SPEAKER_00: Peter was the person who told me this really pithy quote. In a world that's changing so quickly, the biggest risk you can take is not taking any risk.

SPEAKER_03: This guy is a tough nut to try to sort of explain.

SPEAKER_05: Changed money with PayPal, was the first outside investor in Facebook, backed Palantir, which is, I believe they helped find Osama bin Laden.

SPEAKER_08: Almost certainly the most successful technology investor in the world.

SPEAKER_09: I don't think the future is fixed. I think what matters is a question of agency.

SPEAKER_11: What I think works really well are sort of one-of-a-kind companies.

SPEAKER_12: How do you get from zero to one? What great business is nobody building? Tell me something that's true that nobody agrees with you on.

SPEAKER_13: All right, Peter, welcome back. It's good to see you.

SPEAKER_15: You don't do this too often, so we do appreciate it. But when you do do it, you're always super candid, and we appreciate that as well. You fit right in here. You're sitting this year's political cycle out. Right into politics. Well, no, I mean, I think this is a question we all have, which is, you were very active. You bet on J.D. in a major way. He delivered today. It was a very impressive discussion.

SPEAKER_20: Why aren't you involved in this cycle? It's very confounding to us because these are your guys. Man, how much time do we have?

SPEAKER_23: Let's talk about this for two hours or something. I don't know. Look, I have a lot of conflicted thoughts on it. I am still very strongly pro-Trump, pro-JD. I've decided not to donate any money politically, but I'm supporting them in every other way possible. I, you know, obviously, you know, I think there's, my pessimistic thought is that Trump is going to win and probably will win by a big margin. He'll do better than the last time, and it'll still be really disappointing because, you know, the elections are always a relative choice. And then once someone's president, it's an absolute. And you get evaluated, you know, do you like Trump or Harris better? And that seems, there seem to be a lot of reasons, you know, that one would be more anti-Harris than anti-Trump. Let's, again, no one's pro any of these people. It's all, it's all negative, right? Yeah, and, but then after, after they win, there will be a lot of buyer's remorse and disappointment. And that's sort of, that's sort of the arc that I, I see of what's going to happen. And it's, it's somewhat under motivating. I don't know, just to describe, describe it. I think, you know, I think it's, I think the odds are slightly in favor of Trump, but it's basically 50-50. My one contrarian view on the election is that it's not going to be close. You know, most presidential elections aren't, and, you know, one side just breaks, you know, 2016, 2020, we're super close. But two-thirds of the elections aren't, and, you know, you can't always line things up and figure it out. I think either the, you know, the Kamala bubble will burst, or, you know, maybe, maybe the Trump voters get really demotivated and don't show up. But I think, you know, one side is, is simply going to collapse in the next, in the next two months. And then, you know, if you want to get involved, you know, with all the headaches that come with being involved, if it makes a difference counterfactually, and if it's a really close election, everything makes a difference. If it's, if it's not even close, I don't think it makes much of a difference. If it is going to be close, by the way, if it's, if it's like going to be a razor thin close election, then, then I'm pretty sure Kamala will win.

SPEAKER_24: Because, because they will cheat, they will fortify it, they will steal the ballots.

SPEAKER_29: And so, so, so, so, you know, if we, if we can, if we can, if we can answer them, in the event, in the event that it's close, I don't want to be involved. In the event that it's not close, I don't need to be involved. And so that's sort of, that's sort of a straightforward analysis right there.

David Friedberg: But jumping off point, how much cheating on a percentage basis do you think happens every year? How much, and do you think Trump actually won the last time?

SPEAKER_24: With the verb, so, you know, um, cheating, stealing, that implies something happened in the dark of night. Massaging.

SPEAKER_36: I think the verb you're allowed to use is fortify.

SPEAKER_24: Okay, yeah, we don't want to get canceled on YouTube. Ballot harvesting. I mean, it was, you know, it's all sort of, there were all these rule changes that were sort of done in plain daylight.

SPEAKER_23: And, uh, um, but yeah, I think, I think our elections are not, they're not perfectly clean.

SPEAKER_22: Otherwise, we could examine it.

SPEAKER_20: We could have vigorous debate about it. Well, what would you change then? What should change? Because we all want everybody's votes to count. We want it to be clean. Um, I'm, I'm talking about the audience here.

SPEAKER_23: But at a minimum, you'd run them, you'd try to run elections the same way you do it in every other Western democracy. You have one day voting. You have practically no absentee ballots. Um, you have, um, and, um, and it's, you know, it's, it's, it's, it's, it's one day where everything happens. It's not this, uh, two, two month elongated process. That's what the way you do it in every other country you'd have, you'd have some somewhat stronger voter ID and, you know, make sure that, you know, the people who are voting have a right to vote, um, make it a national holiday. That's, that's basically, that's basically what you do in every other Western democracy. And it's, it's, it, it used to be much more like that in the U S I mean, it's, it's, it's meaningfully decayed over the last 20, 30 years. You know, 20, 30 years ago, 30, 40 years ago, you got the results on the day of, of the vote. And that sort of stopped happening a while ago.

SPEAKER_40: What would make you not disappointed? So Trump gets elected. How do you, what's your counter narrative on, you know, we're a year or two years past the election, Trump is president. What, what, what makes you say I'm surprisingly not disappointed? What takes place?

