The Iran War Risk Markets Are Ignoring

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Today's number 81. That's the percentage of Gen Z and Millennials who plan to travel based on a movie and TV locations ad. Why can't Millennials take a joke? Why? Well, often it lands too close to their parent house.

You'll get it. Keep's thinking. You'll get there. Junior, your class sixth Princeton. Imagine you went to a real college. Hits too close to home.

Their home is their parent's house. Ah, okay. What is millennial get on his wedding day? What's that? A participation trophy wife.

How are you? I'm doing well. Oh, yeah. I'm good. I just spent most of the last nine.

I did one of my favorite things. I took an edible impact, which is like a seven-hour experience for me, but it sounds awful to me. I actually sounds like my nightmare. This is what happens when you get older.

A Rolls Royce starts looking cool. The doucheous car in the world starts thinking, I'd like to cut my jib in a Rolls. I already feel that way, but you like the silver shadow. It's pretty cool.

I like fancy colors. With the suicide doors and the umbrella that comes out of the backseat, I went to Australia with a chupriani and this Rolls rolled up. And Jay Z stepped out and got that umbrella out of the back door.

“I think just for a fact, it wasn't even raining.”

Second thing about you can tell you getting older. You start thinking, wow, cruise actually sounds like a pretty good time.

Like, I never would have thought I'd be attracted or drawn to a cruise.

And then what were we talking about? We were talking about packing high. Oh yeah, packing becomes enjoyable. That's crazy. I love, I'm like, which shoes am I going to wear?

Do I need to transfer stuff to you start checking the weather? You want to make sure that you're packing appropriately? I need, for me, packing used to be throw literally some toiletries, a hoodie, a pair of jeans, some socks, a underwear, and my edibles in a duffel bag. I used to be the lightest travel in the world.

I'm like fucking queen and now headed to Rwanda. That's me. But I hate it because it's so stressful for me. I get made fun of whenever we go on work trips because I'll have a very large bag and then Claire will make fun of me, which is I'm being exactly sort of queen and about it.

“But I find it, I mean, I think it's the worst thing in the world trying to figure out and”

predict what am I going to want to wear? Are they going to be variables? Is the weather going to be bad? Is the weather going to be good? Doing all of this. And then once you pack like that's it, that's all you've got.

I used to be the person who just left, you know, a few clean pairs of underwear in my toiletries in a duffel bag and I was ready to come and go. I don't have many things. I'm not that into things. I'm in, I like homes.

So I guess that's a thing. But I don't want to car. I've never been that into watches or

or anything like that. The, I do have a few things that I just absolutely love and one of them. I love luggage. I love Ramallah. I love, by the way, Ramallah if you're out there, you should absolutely be an advertiser and I'll take selfies of me and the Ramallah going around the world to speak to the National Cotton Girls Association about the future of AI.

But I love good luggage and it tries me crazy when people have bad luggage or, you know, especially people with money. Those Ramallah bags are ridiculously expensive, by the way. I mean, it's, it's quite shocking.

“I mean, you have, you have to spend over a thousand dollars to get even the smallest of those bags.”

Yeah, I think it's a pretty strong signal though. And also, it's not like a privilege to respect, but although they're, it's kind of like your watch your phone and your luggage and if you have a car, your car are sort of your signal. And what guys don't realize is that if they ever get, if they're about to get down, the biggest turn on for a woman, I'm going to get sure for this, is if you have a decent

relatively nice place, like you actually put some thought, I think that's fair. I'm in the year to get Council for that. Yeah. And it's clean and she thinks, oh, I wouldn't mind waking up here on the occasional Sunday morning. 100%. But the, the casem in your packing strategies. It's absolutely okay to pack a lot if you look nice. And that's where the casem can happen.

Go ahead. Today we are discussing what the markets tell us about the war in Iran.

“And also anthropic stand against the Pentagon. By the way, just a reminder, we will be recording”

our live episode from the Vox Media Podcast stage at 10 a.m. this Saturday at South by Southwest. We're very excited about it. We hope to see there. We've told you enough about it. If your in Texas come, come hang out with that. It'll be a lot of fun. It will be great. I got another live event coming up here. I noticed how you just clashed over that. On Sunday. Yeah. We'll keep looking. Okay.

It's a little jelly. It's a little jelly at the other podcast. He just thinks because he has a foot and a half on Kara Swisher that somehow she says nemesis. I don't know what you're talking about. I don't even know what that podcast is. The US and Israel launched military strikes on Iran last week. They killed Iran's leader, Ayatola Hamani and several high-ranked military officials and damaged government and defense sites.

