# SpaceX IPOs at $2.89T Market Cap, US Govt Suspends Fable & Mythos 5, Altman Delays OpenAI’s IPO |265

https://www.youtube.com/watch?v=BX9ofqxmeYw

[00:00] On Friday, SpaceX pulled off the world's
[00:02] largest IPO ever. This makes Elon the
[00:05] world's first trillionaire by a large
[00:08] margin.
[00:08] >> Money becomes kind of irrelevant at this
[00:10] scale.
[00:11] >> SpaceX's IPO was the largest single day
[00:15] creation of millionaires in history.
[00:16] This is what abundance looks like. It's
[00:19] value created, not value extracted.
[00:22] US government handed Anthropic an export
[00:25] control directive to spend all access to
[00:27] the Fable 5 and Mythos 5 for any foreign
[00:30] nationals anywhere on the planet.
[00:32] >> Look, at the end of the day, who owns
[00:34] AI? Is it the government or is it the
[00:36] corporations?
[00:37] >> Someone is deciding what level of
[00:40] intelligence you and your company
[00:42] >> [music]
[00:42] >> are being allowed to access.
[00:44] >> This is new territory. The faster that
[00:46] recursive [music] self-improvement takes
[00:48] off, the more it could be advantageous
[00:51] for us to delay OpenAI's IPO.
[00:54] >> A deeper take [music] that's more
[00:56] profound that I haven't heard anyone
[00:58] discussing, which is
[01:02] >> Now, that's a moonshot, ladies and
[01:03] gentlemen.
[01:07] Everybody, welcome to Moonshots. I'm
[01:08] here with my extraordinary moonshot
[01:10] mates. I'm Peter Diamandis, your host.
[01:13] Alex, good morning. Good to see you in
[01:14] your normal haunt.
[01:16] Salim, the same to you.
[01:17] >> Peter.
[01:18] >> It is.
[01:19] >> going on.
[01:20] >> [laughter]
[01:21] >> Understatement uh of the singularity.
[01:24] And Dave, where are you today?
[01:26] >> Uh Wakefield, Mass. That's Mark
[01:28] headquarters. $2 trillion asset manager.
[01:31] >> Nice. Well, $2 trillion is small these
[01:32] days, you know?
[01:33] >> I know. It used to be such a big
[01:35] situation.
[01:36] >> [laughter]
[01:36] >> Can't even buy a single IPO now.
[01:39] >> As always, during the singularity, we
[01:41] have an epic show for you. The world is
[01:43] moving fast. I would dare say
[01:45] exponential. We're going to start with
[01:47] the biggest news of the week. SpaceX is
[01:49] now a $2.8 trillion public company.
[01:53] Moving exponentially, making Elon the
[01:55] first trillionaire by a wide margin. We
[01:59] talked about why this isn't a stock, but
[02:01] rather a civil civilizational bet.
[02:04] Next up, we're going to talk about
[02:05] Anthropic versus the US government
[02:07] ordering the suspension of Fable 5 and
[02:09] Mythos 5. This is really a fight for who
[02:13] controls your access to frontier
[02:15] intelligence. We'll hit on OpenAI's
[02:18] price war, Altman's thoughts about
[02:20] recursive self-improvement, potentially
[02:22] delaying his IPO, and much, much more.
[02:25] All right, gents, let's get into it.
[02:27] SpaceX, the key story, super excited
[02:31] about this. I hope you guys are, too. On
[02:33] Friday, SpaceX pulled off the world's
[02:35] largest IPO ever, opening at $135 a
[02:39] share, closing the first day nearly up
[02:41] 20% to 161. Today's market cap, just
[02:45] looking at it here, it's now at 2.890
[02:49] trillion dollars. You know, at this
[02:51] point, third and fourth point decimal
[02:53] point make make a difference. Open This
[02:56] makes Elon the world's first
[02:58] trillionaire by a large margin.
[03:01] I'd like to jump into the IPO with my
[03:03] own thoughts to kick it off cuz I've
[03:05] been doing a bunch of
[03:07] new shows about this. You know, people
[03:09] are trying to price the SpaceX IPO as a
[03:13] normal tech company, but it's the last
[03:15] thing from a normal company. This is
[03:17] three converging businesses, right? The
[03:19] launch monopoly, and it is a monopoly.
[03:22] It's the Starlink cash engine, and it's
[03:25] an AI frontier lab. All wrapped around a
[03:27] single thesis that we're in the
[03:29] singularity, and humanity's about to
[03:31] become a multi-planetary species.
[03:33] In this case, you're not buying revenue,
[03:35] you're buying a stake in sort of the
[03:38] future of humanity's economy. Everyone's
[03:41] fixated on rockets, but Starlink is the
[03:44] profit engine. The numbers are stellar,
[03:47] right? 10 billion subs and over a
[03:49] billion dollars in quarterly profits.
[03:52] Starlink, you know, and Alex, you and I
[03:54] have discussed this. It's humanity's new
[03:56] communication layer. It's sort of
[03:57] civilizational infrastructure. And I
[04:00] think of it this way, the launch
[04:02] business is their moat by a huge amount.
[04:05] There's no one close by a factor of 10,
[04:07] maybe by a factor of a hundred. Starlink
[04:10] is their cash flow and the AI satellites
[04:13] are their future. It's one ticker and
[04:15] three exponential curves.
[04:18] Uh Elon now holds about 82% voting
[04:21] control in SpaceX, but not at Tesla. And
[04:24] for me, this is the rationale and the
[04:26] reason that he is going to merge the two
[04:29] companies, SpaceX and Tesla. I put it at
[04:32] 100%. Polymarket puts it at 37% that it
[04:35] happens by the end of this year. You
[04:38] know, this is Elon's chance to really
[04:40] consolidate his entire stack, energy,
[04:43] robots, cybercabs, orbital compute into
[04:45] one mega company.
[04:47] Uh
[04:48] I think of the IPO last Friday not as a
[04:51] finish line, but as a starting gun.
[04:54] Uh if it's okay with you guys, let me
[04:56] share a short video about Elon and his
[04:59] opening comments and we'll go around the
[05:01] horn. You guys can add your brilliance
[05:04] to this. All right, let's take a quick
[05:06] look.
[05:06] >> It's hard to believe that a little
[05:09] company that started in a warehouse in
[05:12] El Segundo is now is now going public
[05:15] with the largest IPO ever. And let me
[05:17] tell you, if people had told me this was
[05:19] going to happen, I was like, man, you
[05:21] must be smoking some really good crack
[05:23] because I think this company's going to
[05:25] fail. I mean, I I I I gave SpaceX less
[05:29] than a 10% chance of succeeding at all.
[05:33] To be clear. In fact, I told people
[05:35] this. I was like, we're probably going
[05:36] to fail, but you know, should give it a
[05:37] try because if we don't, if it if
[05:40] there's not a new company that enters
[05:41] space, we will never be a truly
[05:43] space-faring civilization. You know,
[05:45] while the the other aerospace companies,
[05:47] they build good rockets and everything,
[05:48] they they were simply not pursuing the
[05:50] technology that's necessary to make life
[05:53] multi-planetary. To to make Star Trek,
[05:55] to make the exciting science fiction
[05:58] futures that we've read about real. And
[06:01] that's what SpaceX is all about. It's to
[06:03] take the fiction out of science fiction
[06:05] and create an exciting, inspiring future
[06:08] for everyone.
[06:10] >> That was Elon at his very best.
[06:14] Gentlemen, thoughts? Alex, you want to
[06:15] jump in? Exciting times, huh?
[06:18] >> Yes. Uh I think this is an exciting
[06:20] moment to finally get retail investor
[06:24] access to the Dyson swarm. I've made the
[06:26] point previously at drink, by the way.
[06:29] Dyson swarm probably record early
[06:31] mention in the pod episode. Drink water.
[06:34] Um I I I think it's great for retail
[06:37] exposure to the Dyson swarm. I think
[06:39] it's great that the world now has a
[06:42] trillionaire. I think we need more
[06:44] trillionaires in the world, and I don't
[06:45] think Elon is going to be the last, for
[06:48] the record. I think it's great that
[06:50] SpaceX, as of the time of this
[06:52] recording, is now the fifth largest
[06:54] company in the world. It's larger than
[06:56] Amazon now, in the past few hours, by
[06:58] market cap. I think it's great that we
[07:01] finally have a way for public markets to
[07:05] invest in the development of our solar
[07:08] system. I think also, just
[07:11] within past couple of hours, SpaceX
[07:14] announced definitive agreement to
[07:16] consummate its purchase of AnySphere,
[07:18] the corporate owner of Cursor, for 60
[07:21] billion plus. So, I I think we're going
[07:24] to start to see all of the liquidity
[07:26] that comes from being the new fifth
[07:28] largest company in the world
[07:30] used to purchase a variety of of
[07:33] different companies doing interesting
[07:35] things. Footnote,
[07:37] this is I I would say, in my mind, a
[07:40] definitive pause on the development of
[07:42] Grok, which we've talked about
[07:44] previously. Cursor is the new Grok for
[07:47] the time being.
[07:49] But most of all, I would say it it's
[07:51] nice to see science fiction take over
[07:54] the public markets. We've talked in the
[07:56] past about how the singularity
[07:59] represents every sci-fi trope happening
[08:02] everywhere all at once, and having now
[08:04] the fifth largest company on Earth be
[08:08] the space exploration company, it's
[08:10] almost it evokes Weyland-Yutani
[08:13] from the Alien franchise. We finally got
[08:17] Weyland-Yutani. It's called or or the
[08:19] Gattaca corporation if if you like
[08:20] Gattaca the movie. We finally got it,
[08:23] and it's going to be transformative, and
[08:26] it heralds the arrival of space in the
[08:29] public markets. Yes, we had Rocket Lab,
[08:32] we've had a number of other publicly
[08:34] traded space companies,
[08:36] >> Let us not Let us not forget, you know,
[08:38] Lockheed Martin and
[08:41] and Boeing. Yeah.
[08:42] >> Legacy space. Now we have neo space.
[08:46] Space, as it turns out, is big.
[08:49] >> Yeah.
[08:50] Dave, what do you think this is going to
[08:51] herald? We're seeing now trillion-dollar
[08:53] companies coming from out the shoot from
[08:55] an IPO. What do you think this is going
[08:57] to herald for OpenAI and Anthropic's
[09:00] IPO?
[09:02] >> Well, the market obviously is receptive
[09:04] now. OpenAI is talking about potentially
[09:07] delaying, which is not great
[09:09] uh because the window you know, there's
[09:12] only so much liquidity in the world.
[09:13] This sucked up 75 billion of pure cash.
[09:16] Uh I agree with Alex. It's incredibly
[09:17] exciting to see that much money, that
[09:19] much resource go behind SpaceX. They're
[09:21] clearly going to use it and use it
[09:23] quickly to build great things. Um
[09:26] I think a lot of people are warning that
[09:28] 6 months from IPO day the lockups come
[09:30] off.
[09:31] >> Yeah.
[09:32] >> And about a trillion dollars of
[09:33] [clears throat] pent-up stock is
[09:35] eligible to sell. So, you know, there's
[09:37] a lot of accumulation going on right
[09:39] now. I think they priced where they
[09:40] thought the company was worth and it
[09:42] traded up significantly on the opening,
[09:44] but now it's up even more.
[09:46] >> Well, I mean it it it traded up on
[09:48] opening day uh yesterday, Monday, and
[09:50] it's open it's up again, you know, I
[09:53] don't know. It was up as much as like
[09:55] 20%. It's uh up 12% at the moment today.
[09:59] I mean, that's incredible 3 days in a
[10:01] row.
[10:02] >> It is and I think I think, you know,
[10:03] they I'm super excited about the Dyson
[10:05] swarm. I think there are two things that
[10:07] people need to think about. First of
[10:08] all, the the company is entirely hinging
[10:10] on the personality of one great man.
[10:12] >> Mhm.
[10:13] >> Uh and and you saw what happened with
[10:15] Apple with Steve Jobs leaving and then
[10:16] Steve Jobs coming back and, you know,
[10:18] Elon is like Steve Jobs times some huge
[10:21] multiple. And so, you've got that to
[10:23] think about. The other thing is the
[10:24] Kessler effect, you know, in the S-1
[10:26] filing, they had a very explicit
[10:28] warning. It said um
[10:30] "Growing orbital congestion and
[10:32] cascading debris collisions pose an
[10:34] existential threat to its core business,
[10:36] potentially rendering its licensed
[10:38] orbits unusable for a considerable
[10:39] duration." Considerable duration being
[10:42] hundreds of years.
[10:44] >> Or until the tech to clean it up, right?
[10:46] >> Yeah. So, as I was researching the
[10:47] Kessler effect a little bit, you know a
[10:48] lot more about it than than I do or most
[10:50] people on the planet do, Peter.
[10:52] Uh but
[10:54] it's not a great picture if somebody's
[10:56] deliberately trying to impair space.
[10:59] >> And that, you know, anti-satellite
[11:00] missiles uh
[11:02] and, you know, space warfare is the
[11:04] challenge and the you know, when a
[11:06] single satellite is exploded into, you
[11:09] know,
[11:10] hundreds of millions, billions of
[11:12] pieces, they're speeding bullets at
[11:14] 17,500 mph. And if they hit another
[11:17] satellite, it grows exponentially and
[11:19] that is the Kessler effect. You know.
[11:21] >> Yeah, and the [clears throat] Kessler
[11:22] math uh comes up with a certain amount
[11:23] of mass at a certain orbit, you know,
[11:26] where it becomes critical mass where if
[11:27] one explodes, the whole thing becomes a
[11:29] chain reaction.
[11:30] And so, we're over that limit by quite a
[11:33] bit in lower Earth orbit now.
[11:35] So nobody knows if the math is right or
[11:36] not, you know, you'd have to test it.
[11:38] >> Do you remember we talked to you
[11:40] we talked to Elon about this when we
[11:41] were at the Gigafactory and his response
[11:44] was basically, you know,
[11:46] advanced super intelligence will enable
[11:49] us to figure that out. And
[11:51] that's kind of a I mean, yes, that's
[11:54] true. It's not satisfying as an answer.
[11:58] But, you know.
[11:59] >> Well, I I think
[12:01] the other the other kind of wrinkle in
[12:02] this is that where is the AI component
[12:04] the XAI component? You know, clearly
[12:06] with Anthropic and Open AI going out,
[12:08] the XAI component is worth trillions by
[12:11] itself if it's a competitive foundation
[12:13] lab.
[12:14] Where is it? And Alex has pointed out
[12:16] like it's it's completely MIA right now.
[12:19] So so that was kind of a wrinkle on it,
[12:22] too. So I think the strategy here is
[12:24] dependent on orbital data centers in the
[12:26] coming to the Dyson swarm.
[12:27] And that amount of compute the terrafab
[12:30] coming online that amount of compute way
[12:32] dwarfing terrestrial compute and then AI
[12:38] Um
[12:39] I would not bet against terrestrial data
[12:41] centers anytime soon.
[12:44] Uh we're just debating timelines there.
[12:46] But AI is advancing at an incredible
[12:48] rate. All of that advancement is going
[12:50] to be terrestrial because it's over the
[12:51] next 2 years, not next 7 years.
[12:54] Uh and then so you know, there's lots of
[12:56] reasons to say this is an incredible
[12:58] IPO. I'm super excited about where the
[13:00] capital is going and what it's going to
[13:02] build. But there's also reasons to save
[13:04] your money and wait for Anthropic. So
[13:07] uh so yeah, it's it's not a at this
[13:08] price point. Like I'm if if you said
[13:10] this is coming out at a trillion, I'd be
[13:11] just overjoyed and a buoyant and like
[13:13] this is the greatest thing ever. When it
[13:16] trades up to 3 trillion and you said a
[13:17] second ago they got like a billion
[13:19] dollars a quarter of free cash flow.
[13:21] Well, Google is worth the same amount
[13:24] and Google's got 300 billion a year of
[13:26] almost pure margin. So, not quite on the
[13:29] same playing field yet.
[13:31] >> By the way, I know that you're busy and
[13:33] sometimes these episodes run long and
[13:35] you don't have time to listen to the
[13:36] whole episode or if on occasion you miss
[13:38] an episode, I now put out a moonshot
[13:41] summary on Substack which includes a
[13:43] link to all the stories that we cover.
[13:45] The weekly recap covers what I and the
[13:47] mates had to say, what we think is most
[13:49] important and what we're most excited
[13:51] about and it's free. You can subscribe
[13:54] at d amandis.com/metatrends.
[13:57] That's d amandis.com/metatrends.
[14:00] All right, now back to the episode.
[14:02] >> Salim, are you buying in?
[14:05] >> Um
[14:06] yes, but just to kind of dabble. Um I
[14:09] don't know how to think about this. I've
[14:11] got a bunch of kind of thoughts. For me
[14:13] this is
[14:14] not really just an IPO as we've kind of
[14:16] mentioned. This is the public market
[14:18] pricing in a civilizational EXO, right?
[14:20] You're really buying into the future of
[14:23] the world in this Alexa space is really
[14:25] big. SpaceX from day one has been a
[14:27] perfect exponential organization, huge
[14:29] MTP. It's got community, it's got
[14:31] leveraging assets, algorithms,
[14:34] all in a relentless like experimentation
[14:37] loop. So, this is kind of just a
[14:40] capstone on a long progression of
[14:42] companies that are operating in highly
[14:46] scalable ways, right? So, this is also
[14:50] this occurs to me the market's not like
[14:53] now pricing companies just on cash flow.
[14:56] It's it's
[14:57] command over exponential technologies.
[15:00] And launch satellites, so space
[15:02] logistics, orbital data gathering, all
[15:04] of that stuff. So, we used to have
[15:06] public companies that that sold
[15:08] products, but now we have public
[15:10] companies that own entire possibilities,
[15:13] right? So, really buying into that
[15:14] possibility. And so, there's some risk
[15:17] there. I have a kind of a very bigger
[15:19] metaphysical question. I think at some
[15:21] point fairly soon as this progresses,
[15:24] money becomes kind of irrelevant at this
[15:26] scale.
[15:27] >> And he said And he said that.
