I shouldn't laugh.

Right.

Well, I mean, it is.

I mean, you have to laugh or you cry.

Right.

So and then it's like 3000 words that come after the butt.

Right.

What did they think that they're doing? That sometimes people that run healthcare organizations don't pay out when people should be paid out, therefore it's okay to kill the person at the top?

I shouldn't laugh.

Right.

Well, I mean, it is.

I mean, you have to laugh or you cry.

Right.

So and then it's like 3000 words that come after the butt.

Right.

What did they think that they're doing? That sometimes people that run healthcare organizations don't pay out when people should be paid out, therefore it's okay to kill the person at the top?

Let's get right back into the action.

I would just say two things on inflation.

It's actually pretty interesting.

So there's an overall concept of inflation, which, as you said, is growth of the money supply.

But the way that that plays out in the economy, and they actually analyze it this way, it's basically the way they think about it.

It's the basket of overall prices of everything in the economy.

And the government agency that calculates the rate of inflation uses a basket of sort of equivalent products over time to try to get a sense of what's actually happening with prices.

week?

I shouldn't laugh.

Right.

Well, I mean, it is.

I mean, you, you have to laugh or you cry, right? So be- and then it's like three thousand words that come after the but, right? And it's like, okay, like, uh, you know, which is basically a long, long, long-winded ex- you know, sort of justification for murder.

Um, and so, you know, that, that is, that is get disconcerting.

There are some comedians now, c- comedians, you know, that are, have gotten in the game.

Um, and so, um, you know, they-- I would say this is fairly disconcerting.

What, what do they think that they're doing? That sometimes people that run healthcare organizations don't pay out when people should be paid out, therefore it's okay to kill the person at the top?

I shouldn't laugh.

Right.

Well, I mean, it is.

I mean, you, you have to laugh or you cry, right? So be- and then it's like 3,000 words that come after the but, right? And it's like, okay, like, uh, you know, which is basically a long, long, long-winded ex- you know, sort of justification for murder.

Um, and so, you know, that, that is, that is g- disconcerting.

There are some comedians now, c- comedians, you know, that are, have gotten in the game.

Um, and so, um, you know, that I would say this is fairly disconcerting.

What, what do they think that they're doing? That sometimes people that run healthcare organizations don't pay out when people should be paid out, therefore it's okay to kill the person at the top?

Um, Mark, why, why do we need rules for all of this, and why do we need them now?

Yeah.

So [chuckles] so there, you know, as we've been in this just kinda bizarre twilight state for the last, uh, several years, um, you know, where sort of crypto was developing, you know, largely without rules, you know, for better or for worse in kind of, you know, what I would describe as sort of experimental ways, um, you know, between, uh, between sort of inception through twenty twenty.

And then we had, um, you know, between twenty twenty and twenty twenty-four, we had a, a, an administration, you know, in the, in the White House that just like absolutely just decided to just kill the industry.

Like just, you know, flat out, you know, declared war, specifically, by the way, declined to regulate, refused to regulate, um, and instead decided to, uh, uh, prosecute.

Um, and, you know, this kinda really remarkable thing happened, which is the industry didn't die, uh, through that process.

Like crypto is still standing.

You guys had to go, you got, had to go in front of Congress, and didn't you have some-

Mark, why do we need rules for all of this and why do we need them now?

Yeah, so, you know, we've been in this just kind of bizarre twilight state for the last several years, you know, where sort of crypto was developing, you know, largely without rules, you know, for better or for worse, in kind of, you know, what I would describe as sort of experimental ways, you know, between sort of inception through 2020.

And then we had, you know, between 2020 and 2024, we had an administration, you know, in the White House that just like absolutely just decided to just kill the industry, like just, you know, flat out, you know, declared war.

Specifically, by the way, declined to regulate, refused to regulate.

and instead decided to prosecute.

And, you know, this kind of really remarkable thing happened, which is the industry didn't die through that process.

Like, crypto is still standing.

And so we had to ship deliberately

Definitely not

...

the reason that's not true is because the people who tend to, th- the people who prosper tend, in our society, tend to do so because they're be- they're becoming responsible for more and more things.

Um, and, and specifically they're becoming responsible for more and more people.