SPEAKER_29: Man, it's, um, you know, it's, I, I, I think there are some extremely difficult problems.

SPEAKER_23: That it's, it's, it's really hard to know how to, how, how to solve them. I wouldn't know what to do, but, uh, we have, you know, we have an incredibly big deficit and, uh, and yeah, if you can, if you can find some way to meaningfully reduce the deficit with no tax hikes.

SPEAKER_44: And without, without GDP contraction.

SPEAKER_23: Well, you, you would do it if you got a lot of GDP growth maybe. Right. But, um, if you could, if you could meaningfully reduce the deficit with, with, um, with no, with no tax hikes, that would be, uh, that would be very impressive. You know, I, I think we're sort of sleepwalking into Armageddon with, uh, you know, the Ukraine and, um, the conflict in Gaza are just sort of the warmups to the China Taiwan war. And, uh, and so if, uh, if, if Trump can find a way to head that off, that would be incredible.

SPEAKER_45: If they don't go to war in four years, that, that will be, that will be better than I would expect possibly.

SPEAKER_15: In relation to Taiwan, if Trump called you and asked, should we defend it or not in this acute case, would you advise to let Taiwan be taken by China in order to avoid a nuclear holocaust and a world war three?

SPEAKER_20: Or would you believe that we should defend it and defend free countries like that?

SPEAKER_24: Well, I, I, I think, um, I think you're probably not supposed to say, no, no, no, no, if you, no, if you, um, you, I, I, I think, I look, I think there's so many ways our, our policies are messed up, but probably the, you know, the one, the one thing that's roughly correct on the Taiwan policy is that, uh, uh, we don't tell China what we're going to do.

SPEAKER_23: Um, and what we tell them is we don't know what we'll do and we'll figure it out when you do it, which is probably has the virtue of being correct. And, uh, and then I think if you had, yeah, if you had a red line at Kwomoi, Matsu, the island, you know, five miles off the coast of China, that's unbelievable. If you, um, if you, um, if you say we want some guardrails and we won't defend Taiwan, then they'd get invaded right away. So I think, I think, I think the policy of, um, not saying what our policy is and, uh, maybe not even having a policy, you know, in some ways is relatively the best.

SPEAKER_24: Yeah, I, I think anything, anything, anything precise you say, that's going to just lead to war right away. But what do you believe?

SPEAKER_15: I, um, worth defending or not worth stirring the conflict? Democracy in this tiny island worth going to war over or not? According to Peter Thiel.

SPEAKER_23: It's, um, it's not worth, uh, it's not worth World War III. Um, and I, I still think it's, it's, uh, quite catastrophic if it, uh, if it gets taken over by the communists. How does the world, those can both be true.

SPEAKER_40: How does the world divide if we end up in a heightened escalation? Is China, Russia, Iran, friends, is that an alliance, is that an axis that forms, you know, think out the next decade in kind of your base case and, you know. I, I, I don't know what happens. Estimate how the world divides.

SPEAKER_23: I, I don't know what happens militarily if there's a China, Taiwan invasion. I mean, maybe, maybe we roll over, maybe it escalates, you know, all the way to nuclear war. Probably it's, it's, you know, some very messy in between thing, sort of like what, what you have in, in the Ukraine. Uh, what, what I think happens economically is very straightforward. I think, uh, I think basically, um, you know, you have, uh, with Russia and Germany, you had one North Stream pipeline. And we have the equivalent of a hundred pipelines between the U.S. and China, and they, they all blow up. Now, I, I met the TikTok CEO about, about a year ago. And, um, you know, I, not, maybe I wouldn't have said this now, but what I told him and what I felt was very honest advice was, you know, you don't need to worry about the U.S. We're never going to do anything about TikTok. We're too incompetent. Um, but, um, but, but if I were in your place, I would still get the business out of China. I would get the computers out, the people out. I'd completely decouple it from ByteDance because, um, TikTok will be banned 24 hours after the Taiwan invasion. And if you think there's a 50-50 chance this happens and that will destroy, you know, 100% of the value of the TikTok franchise. What was his reaction? Um, you know, uh, he said that they had done a lot of simulations and there were a bunch of companies in World War I and World War II that managed to sell things to both sides.

SPEAKER_24: He doesn't seem so bright to me. Do you think he's, um, he doesn't, no, he, honestly, what was your take on him? He, he didn't disagree with my frame. And so I always, I always find that flattering if someone basically agrees with my framing. So he seemed, he seemed perfectly bright to me even though maybe not, uh, not correct. Game theory, but what, what, um, a lot of bright people are wrong about that.

SPEAKER_56: I saw you give a talk last summer with Barry Weiss and you talked about this decoupling should be happening.

SPEAKER_67: You weren't saying should, you were recommending that every industry leader consider decoupling from China.

SPEAKER_40: I think your comment was, it's like picking up nickels in front of a freight train. Do you remember saying that?

SPEAKER_70: Well, I, I think, like it's, it's, there are a lot of different, there are a lot of different ways in which businesses are coupled to China.