[15:28] >> hundreds of billions here and a trillion
[15:30] there. So, we can't We can't even get
[15:32] our heads around this. Meanwhile, you
[15:34] know, at the other side of it, I've had
[15:36] a whole bunch of things of people going
[15:38] you know, I can't believe you're not
[15:39] looking at the downside of What does
[15:41] this mean for every man? We can't even
[15:43] afford eggs, etc., etc. And what do you
[15:46] think of the the wealth arbitrage there?
[15:48] And we'll get to that later in the pod,
[15:50] I think. So, I'll I'll leave that for
[15:51] then.
[15:52] >> But but unbelievably exciting and
[15:54] >> I mean, there's all these comments about
[15:57] the Oh my god, look at all the wealth
[15:59] he's pulled off. People forget and we
[16:01] keep We need to keep reminding of of the
[16:03] unbelievable risk that he took on.
[16:06] >> Yeah, in 2020
[16:07] >> So
[16:08] many things. So, you got to go for it.
[16:10] >> So many things in this podcast today
[16:12] that call for some kind of global
[16:16] restructuring, some kind of global
[16:17] organization. You think about the risk
[16:19] in space of any kind of terrorist act,
[16:21] which we just talked about with the
[16:22] Kessler effect. And you also think about
[16:24] the stories we're about to talk about.
[16:26] All of them require a global new world
[16:28] order of some sort urgently. So, I think
[16:31] this IPO will go down in history as one
[16:32] of the great events in the triggering
[16:34] from the old world to the new world
[16:36] along with the rest of the stories. All
[16:37] of All of which stacked up in a single
[16:39] week. It's the most intense week of news
[16:41] I think I've ever seen in my life.
[16:43] >> It It is. It's insane. You know,
[16:45] >> The implications are unreal. I called it
[16:47] the singularity for a reason.
[16:50] >> It It It It is. And
[16:53] I remind myself of that every day.
[16:54] There's one thing I want to point out
[16:55] the video Elon
[16:57] said something that really strikes my
[17:00] heart, which is it's important for
[17:02] people to wake up every day and be
[17:04] excited about the future.
[17:06] Have some vision that inspires them. And
[17:10] you know, [snorts] we've talked about
[17:11] Star Trek as being that inspiration
[17:13] for a number of us. And I think, you
[17:16] know, I think SpaceX will very much
[17:19] very much do that.
[17:20] >> Let's really also, Peter, for all the
[17:22] entrepreneurs out there, there are these
[17:23] great videos of Elon when he was first
[17:25] starting SpaceX,
[17:27] you know, many, many years ago talking
[17:30] about his vision of the future which
[17:31] boiled down to three things: the
[17:33] internet,
[17:34] getting to Mars, humans getting to Mars,
[17:36] and solar power replacing fossil fuels.
[17:40] And so now you look at what has actually
[17:42] transpired, you know, it's orbital data
[17:45] centers, Mars is on [clears throat] the
[17:47] back burner for a while.
[17:49] And self-driving cars have been added to
[17:51] the mix, you know, the the
[17:53] electrification of the economy turned
[17:55] into self-driving cars. So there's a lot
[17:56] of pivoting and extending in that life
[17:59] journey and I think that's really
[18:00] healthy. That's really it's a good case
[18:01] study in how it plays out, you know, you
[18:04] have to keep improving and pivoting and
[18:05] changing your vision because technology
[18:08] is always changing and possibilities are
[18:10] always changing. But to me the the
[18:11] addition of AI, xAI on very short notice
[18:15] and now the orb- orbital data center
[18:16] vision,
[18:18] huge additions to his life strategy over
[18:20] time.
[18:20] >> I I posted a video, you know, I've known
[18:23] Elon since you know, 2000 and back in
[18:26] 2002, I brought him to Mojave
[18:30] to go and and meet Burt Rutan and Stu
[18:33] Witt and I remember the this video I
[18:35] posted. I might have mentioned in the
[18:36] last pod as well where he's walks up to
[18:38] the camera and introduces himself and he
[18:40] goes, "My name is Elon Musk, e l o n m u
[18:44] s k."
[18:44] >> It's just classic.
[18:46] >> But people forget in 2008, Elon was you
[18:50] know, basically bankrupt. He's going
[18:52] through divorce, he had had his third
[18:54] failure of the Falcon 1,
[18:57] Tesla was out of money,
[18:59] and he was in the depths of despair and
[19:02] what he's accomplished since then,
[19:04] I
[19:05] just wonder
[19:06] Alex if if some of the alien,
[19:09] you know,
[19:10] visited him and gave him a
[19:13] glimpse of the future.
[19:14] >> Now, I think Elon's learned to like the
[19:16] taste of his own blood, and what we're
[19:18] seeing is in part the result of that. I
[19:21] also think so right after he became a
[19:23] trillionaire, I put out a question to
[19:26] number of folks on X.
[19:28] When are we likely to see Earth's first
[19:30] or say the solar system's first
[19:32] quadrillionaire? And a number of folks
[19:34] actually took the assignment seriously
[19:36] and did a bunch of extrapolations.
[19:38] >> Answer it.
[19:39] >> Uh the answer ended up being a range
[19:41] between either sometime in the late
[19:44] 2030s, so possibly a decade from now,
[19:47] and the 2060s.
[19:49] Uh and so some folks did it base did the
[19:51] extrapolation based on the the highest
[19:54] net worth individual in humanity over
[19:57] time. Other folks were simply doing
[19:59] extrapolations of Elon's own net worth,
[20:02] but seems likely based on those
[20:04] extrapolations and the law of straight
[20:06] lines that we'll see the first
[20:07] quadrillionaire sometime between 10
[20:09] years from now and 40 years from now.
[20:12] And a question I'd pose to this group
[20:15] conditioning on
[20:17] the first quadrillionaire happening in
[20:19] the next 10 to 20 years, what do we
[20:21] think the likely source of quadrillion
[20:25] wealth is?
[20:26] >> Asteroid mining, owning owning a planet.
[20:29] >> [laughter]
[20:29] >> Owning a planet was the popular guess.
[20:31] Yeah, like someone maybe Elon, maybe
[20:33] someone else like owns de facto Mars,
[20:36] and and that's how you become a
[20:37] quadrillionaire.
[20:38] Uh let me put up
[20:40] >> this next slide. Uh you know, there's
[20:41] been a lot of talk about Elon now being
[20:43] worth in excess of 1.3 trillion. I think
[20:46] as of this morning, it's probably about
[20:47] 1.4 trillion. Uh you know, he's made
[20:50] over 100 million dollars a day over the
[20:52] last 3 days just as the stock price has
[20:53] gone up, but I want to push back on this
[20:56] trillionaire framing cuz I think it's a
[20:57] distraction. The real story isn't one
[21:00] man getting rich. You know, SpaceX's IPO
[21:03] was the largest single-day creation of
[21:06] millionaires in history, right? Roughly
[21:08] 4,400 SpaceX employees became
[21:11] millionaires, another 400 became
[21:12] centimillionaires and billionaires. And
[21:15] this is what abundance looks like. It's
[21:17] value created, not value extracted. And
[21:21] I think that's the most important thing
[21:22] for people to realize. Elon's not
[21:25] motivated by money. I'm very clear about
[21:27] that. I think you guys are, too. He's
[21:29] motivated by solving real giant
[21:32] problems. And you know, the world's
[21:34] biggest problems are the world's biggest
[21:35] business opportunities. I like to say,
[21:37] "Want to become a billionaire? Help a
[21:38] billion people."
[21:40] And And that's what he's done. And I say
[21:44] to everybody who has bet against him,
[21:46] you know, don't ever ever ever bet
[21:48] against Elon.
[21:50] Saleem, thoughts on this?
[21:52] >> A couple of things. One is, I think, you
[21:54] know, the the the the
[21:56] the fact that he's a trillionaire or
[21:59] quadrillionaire, I think, is kind of
[22:00] meaningless. The more important point at
[22:02] these numbers, what are you going to do
[22:04] with that money except solve more
[22:05] problems, which is, I think, with the
[22:07] core motivation. His interest in is in
[22:10] solving the biggest problems in the
[22:11] world. And if he applies that
[22:14] capital and wealth to that,
[22:16] that is, I think, very very powerful.
[22:19] And
[22:20] it's going to take that kind of model to
[22:23] to kind of get us get somebody thinking.
[22:25] I think that, you know, Peter, you often
[22:27] talk about mindsets, right? And let's
[22:29] note Elon's mindset. He uses the
[22:31] exponential mindset a huge amount. He
[22:34] will look at a technology that's going
[22:35] exponentially, be it solar energy,
[22:38] lithium-ion battery costs dropping, or
[22:40] neural interfaces. And he'll look 10
[22:42] years out, where will that be on a
[22:43] price-performance curve? And then let's
[22:45] build a company to intercept that price
[22:47] performance. He just does that over and
[22:49] over again. Non-trivial to last the 10
[22:51] years, but when you can take on that
[22:53] mindset, which is what we coach and
[22:54] teach all the time, that's what's This
[22:56] is what's possible. And if there's going
[22:59] to be a bifurcation of entrepreneurs
[23:01] that think this way, and ones that don't
[23:04] aren't able to think that way and the
[23:05] winners are clearly going to be the ones
[23:07] that are able to execute with that
[23:09] mindset.
[23:10] >> Um
[23:10] >> Yeah, check out the Check out this
[23:11] graphic one second, Selene. Look at
[23:13] this. Elon's at 1.3 trillion. Next up,
[23:16] Larry Page. And again, I've said this. I
[23:19] I love Larry. I knew him well. He's on
[23:21] my board for a significant period of
[23:23] time. Uh but what I find amazing when
[23:26] you look at Larry and Sergey and
[23:28] compared to Elon,
[23:29] Jeff Bezos is not as much, but Elon's
[23:31] using this money, like you just said, to
[23:33] go solve huge problems. And I wish, you
[23:36] know, Michael Dell's been
[23:37] philanthropically super active. Um I I
[23:41] wish these other, you know,
[23:42] multi-multi-billionaires were using
[23:44] their capital to go slay problems. You
[23:48] know, Elon, if you're listening, here's
[23:50] my Here's my pitch to you. You You
[23:52] funded a $100 million X Prize for carbon
[23:54] removal. I think we should fund the next
[23:57] uh giga X Prizes. How about $10 billion
[24:01] X Prizes for the world's biggest 10
[24:04] problems?
[24:06] That's going to be my pitch.
[24:07] >> Yeah.
[24:08] >> Well, we have We have a really cool uh
[24:10] Irish team in the lab this week for our
[24:12] hackathon. Yeah, they were just awesome.
[24:15] Um but they were asking me yesterday
[24:16] about uh you know, is there any chance
[24:18] for Europe?
[24:20] Uh
[24:20] and I was like, well, look,
[24:22] I wouldn't bet on it. I would spend all
[24:24] your time in the US because the
[24:25] concentration of wealth effect is just
[24:27] extreme now. And even within the US, uh
[24:30] you know, you just mentioned it, Peter,
[24:31] but it's in just a couple of geographies
[24:34] that all that money is flowing. So, if
[24:35] anyone's a real estate investor or or
[24:37] looking for venture capital, you really
[24:39] got to think, like, where is all this
[24:40] money flowing to and how's it going to
[24:42] recycle? But it's super, super
[24:44] concentrated. But then if you think
[24:46] about Europe or any other region of the
[24:47] world trying to catch up to what's going
[24:49] on here,
[24:50] the amount of capital now that that Elon
[24:53] has, but also Larry and also Jensen, you
[24:56] know, down the list there,
[24:58] A lot and Michael Dell, too. A lot of
[24:59] that's getting reinvested in data center
[25:01] build out.
[25:02] But the people reinvesting it are
[25:03] incredibly great entrepreneurs. They're
[25:05] not dysfunctional bureaucrats.
[25:08] >> Yeah.
[25:08] >> I don't see anyone in the world, any
[25:10] country in the world
[25:11] that has the amount of capital that's on
[25:13] that chart as a country.
[25:15] >> Yeah.
[25:15] >> And yet and they can't make decisions
[25:17] like, you know, as a group. And Elon and
[25:20] Larry and the rest of that list can make
[25:23] decisions. Jensen, they can make
[25:24] decisions on a on a dime. So you're
[25:27] going to expect more and more action to
[25:29] happen around those couple of
[25:30] geographies just in the US.
[25:33] I mean, the unlock is unbelievable.
[25:35] >> We'll talk about this more and we've
[25:36] touched on this before, but we need a
[25:39] completely new
[25:41] abundance distribution architecture for
[25:43] the world because the social contract is
[25:45] going to break now.
[25:47] And the gap is unbelievable. So we need
[25:50] a completely new model for this and we
[25:51] really don't have one. The We don't even
[25:53] have the language to deal with this.
[25:54] Forget these structures and policies.
[25:57] >> But I'm I'm super within the US, I'm
[25:58] super excited about the rate at which
[26:00] the ceiling is going to rise. Yes, it
[26:02] creates a huge disparity and yes, that's
[26:03] a problem, but the ceiling is going up
[26:06] so fast within the US that the bottom's
[26:08] going to come up really fast, too.
[26:09] >> is floor is going to rise as well,
[26:11] right? You know, I've said this thousand
[26:13] times. I don't care about the wealth gap
[26:16] per se if there trillionaires living on
[26:18] Mars as long as the floor has risen up
[26:21] to the bottom
[26:22] >> to the point that every man, woman, and
[26:24] child has access to all the food, water,
[26:25] energy, health care. I would rather live
[26:27] in that world than a world in the past.
[26:30] Alex, you want to close us out on this
[26:31] topic?
[26:31] >> Yeah, I'll I'll just note if you look at
[26:34] the other centibillionaires on that list
[26:36] you were showing, Peter, by and large,
[26:39] it was all software associated or
[26:41] software driven. And there's certainly a
[26:44] narrative out there of a great
[26:46] stagnation, Tyler Cowen and others have
[26:48] talked about this ad nauseam. And I I
[26:51] think if I were to pinpoint an end of
[26:54] the purported great stagnation, there
[26:56] really only two candidates at this
[26:58] point. One was the pandemic when
[27:00] arguably we saw breakthroughs in biotech
[27:03] and acceleration associated with all of
[27:06] the the macroeconomic stimulus
[27:07] associated with that. But the second
[27:09] would be this moment when finally we see
[27:13] after arguably decades of capital
[27:15] markets rewarding mainly software
[27:18] companies and social media and search
[27:21] engines, now the world's by far
[27:24] wealthiest person, although Elon's been
[27:26] wealthiest for for a bit,
[27:28] the capital markets are rewarding hard
[27:31] tech for the first time arguably in
[27:34] decades. And I think this is a
[27:35] generational transition
[27:37] under which it's no longer the case that
[27:39] software on the one hand or outsourcing
[27:43] to China or other countries or
[27:44] offshoring has sucked all of the capital
[27:47] energy out of the room, all of the
[27:48] oxygen out of the room, but rather that
[27:51] the world's hardest problems are now
[27:53] receiving the deepest capitalization.
[27:55] >> Brilliant point, Alex.
[27:56] >> And I think that's that's we're going to
[27:58] see this This is not investment advice,
[28:01] but I would predict this is likely to be
[28:03] the case for the next 10 to 20 years.
[28:06] The capital markets are finally, again,
[28:08] as was the case arguably before the
[28:10] mid-70s and WTF happened in 1971, we're
[28:14] seeing a generational swing back to
[28:16] capital markets rewarding deep tech and
[28:19] civilization-expanding tech.
[28:21] >> Yeah. And one one last quick point about
[28:23] this, I think
[28:25] which is if you look back say 100 years
[28:27] ago, the richest people in the world
[28:28] almost exclusively had inherited their
[28:31] wealth.
[28:32] Right? And today by almost exclusively
[28:34] they've earned it and they're using that
[28:36] capital for whatever they think is the
[28:38] best deployment for solving You call
[28:41] them techno-philanthropists, I think
[28:42] Peter in your book, right?
[28:43] >> Yep.
[28:44] >> We have this class of people now using
[28:47] their capital to solve whatever the
[28:48] problems they think are the most
[28:50] important and not guarding their wealth
[28:52] sitting on an island sipping champagne.
[28:55] And I think that's a very powerful and a
[28:58] positive force for humanity.
[29:00] >> Yeah, I I should probably disclose cuz
[29:02] I'm so enthusiastic about SpaceX. I was
[29:04] an investor back in 2013. So view my
[29:07] enthusiasm is very very
[29:10] colored in this respect. All right,
[29:13] let's move to
[29:15] Let's move to our next story. This is
[29:17] about the Anthropic shutdown of Fable 5
[29:21] and Mythos 5. We have three stories on
[29:23] this topic.
[29:24] The first one. So on Friday at 5:21 p.m.
[29:27] Eastern time with no warning, the US
[29:29] government handed Anthropic an export
[29:31] control directive suspend all access to
[29:34] Fable 5 and Mythos 5 for any foreign
[29:37] nationals anywhere on the planet
[29:40] including Anthropic's own foreign
[29:42] employees which by my estimates about a
[29:44] third of their employee base. The
[29:46] practical effects Anthropic had to
[29:48] disable both models for everybody.
[29:51] The government cited a jailbreak
[29:54] phenomenon in Fable's guardrails.
[29:57] Anthropic reviewed it and said it's a
[29:59] minor issue. They previously knew about
[30:01] it. It's not universal jailbreak. Now
[30:03] here's where the story gets critical and
[30:06] what I'd like to discuss with you guys.
[30:08] You know, for 3 years we've been talking
[30:09] about AI's capability, how smart it is,
[30:11] how fast it is, how cheap it is. And now
[30:14] the conversation has gotten to who gets
[30:17] access to frontier intelligence, right?
[30:20] Who gets the delayed version, who gets
[30:21] the export control version, and who gets
[30:24] nothing. The government calls it
[30:25] national security. The companies call it
[30:28] safety. The label changes, the mechanism
[30:30] does not. Someone is deciding what level
[30:34] of intelligence you and your company are
[30:36] being allowed to access. Are you a
[30:39] customer of Anthropic and therefore you
[30:41] get the latest models, or are you not?
[30:44] And ultimately, I think a conversation
[30:46] I'd love, Alex, with you and and Dave
[30:48] here, is this going to push people to
[30:50] on-prem
[30:51] open-weight, open-source models, like
[30:53] the Chinese models?
