The Biggest Merger Ever | Ep. 050 Lemonade Stand 🍋

>> Got my idea already. >> Last, I flew to a, I flew to New York. >> That would, >> To the stock exchange, I just, I just yelled outside the building.

“Because I think that's what they did on TV.”

>> Right, that's, do you hold a little bit of a paper? >> Yeah, I don't think you should trade anything, I think you will be financially ruined. I should level of intelligence, okay? You could go to tctrade.com, at the very least, you could check out their tutorials, where you can learn some of the corporate jargon.

>> I could go to tctrade.com/lemenade today. >> Then you could do that today. >> Tctrade Incas a registered broker dealer and member of FINRA and SIPC.

>> Welcome to Lemenade stand, first car, why is Aiden so picky and meaty and touchy on my cards?

>> I wrote that one. >> Yeah, I think he's a musicalist, let's get the whole round table going. >> I reached for it because- >> Why did you reach for it? >> Out of the corner of my eyes, I swear to God that first card says Squeaks. >> Which, who is just so, when I'm not prepared to talk about it.

>> Let's show it today's main topic, Squeaks. >> He's on Musk is purchasing XAI through his company Squeaks. >> Yes, he's merging Squeaks. >> Squeaks with SpaceX. >> Wow.

“>> Bringing sort of Squeaks is funny energy and the ability to launch.”

>> There's a quote here. >> I was considering Aiden, but Squeaks simply outperforms him on Mirage every time. >> That's not true. >> That's not true by a rake dude. >> I was a couple, I was last week at least.

>> That's not what you were saying. >> Not as new shit about gaming. >> You didn't know shit about, well, we'll find out what we're talking about. >> It's not what I'm talking about today, but the big one is that the world's largest merger private merger ever just happened between XAI and SpaceX.

>> Nice. >> You may remember, we'll story here, remember Twitter, little blue bird. >> I remember it. >> I remember it. >> This is a business.

>> Imagine that, but in space now. >> Imagine imagine that put that out in the space. >> Okay, all the things you made about Twitter, name them. >> Ooh, I hate the algorithm and the way that it primarily delivers me sloppy now, instead of things from people I follow.

>> Now imagine that, but it's coming to you from space. >> Is that changing?

“Does that make you, are you back in, or are we at grock does that change anything?”

>> If I'm being honest, I'm slightly more intrigued. >> I'm worried that the aliens first contact with us will be through grock. >> And they'll hate us, they will not like a grock is not a likable fellow. >> Yeah, it's just a coin flip of like which of the satellites you hit. >> You didn't have this on space, didn't you?

>> You didn't even know much enough there, grock, or there's the bird in space. Anyway, I remember Twitter, so Twitter is a company not doing so well when it was bought. It was like dead, even barely staying afloat, their CEO was part-time. He worked at square most of the time and then was Jack Dorsey. So you won, buys it, and puts a lot of that on deck, a lot of that on credit card.

You get some Saudi help, and you get whatever it is.

So it's a $44 billion purchase, a lot of it's through deck.

He finds out quickly that his new changes to Twitter don't make any money. They're not, they're actually losing all the advertisers. And the ones that try to sell you the check mark, they don't make any. >> But I read that viewer hours are up from Elon, I've seen Elon make a lot of claims. I know, as for a fact, it did not make a profit, and that's because not only did the revenue

go down, but they had to pay the interest on the deck, which is a lot of money every month. So that all added up to being in that negative, and some of the people that helped them invest in that debt, the Saudis, and they were getting kind of mad, but Elon, he bailed them out. He went to his other company, XAI, which he also owns, and bought Twitter, XAI, buys

Twitter. XAI also lose money, but they were bigger and they're easier to attract funding, because the AI is a cooler buzzword, and maybe Grock is going to do something. >> I'm not a fucking expert. I don't really, I don't know.

>> And at this stage, in a way, Elon has effectively bought Twitter twice. >> That's what we're getting to do. >> That's what we're getting to do. >> That's what we're getting to do. Yeah, he's bought it twice.

He bought it himself, and then he bought it with his other company. >> Okay. >> To bail it out. But now you've combined a money-losing company, which is XAI, with a money-losing social media platform who wrongs make money.

>> Yeah, so they'd be compiling. I think I have a quote here.

$1 billion a month, XAI burns through $1 billion a month.

This is after, I'm not going to do the whole timeline here, but around the time of this article, XAI was trying to fundraise, because they're understandably running out of money. You can't spend a billion dollars a month, and keep afford to buy all the stuff you need for Grock. If you need for Twitter, everything.

So, yeah, you can see right here. They're trying to raise $9.3 billion in debt in equity. Well, it turns out that the market was like, I don't know, you have to give us pretty high

he's like, "Wait a minute, I got a plan, I got an even bigger company that can raise

even more money." >> Wait, wait, wait.

“>> But surely the third company is profitable, right?”

No, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait, wait. I'm being serious. >> Yeah. >> I'm being serious. >> Yeah.

>> Wait, he used, okay, it has to mean, this is space X. >> This is space X. >> Space X is buying Twitter. >> So nobody else. >> Yeah.

>> Or keep it at XAI. >> Exactly. >> So, so now this shit's sandwich is getting rolled up into, what I would say, and I think people who are eating on haters don't give enough credit, space X is a pretty solid company from what I get to.

>> Okay, and that was my question here. >> Yeah. >> I, for everything that's been talked about, for Elon and all these companies that have heard over the years, I actually thought space X was a company, I thought space X was making money.

I thought space X actually had a profitable. >> They're not profitable. >> Okay. >> It's my understanding. >> Correct.

>> But they do make real revenue, and theoretically have a path towards being a real business. >> Yeah. >> Like store link is a product people like, it does, makes for, that's where the majority of the revenue comes from. And they have government contracts for launching rockets and shit.

So like between these things, it's like, there's a business there, which is why, by the way, a lot of space X investors, like the hardcore space X only investors, people that have been in for minute one, and don't care about Elon or Tesla or anything else, or maybe like Elon, but they're mad about this. This is like diluting, because a fourth of the company they now own, the way the way that

the best valued is now Grock and Twitter, and like they, they said X AI and Twitter is worth one fourth of space X when they merge, so that's where the shares were diluted. So like now you own like this weird tumor, this weird appendage on a beautiful space X, and they really liked. >> Maybe.

>> Why, if you love space, I don't see why you wouldn't like an app that has everything on. >> Or like a weird fucking AI that answers your questions. >> It's like, you have starlink, but now you also have something that can deliver porn. >> Yes.

>> Or he's an industrial scale.

“>> But like in a rural area now, you need to.”

>> Okay, all right, so let me give you, let me give you, let me give you the pitch. >> Okay. >> Your best guess, what is the business proposition? >> So in good faith. >> Yes.

>> In good faith. >> Yeah. >> And for, so Elon, a distant interview with DwarCash and they talked about why you would do this. So what would be the purpose of having the space company he owns by an AI company? >> I think the good faith in terms of.

>> From my small brain perspective, I feel like there has to be some sort of alignment with the end goal of the AI that you are training and developing and the needs of the space program that you're building. Like there are advantages of embedding this AI in the satellites that you're putting up as a part of Starlink or the rockets that you're launching or the software that future space travel

that this company is going to do is there seems to be some sort of technological alignment that is the best case scenario that I could describe. >> Okay. Here's the different way of putting it. Who's the most valuable company on Earth right now?

>> In fit. >> Right.

“So what is like, if you, what is like the one of the best businesses you can make right now?”

>> Oh. >> Building a shitload of data centers.

But the problem is that's hard to do on Earth because of things like regulation and human

beings needing the energy and the land. >> Right. >> What if you just took the data centers and you move them into space, Aden? >> Yeah. >> That is the pitch.

AI data centers in space. >> Okay. I know this sounds ridiculous. I'm sure there's a bunch of people that think this sounds ridiculous. Wait.

Is this low-key a good idea? >> No. I don't think so. I think. >> Okay.

>> All right. The idea is you can put a data center into space that is built or built in with or surrounded by solar panels that give it like a constant source of power. Like a constant source of power compared to what you can do on Earth and with like no ramifications for the environment or people.

>> Yes. >> Yeah. >> The probe power. You can make -- there's all these different challenges to having a data center, right? And one of them is energy generation obviously.

So if you put solar panels on a data center and you shoot it into space, you can put it in

an orbit that is always facing the sun.

So you don't have to deal with the fact that you're on Earth like you only get suns some of the time, you don't have to deal with things like weather or physical degradation. And the only cause in return is that it's extraordinarily expensive to get it there to maintain it and you don't have a way of cooling it easily.

And this, you know, assumes a variety of other things all over the Earth.

“>> So sometimes you need to update the chips that you sent up there and it's like incredibly”

a huge pain in the ass. >> Right. >> The sand of the chips are going to basically maintain themselves without any sort of guidance or oversight, but, so here's the counter. As much as this sounds like a crazy Elon thing, Google actually announced a plan to do this

in November. So this is like not sort of, it's not just Elon's wacky idea, they started in November. They call it Project Suncatcher and they've described it as a, you know, it's moon shot and give it a 10-year timeline of like we think that in 10 years it'll be cheaper by the mid 20-30s to start new data centers.

Like launching an operating a data center would become the same prices doing it on Earth. That's their pitch and they're like, "We're going to see if this is even possible and they're going to start to test it." And then Elon went on this podcast like a week or two ago and had a pint of beer and then said in 36 months it'll be cheap and it's based.

“So I could be somewhere in those, in those days.”

>> And it'll translate an Elon 36 months into real time. That's probably about 10 years. >> About 40 years. >> Yeah. >> I have Mr. Timeline, bro.

Yeah. >> Okay. >> Okay. As soon as you started listening to the downsides, I was like, okay, I just can see how this might not be, it might not work, right?

But can you explain what Google's plan is exactly like who are they partnering with or how are they planning to do? >> Yeah. So they're going to start testing stuff in 2027. They're going to partner with planet who is another aerospace company that does satellite

imagery. So they're going to work together to try to solve these issues. And they're being very upfront of like this is extremely technically challenging. This is conceptual. We're going to try to make this work.

We see this potentially working on 10-year timeline. And they listed their own quantum computer and waymo as an example where the like, these are previous moon shots we've tried. They took 10 and 15 years respectively, so we're seeing this maybe be possible in the future. And then to kind of like quail a lot of the concern, I pulled out a quote here, our analysis

indicates that this should all be possible with multi-channel dense wavelength, division, flexing, DWDM, different receivers, and spatial multiplexing.

>> You're always talking about spatial multiplexing.

