

SPEAKER_180: words your emotional condition for 2024 what would it be like how are you feeling going into 2024

SPEAKER_07: exactly oh i feel fine but if i were to describe 24 in one word i would say the year is going to be

SPEAKER_106: turbulent but i feel i feel level that's not me but i feel like the world's going to be very turbulent

SPEAKER_94: um jacal kind of exhilarated enthusiastic about 2024 it feels like a lot of the cleanup work you know that we had to do in 2023 2022 like i feel like a lot of that's we've worked through it and uh i'm finding a lot of optimistic so i guess i would be you know enthusiastic and optimistic about 2024 i'm really

SPEAKER_05: excited to go to work and create i want to create some new things in 2024 i feel very creative creative

SPEAKER_84: yeah yeah creative i would say cautious and pensive i think that just a lot of stuff is changing underfoot and i'm personally not excited to make a bunch of decisions because i worry that those decisions will have to be remade or unmade even nine or ten months later so i i'm just kind of like very pensive

Chamath Palihapitiya: i'm like wow a lot of stuff can change will change even just like you know and then freeberg knows this but like you know there's like some deals underfoot that like i think for the industry

SPEAKER_84: as a lot like as a whole are just really meaningful things and so to do stuff right now freeberg makes me very anxious so right i'm really cautious and pensive right where are you at freeberg

SPEAKER_29: i'm excited i'm enjoying my new job as ceo at ohalo there's so much cool stuff happening i'm personally excited about it so this is the most excited i've felt in many years in terms of

SPEAKER_62: my my work and then i would and i'm really excited to share what we've done next year which i'll or earlier this year which i'll do i'll do it on the show first obviously and then looking outside of the world i'm just a little cautious i'm a little nervous i think there's a like there's still a lot of tinder boxes out there so i mean you guys know i like we joke about it but i do think there's

SPEAKER_305: these like little mousetraps that can get set off and then they set up all the other mousetraps so there's a couple of those things out there that i'm a little nervous about but in the course of

SPEAKER_94: history aren't there always conflicts in the world and like do you try to like put them on a spectrum of like there's always going to be conflict there's always going to be there's never been this much

SPEAKER_362: debt in the world and that's what makes me so nervous like yeah no and i think they're related

SPEAKER_62: so actual conflict relates to the debt load and that's why i'm so nervous because we've never been you can't keep your societal fabric together if you have a lot of debt and you can't grow your economy those are two that's a simple fact and so that leads naturally to finding points of conflict with other nations and other places because you know you look for conflict elsewhere

SPEAKER_16: there's a good chance that will the republicans will force some momentary temporary budget cuts

SPEAKER_482: in this next yeah couple weeks shutdown yeah a couple weeks yeah 17 two weeks away yeah yeah it's

SPEAKER_96: pretty interesting under the terms of the debt ceiling increase that they agreed to last year

SPEAKER_07: they're supposed to all agree on a new budget and if they don't then there's a one percent cut across the board on discretionary spending that goes into effect right if i were the republicans why agree to a deal you're never going to do better than a one percent cut in discretionary spending if you care about austerity or just having any kind of reason in our spending just take the one percent cut yep

SPEAKER_488: yes don't agree to anything agreed that's the most likely path right at this point i hope so

SPEAKER_07: and you know one percent cut cut is a rounding error but the um washington lease are going to shriek

David Sacks: like crazy over that i mean they're gonna yeah squeal over this minuscule cut like we were slashing their budgets right but that's all the reason to do it i think yeah exactly they're cutting their finger

SPEAKER_490: nail and they're crying it's like just clipper totally they're gonna have a big deal off their

SPEAKER_07: arm when they got like a fingernail clip yeah it's nothing all right i gotta run all right everybody

SPEAKER_297: what an amazing 2023 we had here's to a great 2024 you got your prediction show and we'll be back with

SPEAKER_94: more news and a and a classic all-in episode next week have a great new year and uh we wish you all

SPEAKER_496: all the best in 2024 love you boys back at you bye-bye

SPEAKER_504: you've been sourced it to the her feet

SPEAKER_508: we need to get merch