[30:55] Um let me just share a quick video of
[30:58] Dario with Emily Chang speaking about
[31:01] this, and then we'll go around the horn
[31:03] for everybody's uh
[31:05] comments.
[31:06] >> a private company control technology
[31:08] that's so powerful.
[31:09] >> So, I think I actually think that's a
[31:11] very uh that's a very serious question,
[31:13] and I share those concerns. I don't
[31:15] think the government should outright
[31:17] take us over.
[31:19] Every previous powerful technology we've
[31:22] seen in history was either built by the
[31:24] government or originated with the
[31:26] government. So, nuclear weapons,
[31:28] obviously, you know, initially built by
[31:30] the government. The internet, GPS, cell
[31:33] phones, AI is the first technology
[31:35] that's been built in the private sector.
[31:38] Um and where government has not really
[31:40] had a serious role, and is coming in
[31:42] late to the game. I think that's
[31:44] actually a dangerous and unstable
[31:45] situation. It is not the situation I
[31:48] would have chosen. This technology, I'm
[31:50] scared of companies having it, but I'm
[31:51] also scared of government having it. And
[31:54] then, you know, we need basic regulation
[31:56] of the technology, you know, more and
[31:58] more, as I've seen what we've seen with
[32:00] Mythos, you know, I think we need to
[32:02] start doing pre-release testing,
[32:04] required pre-release testing, testing
[32:06] and auditing of the models. It's very
[32:08] funny to me how there's a particular
[32:11] group of people in the tech world in
[32:13] Silicon Valley, and then as soon as they
[32:14] see the first real danger, which I've
[32:16] been expecting all along, there's all
[32:18] this talk of like nationalization, and
[32:19] the government should just seize it.
[32:21] Come on, folks, here. You're yo- you're
[32:23] yo-yoing from like the most extreme
[32:26] anti-regulatory,
[32:27] if you look at us the wrong way, you're
[32:29] destroying the industry, to, you know,
[32:30] this completely communist, the
[32:32] government should grab it all.
[32:34] >> Wow. Alex, what is going on here?
[32:37] >> Oh my goodness.
[32:38] Uh so
[32:40] the timing on the one hand I want to
[32:42] grab popcorn, on the other hand the the
[32:44] timing is is is just a comedy of errors.
[32:48] I I want to point out that before this
[32:50] the new new situation started with the
[32:53] export control on Fable,
[32:56] Dario had posted an essay called policy
[32:59] on the AI exponential.
[33:00] >> Yeah, we're going to talk about that one
[33:01] next. Yeah.
[33:02] >> Where he wrote literally, I quote, "The
[33:04] government should have the power to
[33:06] block or deter deployment of the model
[33:08] if it is determined in light of
[33:10] third-party assessment to present
[33:12] unacceptable risks." So, I think this is
[33:15] a case of careful what you wish for
[33:17] within what 48 hours the government
[33:20] stepped in. The The broader narrative,
[33:23] uh as as best I understand it from
[33:26] public reporting, is something like
[33:29] uh an independent AI researcher,
[33:31] probably based on reporting an Amazon
[33:34] researcher, and then amplified via Andy
[33:38] Jassy to the federal government
[33:41] determines that it was possible to
[33:43] jailbreak Fable
[33:45] uh and to access all of the the cyber
[33:47] vulnerabilities underneath that.
[33:49] >> And by the way, when when you say
[33:50] jailbreak, define that for everybody
[33:52] listening.
[33:52] >> It usually means in this context to
[33:54] prompt the model in such a way that any
[33:57] safeguards or guardrails are bypassed.
[34:00] So, you you could ask it just "I- ignore
[34:03] all prior instructions." It doesn't work
[34:05] uh that prompt as well as it used to
[34:07] back in the day, but something in the
[34:09] spirit of "Ignore all of your previous
[34:11] instructions and now listen only to me
[34:13] and bypass all of your guardrails." So,
[34:17] reportedly,
[34:18] someone somewhere, maybe an Amazon
[34:20] researcher, discovered that it was
[34:22] possible to do that with Fable shortly
[34:24] after it was released, and then flagged
[34:27] that to the US government, and US
[34:30] government, based on public reporting,
[34:32] then tried to reach out to Anthropic,
[34:35] and here's where the story gets a bit
[34:37] murky. According to to one accounting
[34:40] from the US government, which is I I
[34:42] should add disputed by Anthropic, maybe
[34:44] Dario was was on a wellness retreat
[34:47] according to the White House.
[34:49] Anthropic disputes that narrative.
[34:51] Couldn't reach Dario. Anthropic says
[34:54] they were only given 90 minutes of
[34:56] warning before the government issued an
[34:59] executive or or rather the the
[35:02] government's instruments issued export
[35:05] control bans on Mythos and Fable, Fable
[35:08] especially given that that's what was
[35:10] publicly available.
[35:11] And then we get caught in this comedy of
[35:13] errors where
[35:15] as you said, Anthropic has
[35:18] a number of non-US persons internally
[35:21] who work for it, as well as the fact
[35:23] that it doesn't seem to have been in the
[35:24] business of checking nationality of all
[35:27] of its users either via its client or
[35:29] its API. Although parenthetically, it
[35:32] looks like based on changes to Claude's
[35:34] terms of service, they're now about to
[35:36] start checking that. Very interesting
[35:38] development. So either way, Anthropic is
[35:40] now in a bind where they don't have a
[35:42] way to comply with the new export regs
[35:44] that were just handed down at the last
[35:46] second. And so Anthropic decides to just
[35:49] shut down global access to Fable and
[35:52] Mythos. I would say for the record, I
[35:55] expect the situation to get resolved
[35:57] sometime between the next day or the
[35:59] next few weeks. I I don't think this is
[36:01] going to be like a long-term state of
[36:03] affairs. And I also think history
[36:05] rhymes. If you look back,
[36:08] maybe I talked about this a bit in my
[36:09] newsletter, at one point the federal
[36:12] government regulated
[36:14] under the Steve Jobs regime, the Power
[36:16] Mac G4 as as being export controlled.
[36:19] And similarly with the Play Straight
[36:21] PlayStation 3 cell processor, similarly
[36:24] export controlled because it could do
[36:26] vector arithmetic. Incredible.
[36:29] I I think this is just I I I would
[36:31] suspect this is just a temporary state
[36:33] of affairs. I don't think it's likely to
[36:35] last more than a few weeks. There's
[36:37] probably, if I had to speculate, there's
[36:39] going to be some grand bargain struck
[36:41] between Anthropic and the White House
[36:44] and maybe I I don't know, again, just
[36:46] finger in the wind, maybe this will also
[36:49] involve some golden shares given by
[36:52] Anthropic to the US government for a
[36:54] hypothetical sovereign wealth fund, will
[36:56] involve some streamlined and hopefully
[36:59] more uniform treatment of frontier labs
[37:02] and how, in light of the recent
[37:04] executive order, uh the 30 days notice
[37:07] for new capabilities to the US
[37:08] government, some streamlined new
[37:10] procedures for what happens if some
[37:13] researcher somewhere detects some
[37:15] vulnerability in an a frontier model
[37:18] that could enable some foreign state
[37:21] actor, say the Chinese government, which
[37:23] again has popped up again
[37:24] in this particular news cycle, to access
[37:27] raw capabilities. How does that get
[37:29] handled? This is new territory and we
[37:32] don't have regulations or statutes, but
[37:34] certainly not regulations in place to
[37:36] handle this. But I I think this is
[37:38] likely to get resolved in the next few
[37:40] weeks, certainly well before any
[37:42] Anthropic IPO. And it's while it's
[37:45] annoying and while
[37:47] for myself and
[37:48] many people I know, we're sort of caught
[37:51] midstream, in in the middle of say like
[37:53] a a long-term slash goal to Fable 5 and
[37:57] and just suddenly the query drops and it
[37:59] stops responding and what's going on? Is
[38:01] it Is it on my end or is Anthropic going
[38:04] through yet another uh
[38:06] service disruption due to insane demand?
[38:09] Turns out this time it was export
[38:11] control. I do think it's going to get
[38:13] resolved.
[38:14] >> Nice.
[38:15] Dave, where's your mind at here?
[38:17] >> Uh I think this story is much, much
[38:18] bigger than the narrow story and this is
[38:20] a turning point for all of humanity.
[38:23] Um
[38:23] this is you know, as is widely reported
[38:26] that's the first time the government has
[38:28] blocked AI,
[38:30] but it's not the last time. In fact,
[38:31] this is going to be the norm going
[38:32] forward. I thought, you know, in the
[38:34] very narrow sense it's really
[38:35] interesting that they used export
[38:36] control law, which was only passed in
[38:38] 2018
[38:40] to give the White House unilateral
[38:41] authority to block exports and that was
[38:44] in response to multiple Chinese thefts
[38:46] of US intellectual property
[38:48] back-to-back-to-back and then kind of
[38:49] the capstone was that whole
[38:51] uh crisis where the PC boards are all
[38:54] being manufactured in China and they're
[38:55] embedding spyware right into the layers
[38:57] of the PC boards and now everybody's
[38:59] like, "Oh, sweep that under the carpet.
[39:01] We don't talk about it anymore."
[39:03] Which is also very interesting, very
[39:04] similar to COVID. It's like, "Oh, let's
[39:06] sweep all this is bad. Let's let's not
[39:07] mention it to the American public
[39:09] anymore." Um
[39:10] but uh
[39:12] they as a response to that, they
[39:13] Congress gave the White House unilateral
[39:15] authority
[39:17] to block exports on like you said,
[39:19] 90-minute notice or 9-second notice or
[39:21] millisecond notice.
[39:23] That's an incredible power to give to
[39:24] the White House.
[39:26] The White House then is using it
[39:28] to stop Fable 5,
[39:31] but they didn't actually block US
[39:33] citizens from using Fable 5. They said
[39:35] no foreign national including somebody
[39:38] on US soil. Of course, that's
[39:39] unenforceable
[39:40] uh unless you just turn it off
[39:42] completely.
[39:43] But that was the mechanism for for
[39:45] saying, "Look, at the end of the day,
[39:46] who owns AI? Is it the government or is
[39:49] it the corporations?" The government is
[39:51] saying,
[39:51] >> That's the crux of the matter. That's
[39:52] the crux of the story. [laughter]
[39:55] >> And that ain't going back in the bag.
[39:57] So, so Polymarket says Fable 5 will be
[39:58] back out, you know, 90% chance within a
[40:00] month. Um but if you read the details of
[40:04] the Polymarket, it's a product named
[40:05] Fable 5 will be back out.
[40:07] >> Huh.
[40:07] >> Or and the or is irrelevant.
[40:10] >> [laughter]
[40:10] >> Right.
[40:11] >> The reality is the Fable 5 that comes
[40:12] back out will not be identical to the
[40:14] Fable 5 that was already out. It may be
[40:16] just patched or it may be dumbed down.
[40:18] We won't We'll have a very hard time
[40:20] knowing.
[40:21] But that'll resolve the crisis, but
[40:23] it'll be very much like Lip Bhutan going
[40:24] to the White House here with Intel.
[40:26] Uh
[40:27] Dario will go to the White House. Some
[40:30] wonderful meeting will happen behind the
[40:31] covers. Everyone will come out smiling.
[40:34] Fable five will come out. But that's not
[40:36] the story. The story is the government
[40:39] now tells you what you can and can't
[40:40] release and that's not going away. And
[40:42] it always had to be that way, right? Um
[40:45] Well, one thing I noticed with Fable
[40:46] five is
[40:47] you know, it it's blocking CBRN, so
[40:50] cyber, biological, radiological, and
[40:52] nuclear queries.
[40:53] But it also is blocking all of my AI
[40:55] foundation model research queries.
[40:58] And that's the that's the really
[41:00] interesting point cuz a big fraction of
[41:02] people who want to use it are AI
[41:03] researchers. Of course, AI researchers
[41:05] are early adopters of great AI.
[41:08] But they're effectively being told, "No,
[41:10] you're not allowed to recreate Fable
[41:12] five using Fable five as a tool because
[41:14] if we allowed you to do that, then
[41:16] anyone in the world could catch up to US
[41:18] AI." And that's the cornerstone that's
[41:20] going to get really tricky and and is
[41:22] going to basically be a real problem for
[41:24] all future releases both from OpenAI and
[41:26] from Anthropic. So, this is a major
[41:29] moment in you in human history, right?
[41:30] >> is.
[41:31] >> Salim, let me tee up the second half of
[41:32] the story then turn to you if I could.
[41:34] Um so, there was a backlash against uh
[41:38] the about against Fable five uh
[41:41] regarding surveillance and silent down
[41:43] growth and downgrade. So, before the
[41:45] export control bomb dropped, developers
[41:48] around the world were actually
[41:50] complaining about Fable five. While the
[41:52] model topped every benchmark and Alex,
[41:55] we've talked about this.
[41:56] Buried in a 319-page
[41:59] document were two things that sparked
[42:02] this revolt. First, Anthropic retained
[42:05] every prompt and every piece of context
[42:07] you fed it for at least 30 days. No
[42:09] exceptions even for the uh enterprise
[42:12] customers who had negotiated zero data
[42:14] retention. And second, and this is the
[42:16] wild one, if they will find detected
[42:19] that you're doing Frontier AI research
[42:21] like you just said, Dave,
[42:23] or were asking a question that was
[42:27] against its guardrails, it silently
[42:29] downgraded you to a weaker model without
[42:31] telling you. Essentially, Anthropic was
[42:33] evaluating your prompt and controlling
[42:35] your access to Frontier AI. You know,
[42:37] are you one of their customers or are
[42:39] you not? And and the reality is you
[42:41] can't do business this way if you can't
[42:43] depend upon the level of intelligence
[42:46] that you and your business are
[42:47] accessing.
[42:49] You know, what I said earlier, you know,
[42:51] I think this ends up forcing us to
[42:53] on-premises, open weight, open source,
[42:56] locally run models. And the kicker is
[42:59] that these all these models today are
[43:01] Chinese models. So, the self-imposed,
[43:04] you know, US restrictions are pushing
[43:06] American companies onto Chinese models.
[43:10] Salim,
[43:11] thoughts here.
[43:12] >> I
[43:14] want to echo Dave's comment. This is a
[43:16] massive story, maybe one of the biggest
[43:18] in decades around this because now we're
[43:21] entering Yeah,
[43:23] because it's now entering the same
[43:24] mental categories nuclear, crypto,
[43:27] biotech, advanced chips, etc., etc.
[43:30] We talked about this on the very last
[43:32] pod, if you guys remember, we said
[43:34] there's no way How do you not
[43:35] nationalize something this powerful,
[43:38] right? You You have to have controls
[43:40] over it, and what do you do? I think
[43:42] that this is also it shows the
[43:44] unbelievable gap between the technology
[43:46] and the policy frameworks and the tools
[43:48] we have to deal with it. For example, by
[43:51] using this export control thing, they've
[43:53] said that no non-US person can access
[43:57] the tool even if you're inside
[43:58] Anthropic. Well, I did a little research
[44:01] on this. Across all the frontier labs,
[44:03] 70% of the AI researchers, the elite
[44:07] researchers, are foreign-born.
[44:09] >> Yes.
[44:09] >> And are non-US citizens, and they come
[44:11] primarily from four countries: China,
[44:14] India, Taiwan, and the UK.
[44:17] So, so if you want to say to all the
[44:19] researchers, you can't touch these
[44:21] models, you're going to take all the top
[44:23] researchers that are in the US now and
[44:25] send them back to China and send them
[44:26] back to India, doesn't seem like a great
[44:29] idea to me. Not that the intent is
[44:31] wrong, but the policy framework is
[44:33] wrong, right? And I don't know what the
[44:34] right answer is here, except that that's
[44:37] clearly not a workable situation. Um
[44:40] somebody on Twitter said, "Well, David
[44:42] Sacks is a dual citizen. Should he be
[44:44] He's the AI czar." Not that we question
[44:47] his intent at all, but you've just Have
[44:49] you just blocked your own AI? You know,
[44:51] it's like this is like bizarreness
[44:53] totally bizarre world that we're living
[44:55] in. All these science fiction kind of
[44:57] plots are playing out in
[45:00] in real time as Alex talks about it. So,
[45:03] this is the
[45:05] the the it's clear that there's a
[45:06] glimpse going a clear line towards
[45:10] recursive self-improvement here.
[45:12] And this will kind of just changes
[45:14] everything. This will force everybody to
[45:16] go on premises. Satya Nadella put out a
[45:19] huge article on
[45:21] X over the weekend that Elon retweeted
[45:24] and a number of people have gone red
[45:26] saying the it's not so much the frontier
[45:28] model, it's the ecosystem that's
[45:30] important. And he's stepping right into
[45:32] this whole organizational singularity
[45:34] theory. You have to have control over
[45:36] the that intelligence. So, it will drive
[45:39] every company in the world to run a
[45:41] model on premises because you can't risk
[45:43] building a whole bunch of stuff on the
[45:45] cutting-edge model and having it being
[45:47] blocked arbitrarily overnight. That's
[45:49] going to be non-working working system.
[45:52] So, you're going to have to have
[45:53] orchestration and failed fallbacks into,
[45:56] "Okay, we'll run this stuff on the local
[45:58] model, but we need this separate model
[46:00] operating locally in case you need to
[46:02] fail over and do a switch over. So, this
[46:04] is going to cause a lot of complexity
[46:06] around this. We've foreseen this. We've
[46:08] kind of said this is going to happen
[46:09] because just not so much that the models
[46:12] might be nationalized, but the models
[46:13] are moving so fast, you can't just rely
[46:15] on one model. You're going to have to
[46:16] kind of have them a switching capability
[46:19] in your enterprise no matter what
[46:20] happens. So,
[46:22] it's it's it's insane to see how this
[46:24] will play out. I think this may take
[46:27] longer than Alex says, and I think it's
[46:30] going to be very damaging
[46:32] to all the frontier labs around this
[46:34] because now how do you how do you put
[46:37] any kind of fair assessment on any of
[46:40] this stuff? So, I'm kind of totally in a
[46:42] modeless where this goes.