SPEAKER_23: There were investors that tried investing. There are people who try to compete within China. There are people who built factories in China for export. Um, and, um, you know, there are different parts of that that worked to, um, to, to varying degrees. But, uh, but yeah, my, um, my, I, I certainly would not try to, um, to invest in a company that competed domestically inside China. I think that's, that's virtually impossible. Um, uh, I think it's probably quite tricky even to invest in Chinese, Chinese businesses. Um, uh, and, uh, and then, and then there is, there is sort of this model of, you know, building factories in China, uh, for, uh, for export, uh, to the West. And, um, it was, it was a very big arbitrage. These things do work, you know, I mean, I visited the Foxconn factory nine years ago. And it's, you know, you have people get paid a dollar and a half, $2 an hour, and they work 12 hours a day. And they live in a dorm room with two bunk beds where, uh, you know, you get eight people in the dorm room. Someone's sleeping in your bed while you're working and vice versa. And, uh, and you sort of realize they're really far behind us or they're really far ahead of us. And either way, you know, it's, it's not that straightforward to just, uh, shift the, um, the iPhone factories to the United States. Um, so I, I sort of understand, you know, why a lot of businesses ended up there and why, why this is the arrangement that we have. But, uh, but yeah, my, my, my intuition for, you know, what is going to happen without making any normative judgments at all is it is going to decouple.

SPEAKER_71: How inflationary will that be?

SPEAKER_23: It presumably is, it's presumably pretty inflationary. Yeah, that's, that's probably the, you know, I don't, I don't know. It's, it's, you'd have to sort of look at, you know, what the inelasticities of all these goods are. So if that's true, what's the policy reaction?

SPEAKER_29: It's probably not that, it may not be as inflationary as people think because, um, people always model trade in terms of, uh, pairwise in terms of two countries.

SPEAKER_23: So if you literally have to move the people back to the U S that's, that's insanely expensive.

SPEAKER_24: I don't, you know, I don't know how much it would cost people to build an iPhone, but you just, you just, well, I think India is sort of too messed up, but you, you shifted to like Vietnam, Mexico. There are, you know, there, there are 5 billion people living in countries where the incomes are lower than China.

SPEAKER_23: And so, um, and so, you know, probably the, um, the negative sum trade policy we should have with China is, um, you know, we should just shift it to other countries, which is a little bit bad for the U S extremely bad for China. And let's say really good for Vietnam. Um, that's kind of, um, and that's kind of the, the negative sum policy, um, that, uh, that's going to manifest as this sort of, uh, decoupling happens.

SPEAKER_15: Let's talk about avoiding it for a second here. Trump seems to be extremely good with dictators and authoritarians. Uh, Kim Jong-un seems like a big fan. I mean that in like, as a compliment, as a superpower, right? Like he doesn't have a problem talking to them, he connects with them and they seem to like them. So what would be the path to him working with Xi to avoid this? Is there a path to avoid this?

David Friedberg: Because we were sitting here last year talking about this and it just seems mind boggling that if everybody agrees that this is going to happen, that we can't figure out a way to make it not happen.

SPEAKER_29: Well, it's, it's not just up to us. So, um, yeah, there is, there's, and so, I don't know, it's, it's, it's obviously somewhat of a black box. We don't exactly, we, we, I, I feel we just have no clue what people in, in, in China think.

SPEAKER_23: But, um, but I, I, I think it's sort of the, the sense of history is, is strongly the sort of Thucydides trap idea that you have a rising power against an existing power. And it tends to, you know, it's, it's Wilhelmine Germany versus Britain before World War I. And, you know, it's, um, you know, Athens against Sparta, the rising power against the existing power, you tend to, um, get conflict. That's, that's probably what deep down, I think, is, is really, really far in the China DNA. So, so I'd say maybe, maybe the first, I don't know, the meta version would be the first, the first step to avoiding the conflict would be, we have to, we have to start by admitting that China believes the conflict's happening. Right. And then if, if, if, if people like you are constantly saying, um, well, we just need to have some happy talk. Right. Um, that's, that is a recipe, that's a recipe for World War III.

SPEAKER_77: I'm not advocating happy talk necessarily.

SPEAKER_29: Um, I, I, I get accused of being a bit more hawkish, but. Obviously, obviously, um, in, in general, you know, I don't know.

SPEAKER_23: I, I, I'm not, I'm not sure Trump should talk to the North Korean dictator. But yeah, in general, um, it's probably a good idea to, to try to, um, talk to people, even if they're, they're real, really bad people most of the time. And, uh, and, uh, you know, it's, it's certainly, um, a very odd dynamic with the U S and, and, uh, and Russia at this point where, um, I, I think it is impossible for anybody in the Biden administration, even to have a back channel communication with, uh, with people. Like, I don't think Tucker Carlson counts as an emissary from the Biden administration.

SPEAKER_24: And if anybody gets tuckered, or I don't know what the verb is, who talks, you know, that's, that's, that seems, that seems, uh, worse than the alternative.

SPEAKER_85: Can we, um, talk about technology?

Chamath Palihapitiya: Um, you have this, you, you, you have, you have a speech where you talk about some of the misguided things we've done in the past in the name of technology and use like big data as an example of that. Um, what is AI?

SPEAKER_29: Um, oh man, that's, that's sort of a big question. And I, um, it's, um, yeah, I, I always, I always, I always had this riff where I don't like the buzzwords and, um, you know, machine learning, big data, cloud computing, you know, I'm going to build a mobile app, bringing the cloud to, um, you know, if you have sort of a concatenation of buzzwords, um, you know, my, my first instinct is just to run away as fast as possible.