The conflict shows no clear signs of winding down. President Trump said the campaign could intensify and last for weeks. Well, Iran has indicated it is not willing to negotiate with the US. Despite the turmoil, markets have been relatively calm. The S&P is down quite modestly since the strikes began and the yield on tenure treasuries climbed. However, one of the more significant reactions has been in energy with crude oil prices surging to an 18-month high. So, Scott, our job

is to look at the markets here, or at least our job on this podcast is to look at the markets. What the war is telling us about what's happening. The markets also, what the market is telling us,

“what about what's going to happen in the war here. I think one takeaway is that if you were looking”

to the markets to tell you something about the future, it would be that the future of this conflict

will probably be somewhat contained. Just the stock markets reaction, basically flat since this

happened. And of course, treasury yields climbing, which means that actually people have been invested, have been selling their treasuries, and treasuries are usually the safe haven asset. When conflicts break out, you'd expect the opposite to happen. Now, I'm not sure what I make of it, or I think I'm a little skeptical of the markets reaction, but let's just start there. Your reaction is to what the markets are telling us about this military conflict.

I think you nailed it. I think the market thinks it's going to be an eruption. It'll probably ding some of the earnings of travel stocks, luxury stocks, depending upon airport retail, it'll take travel down. I was thinking about going to India in Bahrain, and we're now in April, now we're contemplating whether we're going to go or not. It's just a short-term hit to earnings, but in terms of a long-term war or a real structural impact, it doesn't look as if the market believes

that's going to happen. If you look at most wars, typically stocks fall in the short-term, and then they actually recover pretty robustly, and what's happened essentially since 9/11 where stocks in New York are listed, check down, but then came ripping back. The check-down is usually shallower and shorter than usual, because people look for the bump and start investing in the bump before it's even had a chance to go down. In addition, the kind of risk on of metals going up,

metals have come down. So what do we have? We have some of the stocks that have been hit really hard

to travel stocks, right? So basically, airlines and cruise stocks are down about 10%.

I thought Elvi Amage is down. I thought the most interesting thing in the market was

“that the Cosby or the Korean market had its largest one-day decline. I think in history,”

or since T-Tat, for a long time, it was down. I think at 1.11%. And I think it's because they're pricing energy. The flows, 20% of the oil flows through the streets of Hormuz, the big, the kind of the big loser here, arguably, is China, which gets 80% of the oil exported out of Iran, what's going to China, similar levels, or pretty big levels out of Venezuela, so the supply of energy into Asia has been hit hard, and also there's just a general recognition, and it might be that

the Cosby was up so dramatically. This is just letting some air out of the balloon, that a lot of their biggest companies, whether it's Samsung or their building microchips, they just require a lot of energy and that if energy spikes, that will really have a big impact on their earnings. But I essentially think the markets are saying, and this is why the markets are so

There's nothing like getting truth from someone, then asking them where they're actually investing. But whenever a company asks me to call, I've been on boards and we're raising money, they ask me to call investors. The first thing investors ask is, are you participating in this

“round? And that's sort of, that's Wonder Woman putting a golden lasso around you. So I think what”

the markets are saying here, and the markets get it wrong, but is that they think this conflict

is going to hurt some companies in the short run? But effectively, if oil is up 10 or 12 percent,

diesel's way up more because of supply chain concerns in Europe in the short term. But I think the market is essentially saying, and you tell me if you think I got this wrong, this conflict is going to hit certain sectors in the short run, but we think the conflict is short lived and the world will return to some level of normalcy sooner rather than later. I think that's exactly what the markets are telling us. And to be fair, to the markets and to your point, that is often what

happens. I mean, this is one of the strange things about war and about military conflicts is that usually they are not that impactful to the markets or at least you look back since World War II, three quarters of the conflict since then. If you measure a year after the conflict began, stocks ended up in the green. You saw a positive return, and actually JP Morgan did this study, and they found that S&P returns were actually the same on average during peacetime and following

“conflict. So I think recent history would tell us that this is strangely not that impactful on”

markets, and I think that can be a little frustrating for sometimes because that Rob Armstrong makes this point. We often want the markets to tell us what we really believe. And I look at the death and destruction that is happening, and part of me wants to think, you know, this is like a big deal. This is scary. This is problematic for various reasons, and I want the market to reflect that the markets are definitely not reflecting that, at least not yet. The markets believe that

this is going to be contained. It's going to be, you know, maybe there's going to be a little bit of instability, but not so much that it's really going to hit investors very hard. That's what the markets believe right now. Now, the question you bring up is, are they right or are they wrong? And usually I would say usually the markets are pretty much right. I'm not someone who thinks that

the markets are always getting things wrong and investors don't understand what's happening. But I'm

also someone who believes that the markets can get things wrong sometimes. And that's how I