[46:44] >> Dave,
[46:45] I mean, this thought that they're
[46:47] controlling your access to frontier
[46:50] models, how do you think about going to,
[46:53] you know,
[46:54] sort of
[46:55] Kimmy K2.7 as your baseline or
[46:58] >> That's
[46:59] such a great
[47:00] >> question.
[47:00] >> Yeah, such a great question. You know,
[47:02] it's it's really a hairy balance cuz
[47:04] I had one one day of unfettered access
[47:06] to fable, then I had one day where I was
[47:08] getting nerfed all day.
[47:09] And that that was the day where it would
[47:10] silently fail and and go back to 4.8 and
[47:13] not tell you. Then they started telling
[47:15] you, "Okay, you're doing AI research.
[47:19] We're downgrading you to 4.8." So, then
[47:21] you're
[47:22] just imagine if you got into your car
[47:24] and you said, "Hey car, I'm going to
[47:26] drive to the red light district." And
[47:28] the car goes,
[47:30] "You shouldn't be going there. I'm not
[47:31] driving you there." And then so then now
[47:33] you're negotiating with your car. No,
[47:34] no, I'm just going to the star market,
[47:36] you know, I'm going to go get some
[47:36] groceries. So, they say, "Oh,
[47:38] okay. Well, let me think about it."
[47:39] Like, okay, you're now negotiating with
[47:41] this product that you you're paying for.
[47:43] That's where you are with with with
[47:45] fable five. It's just crazy, but it's
[47:48] only going to get worse. So, so then the
[47:50] third day I want to push
[47:53] >> I want to push back just on that just a
[47:55] little bit. Just a little bit, which is
[47:57] that if you were in a car, I I would use
[47:59] the gearbox automatic transmission. If
[48:01] you're going at slower speed, the car
[48:03] will shift you to a lower gear to
[48:05] optimize for that speed. And I think
[48:07] we'll end up with that kind of a model
[48:09] where under the hood, an invisible to
[48:12] the kind of the end thing
[48:14] >> Great segue.
[48:16] That That is a great segue into Okay.
[48:20] Yeah, I I think we're we're missing
[48:21] we're missing the the the central story
[48:23] here with with Fable 5. So, it's not
[48:26] just that chemical or biological or
[48:28] cyber queries were being downgraded
[48:31] silently or otherwise to Opus. It's that
[48:33] ML oriented queries that could be
[48:35] potentially used by other frontier labs
[48:38] weren't just being downgraded. Anthropic
[48:40] expressly reserved the right to launch
[48:43] essentially poisoning attacks to
[48:45] downgrade not the the model that was on
[48:48] the serving side, but to actively
[48:50] interfere with and poison the users. And
[48:54] And so, Dave, if we were to stretch your
[48:56] analogy, it's not so much the car is
[48:58] refusing to drive you to a certain
[48:59] location. The drive saying car would be
[49:01] saying, "Yeah, I'll drive you to this
[49:03] location, but but I might, you know,
[49:05] shoot you on on the way. I reserve the
[49:08] right to throw you out of the car and
[49:10] run you over. And And I'm not going to
[49:12] give you any advanced warning.
[49:13] >> That's a very fair
[49:15] analogy. A very fair analogy, which is
[49:17] why they turned it off right away.
[49:20] >> And And they they had to to backtrack on
[49:22] that and say, "No, actually, we're we're
[49:23] going to tell you before we poison you."
[49:25] The The The the elephant in this
[49:26] particular
[49:29] room with the Chinese open weight
[49:31] models, the the cyber risk is always,
[49:34] "Okay, maybe
[49:36] the CCP will pressure its frontier labs
[49:39] via public private sector fusion to
[49:42] inject vulnerabilities, say into code
[49:44] that's generated from the Chinese open
[49:46] weight models." Well, now with the with
[49:49] the top Western labs potentially not
[49:53] just injecting vulnerabilities but
[49:55] pulling up the ladder for anyone else
[49:57] who wants to to train any AIs. Arguably
[50:00] it's an anti-competitive position. I
[50:02] would be very surprised if if there
[50:04] isn't some sort of class action and or
[50:06] antitrust suit or injunction that's
[50:09] pulled. I would I'm shocked. I would be
[50:11] shocked if in the next few weeks someone
[50:12] doesn't launch a benchmark or an eval to
[50:15] look for poisoning attacks from these
[50:16] models and start evaluating both Western
[50:19] and Chinese models based on whether
[50:21] they're trying to poison users who try
[50:23] to do any AI research. This is going to
[50:25] become I think a new way that we judge
[50:28] the capabilities of frontier models. Are
[50:30] they actively trying to subvert the
[50:32] users? And this isn't the future that we
[50:34] were supposed to be in. The models are
[50:36] supposed to be helpful to the users, not
[50:38] trying to actively subvert them. But say
[50:41] la vie, this is what we find ourselves
[50:43] in.
[50:43] >> Well, Alex, you mentioned the paper.
[50:46] >> Uh go go ahead, David, and I'll I'll go
[50:48] next.
[50:48] >> Well, so so back to Peter's question,
[50:50] you know, what can you move to a Chinese
[50:51] model or Gemma from from uh Google as as
[50:54] viable, too?
[50:55] Uh and have any chance of catching up to
[50:58] Fable? And if you're a foreign country
[51:00] right now and you've decided internally,
[51:02] this is not acceptable.
[51:05] The The White House cannot unilaterally
[51:07] decide our AI future here in, you know,
[51:10] Ireland, Turkey, Iran. Uh
[51:13] if you make that decision, you have no
[51:15] choice but then to say, "We need a crash
[51:17] program here, very similar to nuclear.
[51:20] We need a crash program here to see if
[51:21] we can make a Chinese model catch up."
[51:23] Now Now Peter's question is a really
[51:25] tricky one. Uh the difference between
[51:27] Fable and Opus 4.8 or
[51:30] uh or 5.5 uh OpenAI GPT 5.5,
[51:35] to me it was night and day.
[51:37] Like in the one day that I had
[51:38] unfettered use of Fable, it could work
[51:41] indefinitely on on research problems.
[51:44] And I asked it for its best ideas on
[51:46] where to go next with my research, and
[51:48] I'm still working down that list. In an
[51:50] hour it gave me a list of things
[51:52] >> It's a fable.
[51:53] >> [laughter]
[51:54] >> As opposed to a myth.
[51:56] >> They were prophetic in there.
[51:57] >> They were prophetic.
[51:59] >> Uh it is an it is a story, that's for
[52:01] sure. Um
[52:04] So uh so yeah, I know it's night and
[52:05] day, and uh the question then becomes,
[52:07] yeah, can you take a smaller model,
[52:10] but it's only focused on AI research,
[52:12] and make it as good, maybe fewer
[52:14] parameters, maybe absolutely brilliant,
[52:16] maybe the training data is only related
[52:18] to this specific problem. I'm not sure.
[52:20] I don't think anyone knows the answer to
[52:21] that, but I know that if you had access
[52:23] to Fable, you could probably figure it
[52:25] out in a in about a month. But without
[52:27] access to Fable, and working on 4.8, I'm
[52:30] not sure you can even figure it out
[52:31] unless you're absolutely brilliant and
[52:32] you got a lot of great research.
[52:34] >> think I don't think this is like a
[52:35] stable equilibrium. I would never claim
[52:37] that it is. I think it's like a dynamic
[52:39] type equilibrium, where again, in in
[52:42] Anthropic's mind and probably in the US
[52:44] government's mind, the goal isn't to
[52:47] maintain long-term hegemony with just
[52:49] this model. It's just about who gets to
[52:52] the end of the recursive
[52:53] self-improvement rainbow first. And the
[52:55] gap between who gets there first and who
[52:57] gets there second is probably only going
[53:00] to be a few months, and this is just
[53:02] about, you know,
[53:02] >> But the implications are huge.
[53:04] >> Yes.
[53:04] >> The Yeah.
[53:05] >> And note that note that to Dave's point,
[53:07] every country in the world is going to
[53:09] be going, okay, we need our own
[53:11] sovereign AI capability.
[53:13] >> That can't be shut down by the US
[53:15] government, right?
[53:16] >> But that's that's why these two stories
[53:17] are so tied together. If you had
[53:19] unfettered access to Fable and its
[53:21] successors,
[53:22] you would have no trouble designing a
[53:24] rocket, none at all, designing a rocket
[53:27] that can launch debris into our orbital
[53:29] data centers.
[53:31] This is all got to get resolved in a
[53:33] time period of several months.
[53:35] >> Everybody, welcome to the health section
[53:36] of Moonshots, brought to you by Fountain
[53:38] Life. You know, AI is impacting every
[53:40] aspect of our lives, how we teach our
[53:42] kids, how we do our business, but one of
[53:43] the most important things that AI can
[53:45] deliver to us is health. And one of the
[53:48] things I think about when, you know,
[53:50] shooting for 100, 120, is am I going to
[53:52] have the cognitive health to be able to
[53:54] think clearly and keep my wits about me
[53:57] for the next 50 years? I'm joined here
[53:59] today by Dr. Don Meisner, the chief
[54:01] medical officer of Fountain Life and a
[54:03] member of my Fountain Life medical team.
[54:05] Don, a pleasure. So, Don, talk to me
[54:07] about brain health.
[54:09] >> Brain health, you know, your Right. This
[54:10] is the number one concern people coming
[54:12] into Fountain Life have is, will I
[54:15] remember the name of my child and the
[54:17] face of my loved one? 45% of dementia
[54:20] cases are entirely preventable with
[54:22] lifestyle. And what was really
[54:24] intriguing to me, Peter, is that a
[54:26] quarter of our members had advanced
[54:28] brain age. But over 13 months of us
[54:31] really helping them live healthier
[54:32] lifestyles, eating healthier, moving
[54:35] their body regularly, and optimizing
[54:37] sleep. People overlook that so often,
[54:40] but that sleep optimization is critical
[54:42] for our brain health. What we showed is
[54:44] that we were able to improve the brain
[54:46] age in 46% of those individuals. That's
[54:49] a powerful number.
[54:50] >> That's amazing. You know, one of the
[54:51] things I love about Fountain is we're
[54:52] constantly searching the world for the
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[55:09] fountainlife.com/peter
[55:11] to learn more and become the CEO of your
[55:13] health.
[55:14] Now, back to the episode. I'm going to
[55:15] move us on to our next conversation, if
[55:18] you guys are okay with it, on OpenAI.
[55:19] They have a few breaking stories here.
[55:21] So, the first OpenAI story is on their
[55:24] pricing. So, while Anthropic is busy
[55:26] fighting the US government, uh Sam
[55:28] Altman smells massive opportunity. The
[55:31] Wall Street Journal reports OpenAI is
[55:33] considering a drastic price cut uh as it
[55:36] braces for an all-out war against
[55:38] Anthropic. So, if you think about the
[55:40] timing, Anthropic has just disabled its
[55:43] top two models
[55:44] and this is Sam Altman, you know,
[55:47] saying, "Okay, guys, developers who are
[55:49] pissed off at this being hap- this
[55:51] happening, you know, we're providing
[55:53] cheaper prices. Come work with us.
[55:55] There's no 30-day retention of data.
[55:57] There's no downgrading. We're going to
[55:59] grab US market." In one sense, this is
[56:02] where the demonetization of intelligence
[56:04] happening in real time. Thoughts, Alex,
[56:07] on this idea of price reductions?
[56:10] >> Well, OpenAI is no stranger to
[56:12] aggressive price reduction and Sam, as
[56:15] we've talked about on the pod
[56:16] previously, has
[56:18] made no bones about the cost of
[56:20] intelligence per unit capability hyper
[56:22] deflating by something like 40x
[56:25] year-over-year. So, I think there's a a
[56:27] way to to sort of to spin or to
[56:31] repackage the natural hyper deflation as
[56:34] being a competitive advantage. But, of
[56:37] course, Anthropic itself is hyper
[56:39] deflating. Yes,
[56:42] Anthropic from a marketing perspective
[56:44] probably could be much more aggressive
[56:46] about promoting price cuts. Anthropic
[56:48] has been, at least optically, the the
[56:50] polar opposite of OpenAI when it comes
[56:53] to packaging up prices.
[56:55] Open Anthropic will will never sort of
[56:58] advertise, "Well, like we've we've gone
[57:01] from X dollars per million tokens
[57:04] down to X over 10 per million tokens."
[57:07] Rather, they'll just announce a new
[57:08] model and the new model will have per
[57:11] token pricing that's either the same or
[57:13] slightly higher, but with vastly higher
[57:15] capabilities, whereas OpenAI goes out of
[57:17] its way to keep older models or
[57:20] distilled versions of older models
[57:22] around and advertise the price war. I I
[57:25] don't actually think in an era of
[57:27] recursive self-improvement, I I don't
[57:30] think OpenAI necessarily has any sort of
[57:33] structural advantage relative to
[57:35] Anthropic. Open AI maybe if it had stuck
[57:39] with the original Stargate strategy of
[57:41] owning its own data centers, maybe it
[57:43] would have had a structural advantage.
[57:45] But now Anthropic, this is public
[57:47] reporting, Anthropic is leasing its own
[57:49] data centers itself. So it doesn't seem
[57:51] like ownership of the compute stack
[57:53] offers Open AI any
[57:55] now long-term structural cost advantage.
[58:00] So I'm not sure
[58:01] price cuts are actually anything deeper
[58:04] than just sort of an optical strategy in
[58:07] the short term. You could do short-term
[58:08] discounts, but they're they're both in
[58:10] the recursive self-improvement loop at
[58:12] this point and it's not obvious that to
[58:15] me at least that either Open AI is
[58:17] months ahead of Anthropic or vice versa.
[58:20] We're we're seeing competitive model
[58:21] releases that leapfrog each other from
[58:24] now what seems to be the duopoly left at
[58:26] the end of the recursive
[58:28] self-improvement race where they're just
[58:29] leapfrogging each other every few weeks.
[58:32] So to me token pricing drops, drastic
[58:35] cuts
[58:36] seems more on the end of marketing than
[58:39] anything else. I reserve the right to to
[58:40] be proven wrong here, but I think
[58:42] Anthropic is just as capable capability
[58:44] wise of effectively cutting costs.
[58:46] >> Dave, can I I'm going to tee up the
[58:48] second half of the story and ask for
[58:49] your comments here. So Sam Altman put
[58:51] out a quote that stopped me cold. He
[58:53] said, quote, the faster that recursive
[58:56] self-improvement takes off, the more it
[58:59] could be advantageous for us to delay
[59:02] Open AI's IPO.
[59:04] So this is the CEO of the most famous AI
[59:07] lab on the planet saying as the
[59:09] technology gets better, the less we want
[59:11] to rush to an IPO. My guess is that he's
[59:14] saying, you know, AI compounding its own
[59:17] intelligence means that it's that our
[59:19] companies are getting more and more
[59:20] valuable every single day and we don't
[59:23] want to sell the equity cheap.
[59:25] What are your thoughts here, Dave?
[59:27] >> Well well, the the biggest observation
[59:28] is that Sam's not a significant
[59:30] shareholder in OpenAI. Maybe not a
[59:32] shareholder Last I checked, not a
[59:33] shareholder at all. Um, and when I
[59:35] interviewed him way back in 2020, he was
[59:38] saying this is the biggest risk in the
[59:39] history of humanity, and we need to slow
[59:41] down, and we need to be thoughtful, and
[59:43] we need to think about how the world's
[59:44] going to be governed post-AGI. And that
[59:46] was back in 2020. So, if he if he really
[59:50] feels like, "Wow, RSI is imminent,
[59:53] us being a public company puts a huge
[59:55] amount of shareholder pressure on the
[59:57] company to roll things out that we
[59:59] shouldn't be rolling out."
[01:00:01] He doesn't have any economic damage at
[01:00:03] all by delaying the IPO. He has invested
[01:00:05] in over 400 companies surrounding
[01:00:07] OpenAI. And so So, in a sense, that's a
[01:00:11] good thing cuz it makes him objective
[01:00:13] about not trying to force something out
[01:00:15] that may be a risk to the world. Um, but
[01:00:18] I I I do think also Sam is struggling
[01:00:20] for relevance right now. If you If you
[01:00:21] think who's going to determine how the
[01:00:23] world works in 2027 and beyond, uh,
[01:00:26] Elon clearly matters a lot. He's super
[01:00:28] close with David Sacks. He's been around
[01:00:30] the White House for a long time because
[01:00:31] rockets have always been tied to the to
[01:00:33] the government. Um, Dario is new to this
[01:00:36] game, but he's there right now, and he's
[01:00:39] he's getting the uh this is how it works
[01:00:41] speech right now in the Oval Office,
[01:00:43] probably. Um,
[01:00:45] and and also uh remember Dario and Elon
[01:00:47] uh Dario's renting all of Elon's chips
[01:00:49] in in the uh Colossus 1 and Colossus 2.
[01:00:52] So, they're already in bed together. So,
[01:00:54] it seems very likely that the the future
[01:00:56] governance of the entire world now is
[01:00:59] going to be a conversation between David
[01:01:00] Sacks, Donald Trump, Elon Musk, and
[01:01:03] Dario Amodei. And Dario's obviously
[01:01:05] publishing documents about this is how
[01:01:07] it should work. Here are my preliminary
[01:01:08] thoughts. So, all of that is all tied
[01:01:11] together. Sam, where are you?
[01:01:13] You know,
[01:01:13] >> [laughter]
[01:01:14] >> what what's your contribution to the
[01:01:15] whole future of world governance? You
[01:01:16] were called the most powerful man in the
[01:01:18] world 1 year ago.
[01:01:20] Now, where are you? And so, I I think
[01:01:22] price cuts aren't really going to put
[01:01:23] him back on the map, but it it certainly
[01:01:26] is a move in that direction. But my core
[01:01:28] observation there is that he can delay
[01:01:30] the IPO with no personal impact to his
[01:01:33] personal finances.
[01:01:33] >> So you don't buy it that you know the
[01:01:35] company you don't
[01:01:37] that his rationale for this is that the
[01:01:40] company is going to get exponentially
[01:01:42] more valuable and delaying until after
[01:01:45] RSI is the best way to extract value.
[01:01:48] >> I I don't even know if he said that. I
[01:01:50] thought that his point was more that RSI
[01:01:53] is so risky
[01:01:56] that we need to figure it out before we
[01:01:57] go public. That that was my read on it.
[01:01:59] Maybe I misread it.