SPEAKER_23: It's some really bad group think. And, um, and for many years, I, I, my bias is probably that AI was one of the worst of all these buzzwords. It meant, you know, the next generation of computers, the last generation of computers, you know, anything in between. So it's meant all these, all these very different things. If we, if we roll the clock back to the 2010s, you know, the, um, probably the AI, to the extent you concretize it, I would say the AI debate was maybe framed by, by two, the two books, the two canonical books that framed it. There was the Bostrom book, super intelligence, 2014, where AI was going to be this superhuman, super duper intelligent, um, thing. And then, um, the anti, um, uh, Bostrom book was the Kai-Fu Lee 2018 AI superpowers. We can think of the CCP rebuttal to Bostrom, where basically AI was going to be surveillance tech, face recognition, and China was going to win because they had no qualms about, uh, applying this technology. And, um, and then, um, if we now think about what actually happened, let's say, with the LOMs and, and chat GPT, it was really neither of those two.

SPEAKER_70: Um, and it was this in-between thing, which was actually what people would have defined AI as for the previous 60 or 70 years, which is passing the Turing test, which is, you know, the somewhat fuzzy line.

SPEAKER_23: It's a computer that can pretend to be a human, um, or that can fool you into thinking it's a human, and, um, and, uh, you know, even with the fuzziness of that line, you could say that pre-chat GPT wasn't passed, and then chat GPT passed it. And that seems, that seems very, very significant. Um, and, um, and then obviously it leads to all these questions. What does it mean? You know, is it going to, is it going to compliment people?

SPEAKER_70: Is it going to substitute for people? You know, what does it do to the labor market? Do you get paid more, do you get paid less?

SPEAKER_29: You know, so there are all these, all these questions, but, uh, it, um, it seems extremely, it seems extremely important. Um, and, um, and it's probably, you know, certainly the, the big picture questions, which I think Silicon Valley is always very bad at talking about, is like, you know, what does it mean to be a human being? Right.

SPEAKER_23: Um, sort of the, I don't know, the stupid 2022 answer would be that humans differ from all the other animals because we, we're good at languages.

SPEAKER_70: If you're a three-year-old or an 80-year-old, you speak, you communicate, we tell each other stories. This, this, this is what makes us different. And so, um, so yeah, I think there's something about it that's, uh, incredibly important and, and very disorienting.

SPEAKER_23: You know, the question I always have as a, I don't know, the narrower question I have as an investor, sort of how do you make money with this stuff?

SPEAKER_91: And, um, how do you make money?

SPEAKER_29: I, it's, um, it's pretty confusing. And I think, I, I don't know, this is always where I'm anchored on the late nineties is sort of the formative period for me. But, uh, I, I, I, I keep thinking that, uh, AI in 2023, 2024 is like the internet in 1999.

SPEAKER_70: Um, it's, it's really big. It's going to be very important. It's going to transform the world, not, you know, in six months, but in 20 years.

SPEAKER_23: And then, um, there are probably all kinds of incredibly, uh, catastrophic approximations where, you know, uh, what businesses are going to make money, you know, who's going to have monopoly, who's going to have pricing power is, um, you know, is, is, is, is, is, is, is super unclear. Um, probably, you know, one, one layer deeper of analysis, you know, if attention is all you need. And if you're not post-economic, you need to pay attention to who's making money and in AI, it's basically one company is making, NVIDIA is making over 100% of the profits. Everybody else is collectively losing money.

SPEAKER_70: And so, um, and so there's sort of a, you have to do some sort of, you should do, you should try to do some sort of analysis. You know, do you go long NVIDIA? Do you go short? You know, is it, um, you know, my monopoly question, is it a, is it a really durable monopoly? You know, and, and then I, it's, it's hard for me to know because I'm in Silicon Valley and I haven't done anything. We haven't done anything in semiconductors for a long time.

Chamath Palihapitiya: So I have no clue. Do you, um, if you, let's de-buzzword the word AI and say, it's a bunch of process automation. Let's just say that's version 0.1, where brains that are roughly the equivalent of a teenager can do a lot of manual stuff. What do you, have you thought about what it means for, you know, 8 billion people in the world if there's an extra billion that necessarily couldn't work or?

SPEAKER_70: Like whether that in political or economic terms, I don't know the, the, the, um, I, I don't know if this is the same, but this is, you know, the, the history of 250 years, the industrial revolution, what was it? It, you know, it, it adds to GDP. It frees people up to do more, more productive things. Um, you know, maybe there's, you know, there was, yeah, there was a, I know there was a Luddite critique in the 19th century of the factories that people were going to be unemployed. And wouldn't have anything to do with, because the machines would replace the people, you know, maybe the Luddites are right this time around.

SPEAKER_23: I'm, I'm, I'm, I'm probably, I'm probably pretty, pretty skeptical of it, but, uh, but yeah, it's, it's, it's extremely confusing, you know, uh, where, where the gains and, and losses are. There, there probably are, um, you know, there, there's always sort of a hobby, you can always just use it on your hobby horses.

SPEAKER_70: So I don't know, the, you know, my anti-Hollywood or anti-university hobby horse is that, uh, it seems to me that, you know, the, um, the AI is quite good at the woke stuff.