“felt about the satrini article. I think that's how you felt about the satrini article too when”

this AI blog post comes out and suddenly everyone devolves into a panic. They start pricing and things that don't really exist yet. They don't have evidence of. And to me that was a moment where the markets got it wrong, we'll see what happens over the next few years. On this occasion, I'm not so certain that the markets are getting it wrong. But I am struck by the markets certainty about what is happening here. And I felt this way when we talked with Steve

I was meant about this where I said, you know, what does this do to your investment strategy? And he said very, very plainly, this doesn't change anything. This won't change my investment strategy by a single dollar. And I'm hearing this a lot actually among investors that this isn't a big deal. It's contained. Trump has essentially concluded the problem. And we're now living in an era of actually more stability and more certainty now that the bonds have been dropped than we were before.

I'm just not so convinced of this. And I think there are plenty of what ifs that the markets ought to be at least considering, but they seem to be not even willing to even acknowledge.

I mean, the first what if would be what if Iran is destabilized even further? What if the nation

evolves into something even worse? And by the way, that is not an unlikely scenario because it is exactly what we've seen in most of the regime changes throughout recent history. It's what we saw in Iraq as an example. I mean, we've seen many instances where there's actually been more instability, more chaos, more death and destruction within the region following a regime change. So there are a lot of what ifs here, a lot of what could go wrongs, a lot of worst case scenarios that to me are

very big deals. And I am struck by investors, general consensus here that none of this is going to

to sponsor and wreak havoc in the Middle East, it is clear that the American public feel that

“at a minimum the president should have gone to Congress, should have been foreign Congress,”

would have been much better off had he figured out a way to use diplomacy to enlist one or more European and Gulf allies. And also it's reflecting a level of incompetence and I call right now Iran as war is in profit. It literally feels as if they're making it up as they go. Right. So the messaging will be there for five days. We could be there a long time. This is a special combat mission according to Republican senators, no according to the president. It's war.

We want regime change. We're not necessarily interested in regime change. Those both those statements came from the president not being able to get American citizens out of the Gulf, not no one actually thought through what happens when everyone wants to come home, what's our plan for getting our own citizens out bombing Tehran where we have probably more pro-West sympathy or empathy than many of the rural regions that are much more theocratic and low. It just feels as if it's not

tactically they are absolutely diminishing their navy, their missile launch capability. I do believe that they're going to totally neuter their capacity to build nuclear weapons. So tactically you could say it's a I would argue it's a win so far. They're achieving objectives. But when you have no real thoughtful delineation of what the objectives are and the story keeps changing and you're going about it alone and you're basically have held up the middle finger to democracy and aren't

even briefing the Senate Intelligence Committee. I mean I've never seen Senator Warner so apoplectic

that and it does it shows just such extraordinary confidence because wouldn't you want to at least brief Senator Warner who has had several presidents in front of him and oversees the intelligence community or informs the intelligence community to kind of get his thoughts. Wouldn't you want to brief Senator Kelly who's flown dozens of combat missions to get the benefit of

“their thinking? Wouldn't you want to have Representative Seth Molten who is in the Marines? I think”

in Iraq and/or Afghanistan to get their feeling about what might be going on the ground because there's we haven't had diplomats there since 1979. So other than relying on the most odd which is obviously going to have their own agenda and their own objectives we have no color or real context here and it looks as if America this is another data point and the larger impact on the market is not the word self but another data point that America is no longer the operating

system to which the world operates. We used to have we controlled the we controlled the supplies or the roots of energy right it was generally speaking ships in maritime passageways were kind of off limits we just sunk a ship with a torpedo for the first time since World War II in international waters. We were the one everything was settled in dollars loosely speaking our trade and our IP agreements were the ones that people live by. It was our our 700 military bases overseas ensured the

safe flow of global trade and international norms and now what they see is okay here's a rogue nation. We used to be the one ensuring no nations went rogue now we are that rogue nation and something happened that I actually think you know it's the stuff you don't see that's or that doesn't get reported that has a bigger impact. India and Canada just struck a trade deal and they said

we're going to do it's a $50 billion deal and the really interesting thing within that deal was they've

decided they're going to settle all of that trade in non-dollar-denominated currencies. So they're not only they're not only re-rooting their supply chain and trade agreements around the U.S. they're they're purposely trying to figure out a way to de-dollarize and no longer have what I would argue is the most formidable carrier strike force in the world and that is the U.S. dollar. Everything settles in dollars. So we have access to everything in terms of flows of capital

and power and we also have the ability to sanction people really severely because everyone wants to