>> You don't go that on and on. >> It's like that's like an insane obsession of yours. >> I just don't think that you guys would get it if we do. >> Probably. >> [LAUGH]

>> Because it's just you don't have the background that I have. >> [LAUGH] >> And you dob's foster school of business. >> You're really, that's one of the main things they have. >> And well, in multiplexing 423,

we just, you get so deep into the sauce with your professor. It's really hard to explain it to people who don't take that class with you. >> You get it, students don't even talk, they just multiplex it. >> You just multiplex, you multiply, so you multiply, you multiply with somebody else sometimes. >> [LAUGH]

>> Okay, let me say something, that is what is being stated by Elon of this is the reason why this is a great fit.

>> Here's what I'll say, XAI is competing in this AI race with Google, with Amazon, with OpenAI.

>> Yeah, they're everybody, they're all full steam ahead to get ahead in the AI race. >> I will say real quick, you kind of dismiss them as saying they're losing a billion dollars a month. >> Open AI is losing three to four billion dollars a month. >> So they're actually doing pretty well. >> 100% actually trying to get to.

>> So I keep pulling my screen, Perry, or like, you show this, okay, so Google stock just had a little bit of a thermal recently. >> When they announced, they're going to be spending $185 billion dollars this year on an AI absurd amount. But, they have a lot of money, Amazon, top them, pause. They said they're going to spend $200 billion in AI, but again, they have a lot of money. All of these hyper-scaling companies are shooting to the moon about that, that's been on AI.

Amazon makes $95 billion in profit, alphabet makes $152 billion in profit. Hesla makes $7, and it's going down. Space X, I don't know if it has property yet, but if it doesn't, it's like around six to seven. It's like in that area, and not, so you can say, so this is a race that even I think is not equipped to throw as much money as these guys can. And the idea that he's going to get to space, build these incredibly expensive data search with no problem, I'm skeptic on.

“But here's why I think, here's, I'm giving alternate theory on why this is happening, okay?”

So Mr. Musk is tweeting about how money cannot buy happiness, and that's an easy thing to say when you have $844 billion and are currently richer than the next three people combined on the list.

You're the rich man in the world by far. So just discussing amount of money, all right? We mentioned the next two are the Google founders who have an extraordinarily profitable company. He has two. Okay. Yeah, and his, I mean, the amount of money has so far dwarfs any of the profit of his business, crazy. Anyway, so he has a pay package that we talked about that he signed with Tesla recent.

Number one is he has to like double the market cap of Tesla. And as I'm looking at this, it feels like this was only the next to last step of where it's going to go, which is that XA I goes to SpaceX, SpaceX is going public this year out of about a trillion dollar valuation and they're going to merge, they're going to merge Tesla and SpaceX.

“SpaceX is going to go public and a trillion over trillion trillion a half. They're trying to shoot them for him. It's not confirmed.”

But strong strong indicator the SpaceX is going public this year. That has to be the largest IPO ever is by far. And the gap between again, like, you know, a trillion dollar company is like a Google or an Amazon, they make huge amounts of profit.

Again, SpaceX is a good company, but it's not there. So the amount they're making it, they're about their value that is so rich.

And now it has like this rock money losing Twitter money losing fourth of it. Anyway, I'm all saying it seems a little skeptical, but it feels like and then I'm not I'm not thinking it's out of my ass. Like a lot of incredible evidence and things Elon has said that he eventually sees all his companies becoming one thing. And it would be convenient if a 1.5 trillion dollar company merged us with a 1.2 trillion our company, right as he needs to add a trillion dollars a market to get his pay package that to me would be a weird thing to say for a guy who's talking about how money won't matter in the future.

Well, I mean, he's saying money doesn't buy happiness, but we don't we don't know if a trillion dollars. But he keeps tweeting like conventional currency will just get in the way wattage and tonnage will matter not dollars and it just it's so funny with how how much money yes, like I could. It was just not so easy to say so anyway, I think this is a part of it. And I'm skeptical on the space data center. I guess like I'm saying is like I think SpaceX had something real and I think they're getting fucked about Elon's greater vision.

Yeah, I can let me make an argument. Yeah, SpaceX is a pretty good company. All right. Yeah, I was looking at this a little bit as well as talked to somebody who works in the aerospace industry who I can't give details about what they do specifically, but they said they're so first off said chat with with bankers who work in the aerospace industry.

“If you go public right you have to work with bankers to do the IPO right so strong rumors that this is happening this year that SpaceX is actually going to IPO this year.”

So that's in like the investment world and the kind of expectation is that at pulling X AI into SpaceX now makes it an AI play that you can go to investors or the public and say hey look AI's the really hot thing right yes this is a space company, but it's an AI space company right so just getting to like have that be part of the package given the spiciness around AI right now when space is in futuristic. Yeah, we kind of finish the whole thing in the eye ten times but boring 20 times. Yeah, it makes it like I can understand that like it's it seems to play to the time.

Right, yeah, and I think it's probably it that's probably the biggest driver who knows how much of this is is Elon's you know, I don't think it's only this by the way. Right, right, yeah, you want is a guy that's mixing my my suspicion is more of the incentive is about eventually merging multiple companies as well as making AI play a raise a ton of capital. Rather than the space data center thing being truly the future of the world. I feel like a hype thing to help boost this idea. Yeah, so yeah, it's for the data center thing seems to be the this is why this makes sense from a PR standpoint and behind the scenes were like this is because you want to put AI next to SpaceX when it IPOs has he alluded specifically to the idea of Tesla taking over or merging with SpaceX.

“He has only in like Twitter replies and stuff. He hasn't like there's been nothing super official, but I think Ben Thompson writes straight techery which is a great blog.”

Really, you did a deep dive analysis on all the statements they made over the years and there's a clear sense of like I want my stuff to have been like I'm it's all coming together all at all part of this great fusion of AI space robotics.

You know, the idea is like if Tesla had an energy part of its company and a robotics part of its company it would be a line like Tesla's already put $2 billion into grock.

It's like a sci-fi book. It's like it's a sci-fi plot. If you use all these to have all these companies and infuse them all. Hey, he's not talking about Mars. He said, you're giving up on him.

He gave up on it, I guess, but you know, 14 years ago Elon Musk said I'll put a man on Mars in 10 years obviously his timelines are always a little off.

So Mars is at least 10 years from now.

“Well, he so he did say on this podcast I want he's it within the next 10 years they're going to invent a time machine to send somebody back to Mars 14 years ago so this timeline was correct.”

I mean, it was funny. So I listened to maybe 20 minutes 20 30 minutes of this podcast and they kept just probing him for like what is the plan here like how is X. I'm going to be comfortable in just like I'm not going to spill the secrets. I would need two or three more beers and I didn't click to the end of the hour and a half to see did he just so I was probably the same 20 minutes. I got this the see my guy was like doorkish kept asking but specifically about the the data centers. The data centers because work has knows his shit and he kept poking him like he's a podcast or he's qualified. He's a podcast, there's no one fresh and there is.

But he came asking him like, okay, what like has his like apparently my understanding I'm not an engineer my understanding is the amount of sword panels you need on these things generate even like the equivalent of a one gigawatt data center is like absurd like at the current tech it's like absurd.

But the size is incredible. The radiation like breaks the GPUs up there much easier like the amount to cost replace is absurd.

Like it just seems astronomical literally and figuratively to do in any realistic timeline and so it feels more to me like hey this is like cool hype thing to say before the IPO. Oh, wait very can you pull this up in space X again like in space X is announcement that they're buying X ai slash also Twitter.

“They you know it's it's this it's saying we are doing this so that we can get data centers into space and that's the only way to scale them to the degree of which you know and there's just one line here.”

The only logical solution therefore is to transport these resource intensive experts efforts to a location with vast power and space I mean space is called space for a reason. There is a laughing emoji in the PR state so I'm pretty sure graph roguest right like low that run a week. All right so I'm a couple of crap rapid fire questions you guys about aerospace industry and I did a small amount of research on this. I as well as chat with my aerospace friends so I think it's easy as certainly I have fallen prey to this to think that space X is like the only space company making rockets shooting things in space.

There's actually others there's like rocket lab is a public company that does this. It does this firefly Astrah in space yeah in space is like a big one you've been working on that one yeah in space you're like watching you're just like. How far do you get you get close well we've gotten probably about 15 feet in the. And don't give us raw numbers say the percentage improvement every year. Yeah.

And in terms of height and then also huge celebrity investors like Laude Wigagran. Oh he doesn't know that he's an investor right but you've been pulling some of the but I've been pulling money out of the account because there's precedent for that.

I've got one million here couple million there okay so there's a lot of companies rapid fire question why the fuck does the average person care about things going to space anyways.

I don't know I thought the I thought Starlink is pretty cool like that's cool right. Like a grand philosophical sense either either grand philosophical or more importantly if you are a person who works at you know a normal job and you don't give a fuck that space X launches. There are many rockets a year what are some reasons that you as an average person might care about aerospace industry. I think there's.

“I think there's still a raw fascination with like space and exploration and like furthering human discovery.”

Boring that I think is that I think is. I think I still have that in my heart I was like fascinated by space when I was a kid. I wanted to be an astronomer. The sleep right now I'm going to kill myself one day. I'll tell you why I'm going to space because I'm a greedy little gold goblin and apparently these meters and these asteroids they have a ton of gold in them.

So that was the that's the other grab on there and you could suck it all out is I do think there's there's probably a longer term argument of if you can make space travel cheap enough you can. Collect or gather a lot of resources from off the earth without a lot of the negative externalities of doing it on earth.

Exolving humans of the downsides of like resources right you guys live on Elon Musk moon city would you move there and visit you.

Privilege I would buy my. I buy an apartment and it's metaphors. Why would you use that as the example does.

“But I feel like those are the two like there's there's the philosophical kind of like human discovery and then I think there's a scientific.”

Like reason alongside that you there's valuable human discoveries that come with like the pushing of human understanding that is required for space travel.

And then there's a more like practical like resource and energy. Reason on the other side. Yeah so like what you said you know NASA has pages about this but you know a lot of the advancements and technologies that benefit life on earth come from.

“Yeah space technology advancements so like solar panels water purification systems dietary formulas material science innovations these are all from NASA.”

As it NASA has talked about how their work has advanced these things this stuff that benefits the average human on top of that weather forecasting that's from satellites and space GPS that's from satellites and space.

As you mentioned starlink communications is you know up until now we mostly communicate with our cell phones and internet on a bunch of ground fiber you know around earth.

I mean I mean I could I give a cool example of starlink like a very practical thing when we filmed tip to tip last year which was Ludwig and Michael Reeves traveling through Japan. There crew behind them in the RV used starlink for a ton of that trip in order to send like proxy files back and forth that they were editing with to upload like final versions of videos.

“It was super useful and was one of the reasons that a project like that is maybe not straight up possible but at least way more practical to do than otherwise would have been.”