SPEAKER_23: And, um, it'll, and, and so, you know, if you want to, if you want to be a successful actor, you should be maybe a little bit racist or a little bit sexist or just really funny. Uh, and you, you won't have any risk of the AI replacing you, um, and then, everybody else will get, everybody else will get replaced. And then probably, I don't know, um, I don't know, uh, Claudine Gay, the, uh, plagiarizing Harvard University president, um, you know, the AI is going to play, you know, the AI will produce endless amounts of, um, of these sort of, I don't even know what to call them, uh, woke, um, papers.

SPEAKER_70: And, um, they, they were all already sort of plagiarizing one another. They were, they were always saying the same thing over and over again. They were using their own version. And then the AI is just going to flood the zone with, with even more of that. And that, you know, I don't know, obviously they've been able to do it for a long time and no one's noticed, but, uh, but I think at this point, um, it, it, it doesn't seem promising from a, um, competitive, competitive point of view. What are the areas?

SPEAKER_60: It's obviously my hobby horses, so I'm, I'm just, that's maybe just wishful thinking on my part.

SPEAKER_85: What are the areas of technology that, um, you're curious about that your mind is like, wow, this is really, I have to learn more, pay attention.

SPEAKER_29: You know, I'm always, I always think, uh, you, you want to instantiate it more in companies than, than, um, things or, you know, if you ask sort of like, where is, where is innovation happening? You know, um, you know, it, it, it, in our society, and it doesn't have to be this way, but it's, it's, um, it's mostly in, in, um, in a certain subset of relatively small companies.

SPEAKER_70: We have these relatively small teams of people that are really pushing the envelope. And that's, that's, that's sort of, you know, that, that's sort of what I find, you know, inspiring about, about venture capital.

SPEAKER_23: And then, and then you, and then you obviously, you don't just want innovation. You also want it to, it to, it to, um, it to translate into, into good businesses. But that's, that's where it happens. It's somehow, it doesn't happen in universities. It doesn't happen in government. You know, there was a time it did.

SPEAKER_70: I mean, you know, somehow in this very, very weird, different country that was the United States in the 1940s, you had, you know, somehow the army organized the scientists and got them to produce a nuclear bomb in Los Alamos in three and a half years. And, you know, the, the way the New York times editorialized after that was, you know, it's, it's, you know, it was sort of an anti-libertarian write-up. It was, you know, there were, um, you know, obviously maybe if you'd left the prima donna scientists to their own, it would have taken them 50 years to build a bomb and, uh, the army could just tell them what to do. And this will silence anybody who doesn't believe the government can do things. And, uh, they don't write editorials like that in the New York times anymore.

SPEAKER_23: But I think, um, yeah, but I think that's sort of, that, that's, that's sort of where, where, when, where, when you look at, I think it's, I think, I think a crazy amount of it still happens in the United States.

SPEAKER_70: You know, and there's sort of, you know, we've, we've, we've, you know, episodically tried to do all this investing. We've probably tried to do too much investing in Europe over the years. It's always sort of a junket, sort of, it's a nice place to go on vacation. As an investor. And, um, and it's, it's, it's, it is, it is very, it's, it's very, I don't have a great explanation, but it's a, it's a very strange thing that, uh, so much of it is still, the U.S. is somehow still a country where people do new things.

SPEAKER_67: Peter, you, Peter, is that a, is that a team organizational, social evolutionary problem in the United States?

SPEAKER_40: What is the root cause of the failure to innovate in the United States relative to the expectation going back 70 years, 50 years, et cetera? From, you know, the, the, the rocket ships and we're all going to live.

SPEAKER_23: Yeah, well, this is always, this is always, there's always one of the big picture, and it claims I have, that we've been in an era of relative tech stagnation the last 40 or 50 years, or the, you know, the tagline, um, that we hadn't. And techno-negativism. There's no negativism. Like, the promise of flying cars, all we got was 140 characters, which is not an anti-Twitter, anti-X commentary, even though the, the way, the way I used to always qualify it was that, uh, at least, you know, at least, it was at least a good company. You had, you know, 10,000 people who didn't have to do very much work and could just smoke marijuana all day.

SPEAKER_24: Very similar to Europe. And so, I, I, I think that actually, that part actually did get corrected, but, um, um, but, but, but I think, I, I think, um, like what went wrong?

SPEAKER_41: Because you, you point out that it's not a technology trend tracker that you think about.

SPEAKER_67: It's about people and teams that innovate and drive to outcomes based on their view of the world. And, and what's gone wrong with our view of the world and our ability to organize, to achieve the seemingly unachievable, with very rare exceptions. Obviously, Elon's here later, but, yeah.