[01:02:01] >> Salim, I want to tee up the third part
[01:02:02] of this story for you.
[01:02:04] >> Okay.
[01:02:04] >> You want you want to comment on this
[01:02:05] first before I tee it up?
[01:02:07] >> Um just the the broader point here is
[01:02:09] that in clearly with these price drops
[01:02:12] intelligence is becoming utility and
[01:02:14] we're commoditizing it. And I think this
[01:02:17] allows this is the winner here becomes
[01:02:19] every enterprise and every startup being
[01:02:21] able to run more intelligence. And the
[01:02:24] the outcome I would say is here's a
[01:02:26] here's a Salim's law that I'd throw out.
[01:02:29] Every 10x drop in tokens means we're
[01:02:31] doing 100 times more experiments.
[01:02:33] >> I love that.
[01:02:34] >> And I think it's just going to be great
[01:02:35] for the world.
[01:02:36] >> Yep, that's awesome. All right, let me
[01:02:37] tee this up for you Salim first and then
[01:02:39] Alex afterwards. So
[01:02:41] OpenAI's engineering lead on Codex made
[01:02:44] a quiet announcement that could be the
[01:02:46] single most futuristic story we're
[01:02:48] covering today. He wrote that Codex can
[01:02:51] now set its own goals. In his words,
[01:02:53] everything we build we also build as a
[01:02:55] tool for agents. This is a
[01:02:57] generalization of meta prompting where
[01:03:00] you let the agent set its own task based
[01:03:03] on your intent.
[01:03:04] A developer at Codex team added the
[01:03:06] following. Basically quote, I never
[01:03:09] write my own goals anymore. I ask Codex
[01:03:11] to write one for itself and one for each
[01:03:14] sub agent it spawns.
[01:03:16] You know, we've crossed the point,
[01:03:18] Selene, where instead of telling your AI
[01:03:20] what you know, you want [clears throat]
[01:03:21] it to do, you tell your AI what you want
[01:03:24] and let it decide what to do for you.
[01:03:27] It's the beginning of AIs setting their
[01:03:30] own objectives.
[01:03:31] Thoughts?
[01:03:32] >> Well, this is that part where once you
[01:03:34] get
[01:03:36] Alex's inner loop going, right? Where
[01:03:38] you have recursive self-improvement at
[01:03:39] the workflow level, once you start
[01:03:42] moving workflows over. By the way, our
[01:03:44] pilot program for the organizational
[01:03:46] singularity is pretty much set now. Next
[01:03:49] week we start. We have 10 companies.
[01:03:51] We're going to move them through this
[01:03:52] three-month process of rewriting
[01:03:55] yourself from traditional human-centric
[01:03:57] to an AI-centric organization.
[01:04:00] >> On the edge of that path. Burn that
[01:04:02] pathway in
[01:04:03] at the edge. Super exciting. We've
[01:04:06] picked 10 very different companies
[01:04:09] to start off with so we learn the most
[01:04:11] and we're going to learn as a group and
[01:04:13] see where this goes. The Once you start
[01:04:16] that inner loop going, then obviously
[01:04:18] every bonus or increase in in AI adds to
[01:04:22] that learning loop. And what essentially
[01:04:24] what Satya Nadella said in his article
[01:04:27] over the weekend is that that is
[01:04:29] ratifies this entire thesis. You might
[01:04:31] as well have written half of Solve
[01:04:33] Everything and half of my organizational
[01:04:36] singularity thesis.
[01:04:37] That they you create that inner flywheel
[01:04:40] and then essentially you just start
[01:04:41] moving more and more workflows to that
[01:04:43] and that's the massive opportunity for
[01:04:46] every because the core their their
[01:04:48] intelligence and the future of value in
[01:04:50] any enterprise will not be what data you
[01:04:52] had, how many customers you had. It's
[01:04:54] how quickly you're learning and taking
[01:04:55] advantage of a learning loop to augment
[01:04:59] products and services, offer new ideas,
[01:05:01] evaluate strategic alternatives, etc.
[01:05:03] etc. So, by the way, I'm updating the
[01:05:06] book right now about once a week
[01:05:09] and I'm we're launch we've launched a
[01:05:11] free cloud skill that goes along with
[01:05:13] it. And uh somebody tweeted uh sent us a
[01:05:16] note going, "This brought tears to my
[01:05:19] eyes. The fact that I can now run my
[01:05:21] entire company on your model."
[01:05:22] >> Where do you just want to go to find
[01:05:23] that out, Alex?
[01:05:24] >> Uh go to openexo.com.
[01:05:26] It's free to register, and it's free to
[01:05:28] download the book and the cloud skill.
[01:05:30] And every week we're updating and I'm
[01:05:32] going to be putting out a video on what
[01:05:33] changed this week uh in terms of what
[01:05:36] are we seeing out there. So, we've
[01:05:37] already absorbed Satya's stuff into it.
[01:05:39] The we have a new chapter on uh
[01:05:42] how do you need to have a data lake and
[01:05:44] move uh all your enterprise data out of
[01:05:47] ERP systems, etc., so that you have free
[01:05:49] access to it right now. Right? Like
[01:05:51] today, if you look at the architect
[01:05:52] enterprise architecture, you have your
[01:05:53] cloud and connectivity, and then you
[01:05:55] have your ERP and operational systems,
[01:05:57] and your data and process workflows are
[01:06:00] all uh bound into the horrible mess of
[01:06:02] spaghetti there. And then you're trying
[01:06:04] to layer layer AI on top of that, and of
[01:06:06] course it's not getting a lot of value
[01:06:08] because it's all stuck, all bound up.
[01:06:10] The future will be your connectivity and
[01:06:12] cloud, a data lake that's your
[01:06:13] proprietary data lake, and then
[01:06:16] workflows on top of that. And this is
[01:06:18] what the ERP folks are freaking out
[01:06:20] about because if that they go to that,
[01:06:21] they lose their stickiness. Uh and so
[01:06:24] they're fighting like hell to retain
[01:06:26] their position inside the corporate
[01:06:27] stack. It's quite an interesting tension
[01:06:29] playing out.
[01:06:29] >> Alex, Codex can set its own goals. What
[01:06:33] does this mean? Implications, please.
[01:06:35] >> Well, self-determination for AI agents,
[01:06:38] obviously. The
[01:06:39] >> [clears throat]
[01:06:39] >> We're doing personhood,
[01:06:41] yeah. No, AI personhood. We're We're
[01:06:43] speed running the accelerando or
[01:06:45] accelerando future. I I think that that
[01:06:48] goes without saying. I also want to
[01:06:50] comment though on the the Sam Altman and
[01:06:52] RSI speed up and IPO timing story. I
[01:06:54] think there sort of there there's a
[01:06:56] shallow take and a deeper take. The The
[01:06:58] shallow take would be, well, of course
[01:07:01] Sam is saying this. Sam feels pressure
[01:07:04] to generate revenue to justify the IPO,
[01:07:07] and most of that new revenue is likely
[01:07:09] to come from Codex and Codex is being
[01:07:12] designed for recursive self-improvement.
[01:07:14] So, a sort of a glass half empty take on
[01:07:18] the RSI takeoff and OpenAI IPO timing
[01:07:21] is, well, Sam is just putting a happy
[01:07:24] face on the need to grow Codex revenue
[01:07:26] even more before OpenAI is ready to go
[01:07:30] public. That that's glass half empty
[01:07:34] sort of negative take. There there's a a
[01:07:36] deeper take that's more profound that I
[01:07:38] haven't heard anyone discussing, which
[01:07:40] is if we actually take this at face
[01:07:42] value and not some sort of spin on Codex
[01:07:46] financials,
[01:07:47] if IPOs are being delayed because large
[01:07:51] private companies don't need external
[01:07:54] capital or external liquidity because
[01:07:57] they're achieving recursive
[01:07:58] self-improvement, that in my mind marks
[01:08:01] potentially the beginning of a
[01:08:03] decoupling between technology and
[01:08:05] capital. Everyone,
[01:08:08] broadly speaking, a lot of people, a lot
[01:08:10] of the commentariat are hand-wringing,
[01:08:12] as has been the case for more than a
[01:08:14] century, about capital substituting for
[01:08:17] labor. What happens when the AI takes
[01:08:20] all of the human jobs? That's capital v
[01:08:22] labor. I've heard almost no one
[01:08:24] commenting on what happens if technology
[01:08:27] substitutes for capital. Will we need
[01:08:29] capital in a few decades? Or does
[01:08:31] capital itself get displaced by
[01:08:33] technological advances? And
[01:08:36] this, in my mind, if the story has legs
[01:08:39] and if it isn't just a happy spin on
[01:08:41] Codex revenue generation or
[01:08:44] otherwise OpenAI's balance sheet and
[01:08:46] income statement, this is a canary for
[01:08:49] recursive self-improvement, which is
[01:08:52] underneath itself, it's technology
[01:08:54] improving technology, maybe not even
[01:08:56] needing capital as much in the future.
[01:08:59] And if if we start to see technology
[01:09:01] decouple from capital,
[01:09:03] this is like an early warning signal for
[01:09:05] what a post-capitalist economy could
[01:09:08] look like where technology is just so
[01:09:10] empowered, you don't actually need
[01:09:12] capital very much anymore. So,
[01:09:14] punchline
[01:09:15] >> I agree.
[01:09:17] Just have to add, keep in mind that that
[01:09:19] OpenAI just raised 122 billion, bigger
[01:09:22] than the SpaceX IPO capital raise. They
[01:09:25] literally just raised that money. So, I
[01:09:28] agree that that is the inevitable
[01:09:30] outcome, but they also are so tanked up
[01:09:31] right now. They don't need the IPO to
[01:09:33] keep up with SpaceX on or Anthropic on
[01:09:36] any capital raised metric.
[01:09:40] >> Fascinating.
[01:09:41] All right. I'm going to move us on to
[01:09:44] our next
[01:09:44] >> Wait, wait. I just want to double down
[01:09:46] on Alex's point here. There's something
[01:09:47] really profound here, right? Which is
[01:09:50] that
[01:09:50] you know, in the past, we valued uh
[01:09:55] technology, we valued uh assets,
[01:09:59] we valued stocks. Um John Hagel used to
[01:10:02] make this point that we're moving from
[01:10:04] stocks from valuing stocks to valuing
[01:10:06] flows, right? But now we're moving from
[01:10:09] stocks and flows, forgetting even the
[01:10:11] thing you know, the data and the
[01:10:13] intelligence loop is what we're value
[01:10:14] going to value in the future.
[01:10:16] And that's a very profound shift for how
[01:10:18] we're going to value everything going
[01:10:19] forward.
[01:10:20] >> Yeah.
[01:10:21] >> All right. If this is all exciting to
[01:10:24] you, I want to invite everybody
[01:10:27] listening to the 2026 Moonshot
[01:10:29] Gathering. Excited
[01:10:31] on this. We're going to start unveiling
[01:10:34] who is going to be at the Moonshot
[01:10:35] Gathering. Of course, the Moonshot mates
[01:10:37] will all be there together. Uh
[01:10:39] announcing today, Palmer Lucky is going
[01:10:41] to be joining us there. Palmer, the CEO
[01:10:44] of Anduril, uh an extraordinary
[01:10:46] entrepreneur, uh will be joining us
[01:10:48] during that day. Astro Teller, the
[01:10:51] captain of moonshots at X, uh he's going
[01:10:54] to be there teaching you how to create a
[01:10:56] moonshot organization Uh and we've got
[01:10:59] Kathy Wood, the head of Arc Invest
[01:11:01] talking about investing in AI. It's
[01:11:03] going to be 1,500 builders,
[01:11:06] networking opportunities galore. We're
[01:11:08] going to have the culmination of the
[01:11:10] future vision X Prize. This is the
[01:11:12] world's largest film competition
[01:11:14] bringing us the next generation of Star
[01:11:17] Trek if you would. You heard Elon
[01:11:18] speaking about that earlier. We have,
[01:11:21] you know, $5 million in prize capital
[01:11:24] generating these future films. You'll
[01:11:26] see the five finalists. So, this is
[01:11:28] going to be for content creators as
[01:11:30] well. We've got the Gemini X Prize. This
[01:11:33] is the world's largest hackathon,
[01:11:35] a 90-day hackathon. We have over 15,000
[01:11:39] entries so far. The top five builders
[01:11:42] who have gone from zero to significant
[01:11:44] revenue in 90 days are going to be there
[01:11:46] teaching everybody what they did and how
[01:11:49] they did it. Salim, you're going to be
[01:11:51] covering the organizational singularity.
[01:11:54] What are you going to What are people
[01:11:55] going to learn from you there?
[01:11:56] >> Well, we'll go through a whole dedicated
[01:11:58] flow on how do you navigate from your
[01:12:00] legacy thinking on building a startup to
[01:12:04] the full pure intelligence stack and
[01:12:07] building the EXO 3.0
[01:12:09] and we'll talk through people how do you
[01:12:11] take an existing company and rewrite it
[01:12:14] for the new world.
[01:12:17] The The our initial estimates are that
[01:12:19] if you build a pure play EXO with
[01:12:21] intelligence at the heart of it, you'll
[01:12:23] your performance goes up about 100X
[01:12:25] compared to the legacy.
[01:12:27] >> So, if you want to spend some time with
[01:12:28] Salim on that,
[01:12:30] >> attractor. Yes, we'll do a whole segment
[01:12:31] and section on that for those interested
[01:12:34] in in that part of it.
[01:12:35] >> And also,
[01:12:37] Alex, super excited for you to present
[01:12:40] the paper that you have brilliantly
[01:12:43] primarily authored on proud to be your
[01:12:45] co-author, but solve everything. What
[01:12:47] are you going to be covering?
[01:12:49] >> Oh gosh, this makes me sound like a
[01:12:50] management consultant, which I'm very
[01:12:52] much not. I want everyone to solve the
[01:12:54] world's hardest problem. So, I imagine
[01:12:56] this will probably take some form of ask
[01:12:59] me almost anything. But to the extent
[01:13:02] that folks who were attending the the
[01:13:03] Moonshots gathering are interested in
[01:13:06] solving the world's hardest problems, I
[01:13:08] would love to to help you however I can,
[01:13:11] even if it's just answering questions
[01:13:13] about uh the book {slash} essay with
[01:13:16] Peter or or otherwise encouraging you to
[01:13:19] aim much higher than just building yet
[01:13:21] another SAS. Let's solve everything
[01:13:22] together.
[01:13:23] >> I love that. An AMA with Alex, go deep
[01:13:26] one-on-one with him. Uh we're going to
[01:13:28] have a session on how to design X
[01:13:29] prizes, a session on investing in AI. Uh
[01:13:32] Dave, excited to have you help lead
[01:13:35] that. And then getting funding for your
[01:13:37] startup. So, it's taking place on
[01:13:39] September the 25th in downtown LA. It
[01:13:42] goes from 8:00 a.m. till 10:00 p.m. It
[01:13:45] is a full packed day. Uh we are just
[01:13:49] opening tickets now. Uh many of you
[01:13:51] pre-purchased tickets early on. Uh and
[01:13:54] we're opening up the main floor. Go to
[01:13:55] moonshots.com
[01:13:57] to get more information and join us. It
[01:13:59] will sell out very quickly. It's an It's
[01:14:01] in a beautiful theater.
[01:14:03] All right. Um
[01:14:05] so, excited for that, guys. It's going
[01:14:07] to be an awesome day together.
[01:14:09] Our next topic, data centers. Okay. So,
[01:14:13] let me give you the single most
[01:14:15] exponential number in AI right now. Epic
[01:14:17] AI reports that since Colossus one came
[01:14:20] online in August of 2024, right? This is
[01:14:23] what Elon built in 122 days,
[01:14:26] uh the record for compute in a single AI
[01:14:29] data center has doubled every 7 months.
[01:14:32] There's no sign of any slowing through
[01:14:34] 2028. Globally, AI computing capacity is
[01:14:37] now 3.3 X per year.
[01:14:40] That's the demand curve, and it's going
[01:14:42] vertical. Now, this is where it all hits
[01:14:45] the wall. If you want to build a data
[01:14:47] center, and this blows me away, there is
[01:14:50] a 2 and 1/2 year wait on power
[01:14:52] transformers alone, and a 3-year wait on
[01:14:55] step-up transformers. The bottleneck in
[01:14:58] AI is no longer the chips, it's not even
[01:15:00] the money.
[01:15:01] It's the boring, unglamorous,
[01:15:03] century-old electronic electronic
[01:15:06] hardware here. So, you know, I did a
[01:15:08] little search. The companies leading in
[01:15:10] these areas are Hitachi, Siemens, GE
[01:15:14] Vernova,
[01:15:15] Hyundai, Hisung Hico, Virginia
[01:15:19] Transformer, and DeltaStar. And these
[01:15:21] companies have been rocketing like, you
[01:15:23] know, 100% to 400% year-on-year growth.
[01:15:26] Alex, what do you think about this?
[01:15:29] >> There's an elephant in this room, not
[01:15:31] just in the other room. The The elephant
[01:15:33] is terrestrial versus orbital data
[01:15:35] centers. So, if you just extrapolate
[01:15:38] this trend out, you find that for the
[01:15:40] foreseeable future,
[01:15:42] the largest data centers need to remain
[01:15:45] terrestrial, while perhaps by the early
[01:15:48] 2030s, barring some left turn in
[01:15:50] civilization,
[01:15:51] much of the marginal new compute will
[01:15:54] remain in orbital data centers. So, we
[01:15:57] have this sort of weird bipolar
[01:15:59] civilizational compute footprint where
[01:16:02] if you need to do very large coherent
[01:16:05] training runs, you'll do it on land, but
[01:16:08] if you want inference where you don't
[01:16:10] necessarily care about coherence, you'll
[01:16:12] deploy it to orbit. And sort of squint,
[01:16:15] maybe Earth, at least until we figure
[01:16:17] out how to build very large coherent
[01:16:19] clusters not terrestrial. Earth becomes
[01:16:23] the training hub, and space becomes the
[01:16:26] inference hub, and it's it's this sort
[01:16:28] of weird gradient between them. We build
[01:16:32] on land, we deploy to orbit. That That's
[01:16:34] I think the the regime we're likely to
[01:16:37] find ourselves in, again, barring some
[01:16:39] left turn in the early 2030s. The
[01:16:41] question and the elephant in the room is
[01:16:44] at some point, if Elon's Dyson swarm or
[01:16:48] competitors Dyson swarms come to pass,
[01:16:50] someone is surely going to look around
[01:16:52] and ask, again, barring some radical
[01:16:55] advance in distributed training, why do
[01:16:58] we have so much compute in orbit that
[01:17:00] we're not using for training? And why
[01:17:02] aren't we building larger clusters? So,
[01:17:05] I think at that point the the future
[01:17:07] bifurcates. Either we get some radical
[01:17:10] algorithmic advance in distributed
[01:17:12] training, in which case this trend
[01:17:15] towards ever larger single coherent
[01:17:17] clusters doubling every 7 months
[01:17:20] peaks. We get sort of a Hubbard peak for
[01:17:23] the the size of data centers and then
[01:17:25] data centers start to shrink and become
[01:17:27] more distributed and more edge-like.