I mean one of the one of the things that really warmed me to starlink recently was reading a lot about what was happening in Iran we don't have to go too deep into it now but. The government we're going door to door checking the rooftops and breaking starting satellites like but that was the only method and so like it is a way of democratizing internet access through you know it's like there's something to that for sure. Yeah and there's also there's a lot of businesses that might not be aware of that are based around satellite imagery which to be fair a lot of this is used by governments for defense manufacturing or spirit.

But they're real actual good use cases for example the Brazilian government uses satellite imaging to see what's going on in the rainforest and can see like okay a narcotics operation is clearing forest land to build an air strip and to like build out narcotics factories. Are seeing it for in the context of like Amazon rainforest logging in like it's like illegal logging practices in the in the Amazon they can see areas or patches that have like been burned in like really remote areas so you can identify.

Where you know where to find like these poachers or loggers that aren't supposed to be there. Yeah so there's there's you know you you actually care I think it's as an average person this might reasonably affect your life in some way but I think the big one to hone in on that we just talked about is Starlink because that's communications and let's look at Verizon's market cap it is $200 billion right like. Just one of the telecom's companies in America is a $200 billion market cap so if you imagine that Starlink and SpaceX who own Starlink can expand that to the point that they are eating giant chunks of the telecom's industry you're starting to see okay a lot of that one trillion dollar valuation that SpaceX has like maybe you can justify it if that just keeps growing and growing and growing.

I guess this is a thing that's unique to this time but especially the Elon's companies were just so much the valuation always comes from saying things like that but it's never from what are they doing now right the money is never there now the robots are not being sold. Autonomous vehicles are yet to have any real driverless rides like it's like I get it I do get it I understand it but they more than anyone else get the biggest amount of like gap yeah no what I just said is a story yeah. I'm just going to happen it's a good sound story that when you go like look here all the things that make this story might be true because of all these things right and then he's a guy who you know provably now because it's been so many years has told again some stories he has has eventually gotten there what's so many the story Homer.

I like Simpson though because like you know that the guy on Mars the the drill the boring drill highways there's like a lot of things they just got promise and now we've had enough time to be like those didn't happen.

One of the big things they're flagging is like hey.

“Is currently being sued by like 12 countries France much of your because of all the weird like things it was doing with putting people in bikinis and well France can't swim if they're in space.”

And like bad PR and like everything that that is political it's tied with Twitter and X and it's now all lumped into space X which is just you know it's like it turns something kind of clean and cool about rockets and there's something very messy that's there. So okay we can click queen queen quick rocket things so okay while a lot of this is a story it is true that space X is by far the most dominant rocket company right now so how many how many launches do you think happened. In 2025 from blue origin it's the Amazon it's the Jeff base of company we hear all about it. How many rockets do you think they want to watch that one with Katy Perry and it was such a PR disaster they haven't done wrong.

So it's like it's like it's like a six minute funny no gravity thing to that first one was such it everyone that was on that thing got like.

The first week. We've done it was sorry they've done two launches in 2025 or two all time 2025 okay I don't say so that it's not it doesn't really make I don't think 24 for an earlier increases the numbers that much but I don't have those talk my head.

“And Katy Perry got so roaster for that she had to start dating Justin Trudeau that's how far to fell back to earth, which is not a good follow up. It's kind of like basically bad p like space X buying Twitter doesn't absolve the problem.”

Okay, lucky Martin they have a space count how many launches do you think they had in 2025 five. Oh, I'm going to give him eight. Okay, close six so rocket lab this is a public company that launches rockets this they're a legit ass public company.

I believe their market cap is 36 billion dollars how many set how many launches did they do 25. Bro give me a hundred holy shit no. Jesus Christ. Okay, no rocket rockets are hard.

“The public company that you can go buy this from 21 and 2025 SpaceX 165 launches they are way above everybody else in terms of launches. Okay, number of satellites that they personally manage and operate out in space planet labs is a public company.”

They have like 150 to 200 doing this satellite imaging Amazon Leo their Amazon star link competitor they have about 200 again their Amazon Leo's explicitly trying to like get in on that star link competition right yeah space X again Amazon is 200 space X has 9600 like this is orders in order magnitude higher right but fucking 50 times more. And then reusable rocket SpaceX is the only one commercially doing reusable rocket so they save something like 40 to 50% of their launch call there's the only one doing reusable rockets yes so everybody has prototypes like China's lab does rocket lab does ISRO does blue origins are reusable but again they're not going into into orbit right now so it's like less impressive.

SpaceX is the only one commercially doing it and he's rocket can get up to like 20 times usage can I say okay so let me let me break away I'm not here to tell you that this company is fully deserving of a trillion dollar IPO. But even without the the the star link part the promising thing of this company to me has always been space travel and will inevitably become part of humans future in some capacity right like the the desire to go back and forth between space in the earth more frequently not from like a human tourism perspective I don't really think that'll be.

You want to go to the moon 10 minutes ago you said you're going to swing by yeah I'll be one of the guys of course no but less that and more there will be like more practical resource driven reasons to go back and forth between space like satellites like but as an example you're you're so far ahead of the curve and an industry that is. So it's so critical to the future yeah I feel like there's so much potential there that's the value that I've always seen in space X so you know X AI or not okay it's not that I do is agree I do think space X is best company.

But all set like here's an analog right the things you're saying about how far ahead they are are things you could have said about Tesla in 2018 or 19 right and if you flash forward till now like for you know I got a story here.

But then also like Tesla since that 2020 period where or 2021 right kind of Pete has flat line like the growth of the cars and all things you said they're going to be dominant in the lecture vehicles they're so far ahead. Yeah, everybody else caught up their flat landing there European sales for this year down 88% Norway down 67% in other ones down 57% in the UK down 40% in France this is all from like this January versus last year okay they're in three consecutive years of decline in Europe.

“So like that's in Europe and China they're worse like they're doing okay in America they're losing on their places so the idea that like space X is going to maintain this app I think they are I mean,”

I mean, undisputably he's innovated in some areas or his companies have innovated in some areas like they've had. The SpaceX absolutely has like definitely definitely. Yeah, but the idea that he has been really good about that next step where you like. First of all maintain the lead and then turn it into a profitable business that can he doesn't been there. And so like I feel like in fact, other people are going to step in take the tech that maybe he's lead on chamey and yeah I'm not even kidding it might be show me the phone company now car company soon to be rocket company that's the way it all works in China.

So I guess I want to take in the under is what I'm saying, but I don't disagree with this. Yeah, just real quick because it's important. Yeah, I hate this dude, but there we go. So space I heard that so anyway fact checking whether SpaceX is profitable.

They have said they're 8 billion in profit last year ahead of the IPO so at least at times they are profitable 8 billion in profit on 15 to 16 billion in revenue and that's from routers 100%.

So, so they're not profitable. So they are profitable. Yeah, so that's like an important correction. Yeah, does that justify buying the thing that's going to lose them a billion dollars a month maybe. But we're going to say, you know, this profit again is we're in comparison to Amazon of a hundred billion. Yeah, what a hundred billion is like.

“So this actually leads to a question I want to ask you, bull is I think revisiting this in this moment of seeing the profitability of a company like Google or a company like Amazon.”

Seeing the list of like the wealthiest people alive right now, at least like private individuals. And then looking at the like where Tesla's at where SpaceX might be, where XAI is and isn't it kind of ridiculous that he's that rich? Like, does any of this? It seems so unfoundedly disproportionate from how other companies are valued and how other people's like net worse or represented. Like, how can this guy who's at best in charge of one company that loses a lot of money, one company that makes $7 billion a year, one company that makes $7 billion a year.

There's $800 billion dollars. I think he, first of all, he owns a larger portion of it than most other CEOs.

I understand that, right? But it's the idea that after everything we know and understand it's like people that invest like broadly. People that invest in these companies understand a lot of the things that we understand about Elon Musk and these companies as well. So how is his net worth living like allowed to be?

“I think he's the greatest storyteller, man. You've talked about story. I think he's just been in credit. He will get people and the market gets excited about the future he paints.”

And whether or not that materializes, doesn't seem to matter so far. I mean, look at the three of us. I get hyped up about shit all the time. Just sit on this show. No, I mean, even if there's one out of three people, you did it in this episode, right? I'm sitting here who I'm not a fan of this guy. But I'm like fucking fucking put the GPUs in space. I'm fucking awesome.

I get that part. But it seems crazy that the story that the narrative aspect is enough to like take, I know my good. And it's not just, I know my company only makes $7 billion, man. But trust me, it's worth way more than this other company that makes $130 billion here. Yeah, but I think the all the market has become more focused on storytelling.

He's just the guy that's the... it's so extreme that it's like, it's frustrating when you water have any sort of valuation makes sense. But yeah.

But what I want to tell you is not the most important part of the studio.

The best part of the show has been hit by the internet. It's a masterpiece. I really hate it. Really? You can't say that. Yeah, you're part of the story, right? But you don't believe it?

I don't believe it. I don't believe it. I don't believe it, I don't believe it. And if they then work at home... Catching?

Does it? Save. This story.

I told you guys earlier that I thought to trade stocks.

You have to fight in New York and yell.

“And the streets and wave with paper around.”

And that's... I've learned from TV. And you guys just... you make TV. He doesn't even do that. It's like a 1920s movie. You guys...

You guys don't watch it. It's like... I can't be open on this show. So where do you trade the stocks? Tell me where you do it.

There's a lot of places you could do it. But one place if you were interested in learning about the jargon behind it or having FDIC, FNRA and FAS, IBC backed, trading platform. You can go to T-Trade.com. Okay.

TastyTrade.com/leminate. Yeah, of course. Otherwise, we wouldn't be talking about it. It's packed with trading features. You trade smarter, like advanced trading tools, backtesting, pre-built strategy,

select a risk analysis tools and a bunch of educational stuff to teach you about how

exactly get into this Aiden.

I am saying that directly at you, that's not for our audience. You really need to learn. This is like... This is not just... I think I just didn't yell loud enough. No, we're not.

You see that. Go to T-Trade.com/leminate today.

“T-Trade Inc is a registered broker dealer and a member of F-I-N-R-A-N-F-A and”

S-I-P-C-E. I'm going to be a language arms race with my boss, Ludwig. Everybody, he speaks so much. He speaks a little Japanese. He speaks French.

He speaks a little of a lot of things. He's not... And he... Some say he even speaks Chinese now. No.

So I've been using that to study French. So I can shit-talk him in a language he can understand. Okay. He's like a one-inch deep ocean. There's nothing there.

It doesn't go down. He knows it's for words. I just know. You don't need that to be Ludwig awkward. You need five minutes at a phrase book.

But if I wanted to learn a lot... You want to learn a lot. It starts speaking to the language in three weeks. You can go to Babel.com/leminate and get up to 60% off your subscription. 60% off when you use our link.