SPEAKER_23: You know, it's, it's, it's, it's over-determined, um, the, um, the, the, the rough frame I always have. And again, it's not that there's been no innovation. There's been, there's been a decent amount of innovation in the world of bits, computers, internet, mobile internet, you know, crypto, AI. So there's sort of all these, um, world of bits, uh, places where there was, you know, a significant, but sort of somehow narrow cone of progress. But it was everything having to do with atoms that was slow. And this was already the case when I was an undergraduate at Stanford in the late 80s. In retrospect, any applied engineering field was a bad idea. It was a bad idea to become a chemical engineer, you know, a mechanical engineer, aero-astro was terrible, nuclear engineering. Everyone knew, I mean, I think no one did that, you know, and, um, and, and there's something about, you know, the world of atoms that, um, you know, from a libertarian point of view, you'd say it got regulated to death. Um, there were probably, uh, you know, there's, there's some, there's some set of arguments where, um, the low-hanging fruit got picked and got harder to find new things to do. Although I always, I always think that was just a sort of baby boomer excuse for, for covering up for the failures of that generation. Um, and, um, and then, um, and then I think, but I think maybe, maybe, um, maybe a very big picture part of it was that, uh, at some point in the 20th century, the idea got, took hold that not all forms of technological progress were simply good and simply for the better. And there's, you know, there's something about the two world wars and the, you know, the development of nuclear weapons that, uh, that, that gradually pushed people into this, this more, uh, risk-averse society. And it didn't happen overnight, but, um, you know, maybe a quarter century, you know, after the nuclear bomb, it's like, by Woodstock, it happened. By Woodstock, it happened.

SPEAKER_40: Yeah. Because that was the same summer we landed on the moon.

SPEAKER_23: Yeah, Woodstock was three weeks after that.

SPEAKER_40: Yeah. That, that was the tipping point. Progress stopped and the hippies took over.

SPEAKER_41: Sex?

SPEAKER_111: Can we shift gears just to the domestic economy?

David Sacks: What, what do you think is happening in the domestic economy? I just, this backdrop, we've had something like 14 straight months of downward revisions to jobs. The revisions are supposed to be completely random, but somehow they've all been down. Um, probably doesn't mean anything. Um, there's also what's happening with, with the yield curve, but I'll, I'll stop there. What, what, what's your take on what's happening in the economy?

SPEAKER_70: Um, you know, it's, it's, I mean, it's, it's always hard, hard to know exactly. Um, yeah, I, I, I suspect we're close to a recession. I've, I've probably thought this for a while.

SPEAKER_29: Uh, it's, it's being stopped by really big government spending.

SPEAKER_70: So, um, you know, in, in May of 2023, the projection for the deficit in 20 fiscal year 24, which is October of 23 to September 24, was something like 1.5, 1.6 trillion. Um, the deficit's going to come in about 400 billion higher. And so, um, which, you know, it was a sort of a crazy deficit was projected and it was way off.

SPEAKER_23: And then somehow, um, and so if, if, if we had not found another 400 billion, um, to add to, you know, this, this crazy deficit at the top of the economic cycle, you know, you're supposed to, you're supposed to increase deficits in a recession. Not at the, not at the top of the cycle, um, you know, things, things would be probably very shaky. There's, yeah, there's, there's, there's, there's some way where, um, we, we, yeah, we have, um, too much debt, not enough sustainable growth.

SPEAKER_70: Um, you know, again, I always think it comes back to, you know, tech innovation. There probably are other ways to grow an economy without tech, um, or intensive progress. Um, but I think they, we, we, we don't have, we, those don't seem to be on offer. And then that's, that's where it's very deeply stuck.

SPEAKER_23: If you, if you wind back over the last 50 years, there's always a question, why did people not realize that this tech stagnation had happened sooner? And I think there were two one-time things people could do economically that had nothing to do with science or tech. There was a 1980s Reagan-Thatcher move, which was to massively cut taxes, deregulate, allow lots of companies to merge and combine. And, and, um, it was sort of a one-time way to make the economy a lot bigger, even though it had, it was not something that really had the sort of compounding effect. So it led to one great decade. And then there was, um, you know, and that was sort of the right-wing capitalist move. And then, um, in the nineties, there was sort of a Clinton-Blair, um, center left thing, which was sort of leaning into globalization. And there was a giant global arbitrage you could do, which also had, you know, a lot of negative externalities that came with it. But, um, it sort of was a one-time move. And I think both of those are, are not on offer. Right.

SPEAKER_70: You know, I don't necessarily think you should undo globalization. I don't think you should raise taxes like crazy, but, um, you can't, you can't do more globalization or more tax cuts here. That's not going to be the win. And so I think, I think you have to somehow get back to the future.

SPEAKER_46: Um, we have time for a couple more questions.

SPEAKER_15: You, um, I think saw that maybe there's Ivy league institutions maybe weren't producing the best and brightest or weren't exactly, um, hitting their mandate. Um, and you created the Teal Fellows and you've been doing that for a while. And I meet them all because they all have crazy ideas and they pitched me for angel investment. What have you learned getting people to quit school, giving them a hundred thousand dollars, and then how many parents call you and get really upset that their kids are quitting school?

SPEAKER_121: Uh, it's, well, I, I, I, I, I've, I've, I've, I've, I've learned a lot. I mean, it's, it's, um, I don't know.

SPEAKER_23: I, I, I, I think, I think the universities are far worse than I even thought when I started this thing.

SPEAKER_29: Um, I think, um, yeah, it's, um, you know, I, I, I, I did this, uh, I did this debate at, uh, Yale, uh, last week, um, you know, resolve the higher education's a bubble.

SPEAKER_23: And, um, and, uh, you should go through all the different numbers and, um, the, and then, you know, and again, I, I was careful to word it in such a way that I, I didn't have to, you know, and then people kept saying, well, what's your alternative?