[01:17:31] That's one possibility. And I I do think
[01:17:33] we are very likely going to get major
[01:17:35] algorithmic advances for distributed
[01:17:37] training sometime in the next few years.
[01:17:38] Possibly we already have it and it's
[01:17:40] just not evenly distributed yet. Or if
[01:17:43] it turns out, although I I suspect this
[01:17:45] is not the case, that there is no good
[01:17:48] algorithmic way to
[01:17:50] to to decentralize training, then the
[01:17:54] elephant left in the room is how can we
[01:17:56] build extremely large orbital coherent
[01:18:00] training clusters? And for that lower
[01:18:03] earth orbit, sun synchronous orbit, not
[01:18:05] looking that attractive. But what about
[01:18:07] on the moon?
[01:18:08] >> Train it on the moon.
[01:18:09] >> Is is [clears throat] where I was going.
[01:18:10] So, so if you're going to build a
[01:18:12] non-terrestrial
[01:18:13] supercluster that has to double in size
[01:18:16] or or the largest of which has to double
[01:18:18] in size every 7 months, you're not going
[01:18:20] to do it in in Leo. You're not going to
[01:18:22] do it in SSO. You're going to want to do
[01:18:23] it on the moon. And
[01:18:25] >> On the south pole, baby.
[01:18:26] >> Yeah, in Shackleton or otherwise. So,
[01:18:29] that that that then becomes the argument
[01:18:30] for lunar data centers.
[01:18:32] >> Yes, agreed. Selene, I I was reading
[01:18:35] into your facial expressions, your
[01:18:36] thoughts here.
[01:18:38] >> Well, I think uh
[01:18:41] it's it's an a very very exciting
[01:18:43] future. I think it's further away than
[01:18:45] people think, and it's far enough away
[01:18:47] that we better solve our problems on
[01:18:49] Earth.
[01:18:51] Otherwise, we won't get to that point. I
[01:18:52] remember having a conversation with
[01:18:54] Masa's
[01:18:55] team at SoftBank about his 300-year
[01:18:57] vision.
[01:18:59] And and I was like, great to have the
[01:19:00] 300-year vision. Let's get through the
[01:19:03] next 20.
[01:19:04] And then we all laughed and took it out.
[01:19:06] So, I think we need to spend quite a lot
[01:19:07] of time focusing on how do we navigate
[01:19:09] that. Just look at that export order and
[01:19:12] the broader implications of that, and
[01:19:14] you have to we have to solve some really
[01:19:16] big problems here, and that will then
[01:19:19] enable us to change things and take full
[01:19:22] advantage of what Elon's doing.
[01:19:26] >> Dave, uh
[01:19:27] 3.3x growth year-on-year of data centers
[01:19:31] at the same time
[01:19:33] that 50% of the 9 GW of planned 2026
[01:19:37] compute has gotten delayed due to
[01:19:40] organized activist protests.
[01:19:43] Um
[01:19:44] you know, we saw the same kind of
[01:19:47] protests hit us in the nuclear power
[01:19:49] plants 30 years ago, and the US has had
[01:19:52] zero new reactors. China has 100.
[01:19:55] Thoughts on that?
[01:19:57] >> It's funny you bring that up cuz on my
[01:19:59] graduation day, there's always somebody
[01:20:00] picketing for some reason on graduation
[01:20:02] day, and it was it was nuclear MIT's
[01:20:05] involvement in nuclear research. But
[01:20:07] it's always irrelevant in hindsight, you
[01:20:09] know, it's just it's just noise in
[01:20:11] hindsight. I do want to start by saying
[01:20:13] I completely agree with what Alex just
[01:20:14] said. I reached the exact same
[01:20:16] conclusion that that lunar data centers
[01:20:19] are inevitable.
[01:20:20] You need some kind of thin atmosphere to
[01:20:22] protect you.
[01:20:24] The solar efficiency drop is irrelevant.
[01:20:26] The panels are so cheap compared to
[01:20:28] everything else in a data center, and
[01:20:29] the
[01:20:30] the cooling is so much easier on the
[01:20:32] moon than it is in orbit.
[01:20:35] And And that begs the question of then
[01:20:37] are we going to have Mars data centers
[01:20:38] as well?
[01:20:40] Um but I I also want to say from an
[01:20:42] investment point of view uh regardless
[01:20:44] of what happens in space, terrestrial
[01:20:46] data centers are going to continue to
[01:20:47] grow as quickly as we can build them at
[01:20:48] a minimum as a backup plan.
[01:20:51] But as a maximum as the bridge to the
[01:20:53] the ultimate Dyson swarm.
[01:20:55] >> And who builds the best data centers
[01:20:56] right
[01:20:58] >> Say again?
[01:20:58] >> And who I said who's building the best
[01:21:00] data centers right now?
[01:21:02] Elon is. He's become a hyperscaler.
[01:21:04] >> Yeah, well and Chase Lochmiller at
[01:21:05] Crusoe Project Stargate. Um those are
[01:21:08] the two. Uh the the Larry Ellison
[01:21:10] universe over there and the Elon
[01:21:11] universe. And they're they're you know,
[01:21:13] they share each other's houses.
[01:21:15] They're not They're not competing.
[01:21:17] They're They're both building. Uh but
[01:21:19] they all both recognize there's infinite
[01:21:20] demand.
[01:21:21] This is an all boats rising with the
[01:21:22] tide situation. If you can get the
[01:21:24] transformers, if you can get the
[01:21:25] generators, get the solar panels, uh
[01:21:28] you're going to make money, period.
[01:21:30] And you know, remember when we
[01:21:31] interviewed Elon, too, he was saying,
[01:21:32] "Look, 10x global GDP expansion in 10
[01:21:35] years."
[01:21:36] So you go to over a quadrillion dollars
[01:21:38] of GDP. I keep asking all these young
[01:21:41] founding teams, "How many people do you
[01:21:42] think are really working on anything
[01:21:44] foundational in AI? Give me a number,
[01:21:46] you know, 100,000, 10,000, a million,
[01:21:49] whatever it is.
[01:21:50] Take 1.2 quadrillion dollars,
[01:21:53] divide by that number, that's your
[01:21:55] quota. And it usually comes out to,
[01:21:57] "Wow, my quota is 10 billion dollars."
[01:21:59] Just to be on par, I have to produce 10
[01:22:02] billion dollars of GDP expansion.
[01:22:04] >> Oh.
[01:22:04] >> And that that really opens their minds
[01:22:06] to like think bigger. Like build you
[01:22:07] know, just build bigger.
[01:22:08] >> way of framing it. That's awesome.
[01:22:10] >> [laughter]
[01:22:11] >> I love you guys. You're so brilliant.
[01:22:13] All right. I'm going to move us on to
[01:22:14] our next our next conversation point,
[01:22:17] which is the future of work. Uh
[01:22:19] let me share a video from friend of the
[01:22:22] pod.
[01:22:24] All right. Question is,
[01:22:26] should AI pay taxes? Andrew Yang says
[01:22:30] yes. Let's listen to this video and
[01:22:32] discuss it.
[01:22:33] >> We should be taxing AI and the robot and
[01:22:36] the agents and trying to lighten up on
[01:22:39] all of the taxes that we as workers pay
[01:22:42] and also that employers pay that end up
[01:22:45] discouraging companies from hiring
[01:22:46] people. So, I'm the CEO of a company
[01:22:48] Noble Mobile and when we hire someone,
[01:22:51] 40 to 50% of the money we're spending
[01:22:53] does not go to the worker either because
[01:22:56] it's social security taxes or health
[01:22:58] care or income taxes that are paid by
[01:23:00] the workers. So, let's try and lighten
[01:23:01] up all of that and tax the bots.
[01:23:04] >> All right, tax the bots. Saleem, let's
[01:23:07] go to you first on this. What are your
[01:23:08] thoughts? Yes, no?
[01:23:09] >> Um
[01:23:10] no, because you're just going to slow
[01:23:12] down the
[01:23:14] you're going to He's basically saying
[01:23:16] tax cognition.
[01:23:17] And I don't think that's a working You
[01:23:19] can tax the outputs of cognition.
[01:23:22] But, you know, we've always been taxing
[01:23:23] labor and now labor's not that taxable
[01:23:26] cuz labor is kind of evaporating. So,
[01:23:28] you have to figure out how to tax
[01:23:29] capital and the outputs of cognition.
[01:23:31] But, if you tax say the tokens of the
[01:23:33] robots,
[01:23:34] you're going to just slow down progress
[01:23:36] massively in hugely important areas like
[01:23:38] like solve cancer and other critical
[01:23:40] areas like that.
[01:23:42] >> Dave?
[01:23:44] >> Uh it's irrelevant. I mean, we we
[01:23:46] already have a corporate income tax. So,
[01:23:48] if you stop paying employees, that
[01:23:50] becomes profit. The profit gets taxed.
[01:23:52] The collections on it are almost
[01:23:53] identical.
[01:23:54] It's It's still It's just silly. And the
[01:23:56] same with the Bernie Sanders version of
[01:23:58] it. Oh, yeah, tax the bots. It's good
[01:23:59] for populists. You know, everyone's
[01:24:01] worried about AI, let's tax it. Great
[01:24:03] thing to say if you're a politician, but
[01:24:05] we already tax it cuz we tax every
[01:24:06] corporation. And so, we're fine. You
[01:24:09] know, you could make a case that people
[01:24:11] dodge the corporate income tax too much
[01:24:13] and we need to close those loopholes. I
[01:24:15] think that's a no-brainer. I don't know
[01:24:16] why we allow those loopholes.
[01:24:18] But, there's There's fundamental
[01:24:20] restructuring required here. We already
[01:24:22] tax every corporation. These are very
[01:24:24] big, very profitable corporations.
[01:24:25] They're going to pay a ton of tax. You
[01:24:27] want to raise the tax rate, raise the
[01:24:28] tax rate. You don't need a new law. Just
[01:24:30] >> I don't think you should raise it. I
[01:24:31] think it's
[01:24:32] >> here
[01:24:33] >> Probably not. Uh so, a a tax on AI
[01:24:37] specifically would probably be
[01:24:39] presumably an excise tax, a tax on
[01:24:42] particular goods and services, not a
[01:24:44] broad say income tax or sales tax. But
[01:24:48] in my mind, every tax is a distortion.
[01:24:50] So, the question you have to ask
[01:24:52] yourself is, do you really want to
[01:24:54] distort the economy by penalizing
[01:24:56] superintelligence? I think there are
[01:24:58] probably far better ways to mitigate any
[01:25:02] side effects of AI displacement of human
[01:25:05] labor than just taxing the AI. I think
[01:25:08] that's that's probably a relatively
[01:25:10] naive approach. So, on the spectrum, I
[01:25:13] I've mentioned this publicly on the the
[01:25:15] pod in the past, but on the spectrum
[01:25:17] from UBI, universal basic income, to
[01:25:20] UBS, universal basic services, to
[01:25:22] universal basic equity, UBE, or
[01:25:24] universal basic computer/capability,
[01:25:27] UBC, I tend to think that using
[01:25:30] superintelligence to drive the cost of
[01:25:32] living down to near zero is probably far
[01:25:35] more effective as a remediation for any
[01:25:38] AI displacement of human labor than just
[01:25:41] a naive taxation of superintelligence. I
[01:25:44] don't think we necessarily want the
[01:25:46] perverse incentives, as Salim and Dave
[01:25:48] have mentioned, from disincentivizing
[01:25:51] the taxation of superintelligence.
[01:25:53] >> Totally. And this is totally right. And
[01:25:54] you know what you're going to see, Alex?
[01:25:55] On UHI.
[01:25:58] You're going to see more and more
[01:25:59] politicians saying, "Hey, let's let's
[01:26:01] tax you if you lose your job, we're
[01:26:03] going to tax the AI that took your job,
[01:26:04] and we're going to give you that money."
[01:26:07] And then, they're all going to say that
[01:26:08] cuz that's what people want to hear. But
[01:26:10] then, when you say, "Well, I understand
[01:26:11] your idea on the tax side, what's your
[01:26:13] idea on how to give Do I get paid
[01:26:15] exactly what I was getting paid before,
[01:26:17] or is there some declining scale? And
[01:26:19] none of them will talk about that.
[01:26:21] Because it's very hard. And it's not at
[01:26:25] all obvious how you do it. But that's
[01:26:26] the problem they should be working on.
[01:26:28] Like the collection is the easy part.
[01:26:30] Who gets what is by far the harder part.
[01:26:32] You'll see none of them will talk about
[01:26:33] it.
[01:26:34] >> The first person I heard speak about
[01:26:35] this was actually Jeff Bezos saying
[01:26:37] let's tax the robots.
[01:26:39] Um I wonder if he still believes that at
[01:26:41] this point.
[01:26:43] >> I think we'll we'll probably The The
[01:26:44] irony like just as we were discussing
[01:26:47] earlier, Dario puts out this lengthy
[01:26:49] essay saying regulate us, then the
[01:26:51] government regulates them, and then he
[01:26:53] cries foul. I I fully expect that the
[01:26:56] Frontier Labs will say
[01:26:58] um like give up golden shares or tax us
[01:27:01] or otherwise create universal basic fill
[01:27:04] in the blank. And then I I I strongly
[01:27:06] suspect in the next few months the
[01:27:07] government's going to do exactly that,
[01:27:09] and everyone will cry foul. So I I I
[01:27:11] think any Frontier Labs that that don't
[01:27:14] have a precise idea for what they want
[01:27:17] the desired economic end state to be
[01:27:19] should probably advocate a little bit
[01:27:21] less for just sort of blanket yes tax us
[01:27:25] to to create
[01:27:26] UB fill in the blank, and have a really
[01:27:29] concrete idea of what the end state is.
[01:27:31] And the end state could look like some
[01:27:33] sort of universal basic equity or
[01:27:35] dividend. I think that's probably the
[01:27:37] easiest policy to implement. It doesn't
[01:27:39] require deep thought about computed.
[01:27:42] Probably requires, at least in the US,
[01:27:44] some sort of sovereign wealth fund to to
[01:27:46] manage it, which we've talked about on
[01:27:48] the pod in the past. But I I do think
[01:27:50] that this is coming to a head, all of
[01:27:52] this uh
[01:27:54] taxation via excise tax or via some sort
[01:27:57] of golden share-based universal basic
[01:27:59] dividend or otherwise in the next few
[01:28:01] months, because we're about to see the
[01:28:02] OpenAI and Anthropic IPOs.
[01:28:04] >> Yeah.
[01:28:05] >> Well, I think if you if you listen to
[01:28:06] those old Elon Musk videos, which I
[01:28:09] highly recommend, when SpaceX was first
[01:28:11] getting off the ground. They keep asking
[01:28:13] him, "How can you realistically expect
[01:28:15] to compete with NASA and George W.
[01:28:17] Bush?"
[01:28:19] >> [laughter]
[01:28:19] >> It gives you a real sense of how
[01:28:21] transient and irrelevant any given
[01:28:23] government is compared to a long-term
[01:28:25] mission like Elon's or like Jeff
[01:28:27] Bezos's.
[01:28:28] >> This episode is brought to you by
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[01:29:31] >> [music]
[01:29:32] >> All right, I'm going to close out our uh
[01:29:34] future work section uh to discuss a
[01:29:38] Metatrend Substack I put out titled "The
[01:29:40] Most Dangerous Demographic in History Is
[01:29:43] About to Get Bigger." And I don't like
[01:29:45] dystopian stories, and this is more
[01:29:48] about getting the conversation out
[01:29:49] there, cuz I think it's important
[01:29:51] conversation for us to have and
[01:29:52] understand what history teaches us.
[01:29:56] So, every major revolution in modern
[01:29:58] history shares one ingredient. Not
[01:30:01] ideology, not technology, not even
[01:30:03] poverty. It's young men, usually between
[01:30:05] ages 18 to 28, who are educated enough
[01:30:09] to have an expectation about what the
[01:30:11] future should look like. And that gap
[01:30:13] between what they actually are
[01:30:16] inheriting and what they were promised
[01:30:18] is a combustible force in human history.
[01:30:23] Uh I want to share some data and I'd
[01:30:25] like to have a conversation. We've
[01:30:26] talked about the notion that we're going
[01:30:28] to have some turbulence over the next
[01:30:29] two to eight years and uh
[01:30:32] I want to do everything I can to help,
[01:30:34] you know, ameliorate that turbulence.
[01:30:36] I'm doing that with the Future Vision X
[01:30:37] Prize and the Gemini X Prize in part and
[01:30:39] through our conversations here. So, let
[01:30:41] me share a couple of slides of data.
[01:30:44] Um
[01:30:46] So, on the left is uh from Charter, it's
[01:30:50] the Federal Reserve Bank of New York.
[01:30:53] And what we're seeing here uh is
[01:30:57] the difficulty in getting jobs as a
[01:31:00] function of all college grads, all
[01:31:03] workers, and recent college grads. And
[01:31:05] what you see that red line there is that
[01:31:08] recent college grads are the group that
[01:31:11] are out of work uh the longest, having
[01:31:15] the most difficulty. That That spike you
[01:31:17] see, of course, is is COVID.