“settle in dollars. So what this is I think the markets have said okay this conflict will probably”

be ring-fanced it'll probably end sooner rather than later but I do what you're going to think what you're going to see over the next year. I think the market is going to underperform and we're going to see a weakening of the dollar because this is yet another example where nation sent Jesus Christ the operating system we've been operating on is no longer we can no longer depend upon it because these guys quite frankly are out of fucking control they no longer see themselves as

part of the West they no longer feel the need to you know if we'd gone in with British French and German intelligence and resources fewer of those missiles would have landed or hit

looks as if Iran may have run out of munitions to fire at their neighbors if we had figured out

a way to try and get one or two Gulf states to join us it would have just had so much more legitimacy it would have been another example of how the West brings people together and has

“some checks and balances instead I think the biggest danger to the markets is not the actual”

action in Iran it's another data point that we are now that rogue nation but I don't understand why because all of the points you bring up here should not instill or inspire much faith in Trump's decision making on this issue at least that is my view of it agreed and so what I don't understand is why there seems to be this kind of blind faith and trust in his ability to handle

this competently and what I've seen all of the points you made no congressional approval

no willingness or effort to inspire or reach some level of legitimacy and consensus on this issue either in America or with our allies also the fact that he was the anti war candidate for many many years I mean this whole thing his whole political career really began with I think Iraq was

“a bad idea I think Afghanistan was a bad idea personally I don't see that much evidence that this”

situation is that much different from what we saw before I don't think that he's proven that to us there seems also as you say the messaging you know what are we actually trying to achieve here are we not at war and to me that's not a function of bad messaging that's a function of actually bad strategy I don't think it's that they don't know what to say I think it's the is that they actually do not know what the plan is they don't have a strategy and so all of that makes me think

we are getting into very very dangerous territory here we are we are potentially witnessing what might be the next trigger of I've some very very difficult long war something similar to what we saw with Iraq which by the way they also told us there's a few days a few weeks they said it wouldn't I mean Donald Trump said literally said I doubt this

“will last six months that's what he told us it ended up lasting eight years it ended up costing”

three trillion dollars nearly 40,000 Americans were injured four and a half thousand Americans died so all of this to me says we don't really know what we're getting into here and there are so many other downstream effects that could be really dangerous for example you know if one very likely scenario would be that this isn't contained that Israel hits Iran's oil facilities Iran starts hitting other nations oil facilities to just cause some chaos because they're frustrated they're on the back

foot oil starts the price of oil starts to go up could easily breach a hundred dollars a barrel at which point what does that do to inflation at home what does that do to the interest rate policy of the federal reserve that's its own thing this what this could do to the affordability crisis and to gas prices in America and also in Europe could also massively destabilize Europe and we're already seeing this in liquid natural gas prices which are skyrocketing in Europe not the case for

America we're insulated from the issue a little bit more because we have our own supply so that's good but then even things like cyber attacks I mean we've already seen a huge increase in cyber attacks on Israel literally days after that they struck Iran what if that happens to America too what if

there is a refugee crisis I mean this is a country the population of 90 million people what

happens if they all decide okay we're out of here this is a hot certain which it is and they decided to stop fleeing to Europe what does that mean for the political complexion of of Europe what does that mean for the rise of right wing populism which is already gaining some steam in Europe what would that do to European markets how would that affect American markets like my mind is like worrying with all of the what ifs and I get that I'm more of a pessimist than most but I feel like that's

kind of what the markets are supposed to be contending with right now and purely based on my conversations with investors I feel like no one is honestly contending with those potentially bad outcomes we'll be right back after the break and if you're enjoying the show so far send it to a friend and please follow us if you haven't already support for the show comes from Monarch smell that spring is in the air that means sunshine flowers and bloom and tax season listen some of us look forward

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building for free today at framer dot com slash markets for 30% off of framer pro annual plan that's framer dot com slash markets for 30% off framer dot com slash markets rules and restrictions may apply with back with property markets anytime you start a war there's an enormous x factor including you know the worst case scenario a downward spiral the results and somebody donating a nuclear bomb

I mean that there's just because the reality is the enemy gets a voice in this and you can't predict

what they're going to do all norms kind of go out the door what is a war is is a negotiation when all diplomatic efforts have failed so they're but also you could make these arguments and never decide to go into cost of all and liberate people to not create a multilateral force and go into Kuwait and push out who's saying to not to not fight their war again after we got nothing from the world or one but a bunch of injured and named americans and just struck a deal with Hitler

and you know there was a very large movement the biggest hero the Elon Musk the biggest hero in 30s america was Charles Lemberg who was who was absolutely against it there was a huge anti war basically a lot of people accused after you are lying to the american public to try and send

armaments to Europe so there is always a a thoughtful and reasoned argument around how any war

any conflict could result in arm again I get it I would argue that and this is my prediction oil any year from now will be less expensive than it was at the beginning of this conflict or war let's call it a war and that the he biggest opportunities from an investment standpoint if things go right if we can figure out a way to ensure that if the war in Ukraine comes to an end and we can figure out a way to ensure that they have some reasonable sense of security I think the amount of

and surveillance technology I think the Ukrainian economy is absolutely going to boom but the

key will be to make sure that we we help them at least win the war having a negotiating power such that we're not we're preventing the next war just not scheduling it if we in fact can figure out a way if the Iranian military is diminished to the point and their launch capabilities their ability to lay minds and the streets of foreign moves their ability to enrich uranium if