Um, and so one of the things I, I, I would observe about myself and ob- observe about a lot of my peers is even as we became more and more, you know, bothered and concerned and ultimately very worried about some of these things is as that was happening, we were taking on greater and greater responsibilities, um, for our employees and for all the companies that we're involved in, right, and for all the shareholders of all of our companies.

Um, and so I, I think that's part, a- and, and a- you know, you could, you could say, you know, th- this sort of this g- endless, you know, sort of question between kind of, you know, absolute dic- you know, sort of absolute commands and morality versus the, you know, real-world compromises that you make to try to, you know, function in society.

Um, you know, I would say I was just as, as, as subject to that, to that inherent conflict as anybody else.

Maybe let everybody know about it first, why you wrote it, and what effect it's had, and then I'll go through it step by step, at least to some degree, and, and I can let you know what ideas we, we've been developing with the Alliance for Responsible Citizenship, and we can play with that a little bit.

... than to have AI write that." It felt like a violation and a betrayal.

We're in this weird moment where, like, the LLMs, like the generative, you know, generative AI, like it just, it just literally started working, and it already works incredibly well.

So it's like this step function thing from doesn't work at all to works incredibly well, and it works incredibly well for w- w- helping on writing, and it works incredibly well for generating art.

And we're sitting here in this moment where, like, in theory, like within a year or two, there is gonna be a generative AI tool where you feed it an essay and it will give you the short film, right? But it, it, that doesn't quite exist yet, but we're almost on the verge of that.

And then by the way, if you were gonna do that today, you could hand do that.

You could use, you know, Midjourney or Stable Diffusion or whatever and you could do what you're talking about, like very quickly.

And I could probably literally do it myself, right, with, by just feeding in the text.

Yeah

Go check it out.

out.Um, and so, you know, there again, we're back to policy, policy questions, which is there, there are gonna be policy efforts to kind of prevent AI medicine from happening or robotic medicine from happening.

But the capabilities for sure are gonna be, are gonna exist.

I mean, the, the, uh, Dr. ChatGPT is a better doctor than 99% of doctors.

Like, it...

People, like, hate, you know, I don't know, doctors hate when you say it, but, like, it is tr- it is.

It just is.

Right.

[laughs]

Yeah, one of, one of exactly two.

And, and what my friend s- what, what my f- my friend said was like, "Look, it's just like this business has been the way it's been forever, for hundreds, for hundreds of years.

And for as long as there have been commercial buildings, there's been a c- a certain specific way of doing it, and we've all been trained in how to do it, and it's all a very specific way of operating." And, you know, and at, at the simplest level, you know, we build a shell, and then we lease it for 15 years, and then the tenant does all the work on, on, you know, deciding what the, what the interior is like, what the experience is like.

Um, a- and I had another...

Actually, it's a digression.

I had had another conversation like that on the-- with a, uh, another conversation, uh, like that with an entertainment industry mogul some years back when the movie theater business started to cave in, um, you know, when theatrical, uh, box office started to collapse.

And there was a whole theory about people didn't wanna be seen when they were talking on the phone.

You never feel like it, it, uh, it's only when you're invested in something that turns out not to be what it wants to be.

So, you know, my friends know that I, you know, I read a lot of history, and in particular, I've read a lot of, you know, tech history.

And, uh, I have kind of this parlor trick that I can do, which is, you know, name anything new in tech, and I can basically tell you the, you know, at any point in time, including, you know, historically, and then I can basically tell you the forty-year backstory of all the failed attempts that history forgot to kind of get to that thing.

But I was just, you know, two, two quick examples of that.

You know, the smartphone was not a new creation in two thousand and seven.

The first smartphone actually came out, if you trace it all the way back, it came out in nineteen eighty-two.

But I- IBM actually released something that actually looks a lot like an iPhone in nineteen eighty-seven.

Like, do you think for yourself, you know, are you deep enough into your idea? Are you kind of connected to it in that way? Or are you just influenced by whatever you think the world wants you to be?

What are the big, big constraints, like the top two or three we should be thinking about when it comes to policy and regs?

Yeah, well, so look, so on the supply side, so on the supply side, you know, basically what the state of affairs right now is basically every single component that goes into the stack of infrastructure and technology and capabilities that are needed to field AI, like there's basically a bottleneck on every single layer of the supply chain.