SPEAKER_70: What should people do instead? And I said, nope, that's not, was not the debate. I'm not, you know, I'm not your guidance counselor. I'm not your career counselor. I, I don't know how to solve your problems.

SPEAKER_23: But, um, if something's a bubble, you know, the first thing you should do is probably not, you know, lean into it in too crazy a way. And, you know, the student debt was 300 billion in 2000. It's, uh, it's basically, uh, close to two trillion at this point. So it's just been this sort of runaway, um, this runaway process. And, um, and then if you look at it by cohort, if you graduated from college in 1997, 12 years later, um, people still had student debt, but most of the people had sort of paid it down. Um, but the first, by 2009, we started the Teal Fellowship in 2010 and it, you know, it felt, uh, by 2009 was the first cohort where this really stopped. If you take the people who graduated from college in 2009 and you fast forward 12 years to 2021, the median person had more student debt 12 years later than they graduated with. Because I, it's actually just, it's just compounding faster. And it was, you know, partially, partially the global financial crisis that people had less well-paying jobs. They stayed in college longer. Um, and the colleges, but it's just sort of been this background thing where it's, it's decayed in these, in these really significant ways. And, um, you know, again, I think, I think it's on some level, um, there are sort of a lot of, um, debates in our society that are probably dominated by sort of a boomer narrative. And maybe the baby boomers were the last generation where college really worked and, you know, they think, well, you know, I, I worked my way through college and why can't, why can't, um, why can't, um, why can't, you know, an 18 year old going to college do that today? And, um, and so I, I, I think the bubble will, will, will, will be done once the boomers have exited stage left. But does the government need to be, it'd be good if we figured something out before then, you know, does the government need to stop underwriting the loans?

SPEAKER_67: Because it's the lending, I think the 90 plus percent of the, the, the capital and the student loan programs is funded by federal, uh, federal, the federal government. And there's, if you're an accredited university, you can take out a loan and go to it and accreditation in a, in a, in a, in a rigid kind of free market system, you would have an underwriter that says, are you going to be able to graduate, make enough money to pay your loan off? Is this a good school? Are you going to get a good job? And then the market would figure out whether or not to give you a loan, would figure out what the rate should be and so on. But in this case, the government simply provides capital to support all of this. And as a result, everything's gotten more expensive and the rigidity in the system that basically qualifies schools and the quality of those schools relative to the earning potential over time is gone. So we need the government to get out of like student loan business.

SPEAKER_23: Yeah. But look, the place, the place where I'm, I, I know the, I'm sort of, some ways I'm right-wing, some ways I'm left-wing on this. So the place where I'm left-wing is I do think a lot of the students got ripped off. And, uh, and so I think there should be some kind of broad, um, relief, debt forgiveness at this point. Um, we should pick up the tab, but it's not just the taxpayers, it's the universities and it's the, the, the, the bondholders. Got it. The bondholders take a little bit out of those endowments. And, um, and then obviously if you just make it the taxpayers, then, um, then you'll just, then the universities can just charge more and more every year.

SPEAKER_70: And there's no incentive to reform whatsoever, but, uh, well, also, I mean, if you know, it's in 2005, uh, it was under Bush 43 that the bankruptcy laws got rewritten in the U S where you cannot discharge student debt, even if you go bankrupt.

SPEAKER_23: And if you haven't paid it off by the time you're 65, your social security wages, checks will be garnished. It's crazy.

SPEAKER_41: So, um, so, you know, I, I, I, I do think, um, but should we stop lending? Should the federal government get out of the student lending business?

SPEAKER_23: Well, if, if, if we, if we say that, uh, if we, if we start, if we start with my place where, you know, a lot of the student debt should be forgiven and then, and then, and then reform. And then we'll see how many people are willing to lend, you know, how, how much, how many of the colleges can pay for all the students?

SPEAKER_109: What's your, what's, what's your sense? If, if it was a totally free market system, how many colleges would shut down because they wouldn't be able to, so there's no tuition support.

SPEAKER_76: So it, it, it probably would be a lot smaller.

SPEAKER_23: It, it, it might, it might, it, you might not have to shut them down because there's, you know, a lot of them have gotten extremely bloated. It's like Baumol's cost disease where, you know, I don't know if you, I have no idea. Like a place like UCLA, it probably has, you know, twice or three times as many bureaucrats as they had 30, 40 years ago. So there's sort of all, there's sort of all these sort of, um, parasitic people that have sort of, uh, gradually accrued. And, uh, and, um, and, and so there's probably a lot of, there would be a lot of rational ways to dial this back. But, um, but yeah, um, you know, maybe we're going to need a new location for next year.

SPEAKER_146: If the only, if the only way to lose weight is to cut off your thumb, that's kind of a difficult way to go on a diet.

SPEAKER_15: So, um, Peter, three of your collaborators, long-time collaborators, uh, Elon Musk, uh, Mark Zuckerberg, and, uh, Sam Altman are arguably the three leading AI language model, um, leaders. Which one is going to win? Rank them in order and tell us a little bit about each.

SPEAKER_152: Peter said he would answer any question. I said he would take any question. I didn't say to answer any questions. You said, you would honestly, you said today you felt extremely honest and candid. So let's. Uh, I, I, yeah, but I've already been extremely honest and candid.