“all of that is absolutely neutered I think the Middle East is safer if we can and this is the”

optimistic point and let's go to what Josh Brown says what could go right if we got not even get a pro west at government ruling party but a neutral one that embraces technology may be normalizes relationship relations with Israel which has a lot of technology normalizes or has enough neutral enough relationship with Europe and the U.S. to get better well infrastructure and technology I think you're going to see an economic boom in Iran I think the

private equity guys while I was suddenly flying and there'll be a four seasons in Toronto where they're trying to figure out a way to invest so a lot of times look at World War II what have been the two most productive economies the last half of that century Germany and Japan but those are the exceptions to the rule kind of here if we're talking regime change and if we're talking U.S. involvement like those were success stories do you think the Venezuelan economy is

“going to be better two years from now or two years or two years back I think it's a very open question”

I think right now I think right now there is some support for the U.S. and I think that there as you mentioned in Tehran in Iran there are support for the American cause because they have been so oppressed but I mean my mind just go I feel like we've seen this movie before we saw this in Iraq where there was also some support for the U.S. and then there was so much instability over the next few years that suddenly everyone decided to go actually we wish these guys didn't

come in here whether whether they're right or wrong I'm not I'll leave that up to them but the reality is you know when the year off the invasion happened the Iraqis were pretty split and then three years later all of them decided that America was the enemy so far that was the worst geopolitical mistake of this century was George Bush lying to us and getting propping up his CI director and in general pal to say their weapons and mass destruction there wasn't he himself didn't have plans

his or the organizing principle of Iraq unlike Iran wasn't death Israel and death to America but this is how I would summarize it the why and what they're doing I think I think the Trump would have had potentially had he gone to Congress he would have gone for an authorized authorization

of the use of military force they never get a declaration of war and I think he may have gotten

or may not but he needed to do that because what it forced him to do was to say oh this is a defensive posture well why is it defensive because they were about to be attacked and if they were attacked they would attack us back okay so you're you're saying that Israel is now running the military in U.S. policy the what in the why here and why now I think have real rational justification the problem is no one trusts the guy that's driving the bus to execute it correctly

and that it could backfire because if our messaging is wrong if we don't execute well if we I mean right now quite frankly I believe everyone just wants this war to be over I think

“the worst thing we could do right now is make a much a hollow excuses for pulling up stakes and”

leaving because what's the next time we want to take military action the nation just points it's missiles that its neighbors and says wait four or five days and hire a bunch of troll farms to piss on the president on social media Russia to their I don't say to their credit but Russia has lost a million people and it's spent four years and it's not moved in inch meanwhile Spain won't put a single fucking boot on the ground and I hate to say this but it kind of goes back to

what the one smart thing that I forget the guy my curiosity son said who would you rather be less rather be in a fight with someone who's really smart or someone who's fucking crazy

and the reality is the West if the West leaves right now and I I understand that there was no legitimacy

going into a wrong that they lacked he lacked the legitimacy when you declare war and this is war you are supposed to get congressional approval and let the US public have a vote in this visibly their representatives and you have more legitimacy going in if you go in with a multi-national force he did not do that people on the left and right are pissed off by the way he's got about I think it's 72 or 77 support of Republicans 17% of Democrats this as everything is

about 32% support but again I go to this is another data point that the leader of the free

“world does not know how to allocate resources in a responsible safe way I think he could have”

made a very solid argument for why this was a good idea if he outlined objectives that were very straightforward measurable had a multilateral force including European nations and Gulf nations gone to Congress brief the right people and if Congress if he didn't get the votes then he shouldn't do it because this is war this isn't a defensive act where he's understandably given the rights to move quickly so this isn't in my opinion this is moved from

whether or not this was the right thing to do the bottom is this is another data point where we think we have an autocrat who does not think things through who acts based on the last person you spoke to whether was Secretary Rubio or BB Netanyahu and is allocating our resources in a very irresponsible dangerous way and has the whole world going Jesus Christ the knock at the door now they were supposed to be scared of we're supposed to be the good guys now they're the knock

at the door the the one thing I don't I'm not sure I'm aligned with you on is when you say that that messaging I mean as the as the example they come out and they say in so many words this was