Join the millions of Babel learners breaking the language barrier every day at Babel.com/leminate. We should say Babel is an award-winning app that makes learning a language simple and effective. You got practice conversations with speech recognition. Real people. It's like a private tutor.

Your pocket tons of good stuff. That's what I was saying. You should use it to harass your boss. Who makes your life terrible. He makes my life terrible.

This is a personal language. This is a personal language, which bog your boss. Which is a lame thing to do. I do wanna say, okay. Well, on this subject, we talk about, you talked about GPUs in space.

I want to do a quick gaming story. You view guys, Mike. We do a quick gaming story. No. Okay.

Look, I'm gonna be honest with you. I'm begging for gaming. Cause we don't put some gaming on this game. I'm just begging to be back. I wanna do a gaming story.

So GPUs in video just canceled their GPU line up through 2027 possibly beyond. They're just not making gaming GPUs. Or like they're making new ones. And it's because of this gaming is like, Because of how expensive memory has.

Because everyone is buying AI chips for this. From space. Like even is buying them and just throwing them into the air or something. Yeah. Let's get this in.

So it just came out. It's like, yeah, we're just not doing a new like the old chips or where we're going to stop. You just buy those for the machine. Well, for you, sure. And it's like kind of interesting.

I have a question. So graphics are frozen. It's what I'm saying. Right. Starting right now.

Graphics are frozen until the AI thing clears up or new stuff comes in.

“Do you feel that you, you were the head of marketing and gaming, right?”

And in video, do you feel like you leaving, made, Jensen say, what's even the point? I feel like I wish I was there now because knowing this, you are getting paid to do no work. You think they don't let you off.

You think they're like, hey, bro. Don't keep your corner office happy for me. During there was like a crypto wave in 21. And all the cards got bought up by crypto miners. And they were like, hey, just take the summer off.

Don't market because we can't sell any. And people are mad. Like, it's almost all sold out. It was, that was it, like, just don't, just don't, like, cut down the marketing. So I just sat there and like, town no marketing.

Just work less. So that's what they're doing right now. I'm sure the marketing team's just chilling. Anyway, I want to say it. Two more gaming stories.

Because of graphics are frozen now. There has been this big push from my bunch of different laid off triple A developers to make essentially Overwatch clones. This happened recently with a game called High Guard. They, I don't know if you guys heard about it.

It just came out. It was like, it's not Overwatch. But it's like a hero shooter 555 thing. You better not be talking shit about high. You're a high guard guy.

No. No. I wanted to ask you about it. Because all of these, these ex Blizzard, these ex Riot ex. They all have made similar time of hero shooters.

And they are all flopping.

The big one was concord for a hundred million at Sony.

But now high guard, they just laid everybody off. Like two weeks in. They had a hundred thousand people at launch day.

And then this is not necessarily a hero shooter. But like two days ago, I saw a thing from Riot Games, where they have been teasing this fighting game to XKO for like eight years. And it finally launched and everyone has laid off in two weeks. Like it's like, so what?

I'm not even, like this is just a thing of like ways going on and gaming. What do you guys think is happening that triple is triple ages dead outside of like fortnight. And all these companies are doing these big high profile flops and nobody seems to be able to adapt to what gaming is now. Maybe you have a better window into this than I do. Because I've, I've been feeling a similar question.

I've been wanting to talk about high guard specifically because of how low the numbers have been and how I had heard about this. But with two XKO, something that surprised me was. I feel like they were willing to let this game simmer for so long.

But you let the buildup time was incredible.

The fact that they could work announced that this game existed work on it for so long. Keep everybody employed through that time period. Then launch it half kind of of a weird timeline of marketing and beta releases that I actually think the launch of the game.

“Yeah, that's what I never knew when the game was actually out.”

So by the time that the game is actually out, it's like, hasn't this been out? I don't, there's no hype anymore. That was my outside perspective. And that's ignoring that like maybe the genre is like tough to access and another stuff. But you, you're willing to go through all of these layers of friction to get to the release.

And then you only have the game out for a short period of time longer than two weeks into XKO. Sure, sure, sure, sure. It's been like, I think it's been like six weeks. But it was quick, not a, maybe. It is.

It's a special release. It's a special release. It's a special release. It'd be good to clarify. But I'm, all I'm saying is, why are you willing to wait that long for the game to exist?

But not enough time to see if you can turn things around after it comes out. And if you have any insight there or to the broader question that he has, I'm very curious. So like, I don't have like insider knowledge on this. Like, you know, technically I was a game developer in the most like technically sense. No, but you're a streamer. You're plotting. You have a chat. You don't say like, this is.

I'll say on that note. Yeah. The, one of the developers, my guard, one of them, got kind of mocked for this.

But he basically blamed gaming culture now, including streamers.

The reason his game didn't, did this died on release. He said, people made fun of our videos on social media. The comment section were flooded with memes, calling us concord to. We got negative reviews from users. You didn't even play it.

And that's why we didn't. And it's not like I don't think those things are true, but I feel like that's an insane cope. That doesn't, that doesn't drive with how I see games that succeed. Like the game operators is crushing.

“So, you know what I'm saying? Is it just the good game thing for a bad game thing?”

I mean, I would say an anecdotal thing and then a maybe business side. anecdotally, I have not played many AAA games the last several years. I've just become less interested in them and have had less time for games. And so I don't want to take on a game that's going to be 50 hours. But last week and I tried Death Stranding 2.

Okay.

He hadn't played the first one.

I was like, oh, this could be really cool. And to be honest, I was pretty disappointed. It seems like a cool game. It's not like it's bad or anything. But I just thought it would be more.

I thought it would be more different than what I understood the first one to be. And it seems like it's that, but with a new coat of paint. And whenever I try a AAA game, obviously it's extremely subjective. But for me, it doesn't feel like that much stuff is different than five years ago. Or 10 years ago. The graphics are nicer, but I don't care very much.

Those are frozen now. So those are frozen anyway. Like, that's not a driving factor. I want like compiling gameplay that gets to the deal quickly. I tried Pickman 4 recently as well.

And after 45 straight minutes of characters talking and no game play. I was like, I don't fucking care. I want to just play a game. Like, I'll give it to Pickmanverse. And so he's got to eat me a little more.

He doesn't get all the more. It's like so deeply attached to these.

“And it totally, I think, that Andy Games have done a better job of being innovative and being creative and compelling.”

And I think that, like you see that in the market, Pick absolutely fucking crushed. And actually, I talked to one of the peak developers at the streamer awards. And he was talking about how he was part of the team that made another crab's treasure. They had worked, I forgot how many years. It was like, like, three or seven years on this game, right?

And they finally put it out. It's like Dark Souls Ask kind of game. And it did okay. And then they spent three months on Pick and it becomes one of the biggest games of all time. And he was like, I feel show-confused about this because, like,

The thing I barely put any time into is one of the biggest gaming sensations of all time. And it's a nice, I think, example of how much creativity matters more than just production value. I do him in college. Do you really play it? We played Malin again.

Oh, right, I forgot he mentioned that. Yeah, it's crazy. It was so surreal to see him there. Because it was like this weird thing. I've, like, I haven't seen you in so long.

Why are you here?

We used to play Malin at the UW Smash Club. Guys. Well, that's another funny coincidence is he was like, We were talking. I was like, oh, my brother makes indie games.

He's like, oh, what games? Oh, he made the Stanley Parable. And he's like, your brother's Davey. He's really helped me out. And so this dude has like a weird personal connection.

It's crazy. It's cool in that. So you're saying, like, so at this same time is like this game around the same time. The this game is blowing up. Everyone's getting fired.

Yeah. Yeah. Mew Genics. I don't know if you guys heard what this game is. Yeah.

Yeah. Yeah. It's a new cat indie role.

It's selling like a million copies.

It's like, like, creative stuff is breaking through at a greater level than ever before. Yeah. Indy people with three person studios are making absurd money. But like the tribalized of it takes eight years to make. And it's like, behind on what consumers are wanting at the moment is like,

It's getting destroyed. I think the value proposition or like, the risk is just so much different than it used to be. I imagine there's a world now where indie devs have actually a more reasonable path to making and getting their names out there in a shorter period of time with relatively less cost than a AAA studio could, which were the primary vehicles for developing and publishing games maybe 10 20 years ago.

So like this old business model of how AAA studios address like address the market doesn't really make as much sense anymore. Yeah. It's it's just tougher competition. And then also the or sorry, the risk reward of taking that approach to publishing a game like doesn't make as much sense.

“The other thing I think is huge that I think about a lot is online gaming when we were coming when we were kids wasn't that prevalent yet, right?”

So this idea of this big continuous live service experience was very new.

And people were creating games that were like the first to market in that area.

But now after all of the time that has passed, giant live service titles are established. Yeah. So when your new game comes out, when you're fucking Overwatch 45 clone comes out, it is it. It doesn't just have to be good by its own merits.

It has to prove its value within a genre of things that already are like stable and have a lot of value. You're competing with like Overwatch that already exist. You're competing with Valorate. You're competing with Counter Strike League of Legends. These games that have established player bases and follow-ins that people will go back to for later in some cases.

Like CS has been around for decades league is coming up on 20 years. Like these games are things that people continuously come back to. And your game needs to out compete and provide something that those games don't already. Peel you away from that and this was actually my problem with playing platform fighters that weren't melee. Because I had played melee for so long and melee is so good in my eyes that anything that would come out that was vying for my attention in that space.

Like that old game icons that actually got published in a different form or even when rivals too came out.

“And I think rivals too is a really fun game, genuinely.”

And I do I do not have financial ties to that company. So you're just financially tied to the guy who owns the whole lot of things. It's fair enough. Fair enough. There's a conflict of interest there.

But genuinely when I played rivals too for the first time, I was like this is the first platform fighter. I have played besides melee that I'm significantly enjoying.

But I never got into it because it's like I could just keep playing.

You really have the friends and the tournaments and everything that they've seen. Yeah. And I think in every game that's getting dropped, especially with these lofty expectations of being a continuous live servants like log on and play a bunch thing. That isn't like this a story game that can like crack through and like have value for a short period of time and maybe you put a sequel down the road. Like these community or multiplayer experiences.

They you you are just you're putting it out there and hoping it beats out all of these tights that didn't exist. I heard this from a game developer frame, which is like they're like death stars. You call them, which is basically fortnight legal edge. Yeah, I can't even believe I forgot fortnight. There's these massive live service games that have billions of dollars pointing in.

They have new content all the time. They have established legacies. Yeah. And because they make so much money. Everyone wants a slice of that pie.

Everyone's like, if I could just crack through, which to be fair, a game like Arc Raiders did. It's a live service game that is like doing really well. Yeah. It's amazing. If you crack through, you are you are hitting a cash geyser.