Right.

And so, by the way, it starts at the very bottom with energy, you know, where there's bottleneck on energy production, you know, for reasons that you well understand.

Then there's bottleneck on literally physical facilities, physical plants, right? So, you know, the big data center controversy, right? Right.

and the whole thing on that.

By the way, there's constraints on all the physical infrastructure that go into building data centers.

Yeah.

Hmm.

Right? I mean, SpaceX got prosecuted by the previous administration's Justice Department for not hiring enough refugees as a federal military contractor that's only allowed to h- to, in theory, that's only allowed to have US citizens work, work on its systems.

So anyway, so first of all, it's likely the Ch- [laughs] the Chinese have everything that we're describing anyway.

A, um, and then B, yeah, 100%.

Like, yeah, if they get free and, and unalloyed access to, to, to, to, to everything, then yeah, they're, they're going to use it.

But again, the, it is, it's the...

You're back to the question of trade-off, which is, okay, if they're not using the American technology to do that, then they're building domestic technology to do it.

Um, the thing that I find interesting from an, uh, from an investor's perspective is that are we in a moment where you could pursue financial objectives as an investor and non-financial objectives around, say, national security or national interest without giving up returns? And it seems like you're saying we are in that moment.

They

gave up because just becoming part of the West or as best that they could do that was a better outcome than trying to run their own parallel system.

And so I think we have a vision of sort of global technology supremacy that says the entire world runs in American AI, including ultimately China.

To do that, what do we have to do? We have to export.

We have to take our technology and we have to make it available to the world.

We have another goal, which is, as far as I can tell, just as important, which is AI is an extremely disruptive new technology.

It has profound, not just economic implications, but also national security.

What a great story.

Yes.

Um, and I think a lot of people have a lagging view even of what it can do today, 'cause what happens is they use their, you, you use their free models.

They'll u- they'll use the free or outdated models, and so, you know, they'll have tried ChatGPT two years ago, or they use, you know, whatever is default built into whatever thing they have, or they use the free version of something, and they really don't have a sense of what it's capable of.

To really get it...

A-and by the way, Grok, you know, Grok is very good for the free version, but, like, the, the, the, the, the really, really good ones are the paid ones.

Um, and it's, it's really worth it if people are interested in this.

I think it's, uh, for several, several of them, Anthropic, OpenAI, Grok, um, and I'm not sure about Google right now, but, like, there's even, like, high-end versions.

Sure.

And the same thing, like, is, is it Palantir or is it Alex? Um, and is it-

it-Uh, Andrew Lur is at Palmer.

And that's just over and over again.

So the companies that are winning in marketing, the brand is the person.

And I guess, like, if you had another founder or somebody who is a really permanent fixture and not the CEO, you could imagine that person kinda getting that person off to the, to be the brand.

But it's gonna be a person.

Like, I, I don't think there's a way around that.

Andrew is another example.

Whoa.

And on, like, every topic.

I'll give you an, I'll g- I'll give you an example.

So I'm gonna use, we're gonna use coding a lot, uh, as we talk about this because co-code-coding, it, it, so it turn, it turns out of everything these things are good at, coding is the thing that they're the best at, uh, writing software code.

And the reason they're the best at that is because these companies are, the AI companies themselves are in the business of writing software code, and so it's the thing that they're most excited about automating 'cause it's the thing that they, they are doing themselves.

And so it's like the, it's like the shoemaker's son making shoes, you know, for, or the shoe-shoemaker making shoes for his, his kids.

And so, so these companies are the furthest ahead on coding.

What are they hiring people for?

What are they hiring people for?

To e- like everything under the sun, including coding.

Okay, so let, let's talk about coding specifically.

Okay, so here's what's actually happening with coding.

Here's what's so interesting.

So everybody I know who uses AI for coding, you would think, you would think basically one of, one of two things would have happened.

One is they just would be out of the profession entirely, um, yeah, you know, because there's no point anymore.

Right

Yeah.

Uh, you know, you and I have partners at the firm who actually have never coded, who are now, like, ripping out software like crazy.

And, and again, they're, they've, they've turned into [laughs] they've turned into AI vampires.