“Netanyahu's decision he brought us into this that's what Rubio basically says that is the”

stupidest thing they have and this is not this is a high bar that is absolutely the stupidest most damaging thing they could have said but what if it's true like I mean if it's a messaging problem I mean if it's they they they flubbed their explanation that's one thing so you think that Netanyahu and a pack are effectively controlling the president and deciding what if and where we declare war I think that what Rubio said I could see as being true which is that Netanyahu said

we're going in join us or not I'm the American decide to join us I don't think America scares that easily I don't even trump I don't think that I think it more likely when something like this and we

won't know until you know those tapes or eventually the truth is like oxygen trapped under water

at some point there's a bit of an earthquake in the oxygen reaches the truth reaches the service

“I think what more likely happened I think he respects Netanyahu and Netanyahu was one of”

probably several voices saying this could be your legacy you could unlock these of either incredible resource in the best performing organization in the world the US military you could unlock unprecedented peace prosperity and stability in the Middle East with this bold leadership action and oh the free gift which with purchase, wink, wink is you're going to push up scene out of the news for for a few weeks but I don't I just do not buy and I'm uncomfortable

with the notion that I feel kind of plays into this trope that 2% of the population in the US that is Jewish is somehow controlling you know the the the US government I don't doubt that I don't doubt that Trump listens to Netanyahu and in respects him but this was Trump's decision not and if they said we're going in with or without you they could have find they're not afraid to do that what what's become clear since October the 7th is that Israel is the superpower in

the Middle East yeah that they are I mean if you look at we talked about geopolitical disasters Iraq disaster total fucking disaster and set off a hallucination that has damaged your generation that can be distilled down to the following oh hey everybody hey old people we can cut your taxes and go to war because guess what we have so much built up trust because of previous generations responsibility and leadership that we have massive borrowing capacity George Washington

to George Bush 7 trillion in deficits George Bush to Donald Trump another 30 trillion in deficits right

so that was a huge mistake the second biggest geopolitical mistake and may have surpassed

was October the 7th if someone had told Sinmar and Khomeini you're both going to be dead and Assad is going to be playing video games in Moscow and Hezbollah this supposedly great fighting force is going to be neutered that the hooties and Yemen are going to have are basically going to be just bothersome but not a real force and Iran is not even going to have control over its own skies in Syria is now run by some I mean this was the biggest mistake we made the

second biggest mistake or biggest mistake so far of the century I think Sinmar and Iran unless we honestly was Iran made the biggest mistake again let me just wrap all this up how with a market

ex-factor because the enemy has to say in it I do believe that the biggest mistake here I think

the Trump could have made a very strong argument for why to do this why now why it's an opportunity right now if he'd said very clear objectives and quite frankly had a secretary of war that didn't have his head up his ass and was a little bit more competent we are veered so far from the markets real us back in had real us back in we have veered far but I do think that it all relates that's the problem it's we're trying to price massive levels of uncertainty here that is what the market

job is to do at this point and so that is the question they believe we're okay and then I guess

“the question is if you're an investor do you agree with that and I think there's a decent argument”

for that and I also think there are some decent arguments on the other side as well well let's make a bed here and let's time stamp it and I keep saying let's time stamp it and our producers don't listen to me in a year do you think oil is going to be higher or lower than it is now I think it will probably be lower I think I agree with you but my certainty rating on that is very low I that's not a bet that I'm willing to put a lot of money on because I don't feel much conviction in it

but if I had to gun to my head I would agree with you oil goes well will be right back and for even more markets content sign up for our newsletter at proftymarkits.com/subscribe support for the show comes from vanta if you're a business owner you may have noticed that both risk and regulation are ramping up and customers expect proof of security just to do

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we're back with property markets last month we thought i'm thropic superbowl ad was going to be

“it's big moment the ad went viral racking up nearly 5 million views on x in under 24 hours”

but the buzz then faded and now the real big moment may have actually arrived at the end of February

and thropic rejected a 200 million dollar pentagon contract the company refused to allow

its technology to be used for surveillance of u_s_ citizens or autonomous military strikes trump swiftly blacklisted them and hours later open a_i_ picked up the contract but taking that stand appears to have paid off for anthropic clawed climb to number one in the app store and and thropics enterprise market share rose to 32% over taking open a_i_ meanwhile chat g_bt's uninstall rate in the u_s_ reportedly jumps nearly 300%

after news of its pentagon deal broke now the question will be how hard of a line is anthropic actually willing to draw it looks like the company is now back in negotiations with the pentagon seeking a compromise that would enable the government to keep using its technology it would also prevent anthropic from being excluded from the military supply chain so