The oil comes out of the ground. You're shit, but it's so difficult because your competing against the best of the best with infinite resources in time. So I agree.

“I think too many AAA studios swung at the king and missed basically.”

You know, it also reminds me of when I and maybe you guys experiences to it. When I worked in eSports production.

Worked at a company called ESL and it did we did.

“I was working on like medium sized gaming tournaments, right?”

And I remember I did a show called Trinity series. Which was a hard stone tournament. And I was we were up allotted because it was very creative. People like, well, this feels so different. And you need compared to the average tournament.

And I reflected on how much time I actually spent focusing on the creative side of the tournament. It was maybe 10% of the time. 90% was about coordinating all the production assets and the team and the logistics. And getting the ideas into place. When you have that much production scale in size.

The vast majority of time is just spent. Like just getting the ideas even remotely implemented. Right. And then I went to YouTube. And I was utterly refreshed by how the inertia between I have a creative idea.

And it is out there in the world is a hundredth of the amount of space. I just imagine that for AAA of like if you're the Assassin's Creed developers. And you're like, I want to do something like crazy and experimental and different. That you might have one chance to do that for the entire next game. Right.

“Right. That's what you can afford. That's what you can do versus an indie developer who can like just crank that out every week.”

Yeah, it might look as polished, but if it's fun, it'll just take off nowadays. I used to like working in one of the reasons I left working in eSports was the frustration of the dynamic of how add funding or heavy marketing was the the lifeblood of eSports for so long, right. So you had to like kind of pander to and create tournaments in a style that the advertiser, especially if it was a white label project, looked for it. And what I mean white label for people who don't know, it means like when your production company or your company doesn't, you're not at the front end of the presentation of the product anymore.

So like if Chipotle would approach us and be like run a Call of Duty tournament. Nobody knows that it's my studio making the tournament. They just contract us. Yeah. Chipotle is the brand on top of it. And Chipotle would have all these restrictions about how they want the tournament of the format to be.

And I was like, this is definitely going to be bad. Like this isn't what the players want. This isn't really what the viewer wants. But it's what the money wants and you would have to do that. And I think I got frustrated with that part of eSports. And I was like, you know, this thing I dreamed and working up for so long.

I don't want to fucking do this anymore. I'll go be a lot of ways, boy. I'll be love a boy instead.

Or I wanted to go work at a company like Riot where at least you were the first part.

You were the doing stuff internally or first party. And my favorite eSports project I've ever worked on was this melee league I did in SoCal in 2024. And it was because I had full freedom to do instructor things in whatever way I wanted.

“And I think in that space, I'm a true expert.”

That is, if I could pick one thing that I'm an expert at in the world. It's rocket ships and this rocket ships getting things into getting GPUs into space. And I toss them really high. It's crazy. You've been breaking quite a few, but like you're getting there for sure you're getting there.

It's expensive. But the freedom to design that competitive that scene and that league in the capacity that I wanted to was the most fun I've ever had with an eSports event. And it's because I imagine indie developers feel that. I just, I don't want to I don't want to leak too much.

I heard from someone who worked at a agency that got the high-guard contract to help them get like streamers and stuff.

Basically, their words were that they did start with an L and N with an O.

They were like, hey, we tried to tell them like some of this stuff is not going to work. And the money didn't want to hear it. And so like, and then you flash for two weeks and everyone's laid off. Like it's like, it's that quick nowadays. Like if you don't, if you're on hitting the the culture of the creativity, it's like people just don't play it.

And then all of a sudden, I don't know, it's crazy. Anyway, guys, I want to move on to the talk because we're on time here when there's like 10 different things to hit. I want to talk very briefly. It's a real tone switch. You ready for this?

Yeah. The garment shutting down again. It's like government has too much production value. And I like when we talked about games. I love talking about games.

I see it. All right, let's get into the review and then we're going to talk about the new Diablo 2 expansion. Okay, fine. We'll do one sentence on it. Basically, the department of Homeland Security is the only part of garment shutting down.

No, I'm sorry. The whatever ladders up into. As is DHS. DHS is shutting down. They couldn't get funded as of Saturday morning, 1 AM.

It's over. There's no money. That being said, because of the unique quirk of the big beautiful bill. Everything in the DHS except for ice is unfunded. But ice is still funded.

So even though this is all about ice. Like all the anger is about ice. The reason they're freezing it is about ice is still fun.

Because they have 70 billion in cash from the big beautiful bill.

I think the virtual might be fun as well. But like. TSA, right? TSA. Exactly.

That's the big one. There's a couple more of them. But these are just the general idea. TSA. Yeah.

I guess the main one we're going to realize is TSA. That's the translation security administration. Yeah. I guess that's the main thing you're going to see. Like in terms of the feet.

So that's being unfunded. So some people are going to work. Knowing they'll get paid back pay where this gets figured out. But it came more back to it again where it's like the whole funding thing. I will say the main thing comes down to you if you pull us up.

There's 10 demands.

This is what they need for the vote, which is basically no masks require ID protections from who's the man.

This is the mansion of Democrats. Okay. Who voted against this? Only one.

“I think it was federal men flip sides voted with Republicans.”

Mm. Think summer. I think nasty or someone might have voted on the democrat side. The point is that they don't have a fullbuster roof. Majority to get the bill through.

Until they agree on this. So they are debating now. But my understanding is because the. There's like a recess. They're not able to vote for 10 days.

At least 10 days of the shutdown. Not gonna. We'll cover this more because of bigger deal in terms of. The shutdown expanding. But my understanding is like it's like it's just a.

A political flash point right now around. You know what I mean? These. These demand seem extremely reasonable. Get this.

Like the basic first step.

Yeah. It's like you're not.

“These agents should not be wearing masks.”

They should not. They have to verbalize who they are and their ID and they need to display their agency name and not just be like mysterious people showing up at bands like these this seems. Have you seen the audience? There's like a. Yeah.

It's a bit of a rip and not good. It's kind of me. But it was like. Um. Republicans.

We want to kidnap people and put them in unmarked bands. Democrats. Mark the bands. Yeah. That's just a crap.

It does. It does. Yeah.

It's a basic first step and I'm surprised.

Can I? Yeah. You want to jump in? Well, okay. One.

I've a please clarify for me. Yeah. The. I don't. Is the idea that they're using the weight of the shutdown as it pertains to a bunch of other things to get changes to.

Nice. That remains funded currently no matter what they have no other lever to get it ice than this. Yes. This is what ice ladders up into. Just the fact that ice is already funded is not they're probably they just have to do it this way.

“So this is like the best thing they can do to like get changes to ice.”

Like I hate like it just feels like you ever seen that like Chuck Schumer parody video where like the like Trump goes too far again. And then the guy is dressed up like Chuck Schumer. That's not very nice. They shouldn't. It's a strong word to better kind of.

Yeah. Well, and I think I was listening to a daily episode about this and the corresponding was talking about the Democrats strategy with this with the shutdown and how they view the previous shutdown as internally Democrats view the previous one as a success. Because I know I know and I was like I don't understand. Didn't they came with the last second for the whole and they view it as a success as a success because it was a flash point for raising awareness about Democrats better support for health care than Republicans.

I did do that. And I was like, yeah, it may be it did that, but it didn't they didn't get any changes. I was like, what are we fucking talking about, dude? And this I look, this is obviously by bias leaking through, but it's the same reason I asked Pete at the end of the last episode. And I think one of the things you were trying to hammer her home with Gavin Newsom when you're doing that interview was like, no, you don't understand. Like you you can't just I get that your position to win the next election, but you can't just win it.

Yeah, so you have to make substantial changes in the way that allowed these problems to. Yeah, existing the first. I will say, okay, I'll, I'll straw steel straw, what's the good one? Steel man this one. I'll cover some straw on the steel man.

I like to. You think it's a straw man, but it's hard to do it. Let's do it. You know, I feel the vibe of this and I agree with the vibe of this on general, but I feel like people are expecting in this moment right now a miracle. The miracle from a party that has nothing, they don't have the house, they don't have this, they don't have this.

And unless you expect in the grab an AK 47 and swap the capital, like do you know what I'm saying, the reasonable thing they can do is like try to make demands on things they have leverage on, which is this.

And I think for a temporary stopgap before they can win elections and maybe real changes, these changes seem like a good like baseline all American should agree.

Why the masks, right? But I feel like I'm a, maybe I'm a, maybe I'm a fucking moron dude. But it's like we're going for another shutdown strat when, when a month ago you walked.

“Oh, yeah, that's how I felt like it's crazy.”

And you know, but they walk on this one, right? You know, say like it then, yeah, I agree with that in general, but I think I'm just more. We need to go back to gaming. Go back, I'm getting to, I'm getting to round up. I need to talk about high guard.

You know what, what I've been doing is every, every week, I've been checking the high guard concurrence. I'm just saying, I'm not going back to high guard. I'm not voting for the DHS funding bill until they fund high guard with it. Yeah, until they keep dedicated servers up for high guard, no more masks on the developers. No, developers got to be unmasked.

I think, okay, now I actually do have a bit. Uh, man, I actually didn't want to do anything. I got fucking no. Go to another thing. All right.

Here's one. This is for Doug. Hmm.

You watch the football Doug.

I did watch the Super Bowl. I tried to pay his little attention as possible because the game sucked in the ad sucked. Hey, it would be like a referral at all times. If you love kicking, it was a great game. No.

Is it real, guys? It's a real masterclass and deep. It's a masterclass and tough. Fuck off. And kicking.

No, it's a masterclass and defense. It both teams are defending really. It's boring. The whole thing's boring. It was just like a game.

And I agree the ads were bad.

“But one bright point of the ads was we in a little bit of an AI war.”

Ooh. A little bit of a drama. There's a little bit of a, uh, you know. And so this is a little bit dated as we say this, but it's going to go into something else. Which is, which is that Gemini.

Open AI. AI dot com. Who else? Madda. Bunch it.

There was some weird AI slap ads. You see that vodka ad where there was just literally. Yes. It was just a lot of AI generated. We contacted that.

Was it put in the vodka one? Actually. Yeah. Generated. Because we were watching it in the office and we're like,

Was this just that? Yeah. It was like an Asian generated swap ad. And they were terrible. Oh my god. The, the like a personal like cleaning robotics one seemed to be all. Oh yeah.

It's nonsense. So there was some weird slap in there, but the big thing was these big companies that are again all spending hundreds of billions of dollars are kind of like. Muscling in the show is territory and trying to stink their claim as what makes their brand different. And the big thing that big argument was between anthropic and open AI where anthropic is like, Hey, we don't do ads.

That's our whole thing. They did these, they did these ads. I don't know if you saw him where they had like the guy. Yeah. Pretend to be an AI.

He's like, hey, but I don't know if they all rolled at the Super Bowl. But I'd seen this on Twitter the week before. Yeah.