I won't name names 'cause I'll, I'll let him tell his own story, but we have one partner who's built an entire AI system for everything that he does at work, and he is absolutely excited about it, and it's, it works great, and he loves it, um, and it's like his partner in all of his work now.

Um, and, uh, I asked him, I said, uh, uh, I, I said, uh, "Have you, do, you know, have you looked at..." You know, he, he, vibe coded the whole thing, and I said, you know, "Have you looked at the, have you looked at the code?" And he's like, "Hell, no." Um, uh, you know, I've, uh, I, I, I've never done that.

And I said, you know, "Have, have you, have you ever looked at any software code?" And he's like, "Hell, no." [laughs] Right? He doesn't have a...

You know, he's not, he's not a programmer by background.

[chuckles]

Uh, wha-wha-what might you say more broadly, is, is it just overstated in general? Because people also have this idea of filter bubbles too, but, uh, of course, it, in some ways it's the opposite in the sense that the internet exposes you to ideas that you wouldn't have seen otherwise.

Right.

Yeah, so I think people just have a really rose-colored glasses view of the past.

The, the, the past gets sanded off, like, in, in part 'cause we only interpret the pa-- you know, number one is we, we weren't there, and then the modern interpreters of the past, you know, are often quite honestly not telling us the truth about what happened because they, they have their own modern kind of, you know, gloss or spin they wanna put on it.

Um, and so, uh, i-i-- but just the edges of the past gets sanded off in, in, in retrospect.

But it's just like, it's really significant.

Like, if you just...

And so I'm curious what, what sort of mental model you, you might have for, for, uh, for the idea of ops and how that might help, uh, one understand the, the, the social platforms today.

[laughs]

And now the whole world knows how to do it.

And then, you know, three months later, every other AI model is, is adding reasoning.

And so, so you get this kind of double...

Like, even if the Chinese models themselves are not the models that get used, the education that's taken place to the rest of the world, the information diffusion, you know, is incredibly powerful.So that happens.

And then, I don't know, we'll, we'll see.

You know, there are a bunch of American, you know, open source, y- you know, AI, uh, model companies.

Mm-hmm.

Yeah.

Um, here's what I know.

Here's what I know.

Um, in the next three or four year, it's like somewhere between three or four years out, basically everything is selling out.

So, like, the, the entire supply chain is, is, is, is sold out or, or, or selling out.

And so there, there's no, like...

It, the...

The paper.

[laughs]

But no, and by the way, they're all hysterical.

They're all absolutely fantastic.

And it's literally like him on his porch in the middle of nowhere with like a cigar, and it's like a half hour.

It's just absolutely, absolutely, absolutely spectacular.

And so anyway, like I, I, I do think there's something to that, which is like, okay, b-back to your, back to your original question, it's just like, okay, like in addition to all the emotional pain that life has already put on us or that we've already put on ourselves, you know, and by the way, you know, a lot of it legitimately so for, for the things that we actually do to other people and so forth, but it's just like, okay, how much are we gonna torture ourselves? And, and, you know, there's, there's something about modern culture, modern Western culture or something, where we've become like very guilt-oriented and very, you know, very into like self-flagellation and very into the whole concept of the hair shirt.

You know, the, you just like we, we wear these metaphorical garments that just are like tremendously painful.

You haven't gone to Miami? I got lots like, "Why has he moved to Miami?" I'm like, "Has he moved to Miami? My research tells me no, but fuck, okay, maybe he's done a Sergey." [chuckles]

You haven't gone to Miami? I think I got lots, like, "Why has he moved to Miami?" I'm like, "Has he moved to Miami? My research tells me no, but fuck okay, maybe he's done a Sergey." [laughs]

No, I'm a Calif- I'm a Calif- I'm a California...

I'm, I'm very dug into California.

And so, like, uh, look, I, I am very keenly...

I am not a Silicon Valley partisan in the sense of, like, I think everything should be in Silicon Valley, or I think it'd be good if everything was in Silicon Valley.

Like, I don't believe that.

And, and I am a very, very keen, [laughs] I would say, student of all the issues in Silicon Valley.

Do, do you think the core models, AI, OpenAI, for example, will move continuously into the application layer and consume more and more of the value chain?