“scott i think this is very interesting because this goes back to something that you were”

saying a long time ago when terrorists were unfolding where you said actually if you're the leader of a large public company a lot of them were very scared to say anything bad about trump or to stand up to him or to disagree with him in any way and you made the point actually this could be good for you it doesn't school we have we have ethics we have leadership and we have sustainability courses in age costs every course costs $7,000 let me say be $21,000

ethics think about right and wrong okay that's the ethics course leadership do the right thing even when it's hard boom you're done with leadership and the sustainability thinking about doing the right thing doing the right thing when it's really hard you might make

“money out it boom you're done i just saved you $21,000 when you don't speak out on behalf”

of our wonderful allies and other companies and speak out on behalf of your own company and just wait folks in a long run it's just really bad for you not speaking out someone's now tried it in Darryu Amadeh who stood up to the president and what happens in store rates of anthropic

and of broad skyrocket and actually their revenue their ARR went from 14 billion dollars to

19 billion dollars in two weeks which is a 36% increase it's just unbelievable so it seems that they have actually proven your point here but let's get your reactions to what's happening between anthropic and Trump and the Pentagon and open AI he's the first CEO who said no and he's absolutely right under all builds weapons so the government can kill people the silicon valley wokster ethos was no we're gonna walk out during lunch because we don't like Google working with the defense

support well good for you that's that'll show them your little wok bitch meanwhile it go back to the cafeteria and get your sushi and cry into your Atlantic anyways they get to do that Palantir if they want to provide data to Israel as long as they go they get security clearance they're allowed to do that because as long as you comply with the law you get to operate within your entitled to and subject to the laws when the Pentagon starts saying no you got to do this

and he said he stuck up the middle finger and guess what we're here for it America's here for it and as I mentioned before on Sunday we're going to Minneapolis we've had this resistant unsubscribe movement highlighting a bunch of companies that subscribe from the next evolution of it is the following we're gonna try and put out a bunch of data and a bunch of messaging and a bunch of media encouraging people to not use an unsubscribe from the open AI but to subscribe and patronize andthropic

if you believe the companies have the right to operate under the laws and not and should not subject to intimidation from the president or the Pentagon to do exactly what they want when they're not comfortable with it then sign up for anthropic he's the hero we were waiting for and it's and we have been saying this for I've been saying this for six or nine months there's an

enormous commercial opportunity for the first person who gets off their knees and says fuck you

we get to decide who we work with we can do it based on sexual orientation we can't not serve people because of their their sexual orientation of their race actually that's not true now that I think the Supreme Court is decided you don't have to make a cake for someone if a gay wedding cake but anyways my point is he's the guy finally someone took advantage of the biggest commercial opportunity of the last six months and that is to stand up and say you know what is last I check

being an American and being an incorporated in America means we have to we absolutely have to operate by rule of law but also we are protected by rule of law meaning we get to make we get to make these decisions and he's been articulate he's been forceful and this goes to another prediction we

“made I think about three four months ago that within a year anthropic would be worth more than”

open AI mostly because I think open AI is going to decline in value it's been proven now I mean I just return to this unbelievable number that their ARR their annualized recurring revenue two weeks ago

was $14 billion and today it is $19 billion like we literally have the data in front of us

that getting off of your knees as you say standing up to the president literally translated into a $5 billion revenue opportunity and who knows how much it'll increase in the future meanwhile look at the damage that it is levying on his greatest competitor which is open AI Sam Altman they step in they say okay we're going to take the contract with the Pentagon and suddenly the uninstall rate absolutely skyrockets one and a half million users leave chat GPT and then there's

this movement online that starts to trend have to take cancelled GPT so we're watching the evidence

“play out in real time and I think the other thing that is so interesting is how badly Sam Altman”

is fumbling the bag every time from a PR and communications perspective something that is quite striking a year ago nine percent of Americans said they dislike Sam Altman that's already a pretty

big number today that number is 20 percent so it has more than doubled in the past year and you

think about all the things that he's gotten wrong obviously his response to that Super Bowl ad his very awkward Senate hearings his very awkward interview on Jimmy Fallon where he tried to present as this fun likable relatable guy ended up being quite awkward and and seeming quite honestly a little evil in a lot of ways but then I think the most accepted the the the worst moment we've seen from him happen a couple weeks ago and I just want to play this clip for you