They released four different cuts of this ad that basically have the same premise.

Yeah. And this rolled at the Super Bowl. There's a few of the funny thing. My understanding because I read a lot of ad breakdowns after the Super Bowl because I do it for my show. And it turns out Margaret research showed that most like the average like 46 year old guy watching this will drink in a beer.

Thought this was genuine. So that like, if you're watching this kind of half, you're just like, this is kind of weird. Like they thought they were presenting this as a good thing.

“And so it's like this, as far as I can tell, is it not a backfire?”

Like a little bit of backfire. Like the main takeaway from the ad is like, yeah, it's kind of creepy. We're like, they're also they were trying to. They were attacking opening eye, chatting with the adding ads, right? That was like their main attack.

Yeah. And you know, which is a legitimate thing. And we've talked about that in the past. But then also, I guess you said they just started. But ads aren't in it yet.

So it's also to the average person who's not extremely online. But they are in it, right? Look, I saw maybe I'm crazy. But like if they are, they started like a couple days ago. They started after the Super Bowl.

Right. I saw. So it's like, it's an attack on chatGBT about, hey, these guys are doing ads. And we're not, which is very, you know, a very valid line of attack. But it's bizarre when the average chatGBT user is like, I don't get it.

I don't have ads in my thing yet. But I guess they were just getting ahead of it. Because ads are supposed to want soon, I believe. Dude, Sam Altman. So the head of opening eye said.

Need a gigantic reply to this, didn't he? The good part of the anthropics ads, they are funny and I laughed. But I wonder why anthropic would go for something so clearly dishonest. I guess it's on brand for anthropic double-speak to use a deceptive ad to critique theoretical deceptive ads that aren't real. But a Super Bowl ad is not where I would expect it.

He also tried to make him not like the big bad rich guys. You see that? Yeah.

“Anthropics serves an expensive product to rich people.”

We are glad that they do that. And we're doing that too. But we also feel strongly that we need to bring a lot of billions of people who can't pay for subscriptions. Only one of those companies went to the international and one of you on Dendi and Dota. Oh, you're talking about it. And it's open, yeah.

It's okay. He's going to try to bring it back to gaming every time now. No matter what. Yeah, I can interact with it. I guess why this is about high-grade.

I don't even know where it is. I do Mario 64. We're bringing gaming back. We were about gaming. It's about business, about Gerald Ford.

A lot of people ask you for Gerald Ford in the last comments, by the way. A lot of people care about Peter Buttigieg. And if this episode gets to 10,000 likes, we will bring Gerald Ford. No, I guess.

Can you imagine we did it AIG? Our worst rate of episode that. You boys know what they look like. This is what the open AI ads look like. They're not actually launched.

Okay. They're not as intrusive on frame one as you'd expect, I guess. It's like they have a line and they separate it at the bottom. So they'll give you your answer. And then it'll be like, here's something related to your answer.

It's not necessarily like, hey, bud. You've been feeling sadly. You know, give you a pick me up. It's like nerds or whatever. Sanx.

Sanx.

For me, it's always candy.

If I'm depressed, that won't be candy. Uh, that's so cool. It's all dystopian. I'm realizing I haven't. I mean, I don't know.

This is necessarily like for this. To be honest, here's Robin and Sanx. Let's get crazy with it. I don't want to get crazy with this. Well, this episode 118 Sanx is brought to you by the league,

the dating app. And we three people were, we're in happy relationships. So we set our good friend Eli that we play basketball with, into the trenches. And I was confident sending Eli onto the league because he's a professional man.

He's a PhD. PhD. Had a great job. He's a teacher. He plays like an animal. That's where he lets it all loose.

But that was one of the things he liked about the league was how, compared to other platforms. He felt like everybody was very well like put together, looking for like long, long lasting permanent relationships. And just just higher quality matches in general.

This is true. This is actually his feedback from trying out the app. And did it help his lay-up percentage? No. No. Or anything.

I think he's been distracted. He's been distracted by trying to find something. I didn't scream he got him on the court. But more is it better? Better is better.

And if you're ready to date in a way that actually respects your time, this is the move. The league finds someone in your, download the app and apply today. I've been waiting to do this.

Don't show my screen yet. I'm pulling up a, I'm going to convince Aiden. You're an AI guy lately. I've been feeling like that shit is moving so fast in the world of AI that I have to get, I still think it's a financial bubble.

But the tech is like getting crazy in some areas. And I'm going to convince Aiden and this whole podcast is going to be ruined, dude. Okay. I'm going to show you.

“Wait, will you not convinced by his to-do checklist app?”

Yeah. Yeah. Again, it's weird.

I always know that it could do something simple like the checklist app.

I, for me, it wasn't like, oh, this is crazy breakthrough. But it's like damn, it's pretty good. I could just type it and it doesn't. But here, this, this is your goat. Rucker, pregnant, dude.

Oh, right. Right. Mean, right. You talk to me read all this books. I bought you his book for Christmas.

Another one. Yeah, like Rucker. This guy. I mean, this is an example. But he has a different post where he's like, hey,

why is our some people completely sticking their head in the ground on this? I, he's, he's not an AI guy. But any stretch of the dimension. He's a total like, I mean, how did you describe it? Why would, like, what do you think his philosophy is?

I don't know, like, like a humanist. He's, he's, he's very, I feel like he's very positive about humanity and how we can use our innate goodness towards making it all of our lives. He's such anti-fascism anti-big business. Yeah.

You know, all this stuff. But this guy's like, hey, I needed to do a teleprompter app. And I was going to buy a hundred dollar one. But I vibe coded it in two prompts. It worked better. Like he, I mean, he gets a longer throw out on this.

He has a blog. Mm-hmm. But, and I wonder if I could. It's weird he didn't text me about this. (laughter)

Okay, he's talking about U.S. wealth, concentration, all this stuff. I'm just saying, I'm seeing more people who actually try it, be like, damn, some of the shit's crazy.

“And I think, I don't know if you had an example from seed dance.”

But I saw, was his new Chinese video AI. It's crazy. Like, something, it's obviously not, it's still swap. I can understand that. It is still at its core.

I watch it.

It's like always the same fucking upgraded version of Sora.

I'm going to be vulnerable. It's like Rick and Morty fucking dancing. You know what I'm saying? It's always swap.

This, this. Just as an example.

This is a prompt of, this is AI generated video of Brad Pitt and Tom Cruise fighting,

arguing about Epstein. He was a good man. He knew too much about our rush operations. He had to die, and now you die too. Yeah.

So this is from Bite Dance, which is the company that makes/made TikTok. Yeah. They've been trained on your TikToks. I've got a couple things about it. Guys, dump in.

One, because I had seen a bunch of these videos are going around.

“And I think the reason that this is sort of catching on a little is I would say that these”

videos look better than previous iterations of AI video software that I have seen, or at least most of them, right? Yeah. And I think by the nature of the product, it means it's going to improve over time. And I think on Twitter, you do see a similar range of reactions to these things.

This is stupid. It looks bad. This is so obviously AI, whatever. But I do want to point out that I think in the past week, and I don't mean Tom Cruise and Brad Pitt fighting.

I mean little videos that have taken me as someone who, I think as someone who grew up on the internet, has a relatively, does a relatively good job of parsing whether or not something is real or fake. Is this a scam?

This is the first week with AI videos where I have seen a couple things that have been presented to me.

And I'm like, oh, I thought it's like Twitter or something. Yeah, just on Twitter. Just people uploading things on Twitter that have been fed to me through my algorithm, right? And it took me way, like, it took me longer to figure it out. And realize that like, oh, this is definitely, like, ha ha, it's so funny to make fun of the AI videos.

This is just gonna, this is gonna, yeah, there was that viral rabbits in the trampoline. They were a lot of people were like confirmed it was real. And it was AI. And that was like, that was one of the big moments for people. Here's an example, record, record, retweeted this.

This is Josh Dawes. I'm 48 and I've worked as a software engineer for 30 years. I've grown numb to the Silicon Valley height machine. My default posture is met, we'll see. What I've seen experience firsthand in the past two months is not hype ignored at your peril.

Again, I do think that a lot of this is a little bit too far on the, oh my god, side. But I gotta be real here. The advances are getting faster. And they are real. And the more I dig into it, the more I see real concrete examples of certain air.

Like, like, the big one, the one that kicked off the episode we talked about last week or two weeks ago. It was, um, an anthropic putting in a thing that allowed the illegal add-on and like I've seen, I was out of block that kind of broke down how it's impacting the legal field. And it's just like, the way I think about it,

it's, I think of my entry level jobs. I think of things I did when I started at Twitch. Like I managed the email newsletter and I managed the front page. And I know for an absolute fact that everything I did in those jobs, for again, probably a year and a half to two years of like,

got started in the industry. Yeah, it can be done in one prompt now, everything. The entire email I created, everything. And so that is something different, like that. And then you see them, the Microsoft guys and they're like,

every white collar jobs getting automated in 12 to 18 months. And again, I'm naturally skeptical as you know from this podcast. I'm naturally skeptical of all this stuff. That being said, I'm not stupid. I do test these things and try them out.

There is, there's breaking a line. It's like, it's getting more, yeah.

“I think the idea, like even with what I'm saying, right?”

I'm not here to say that like AI video is this flawless thing or something.

It's the fact that I'm hitting this point for the first time in a few years

where I had a passing thought of, I wasn't sure. And then being scared of that feeling and realizing that this trend will only increase. I will be more, I have to be even more conscious than I ever was of the idea that this video is just entirely fake.

And then I saw another thread that really convinced me. It was a, it was a filmmaker I think talking about. It was like, listen, this scene where it's me and Doug in a room doing dialogue, they're not going to replace that. But this scene that opens it where it's like a helicopter shot of London

that goes into a window and then starts the scene. We can make that in two seconds now. And if that's good enough to be not able to tell that just, you just, if they've hundreds of thousands. You've said $100,000.

And so, and again, this is just bad as it'll ever get. So you dance too out of nowhere. So I'm just getting more real to the idea that this is not just an issue, but like a really big issue, like a really, really urgent issue

“that I think even if, again, I'm actually more of a skeptic on”

AGI, but on like, I guess what I'm realizing is how most jobs don't need AGI.

Most white collar jobs are like, see a couple things.

“Think about one destroys on that and then do an action.”

Yeah. Yeah. So let's do a little role reversal. Okay. Let me make a pitch to you guys about why this stuff is overhyped.

Oh, interesting. I want to, I want to, I want to make a different episode. One quick thing about seeing it. I'm getting so high. And I'm holding it.

What? I didn't want to mention seed ants. There you go. I think it was today. Disney and Paramount both sent a white dance a season

to cyst. 100%. I'm like, already. And they seem very upset. One of the quotes from one of the partners with Disney's law firm said

"Bite Dance is a virtual smash and grab of Disney's IP is a wealthful, pervasive and totally unacceptable." Yeah. Because all of these examples are like, I'm watching Mario and Luigi like Fris Faye.