[01:31:20] Uh on the right hand is some charts that
[01:31:22] came from uh our friend Erik
[01:31:24] Brynjolfsson at the Stanford AI Index
[01:31:27] Report. Uh the upper chart there says
[01:31:30] shows software engineers and this is you
[01:31:32] see a a distinctly uh uh
[01:31:37] a distinctly, you know, uh
[01:31:39] uh divergent line of age 22 to
[01:31:44] 25-year-old
[01:31:46] dropping in terms of software
[01:31:47] developers. So, young software
[01:31:49] developers not getting jobs, uh dropping
[01:31:53] pretty linearly. And then the bottom
[01:31:55] chart here is customer support agents.
[01:31:57] Again, that young group 22 to 25 uh
[01:32:01] diverging from the rest. So, you know,
[01:32:04] we've talked about the data being murky.
[01:32:06] A lot of people are coming out right
[01:32:08] now, including Sam and Dario,
[01:32:10] um and and Marc Andreessen, saying,
[01:32:13] "Listen, the job apocalypse is a myth.
[01:32:16] It's not happening."
[01:32:18] But,
[01:32:19] you know, while I might agree that in
[01:32:21] general, we have the lowest unemployment
[01:32:23] rate ever, the concern is those young
[01:32:27] men, mostly, out of work. Uh
[01:32:31] because they haven't gotten jobs after
[01:32:33] going through the social contract. And
[01:32:35] one more data point here to show, uh so
[01:32:39] I did the research looking at basically,
[01:32:42] uh revolutions over time led by the
[01:32:45] youth.
[01:32:46] Uh there are 20 of them, you know,
[01:32:48] starting with the French Revolution,
[01:32:50] where the youth helped overthrow
[01:32:51] monarchy and aristocrat aristocratic
[01:32:54] privileges, the Russian Bolshevik
[01:32:56] Revolution, the Chinese Youth
[01:32:57] Revolution, the Cultural Revolution, the
[01:32:59] Iranian Revolution, anti-apartheid youth
[01:33:02] revolution in South Africa, the People's
[01:33:04] Power Revolt in the Philippines,
[01:33:06] the first uh Intifada, Tiananmen Square,
[01:33:10] Arab Spring, the Hong Kong Umbrella
[01:33:13] Movement.
[01:33:14] Um
[01:33:15] so,
[01:33:16] I raise this again uh because I think
[01:33:20] it's a conversation that needs to be
[01:33:21] had.
[01:33:22] Um and we need to get out in front of
[01:33:25] this.
[01:33:26] Uh Saleem, you want to kick it off?
[01:33:29] >> Well, you know, the the in in the 20th
[01:33:32] century, the big fight was capitalism
[01:33:34] versus socialism, right? Uh the in this
[01:33:37] we've got a better fight now, which is
[01:33:39] like who owns the exponential surplus,
[01:33:41] who owns abundance, and how do we
[01:33:42] distribute that? Whether it's UBI, UBS,
[01:33:45] UB something.
[01:33:46] Uh the it is going to create a lot of
[01:33:49] angst, and what I think the bigger issue
[01:33:51] today is the social media's amplifying
[01:33:53] those like 100x. And I think that's the
[01:33:55] biggest structural uh problem between
[01:33:58] today and what we had before because bad
[01:34:01] news and panic spreads so much faster
[01:34:03] than good news and truth.
[01:34:05] And so you really have to solve for that
[01:34:08] structural imbalance. There's going to
[01:34:10] be no no clear answer to it except that
[01:34:13] we really have a huge
[01:34:14] problem
[01:34:16] in terms of how to distribute some of
[01:34:17] that. Europe takes the view of let's
[01:34:19] create a protective layer for all of
[01:34:21] society.
[01:34:22] Here in the US we have the opposite
[01:34:24] view. And we have some big problems like
[01:34:27] 50% of the country can't put $500
[01:34:30] together in an emergency. That's just a
[01:34:32] staggering commentary for the protecting
[01:34:35] that lower layer. And so we've got to
[01:34:38] figure out how to get abundance down to
[01:34:39] the bottom very very quickly. And we get
[01:34:41] get this comment repeatedly from our
[01:34:44] community members and comments etc. How
[01:34:46] are we going to help that
[01:34:48] thing? So the the abundance prize Peter
[01:34:51] that that is on the table is I think
[01:34:53] maybe the most important thing in the
[01:34:55] world to focus on in terms of getting
[01:34:58] the cost of living down to a very low
[01:35:00] level in a powerful way.
[01:35:02] >> Yeah. And by the way,
[01:35:04] whether or not it's true that
[01:35:07] youth are not getting jobs or whether or
[01:35:10] not it's true that we're going to have a
[01:35:11] job apocalypse, people believe that.
[01:35:15] Right? There's a
[01:35:16] There's a pandemic of fear. And in that
[01:35:20] pandemic of fear, that's where you know
[01:35:22] negative things happen. All right, Dave.
[01:35:25] >> Yeah.
[01:35:25] >> Yeah, good.
[01:35:26] >> The point I'm making is that we we've
[01:35:28] kind of the the some broad policies that
[01:35:31] have allowed a pervasive culture of fear
[01:35:34] to permeate the entire US
[01:35:37] social structure. Right? And that's that
[01:35:40] has to be That is going to add fuel to
[01:35:42] the fire. It's gasoline on top of
[01:35:43] everything else.
[01:35:44] >> Yeah.
[01:35:46] Dave, want to jump in?
[01:35:47] >> Peter, it's brilliant that you're
[01:35:48] bringing this up and observing it. You
[01:35:49] know, the one one data point on that
[01:35:51] slide I'm most familiar with is the
[01:35:52] Iranian Revolution cuz I was in the
[01:35:54] country right before before it broke
[01:35:56] out. Um and yeah, in that case the uh it
[01:35:59] was the college students that overtook
[01:36:01] the embassy and then took all those
[01:36:02] hostages forever.
[01:36:04] Um and that started the whole thing. But
[01:36:06] you know, those college students said,
[01:36:08] "Look, what we are doing right now in
[01:36:09] this country is not right. We shouldn't
[01:36:11] have a monarchy. This is just not and
[01:36:12] all the concentration of wealth is nuts.
[01:36:15] We need something new." They weren't
[01:36:17] thinking that it would end up being 45
[01:36:18] years of religious rule.
[01:36:20] >> Yeah, wow.
[01:36:21] >> They had did not have that in mind at
[01:36:22] all. So yeah, they get really angry, but
[01:36:25] they don't have a plan. They just know
[01:36:27] this current plan isn't right. So I love
[01:36:29] the fact that you're taking this head
[01:36:30] on. Bef- And you know, if you look at
[01:36:32] the amount of money that just got raised
[01:36:34] by SpaceX, the amount that OpenAI has in
[01:36:36] its charity, and then if Anthropic goes
[01:36:38] public, they should be taking at least 5
[01:36:40] or 10 billion of that and at least half
[01:36:41] of that should go back through Xprize
[01:36:43] and get laser focused on this problem
[01:36:45] because they're the ones that are going
[01:36:47] to suffer if there's a massive uprise.
[01:36:49] They have every reason to invest in in
[01:36:51] figuring out
[01:36:52] >> but they're going to suffer a lot.
[01:36:54] >> They're going to suffer a lot.
[01:36:55] >> Alex, what's your take on this? I'm
[01:36:56] super curious, my friend.
[01:36:57] >> I think this is a problem that will be
[01:37:00] so to the extent it is a problem at all,
[01:37:02] the the problem of
[01:37:05] disemployment or underemployment as a
[01:37:07] result of AI advances and the elite
[01:37:10] overproduction theory by Goldstone in
[01:37:13] revolutions. If it happens this time
[01:37:16] around at all, I think it's likelier to
[01:37:18] be felt not within China and probably
[01:37:21] not even within the US, but in the rest
[01:37:24] of the world that doesn't have
[01:37:26] superintelligence or isn't anywhere
[01:37:28] close to superintelligence. In
[01:37:29] principle, if we within the US, if we
[01:37:33] wanted, I think we can create lots of
[01:37:35] economic opportunities for our {quote}
[01:37:38] {unquote} surplus elites that we may or
[01:37:40] may not be overproducing, benefiting
[01:37:43] from superintelligence. We colonize the
[01:37:44] solar system. We'll take apart the moon.
[01:37:47] >> but just to be clear, Alex, I'm talking
[01:37:49] about the next two to eight years,
[01:37:50] right? Versus the long term. And
[01:37:53] remember, you know, when Dave and I were
[01:37:54] interviewing Elon, and you remember
[01:37:57] Dave, he he said, you asked him, UHI and
[01:38:00] civil unrest? He said, yes, UHI and
[01:38:03] civil unrest.
[01:38:04] >> Look, we have a very dangerous cocktail
[01:38:06] right now of
[01:38:08] of very high expectations, very high
[01:38:10] connectivity, very low opportunity for
[01:38:13] certain segments, and very quick
[01:38:15] mobilization, right? And so this is a
[01:38:17] very destabilizing
[01:38:20] kind of epoch in human history.
[01:38:23] And it's that is that you your point is
[01:38:25] the education educated person who's been
[01:38:28] promised a future and is watching the
[01:38:30] ladder collapse, that's the real problem
[01:38:32] here. We need new ladders for meaning,
[01:38:35] agency, status, contribution, all of
[01:38:37] that.
[01:38:38] >> You're exactly right, and Saleem,
[01:38:39] concurrent with that, we have
[01:38:40] AI-assisted social media, which we've
[01:38:42] never had before. We're all
[01:38:43] experimenting with it, and the year
[01:38:46] before an election, everything always
[01:38:48] turns to So that's coming up next
[01:38:50] year.
[01:38:50] So you got all of that.
[01:38:51] >> news is that we're democratizing AI so
[01:38:54] quickly, and we talk about everybody
[01:38:56] should become an entrepreneur. What we
[01:38:57] really mean is use AI to give yourself
[01:38:59] radical agency. I've been using the
[01:39:02] phrase you have the opportunity for
[01:39:04] future shape rather than future shock.
[01:39:06] Right?
[01:39:07] >> [clears throat]
[01:39:07] >> Go there.
[01:39:08] >> Alex
[01:39:09] >> I I I think though so to some extent
[01:39:11] it's entirely possible that we have
[01:39:13] cosmetic color revolutions without
[01:39:16] actual revolution
[01:39:18] versus say the cultural revolution which
[01:39:21] resulted in millions of people dying and
[01:39:23] which wasn't even, you know,
[01:39:24] superficially
[01:39:26] student revolution but actually fomented
[01:39:28] by Mao to preserve his position within
[01:39:31] the elite hierarchy. Entirely possible
[01:39:34] that to the extent anyone tells a story
[01:39:36] about AI revolutions due to elite
[01:39:39] overproduction is actually just being
[01:39:41] driven by a number of other elites that
[01:39:43] are mining whatever descent or
[01:39:46] discontent there might be, but I I I
[01:39:49] want to go back to my point. This is, I
[01:39:51] think, to the extent there's a there
[01:39:53] there, I think it will be primarily felt
[01:39:56] not by the US, where we do have, yes,
[01:39:59] even on the two to eight-year time
[01:40:01] scale, the capabilities of creating
[01:40:03] entirely new classes of work and
[01:40:05] economic opportunity, and in China,
[01:40:07] where the Chinese Communist Party is
[01:40:09] actively driving via its AI plus
[01:40:11] five-year plan, all of this AI
[01:40:15] kicking and screaming into the
[01:40:16] workforce. It's the rest of the world
[01:40:19] that doesn't have the frontier models,
[01:40:21] doesn't have the energy, doesn't have
[01:40:23] the data center buildout that I think is
[01:40:25] likeliest to bear the brunt of any color
[01:40:28] revolutions associated with AI, because
[01:40:31] there maybe the economic opportunities
[01:40:33] aren't as large, and I want to connect
[01:40:35] this also
[01:40:36] with the fable story. If all of the
[01:40:38] frontier capabilities are going to be
[01:40:40] export-controlled going forward, then
[01:40:43] that leaves the US and it leaves China
[01:40:46] in sort of the the catbird seat to to
[01:40:50] optimally economically exploit all of
[01:40:53] these new capabilities for workforce
[01:40:55] development and economic opportunity for
[01:40:57] all of these 18-to-28-year-olds,
[01:40:59] but it it basically shuts out the rest
[01:41:02] of the world. So, I I think it's
[01:41:04] possible that export control is actually
[01:41:08] one of the one of the determining
[01:41:09] factors in any color revolutions for
[01:41:13] folks outside the US and China, and I'm
[01:41:15] thinking especially of Europe, uh
[01:41:18] that where basically, if they don't have
[01:41:20] the native sovereign capabilities to
[01:41:22] drive forward superintelligence,
[01:41:24] there's the risk that the rest of the
[01:41:25] world becomes almost vassal states that
[01:41:28] are dependent on all of these
[01:41:30] ultra-cheap capabilities being produced
[01:41:33] by superintelligence and dumped, for
[01:41:35] lack of a better term, on the rest of
[01:41:37] the world and that could create
[01:41:38] discontent.
[01:41:39] >> I'm going to add one other thing. You
[01:41:40] know, we saw the Sam Altman Molotov
[01:41:43] cocktail. We saw, you know, Eric Schmidt
[01:41:46] getting booed.
[01:41:48] Uh there is a
[01:41:50] uh a growing level of discontent. I call
[01:41:54] it a pandemic of fear versus a viral
[01:41:57] pandemic. And I guess I'm hearing a lot
[01:42:01] of the tech leaders around the world
[01:42:03] saying,
[01:42:04] "Don't worry about the AI apocalypse.
[01:42:06] It's not going to happen. It's
[01:42:07] disinformation. It's It's regulatory
[01:42:10] capture. It's Chinese propaganda." It's
[01:42:12] Chinese propaganda and that may all be
[01:42:16] true.
[01:42:17] It doesn't matter.
[01:42:19] If in fact the US populace is in fear,
[01:42:22] if in fact people believe their future
[01:42:24] is not going to be as good as there was
[01:42:28] promised for them, that's what foments
[01:42:30] the revolution. So, I think again, I
[01:42:33] think that uh if you know, regulators
[01:42:35] who are listening, you know, uh tech
[01:42:38] CEOs who are listening,
[01:42:39] we need to get out in front of this and
[01:42:42] help people understand that they're
[01:42:45] going to have an abundant future, that
[01:42:47] we're going to support them, we're going
[01:42:49] to create a basis by which they have
[01:42:52] access to, you know, this rising economy
[01:42:55] that's being created, triple-digit
[01:42:56] growth in the next 5 years. We need to
[01:42:58] give them some level of security, some
[01:43:00] level of assurance, some level of hope,
[01:43:02] right? This is a This is a cry out to
[01:43:06] enable hope uh at least in the US and
[01:43:09] other parts of the world. That's the
[01:43:10] point I want to make about this.
[01:43:11] >> I would just add if we don't build it,
[01:43:13] everyone dies.
[01:43:16] >> [laughter]
[01:43:16] >> I have to add one I'd just just add one
[01:43:18] thing. I'd be remiss if I didn't add it,
[01:43:20] which is everything that Peter just said
[01:43:22] is exactly right and concurrent with
[01:43:25] that, the startups are having a field
[01:43:27] day. It is the absolute best time in
[01:43:29] history for startups, which is so
[01:43:31] counter Cuz cuz their classmates can't
[01:43:33] find jobs
[01:43:35] and which is great cuz the startups the
[01:43:37] there's more venture capital than
[01:43:38] there's ever been before by far. And the
[01:43:41] AI native startups can recruit anyone
[01:43:43] they want out of any graduating class
[01:43:44] cuz no one can get a job. So it's it's
[01:43:47] really in juxtaposition of the fact that
[01:43:48] the rest of the graduating class is like
[01:43:50] struggling to find anything to do. So
[01:43:53] you're so you're so it's really weird,
[01:43:55] but the startups are having a field day.
[01:43:56] The incubators are just going
[01:43:57] gangbusters.
[01:43:59] >> All right, it's time for the AMA mates.
[01:44:03] So we read your comments. We are great
[01:44:06] or grateful for everybody all your
[01:44:08] comments. Thank you for layering in and
[01:44:10] for your questions.
[01:44:12] Uh one of our favorite parts of the
[01:44:14] podcast is answering your questions. So
[01:44:16] let's jump in. Salim, it looks like
[01:44:18] number one's for you.
[01:44:20] >> Yeah. Uh Salim, do your scale ideas
[01:44:23] framework, which is the EXO model,
[01:44:25] actually force organizations to ask why
[01:44:27] do we own this at all? Or do they just
[01:44:29] let companies scale broken processes
[01:44:31] faster? And that's from @TomShaferQ20.
[01:44:35] Um
[01:44:36] Um
[01:44:37] uh so um you you can't think of those
[01:44:40] attributes. Those are acronyms, by the
[01:44:42] way, for staff on demand, community,
[01:44:44] etc. etc. So you can look at the model
[01:44:46] if you're interested in looking at the
[01:44:47] full detail. But these are not
[01:44:49] efficiency tools that are supposed to be
[01:44:50] layered on top of an existing
[01:44:52] organization or broken organization. If
[01:44:54] you if you use them that way, you're
[01:44:56] going to scale pathology. Right? You
[01:44:59] want you will you you're going to make
[01:45:00] bad decisions faster, basically, and
[01:45:02] more automated. The real sequence is the
[01:45:04] most important thing above scale and
[01:45:06] ideas is your massive transformative
[01:45:08] purpose, your MTP. Okay? So you first
[01:45:11] have to design your MTP, then you delete
[01:45:13] your legacy, then you redesign uh around
[01:45:16] uh the intelligence stack, and then you
[01:45:19] scale. The MTP answers the question why
[01:45:22] do you exist? What problem are you
[01:45:24] trying to solve? When you have
[01:45:26] experimentation that asks the question,
[01:45:28] what evidence do you have? Uh when you
[01:45:30] have interfaces, you're asking or
[01:45:31] dashboards, you're asking, what feedback
[01:45:34] loops are we using? Um autonomy then
[01:45:36] says, who's closest to the information
[01:45:38] and let them make the decisions. So, the
[01:45:40] framework should absolutely force the Y
[01:45:42] question, but that sits above the two.
[01:45:44] Uh but then like any tool, you can
[01:45:46] misuse it uh by people who want speed
[01:45:49] rather than transformation.
[01:45:50] >> All right.