“get your reaction because I think this is probably the worst thing Sam Altman has ever said”

in a public forum people talk about how much energy it takes to train a young model relative to how much it costs a human to do one inference query but it also takes a lot of energy to train a human it takes like 20 years of life and all of the food you eat during that time before you get smart and not only that it took like the very widespread evolution of the

hundred billion people that have ever lived and learned not to get eaten by predators and learned

how to figure out science and whatever to produce you and then you took whatever you you know you took so the fair comparison is if you ask chat to be a question how much energy does it take once this model is trained to answer that question versus a human and probably AI has already caught up on an energy efficiency based this measure that way that's get your reactions there are certain looking glasses and the people's character and souls and I've also had two easy ones or how

people treat service staff do they look them in the eye how they're patient with them do they tip well and then also how they treat their pets I have a close friend who I like to drink with and no matter what it exactly eleven and he I might lose him as a drinking buddy he's like I got to get home and get my dog out it just how you treat your pets and how you treat staff looking glasses and the people soul and there's a lot of different things right this was a rare moment

when we had a bit of a looking glass in the salmon soul and he's a fucking nihilist he is basically saying there is a rational reason to invest more in non-sentient beings because sentient beings require too many resources and so I will all right boss that means you're the guy who's looking for the fuck doll and rather than having a human to have a relationship with that you don't you really don't understand what the shooting match the reason we're here is to is to create friction

can have relationships with and that he even thinks that way that it's unfair when you think

“about the amount of energy we have to put into raising a child to get to the point where it's”

intelligent that wait I can replicate that with less energy just just that he's thinking that way feels a feels quite frankly it just feels frightening someone who sees power and ROI as besting emotion relationships and sentience and no power and ROI in the markets and AI are all meant to unlock greater prosperity and an absence of anxiety such that you can focus on those little energy-consumptive nightmares called children that's the whole fucking point

that we do all this other stuff such that we can make the investments in these children that are worth it and I thought this is such a this is such a statement from someone who has not had enough love in his life or has an experience what it's like to raise children and generally sees maybe a legitimacy of the rise of the robots it's kind of this Peter Teele nihilism weirdness that would they just look at stuff as as ROI being the endgame no the reason why we pursue ROI

it's such that we can waste time and money and be very inefficient with the investments we make and I still haven't got my money back on my children yet I'm not trying to ever going to and almost every calculation of ROI I say this is what gets all the time I'm like I talked to them about becoming a man in the idea of surplus value and I'm like you're surplus negative right now I'm like the school spending way more than you're giving back we give you so much

more love than you give us I can't I'm like do you know how much I'm spending on you like my son's been selling Pokemon cards and I'm like okay give that to me back I'm forced my kid who just got into college to go through and tell me how much I will have to make pre-tax such that he can join a fraternity and sorority and you know and and make out with girls from you know from Richmond Virginia negative negative value but this is the whole point the whole point of humanity or

being a parent is that you make these investments because that's where you give in to purpose that's where you give in to the most loyal Americans and some of the most satisfied Americans or veterans they

will never get an actual return on their service and being away from their families but it gives

them purpose that they're able to invest in something that you're able to give up your resources and your emotions and invest in something realizing on a tangible anodine level you'll never

“see a return what you get back is knowing that you added value I think that's well said I think”

that it is a very significant concern and question for us I mean what do we do about the fact that the leaders and the builders of the technology of tomorrow appear to have a genuine fundamental misunderstanding of the point of life of the point of why we're all here what existence and humanity is actually all about I mean what does that mean for us I totally agree with you I think Sam up we'd saw him to his soul there he does not have an understanding of these things

he doesn't have an understanding of purpose and I think that quote said it all now the question's gonna be Daryama Day he now appears to be in talks again with the Pentagon is he gonna fold on his previous position I mean I I hope not we'll see how these talks unfold but I think he has something good here which is standing up for his actual beliefs and his values if he caves then maybe it was fake maybe he didn't have values at which point we'll have to turn again

but it is very interesting to see how this is all unfolding I'm gonna wrap us up here because

“I know that you need to go let's take a look at the week ahead we will see inflation data from the”

personal consumption expenditures index for January and then consumer price index for February we will also see earnings from Oracle and Adobe any predictions gone my prediction is no

and that is Daryama Day has taken this company from 14 billion a year in AR to 19 billion a year in AR

with one simple strategy no and by the way the average us in P company I think does 18 billion a year and I think that is gonna give CEOs the confidence to say no I think you're gonna see a half a dozen to a dozen CEOs over the next 30 days find their testicles and say no this episode was produced by Glenn Miller and Allison Weiss and engineered by Benjamin Spencer our video editor is Jorge Coltty our research team is Daesh Lahn is about a canceled

technical director and Catherine Dylan is our executive producer thank you for listening to

“property markets from property media if you like what you heard give us a follow and join us for a”

fresh take on markets tomorrow

.

of Amaltson Verpackung's data from the year 2005 in Rosbotanian and the EU.