Yeah. Yeah. Yeah. Yeah. So so I, of course, there's going to be this reaction.

But it's happening very quickly. And I just want to confirm when you saw that. You were unsure whether it was real or not. Yeah. I did think that was the one where I was like, I'm pretty sure this is real.

I really did fight Luigi. Yeah. But it's like, this is, this is like, they both love for Disney. So it's, yeah. Okay.

All right. So this episode because I guess I'm being the fucking AI Holy shit guy. And you're going to, you're going to downplay. Yeah. All right.

So two weeks ago, we talked about AI coding.

“I think that there were valid criticisms that we focused too much on hype.”

As well as a lot of the people I quoted were basically people in AI who are highly invested in AI succeeding.

And I think that's that is a fair criticism. I want to remind everybody, none of us are experts. So I'm trying my best to learn. But this week, I made an effort to go and specifically research and present some other sides, including things we didn't get to that last two weeks ago.

So in terms of just like raw numbers, we just talked about it. Bunch new models releasing. This was like 10 days ago andthropic released Opus 4.6, which is like the even better coding model of what we had been talking about. And then 28 minutes later, open AI drops GPT 5.3 codex.

So they're like literally trying to snipe each other within like an hour of dropping the hot new thing. So this keeps going. And I reached up to some AI or excuse me, software people who are not like, you know, tied to the AI space. So from what I've been hearing for four or five people that I spoke with,

in some situations, this stuff truly is like mega advance in terms of the coding specifically. A lot of people do feel like there's a major shift in the past few months. And you see it like this guy right here who just vibe coded a thing and is going, Holy shit, this is different from what I did. Can I reach this one which is pretty cool because I didn't, this is what I was looking for.

And this is like this coming from this guy knowing what we know about rocker. Yeah. It's like a really crazy thing for him to say. That's what kind of woke me up made me. So he said, I'm increasingly annoyed by how many journalists, academics and large parts of the left,

which he is on get everything wrong about AI. So many smug dismissals from people who clearly don't use it much or don't know how. I have multiple what the fuck moments every week now. For example, and then talking about the top top of your thing.

For context, I've never written a line of code in my life,

but I was able to give Claude to rambling prompts two minutes later. It works better than the fancy $100 software, the patented voice track technology. Most surreal text brands have ever had. And it's all moving so much faster than I expected. AGI is not even a clear concept to me, but I do know what's available now is just fucking impressive

and it'll only get better. It's totally unserious to keep dismissing the greatest technological revolution of our time. Sinking your fingers in your ears, it must be BS because it's looking like, because they have these hands on the red marks where I don't know what's not happening anymore. Wait, hold on, say that sentence again.

That was crazy, that was crazy. I know that we complain about you. But the text is going to scratch and you guys can read that. But that one was crazy. You know what you feel is vibe code, a text reading app, like, do it again.

Do it again. Do it again. That's very, very good. I don't want to. We have audio listeners.

It's totally unserious to keep dismissing the greatest technological revolution of our time. Sticking your fingers in your ears, it must be BS because it comes out of slow-con value and these hands have it red marks or a door noise on helping anyone. Love it. Coming from rocker, fragment means something because he's a guy who's principled.

He's very principled. He doesn't just say to say that he has no financial stake in this. Yeah, but that made me for context. There's two famous clips with this guy outside of his writing as an author. There's an old clip where he's at Davos.

“I think at the World Economic Forum where he calls out everybody on stage.”

And he's like, I feel like I'm having a surreal experience where nobody here talks about taxes and the importance of taxes. Yeah. We all fly here on our private jets and nobody want. I feel like I'm going to have fire conference and nobody wants to talk about water.

That's his famous quote. And then there's another cut interview from Fox News when Tucker Carlson was still there where because of that clip, Tucker Carlson's interviewing him and he's asking him, it's so impressive that you stood up to the elites in the upper class and called them out all out on that stage. And then Rutgers like, yeah, but you're like one of them.

Like you do the same thing. And then Tucker starts costing them out. They cut it from broadcast. So it's that guy.

I always say right after he makes this point about AI, he's like retweeting, you should quit

Like he's not boosting this anyway. I think he's just being honest.

“And I have been feeling increasingly more like this, especially in the past three months”

as I've like tested the stuff and seen things like CDance. It's like it, it's getting better faster. That's the thing. It's getting better faster. I'm speaking largely about software here, but the reason software matters if you aren't a coder

is because if software gets insanely good, that allows people who are making the models that touch whatever industry you work in to go faster.

That's always been kind of, it's called like closing the loop is what they talk about.

Whereas you start to have AI's writing code that's training AI's and you just start to speed that up. And so in theory, it's just going to get better faster. And so I spoke with somebody who is a CEO of like a mid-sized startup and I was like, is this hype and it's like, it's not hype. This is crazy.

I meld this, I did this huge new feature that touched all the different aspects of our app. Our CMS, our data pipeline, our managing data pipeline, actually presenting everything to the customer service, doing all this analysis, all of it on the way to work at my commute.

“And on the other side, talk to software engineers or like, no, this is not good.”

So my friend who I mentioned last time who nine months ago said AI coding agents are like, a, you know, like a junior software engineer who doesn't learn. He said it has gotten a lot better. He's using it a lot more and he's coding less than ever. Again, this is a guy who is not invested in AI in any way.

It's very skeptical and he's the smartest programmer I've ever worked with.

But he says, it misses critical things.

So you cannot fully trust this. He spends tons of time fixing the little things that it misses. So his quote is it gets 90% of the way, but that 10% is missing. And that means you end up spending far more time getting that little bit to work that, while yeah, it seems like it's really helping you.

If it's not fully getting there for many industries, that's not useful for a doctor. That might not be useful for sure for a lawyer that might not be useful. Even maybe for a film developer or a producer, whatever, if that helicopter shot just can't get the right creative vision he wants, that might not be useful. He also said, it's a security nightmare.

Like it is just terrible passing various things around. At managing proprietary data, there's huge vulnerabilities. And this is the number one complaint I see when people talk about building apps at scale. Like large commercial use. So I think having looked into this more pretty much anybody at my level and even a small company.

This has this has leveled up in the last few months or you're like this can potentially do everything. But anything that touches security and then anything that's a giant code base. So like some of our YouTube commenters were saying, okay, I work at a giant SaaS company. I work at this company with a huge database and they're saying, it can't do, it cannot handle this. So there's very much still a limit at which this stuff is just not effective.

But in this, you know, they're like these, I think growing tiers at which people are like, Whoa, this stuff is 100%. That's one of the parts I'm still convincing the financial level. Because I was seeing examples of people being like, holy shit, everyone will be able to code their own Monday.com or Trello or whatever.

And then those things are going to die, right? That's the idea. And maybe those, those are like the easiest ones and maybe, but like sales force.

“But here's the thing is if you're at every individual company is going to try to make their own and spend all their time debugging that.”

Right. Getting that ready and getting the security to be okay. The amount of time and money they spend on that. They could have just spent 80 bucks worth of the seat for buying the device. And it turns out like it's probably not going to be nearly as efficient to duplicate the work across everybody to make their own.

Right. You know what I'm saying? So I fully see this skepticism. I'm just more impressed with the tech than I was before. And I do think it's going to change some things. So here, I think is another, it gets a little higher level. But what are some downsides of people continuing to use these tools in the ways that we're talking about?

The first is a concept called deskilling.

So we've essentially alluded to this, but the idea is that if you offload your critical thinking to an AI,

your skills actually degrade. So I found a paper AI induced deskilling in medicine. And there's a whole bunch of evidence that doctors who use AI to do decision-making in a medical environment, actively lose the ability to make those same tasks without AI. A quote, automation gradually erodes human expertise.

Critical processes become increasingly vulnerable as reliance on AI becomes entrenched. And the necessary skills to operate without it are forgotten. There's another study that did looked at doctors who do colonoscopies in Poland. Tested three months of them just like digging in there for answers without AI. And then used AI assistance for three months.

The detection rate, the robots are taking such a beautiful job from human. I want Optimus to get up in there. Yeah. I don't want, I want to, this is humans of love digging through the human- Polish-Ana system.

For a long time for somebody. And now it's gone. That's a huge part of the job. We'll be able to take all the jobs. Think of the Polish-Ana system.

their ability to detect this without AI dropped 6%.

“They just became measurably concretely substantially worse at their job”

without AI after they'd used it for a period. Last time we talked about anthropic doing this study with programmers who used a learned new Python library using AI. And the ones who used AI didn't learn it as well. Couldn't refer back to what they had learned.

Like the understanding was worse. So, this is really concerning in a world where we have AI's that are increasingly like, "Oh, I can do everything for you. 80% of your code is just tell me what to do.

But you're actively losing the critical thinking skills."

So, there's another from modern software engineering, a YouTube video, where they did a study about the maintenance of code. The idea is, look, writing code is getting the first draft done is a small portion of the overall work it takes to do software. The maintenance of it after you've made it is in his estimate three to five times more

than the lifetime over the lifetime of the software. Some quotes I like. It's largely naive nonsense to imagine you can develop software once and then never revisit it. Yet, most AI studies stopped at did the AI software developer finish faster.

And they just kind of brag about the speed and quality of what's written.

“Don't think at all about, is this even useful in the long term?”

And again, with all of this stuff, you can start to imagine how this applies to any industry, right, not just programming. So, they did a cool study, phase one. They had a whole bunch of programmers, add features to an app, some with AI, some without phase two.

A second group of programmers came in and tried to improve the code from phase one, but they didn't know whether it was AI written or not. So, the question is, is it harder to maintain AI software? And the results, he was like, I'm actually surprised. It didn't appear to make a huge difference.

Push his back on this narrative. You would think the AI code is total dog shit, but it was not. It was fine. But what it did reveal is that the smart engineers using AI had better code.

It was like better quality. And the less experienced engineers, the worst one who used AI had worse quality code. And it's quote, if you're already doing the wrong things, AI will help you dig a deeper hole faster. Tools amplify capability, they don't replace it.

So, it brings up this idea.

“If you're someone who never learns critical thinking skills,”

they never spend those two years being an entry level person to figure out what looks good or what's bad.

They just offload their thinking to the AI. Or even if you start with somebody who has the expertise, and then they deskill and actually devolve because they're having the AI do much to the work. You were now going to have a world where people who don't have good critical thinking skills and a background are producing more shit than they did before.

You had that world right now. That is the world we are in. That's what I feel like. Yes. It's well said.

It's pulling the ladder up on critical thinking. I feel like. But what also like kicking people down. That's the thing. I think it's been easy.