SPEAKER_23: So I think I've been honest talking. Quote about. It's, it's, it's, it's whoever I talked to last. Okay.

SPEAKER_24: Well, okay, why don't you. They're all very, very convincing people. So, you know, I. Great answer. I don't know. I, I think, um, I think it was, uh, the idea that Sam Altman was getting away with turning open AI from a nonprofit into a for-profit. That was such a scam. If everybody was allowed to do this, everybody would do this, uh, that it has to be totally illegal what Sam's doing and it shouldn't be allowed at all. And that seemed really, really convincing in the moment. And then sort of half an hour later, I, I thought to myself, but you know, actually, um, man, it was, it's been such a horrifically mismanaged place at open AI with this preposterous nonprofit board they had. Nobody would do this again.

SPEAKER_23: And so there actually isn't much of a moral hazard from it. So, but yeah, whoever, whoever I talk to, I find very convincing in the moment.

David Sacks: Will that space just get commoditized? I mean, do you see a path to a monopoly there?

SPEAKER_70: Well, again, this is, this is again where, you know, you should, you know, attention is all you need. You need to pay attention to who's making money. It's NVIDIA. It's, it's the hardware, the chips layer. And, um, and, um, and then that's just, it's just what we, you know, it's not what we've done in tech for, for 30 years.

SPEAKER_109: Are they making 120% of the profits?

SPEAKER_23: They're, they're making, they're, I think everybody else is losing money collectively. Yeah. Everyone else is just spending money on, on the computer. So it's, it's one, it's one company that's making, I mean, maybe there's a few other people that are making some money.

SPEAKER_167: I mean, I assume TSMC and ASML, but, but, uh, but, uh, yeah, I think everyone else is collectively losing money.

SPEAKER_15: What do you think of Zuckerberg's approach to say, I'm so far behind, this isn't core to my business. I'm going to open source it. Um, is that going to be the winning strategy? Candy cap that for us.

SPEAKER_121: Um, again, I, I, I, I, I, I, I would say, um, my, again, my, my, my, my big, my, my big qualification is, you know, my model is AI feels like it does feel uncomfortably close to the bubble of 1999.

SPEAKER_23: So I'm, we haven't invested that much in it. Um, and, uh, I, I, I want to have more clarity in investing, but, uh, but the, the, uh, the simple simplistic question is, you know, who, who's going to make money? Um, you know, I think a year ago, two years ago, in retrospect, NVIDIA would have been a good buy, you know, I think at this point, everybody it's, it's, it's, it's sort of too obvious that they're making too much money. Everyone's going to try to copy them on, on the chip side. Maybe that's straightforward to do. Maybe it's not, but, but that's, you know, I'd say probably, um, you should, you should, if you, if you want to figure out the AI thing, you should, you should not be asking this question about, um, you know, meta or, um, open air or any of these things. You should really be focusing on the NVIDIA question, the chips question. And the, and the fact that we're not able to focus on that, that, that tells us something about how we've all been trained.

SPEAKER_70: You know, I think NVIDIA got started in 1993. Yeah. I believe that was the last year where anybody in their right mind would have studied electrical engineering over computer science, right? 94 Netscape takes off. And then, yeah, it's probably a really bad idea to start a semiconductor company, even in 93. But the benefit is there was going to be, no one would come after you. No, no talented people started semiconductor companies after 1993, because they all went into, you know, into software.

SPEAKER_69: Score their monopoly power.

SPEAKER_29: Um, it's, I, I, I think it's quite strong because this, this, this history that I just gave you where none of us know anything about chips.

SPEAKER_23: Um, and then I think the, you know, I think the risk, it's always, you know, if attention is all that you need, um, the qualifier to that is, you know, when you get started as an actress, as a startup, as a, as a company, you need attention.

SPEAKER_70: Then it's desirable to get more, and at some point, attention becomes the worst thing in the world.

SPEAKER_23: And, uh, and there was the one day where NVIDIA had the largest market cap in the world earlier this year. And I do think that represented a phase transition. Once that happened, they probably had, um, more attention than was good.

SPEAKER_46: Hey, Peter, as we wrap here, um, your brain works in a unique way. You're an incredible strategist. You think, you know, very differently than, uh, a lot of the folks, um, that we get to talk to, um, with all of this, are you optimistic for the future?

SPEAKER_29: Uh, I, I always, man, I always push back on that question.

SPEAKER_23: I, I, um, I think, I think extreme optimism and extreme pessimism are both really bad attitudes and they're somehow the same thing, you know, extreme pessimism, nothing you can do, extreme optimism, the future will take care of itself. So if you, if you have to have one, it's probably, you want to be somewhere in between, maybe mildly optimistic, mildly pessimistic. But, uh, you know, I, I believe in human agency and that it's up to us and it's not, you know, it's not some sort of winning a lottery ticket or some astrological chart that's going to decide things. And, uh, I believe in human agency and that's, uh, sort of an axis that's very different from optimism or pessimism. What a great place. Extreme optimism, extreme pessimism. They're both excuses for laziness.

SPEAKER_173: What an amazing place to end. Ladies and gentlemen, give it up for Peter Thiel. Thank you. Thank you, Peter. Come on now. Thanks, guys.

SPEAKER_175: Wow.

SPEAKER_173: Peter Thiel.