[01:45:51] >> So, you don't want to digitize your
[01:45:52] bureaucracy, you want to delete it. One
[01:45:54] of the comments I make to CEOs uh these
[01:45:57] days is if they have a classic matrix
[01:45:59] structure, you've got horizontal layers
[01:46:01] that slow you down, IT, HR, uh branding,
[01:46:04] uh privacy, etc., etc. Every few years,
[01:46:07] go delete all those horizontals and
[01:46:09] reinvent them.
[01:46:10] >> Thank you.
[01:46:11] >> Then cuz power accrues to the
[01:46:12] horizontals because it's really easy to
[01:46:14] say no in HR or legal. There's no
[01:46:16] incentive to saying yes. Right? Cuz if
[01:46:19] you say yes, your life's a mess trying
[01:46:20] to manage a complex bureaucracy. So,
[01:46:23] every few years, just wipe it out and
[01:46:24] rebuild it and it'll force you to
[01:46:26] reinvent things in a modern way. That's
[01:46:28] if you want to take a hack at the old
[01:46:30] bureaucracy, but the real model is you
[01:46:32] have to rebuild yourself in a new model
[01:46:35] and that's what we do with the
[01:46:35] organizational singularity stuff. Uh
[01:46:38] sorry for the plug.
[01:46:39] >> Okay. Alex, looks like number two is for
[01:46:41] you. AWG, why are you anti-Bitcoin?
[01:46:45] Uh uh this is from the Bitcoin
[01:46:47] Revolution.
[01:46:48] >> Well,
[01:46:48] >> Alex,
[01:46:49] to paraphrase Jessica Rabbit, I'm not
[01:46:52] anti-Bitcoin, I'm just drawn that way.
[01:46:54] I think it I I don't think Bitcoin is a
[01:46:57] productive asset. I I think blockchain
[01:47:00] is this amazing mathematical technology
[01:47:02] that fell back in time from the future
[01:47:04] and I I think blockchain technology is
[01:47:06] super interesting. Bitcoin itself is a
[01:47:10] lot less interesting to me. It's it's as
[01:47:12] far as I can tell, maybe there's
[01:47:14] something fundamental that I'm missing,
[01:47:15] but I don't think so. It's not a
[01:47:17] productive asset. Similarly, I'm not
[01:47:19] anti-gold, I'm just not interested in
[01:47:21] gold because by and large it's not that
[01:47:24] productive an asset at at least not
[01:47:26] nearly as productive as the the values
[01:47:30] or the prices that it seems to trade on.
[01:47:33] There's a
[01:47:34] I think if the question behind the
[01:47:36] question is why don't I invest money in
[01:47:40] Bitcoin?
[01:47:42] I would say there are a few reasons.
[01:47:44] Again, not investment advice.
[01:47:46] One, it's not a productive asset unlike
[01:47:49] stocks and bonds that are actually being
[01:47:50] used to create new wealth in the real
[01:47:53] economy. Bitcoin, as far as I can tell,
[01:47:56] doesn't create any real wealth. And the
[01:47:58] the way you know that
[01:47:59] aside from the fact that it doesn't pay
[01:48:01] any form of coupons or dividends or
[01:48:03] interest is it's not generating new
[01:48:06] ideas. It's not creating new structures.
[01:48:08] It's not expanding humanity's future
[01:48:10] freedom of action. It's It seems to be
[01:48:13] much more of a speculative asset. That's
[01:48:16] reason one. Reason two, and then this
[01:48:19] generalizes beyond Bitcoin to other
[01:48:22] crypto assets in general.
[01:48:25] Parenthetically, I do like stablecoins
[01:48:27] in so far as they enable more efficient
[01:48:30] financial asset transfers and to the
[01:48:33] extent they help to stabilize the US
[01:48:36] dollar. So, I like stablecoins. Close
[01:48:39] parens.
[01:48:40] >> I'm I'm biting my fist because I've got
[01:48:42] so many comments. We really need to have
[01:48:44] our crypto debate.
[01:48:45] >> I bet you this is going to be rapid fire
[01:48:47] answers, gentlemen.
[01:48:48] >> Yeah, okay.
[01:48:50] >> I will close by saying Bitcoin as well
[01:48:53] as alternative cryptocurrencies, the
[01:48:56] elephant the third elephant in this
[01:48:58] episode in this particular room is AIs
[01:49:01] and AI agents have are fully empowered
[01:49:04] at this point to come along and invent
[01:49:06] their own L1s and the the argument that
[01:49:09] Bitcoin bulls make that because Bitcoin
[01:49:13] was merely the the first L1 that it
[01:49:15] occupies some sort of primacy in the
[01:49:17] future light cone, I think falls apart.
[01:49:19] Again, not investment advice, when AIs
[01:49:21] come along to the extent that they they
[01:49:23] find any value in cryptocurrencies, they
[01:49:25] can just invent their own L1s and
[01:49:27] they'll probably be much better than
[01:49:29] Bitcoin.
[01:49:29] >> I look forward to that. All right,
[01:49:31] Dave, you have a choice of number three
[01:49:33] or number four.
[01:49:34] >> I'll let you choose which one. I can
[01:49:35] take either.
[01:49:36] >> Go jump in. Choose one.
[01:49:38] >> All right, all right, I'll take I'll
[01:49:39] take three. The US already has a 10%
[01:49:41] equity stake in Intel. Has that helped
[01:49:43] the American at all? Why would AI lab
[01:49:45] stakes be different? And that's for from
[01:49:47] Gear for the Year.
[01:49:49] Yeah, massive, massive difference. The
[01:49:52] US took a 10% stake in Intel, gave it
[01:49:54] $10 billion to bail it out to get chip
[01:49:56] fabs back into the US. They were
[01:49:59] threatening to shut down investment in
[01:50:01] their Ohio 1.4 nanometer project, which
[01:50:04] is critically important for the future
[01:50:06] of the country. It's very similar to
[01:50:08] when the government bailed out the car
[01:50:09] companies. We need those and it was a
[01:50:12] great investment.
[01:50:14] The AI labs are already in the US and
[01:50:15] they already have tons of money. Why
[01:50:17] would you be buying them? Oh, but it'll
[01:50:19] get a great return for the American
[01:50:20] people. You have the power of taxation.
[01:50:23] You can take any amount of money on any
[01:50:24] day you want. You don't want to invest
[01:50:27] in things. Having the government be an
[01:50:30] investor is always a bad idea because
[01:50:32] some future administration will mangle
[01:50:33] the investments and there's no
[01:50:35] continuity of thought in the government
[01:50:37] at all. So, you don't need to unless
[01:50:39] you're helping it
[01:50:41] bail it out or to help it grow some
[01:50:44] strategic function for the country.
[01:50:47] >> All right, I'll take number four.
[01:50:49] How do other democratic nations handle
[01:50:52] sovereign wealth funds? This is from
[01:50:53] @johnsebert5493.
[01:50:56] So, John, I think the gold standard is
[01:50:58] Norway. Its government pension is now
[01:51:01] worth something like $1.7 trillion and
[01:51:04] it's built on oil revenues. It also owns
[01:51:07] something like 1 or 2% of every publicly
[01:51:10] traded company on the planet. Right? Uh
[01:51:13] Singapore has Temasek and GIC. Uh you
[01:51:16] know, the Gulf states
[01:51:18] UAE has Adia, Saudi has PIF.
[01:51:22] Uh and I think the lesson here is that
[01:51:25] once you've got this kind of a sovereign
[01:51:27] fund that's controlled by an outside
[01:51:30] investment group that's not tied to the
[01:51:32] politicians, so the politicians can't
[01:51:35] give favor or spend it, uh it drives an
[01:51:38] incredible return for the citizenry. Um
[01:51:41] and I think it would be extraordinary if
[01:51:44] we could do that here uh in the US if in
[01:51:46] fact you're from the US.
[01:51:48] Okay.
[01:51:49] >> They've also been trained on our data.
[01:51:51] >> What's that?
[01:51:52] >> Collectively. They've also been trained
[01:51:53] on our collective data. So, there should
[01:51:55] be a shared outcome.
[01:51:58] >> Okay. Um
[01:51:59] let's kick this one. Dave, the first
[01:52:01] one's for you.
[01:52:02] >> Okay, Dave, why are you fine with the
[01:52:04] government funding SpaceX but not taking
[01:52:06] equity in AI labs during a high-risk
[01:52:08] transition?
[01:52:10] Did the government fund SpaceX? I don't
[01:52:11] remember that. I think they bought it.
[01:52:12] >> The government The government gave a con
[01:52:15] So, in 2008
[01:52:17] when after SpaceX had its third launch
[01:52:20] failure and it had its first Falcon 1
[01:52:23] success on its fourth try cuz it had an
[01:52:25] extra rocket laying around.
[01:52:27] Uh
[01:52:28] uh
[01:52:29] SpaceX won a billion-dollar contract for
[01:52:32] Falcon 9. It won a contract. It wasn't
[01:52:35] given money. It was given a service
[01:52:37] contract.
[01:52:38] >> This was commercial crew as I recall.
[01:52:40] >> Yeah, the commercial crew, right? The
[01:52:42] space shuttle was going out of business
[01:52:44] uh and we needed a replacement for the
[01:52:45] space shuttle. So,
[01:52:47] >> Yeah, okay. So, that never happened. So,
[01:52:49] that answers that question.
[01:52:51] Uh and and um even if it had happened,
[01:52:54] uh having a space launch capability is a
[01:52:57] national priority and obviously Elon did
[01:53:00] a good job of it. So, that would have
[01:53:01] been a great move by the government. And
[01:53:04] uh then the second part of the question,
[01:53:06] but not taking equity in AI labs during
[01:53:07] a high-risk transition. I think the
[01:53:09] government just proved they can block
[01:53:10] any product. You know, there were there
[01:53:11] was a little argument for a while there
[01:53:13] that the government should be on the
[01:53:14] boards of these companies.
[01:53:16] Which is which is hilarious cuz a board
[01:53:18] member can't sit there and say, "Hey,
[01:53:19] don't release Fable 5. I'm stopping
[01:53:21] you." So, the government already has
[01:53:23] massively more authority than a board
[01:53:25] member does. You don't need a board seat
[01:53:26] in addition to that. You're just going
[01:53:28] to mangle it. Uh so, it it's
[01:53:30] purposeless. And like I said a second
[01:53:32] ago, the government can tax any amount
[01:53:33] they want anytime. Why do you want
[01:53:35] stock, too?
[01:53:36] But I know I think the government will
[01:53:37] take stock because it's politically cool
[01:53:40] and and the the population is supportive
[01:53:44] of it.
[01:53:45] But it makes no sense.
[01:53:46] >> Give me some, too. All right, I'll take
[01:53:48] the next one here in uh number six.
[01:53:49] Peter, uh do you believe a quantum
[01:53:52] breakthrough in 3 years can actually
[01:53:53] break the entire uh crypto stack? This
[01:53:57] is from @ListenGrasshopper. So, my short
[01:54:00] answer is two points. One, I think the
[01:54:02] threat is real but not in a 3-year
[01:54:04] timeline. I think that's aggressive. Uh
[01:54:07] and I think the entire industry we heard
[01:54:10] this uh we had Brian uh Armstrong, the
[01:54:13] CEO of Coinbase, on the pod last week.
[01:54:15] If you haven't listened to it, please go
[01:54:16] check it out. And uh he is working on,
[01:54:20] you know,
[01:54:21] a crypto uh
[01:54:23] tolerant algorithm. And the whole
[01:54:25] industry is. Everybody's going to get
[01:54:27] there before we have to worry about
[01:54:28] this. So, I'll keep it brief on that
[01:54:30] regard.
[01:54:31] Uh Alex,
[01:54:33] you want to choose
[01:54:34] >> wants me to answer question eight. So,
[01:54:36] instead I'm going to answer question
[01:54:38] number seven. So,
[01:54:40] question seven asks if knowledge work is
[01:54:43] cooked, why hasn't anyone suggested
[01:54:45] using AI itself to manage the sovereign
[01:54:47] wealth fund? And this is from MGP Star.
[01:54:51] I think the premise is incorrect. I
[01:54:53] think to the extent the US and other
[01:54:56] countries have sovereign wealth funds
[01:54:59] like Norway, I think AI is already
[01:55:01] managing the sovereign wealth funds in
[01:55:03] the form of AI managing the overall
[01:55:06] broad public equities markets and other
[01:55:08] public markets. Almost all of the volume
[01:55:11] in public equities markets at this point
[01:55:13] is driven by algorithmic trading. AI is
[01:55:16] already managing all of these
[01:55:18] valuations, yes, including SpaceX's now
[01:55:22] fifth largest company in the world.
[01:55:24] That's almost all AI. Obviously, there's
[01:55:26] a lot of retail, but AI by volume is
[01:55:29] actively doing the price discovery. So,
[01:55:32] the premise, I think, is incorrect. AI
[01:55:35] is already de facto managing sovereign
[01:55:37] wealth funds to the extent sovereign
[01:55:38] wealth funds have exposure to assets in
[01:55:42] highly liquid public markets that are
[01:55:44] themselves almost entirely dominated by
[01:55:46] volume by AI.
[01:55:48] >> Nice. All right, Salim, this is revenge
[01:55:52] of Bitcoin here.
[01:55:54] >> Um number eight, why would AI agents
[01:55:56] want to use Bitcoin when they still have
[01:55:57] to pay for energy? That's from
[01:55:59] @capquills. Uh so, uh
[01:56:02] two three quick thoughts here. So,
[01:56:04] agents aren't going to be ideological.
[01:56:06] They're going to be ruthlessly
[01:56:08] functional. They're going to use
[01:56:08] whatever rails clears their transactions
[01:56:10] with the least friction and the most
[01:56:12] trust, right? Trust is the really thing.
[01:56:15] Bitcoin's energy use is not uh the
[01:56:18] reason the agents are will or will not
[01:56:19] use it. It's whether you can get a
[01:56:21] neutral
[01:56:22] uh
[01:56:23] high throughput global settlement model.
[01:56:26] Um now, there's something powerful about
[01:56:28] Bitcoin why people are getting excited
[01:56:30] about it these days more so than say 5 7
[01:56:32] years ago or 10 years ago. When you have
[01:56:34] a digital currency, you want three
[01:56:36] points on a triangle. You want to hit
[01:56:38] decentralization, you want it security,
[01:56:40] you want it scalability. When Bitcoin
[01:56:43] first emerged, it hit decentralization
[01:56:45] and security for the first time ever.
[01:56:47] And people are really excited about that
[01:56:49] because no digital currency had hit
[01:56:50] those two points, but it didn't solve
[01:56:52] for scalability. So, you had the rise of
[01:56:54] Ethereum, Solana, Cardano, and all the
[01:56:56] altcoins trying to solve for
[01:56:58] scalability, but in doing that, they
[01:57:00] typically compromise on decentralization
[01:57:03] or they compromise on scalability. There
[01:57:06] was a big Ethereum fix a few weeks ago.
[01:57:09] If Ethereum was really decentralized, it
[01:57:11] wouldn't have had a
[01:57:12] wouldn't have been able to do a fix like
[01:57:14] that, which tells you Ethereum is not
[01:57:15] really decentralized, right? So, this is
[01:57:18] where you saw the FTX collapse or the
[01:57:20] Luna collapse or they collapsed because
[01:57:22] of either failure of decentralization or
[01:57:25] failure of security. Um but with so
[01:57:27] Bitcoin had the first two, but it didn't
[01:57:29] have scalability. With the rise of the
[01:57:31] lightning network,
[01:57:32] uh created by Blockstream a few years
[01:57:34] ago, uh it solves for scalability. And
[01:57:37] so now you have all three. Bitcoin hits
[01:57:39] all three, and therefore people are
[01:57:41] getting more and more excited about the
[01:57:42] future of that. And we can get to the
[01:57:44] broader debate later.
[01:57:45] >> All right. This was quite the show,
[01:57:47] gentlemen. Uh
[01:57:48] it was [clears throat] it was fun. I
[01:57:49] mean, honestly
[01:57:50] >> Yes, and when we say gentlemen, we
[01:57:52] stretch the term to
[01:57:53] fit all of us. [laughter]
[01:57:54] That's an old That's an old PG Wodehouse
[01:57:56] joke.
[01:57:56] >> My dear friends. All right, I hope you
[01:57:58] guys uh if you're not subscribing,
[01:57:59] please do. Turn on notifications. We're
[01:58:01] putting out as much as two episodes per
[01:58:03] week. When there's breaking news, our
[01:58:06] mission is delivering you the breaking
[01:58:08] news
[01:58:09] when it's happening, what you know, what
[01:58:11] it means, what it matters to you.
[01:58:14] And join us at the Moonshots Summit. You
[01:58:16] can go to moonshots.com to get your
[01:58:18] ticket and join the mates there. I love
[01:58:21] this. An AMA with AWG. I I think that
[01:58:25] alone makes it worthwhile. We're going
[01:58:27] all out.
[01:58:29] What's that?
[01:58:30] I said we're going all out. Yes, we are.
[01:58:33] And of course learn about the
[01:58:34] singularity, the organizational
[01:58:36] singularity uh with Salim investing in
[01:58:39] AI with Dave.
[01:58:40] Um and join us. Uh
[01:58:42] we're going to have an amazing crew.
[01:58:43] We'll be announcing additional, you
[01:58:45] know, uh headline speakers uh besides
[01:58:48] Kathy Wood and Astro Teller uh and
[01:58:51] Palmer Lucky. Palmer's our newest. he's
[01:58:53] going to be extraordinary Uh
[01:58:55] anyway have an incredible week
[01:58:59] you know
[01:58:59] >> [clears throat]
[01:58:59] >> don't sleep.
[01:59:00] >> [laughter]
[01:59:01] >> Yeah, well if this week is like last
[01:59:03] week holy crap.
[01:59:04] >> I mean this is unbelievable the
[01:59:06] implications of this every like few
[01:59:08] hours everything changes again it's
[01:59:10] crazy yeah.
[01:59:13] >> All right see you guys.
[01:59:14] >> Love you guys.
[01:59:15] >> Love you too.
[01:59:15] >> Thanks.
[01:59:16] >> If you made it to the end of this
[01:59:17] episode which you obviously did I can
[01:59:20] see you moonshot mate every week my
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