We've talked many times about how, hey, this is going to destroy entry level jobs because a senior engineer can just review what an AI does. And this is, I've talked about this with doctors doing the same thing. But we're like, wow, we'll people learn to be a senior person. But this is also revealing that the senior people are getting dumber by using AI.

So in both angles, we're like suffering. And then they're just going to be this massive slop that is being pushed out as everybody becomes dumber. But is better at producing slop. We're getting really efficient at being dumb.

Getting sloped. Right. Prime said this. He reviewed the two most recent models. The people who weren't producing good code are just producing bad code faster.

But I had a gargantuan rate. Yeah. And then one final thing I'll say. There's this excellent YouTube video called it can AI pass fresh been CS. So this is graduate TA at Cornell.

I guess we can put links to these YouTube videos in the description. But graduate TA at Cornell last semester did a study.

Where he basically had the three of the best coding models.

Gemini, Claude and Chatchee B.T. Just follow his computer science class that he helps teach. To see, is it actually like Ph.D. level coding? Because Sam Altman keeps saying they're now like Ph.D. level coders. So the synopsis of this hour and a half video.

These AI's ace a whole bunch are really hard things. And screw up things that no student would ever get wrong. And no human would ever get wrong. Yeah. And the final raids works.

Gemini and Claude both got a C plus in this class. Chatchee B.T. got a B plus. All three of those models, which are the newest models that are mega hyped that are told like we're told constantly. These are Ph.D. level smartness.

Look at all these graphs. Every single one scored below the median student grade. These are supposedly Ph.D. level C.S. coding capabilities. And they're doing worse than a freshman computer science student. And so he ends with a quote that I really like.

He talks about how there's all these mistakes. And then he says, but the complete void of creativity that permeates everything that AI touches makes the output so much less than anything we got from the real people we got taking the course.

it really isn't even a comparison. So can an AI pass a first semester CS class sure it can technically. But looking at our students, I'm still feeling okay. And I think I was very optimistic. And he showed examples of how students really added like unique creative angles

to all the assignments and were able to thoughtfully solve things. And instead these models are like can sort of kind of do that. And I was like, okay, maybe we got some hope for entry-level people. And all of this, and we can now jump to it. But all of this is not what the stock market is thinking.

The stock weather or not these AI's are actually game changers. The stock market is acting like it is. So to tie back to business last two weeks, software starts. So just getting absolutely unnoticed. Panicking first as I even software stocks like everything that could possibly be described

by AI is getting care cut 10, 15, 20% it's like it was software. It was legal. It now it's like commercial real estate stuff like a lot of things. A lot of things are all getting haircuts.

“I think the takeaway that I've had from from looking into this more is these things”

are really good at certain tasks. And certain let's say silos of what you're doing.

But there's a degree of critical thinking and creativity that is necessary.

And in certain cases, just like security and logistics for this to really be valuable in most industries, right? But on paper, it can replace these people. And that's what the market is doing. And that is where again, I'm really concerned about entry level stuff.

Steve Isman, best friend of the pod. He did his weekly market recap last Friday. And he was like, open AI just approved an insurance provider AI app. Investors took that news as a potential existential threat to insurance brokers. Many of which went down 10%.

He explains that those insurance brokers provide complex services to commercial insurers, whereas the open AI app is for personal insurance, like a casual format. But in this environment, investors shoot first and ask questions later if they ever ask questions at all. Same thing with an AI tax powered tool that knocked out a bunch of stocks and

philanthropic or police release the productivity tool for lawyers and legal zoom drop 20%.

“Which is like, I use legal zoom, like they've been nice.”

And so, and then, and that doesn't get to lay off. Which we can chat about, but. Yeah, he pulls up. It's the way you were describing is I've seen it. This is not the drawing in the chart.

But it's like the way I always describe is that if this is like a skill chart with different

skills, AI goes off the chart on like one part of the task. Like insanely insanely efficient and insanely good. And then it's like really weak at the other parts. So it's not well rounded in that. But some part of the task is just destroys.

Which caused people to get scared. Yeah, again, I don't know where I land on hype versus reality. I'm just in a process of flux. But I do know that it's getting better faster. I do know that.

And I do know that the old idea of it is just a. Next token generator, parrot, getting back to is not really true anymore. Because they added, well, I found this out from that book that we read. And I took more time into it, but because they forced it to do. Chain of thought reasoning, where it has to say how it's thinking at all times.

And then they graded that and did reinforcement learning on that. Right. It now has these processes that applies to everything. And so it's actually capable of getting two solutions that are not just

“remixed of. Yeah, and so that that, you know what I'm saying?”

That is. I just know because I've worked in the corporate world. Most jobs are not that mentally taxing. Most jobs. Three hours a day people are on red or check in the email.

And they have a couple of key decisions in the day. A lot of things is pattern matching. A lot of things is like, oh, I got this file. I need to put this in Excel in this way. Since this person has to email respond to this.

It's like, if you can figure that out that basic thing out, you could do that job. Okay. That's okay. Let me permit me to rant one final second. And then we'll wrap it up.

Yeah, we should wrap it. But exactly what you said, right?

I think that it's clear that there are critical things missing that which humans are necessary.

Even my friend who runs the startup is like, look, these things are not creative. The only reason it's valuable is because human beings are making smart decisions around what it should do. But the market is ignoring that and going, we can just knock out all of these jobs and replace them. So Josh Tyranji did a journalist to attack and he didn't interview with Derek Thompson.

He has a quote that I like this from this last week. He says, when I spoke to a bunch of CEOs, they said, look, I actually like my workforce. I actually think that this meeting AI would take time and we could perfect it. Wall Street has no patience for that. They're expecting me to show financial results now.

And then the way they show financial results the fastest is by cutting jobs and replacing those with automation even if it's not perfect. He talks about how McKinsey's another company's like to look at a lot. McKinsey's business model is to hire a bunch of college graduates who've never run a company and then charge another client $5 million to have these college graduates to make a bunch of power points.

So beast business model. It's obviously crazy business model. But they do all of this stuff, right? They do have a staff of people and to their credit, McKinsey generally hires like, "Wicked smart people out of very high-end schools. They do maintain their prestige."

And they spend months creating the analysis and whatever else, even if the analysis at the end is like, yeah, lay off tons of people. So if you think about AI though, AI could just take the data set of all the analysis they've done

“and then just shit something out to a client, right?”

McKinsey could very easily make an AI that replicates what their team of human beings does. And just does like an okay, you know, pretty close. It's a 90% version of it, but kind of misses some core things. And even if McKinsey is like, we don't want to do it. We want to maintain our prestige.

Well, another company is going to come along and say, hey, we're going to get you the report in one week. And it's going to cost $1 million instead of $5 million. And he talks about McKinsey is all the sudden McKinsey has this massive competitive pressure. And they will fall in line because they're not going to lose business over this. So what I'm really concerned about now is not only are companies being driven by Wall Street short-term profits,

which means lay people off and replace them with AI,

which is not ready to do the critical thinking and misses certain things.

But on top of that, we're going to have this shitty race to the bottom, where they're forcing more AI usage and more layoffs when it's not ready, because everybody's going to be doing it. And I find this to be pretty concerning. Yes, just to put it like short-term, especially.

I do think white-collar layoffs are accelerating. And I think this is a bigger part of it than I anticipated. Dude, I, like, Dario Amadai biased. We're transthropic. Has a long essay he did about two weeks ago.

And just lists. So he, they're making Claude. And he's like, I really think this is going to destroy jobs at a much faster rate than anybody else. I don't, I don't. I don't.

Maybe he isn't set of eyes to do that. I'm not sure why he would, I guess. But the point is he is actively, he's one of the few. I want to be clear.

He isn't set of eyes because he's got money.

He's set of the blind clients and he, they want them to come make a deal with him. Yes. Okay. Yeah. No, no, no.

That's faster. He, to his credit. I think he's going out there repeatedly and saying, we are a coming in for a catastrophe with our economy. We are about to destroy giant swaths of entry-level jobs. Or at the very least, I think there's an argument again that they're not going to do it effectively.

But that Wall Street and corporations will do that because that's the short-term beneficial thing. And that is really fucking scary.

“And that's why I brought up with Pete last week.”

Because I was like, I think this is going to be the biggest thing in two years. This feels like a fucking catastrophe that is incoming, dude. Well, if you want to hear us talk about the disastrous revised job numbers. You can turn the seconds and then talk about gaming. You can join us on the Patreon.com/liminatesame.

We do an extra hour of the show every week. But that's it for this week's episode. You turn the Patreon. Hey, what are you wearing? All right.

You pulled the website. Listen. As one person that embodies the spirit of this pod and us telling the truth at all times. Right. And that is the great Bernie Mado.

I don't know if he's dead actually. Did he die? He did. Have any died in prison, yeah? It's good.

He's dead on the pod. Okay, here's the deal. We're selling this sweater with Bernie Madoff on it. I came up with, I came up with this design. I'm pushing this sweater for like five years.

Yeah. If you followed me closely for some reason, or Josh Mann, the melee player, you may have seen this sweater, and it's because I made it a very long time ago. But I didn't have a personal brand to sell it under that really made sense. And we finally decided to put it on sale.

I was like, what if we actually sold this now?

“So if you want to cop a Bernie Madoff, you should never wear that hustling sweater.”

Yeah. It's Bernie Madoff the greatest Ponzi skier in. World history.

And it says never stop hustling.

And if that's the kind of brand you want to rent yourself. Yeah. Which I certainly do. Here's Bernie, right here. There's a smile that can't lie, dude.

Wow. He wouldn't lie. He wouldn't lie. He wouldn't lie. He wouldn't lie.

By the way, do stories crazy. Money from this, or are you just using our website for this? It wasn't clear. That's a great question, actually. And this one you'll go somewhere.

I don't look. I really just wanted to get this one out. This sweater's not a skier. That's a skier. How appropriate.

Guys, thanks for watching. Take care of the picture. Check out this website. Lemonade stand dot shot. Lemonade stand dot shot.

Take that out. Thanks to Bernie Madoff for his long times of shit for our podcast. Yeah, that's Bernie. See you guys next week. Thanks everybody.

Bye. See you guys next week. See you guys next week.

In house the tray? From getting a call? No. Oh, it's called me. No, you're not.

Oh, it's my friend. I said to New York. They said it.

I thought they were profiling you.

I thought it was a me. I thought it was a me. I thought it was a me.

“Maybe just if I said someone with more charisma and you don't raise when you”

screamed by by cell cell at a wall.

Well, don't keep us waiting. Did it work? I did it right at the ball. All right.

“Well, if it didn't work, which I assume it didn't.”

You could still go to history dot com slash lemonade today to get started with an actual

trading platform. See you to trade in because I registered broker dealer and member of FINRA and FAA and SIPC.