AI Is Changing the World. But At What Cost?

[0:02] Yo, welcome back to another episode of
[0:06] the Jack Mallard Show. My name is Jack
[0:08] and you are listening to yet another
[0:11] edition of Mailbag Monday.
[0:15] Ladies and gentlemen, let's get this bad
[0:17] boy timestamped. I'm talking to you all
[0:18] at a Bitcoin price of $65,290,
[0:22] putting Bitcoin's market cap at 1.31
[0:25] trillion. Alltime high
[0:29] 126,160.
[0:31] We are now 48.2%
[0:33] off our all-time high that we made on
[0:35] October 6, 2025, 287 days ago. The last
[0:40] Bitcoin block mined since I hit stream
[0:43] was Bitcoin block height 958,933.
[0:49] How are you guys doing? Good to see you.
[0:52] Um, here's the deal with this episode. I
[0:54] got no Dylan. Um, last week was a really
[0:56] big week for us. Uh, you'll know why
[0:59] soon. This week is going to be another
[1:01] really big week for us. So, I got no
[1:03] Dylan, which means I got no Q&A. So,
[1:05] today will be unfortunately a little bit
[1:08] of a shorter episode. I thought this
[1:10] episode was going to be the longer one,
[1:12] the Q&A one. It's not going to be, so
[1:16] it'll probably be next week. I'm done
[1:17] guessing. It'll be when it be. Um, t is
[1:20] what it is. Everything happens for a
[1:23] reason. Uh, so bear with me. Uh,
[1:25] apologize for that. No Dylan, so I got
[1:27] no one writing questions down. I mean,
[1:29] we could try some Q&A interacting with
[1:31] the chat at the very end if we want. Um,
[1:34] but we got no Dylan today. So today will
[1:37] likely be a bit shorter, but we do got
[1:39] some good topics and grind my gears. So
[1:41] without further ado, try to make these
[1:43] intros shorter. Uh let's get this show
[1:46] on the road. So the title today is AI is
[1:49] changing the world, but at what cost?
[1:53] Just want to talk about obviously this
[1:55] is a Bitcoin show because I'm a
[1:57] Bitcoiner. Um it is the Jack Maller
[1:59] show, so I guess at times we talk about
[2:01] all sorts of random [ __ ] but um I'd
[2:03] consider this a Bitcoin show. uh when we
[2:05] get down to brass tax. So what is my
[2:07] interest in AI? I'd say a few things. Uh
[2:10] one, AI is uh the effort to turn
[2:14] electricity into intelligence. And so I
[2:16] think broadly speaking, I'm a fan of AI
[2:18] and I'm an AI bull because I've talked
[2:21] to you guys before. I think that the
[2:23] story of humanity is commercializing
[2:25] energy from the sun. Um and that's our
[2:28] ability to eat food and turn that into
[2:29] caloric energy. Bitcoin is energy money.
[2:33] Uh, I think that AI is energy
[2:36] intelligence and our ability to harness
[2:38] and commercialize energy from the sun
[2:40] and turn it into intelligence that is
[2:43] accessible to all. I think that that is
[2:45] incredibly valuable, incredibly
[2:47] important. I gave a talk in Prague that
[2:49] Bitcoin and AI are bringing about a new
[2:52] human renaissance that is both unlocking
[2:55] our ability to save and exchange wealth
[2:58] and to have access and produce
[3:00] intelligence. I think it's a really
[3:01] exciting time. So that's more just
[3:04] personally I'm a fan of energy meets
[3:07] intelligence. Broadly speaking when it
[3:09] comes to macroeconomics, financial
[3:10] markets and Bitcoin AI matters because
[3:14] uh it has become a too big to fail
[3:17] sector. It's responsible as we'll talk
[3:18] about in a second for a ton of GDP
[3:21] growth, for a ton of active investment
[3:22] in the west. Um it is the new you know
[3:25] hot war/cold war between the east and
[3:28] the west, between China and the United
[3:29] States of America. Um and it is has
[3:32] great great great great impact on the
[3:34] stock market on the MAG 7 uh on where
[3:38] the marginal speculative capital is
[3:41] going. And there's I've said before and
[3:44] I'd say it's just generally true that
[3:47] Bitcoin won't really start to hum and
[3:49] run until the AI bubble I don't want to
[3:52] say pops and I'll get into you know AI
[3:55] bubble are you saying that this
[3:56] technology is invaluable? I'll explain
[3:57] that all in a second. The reason that
[3:59] all this is relevant is because I do
[4:01] think that the market has had to really
[4:04] digest what this thing is, what proper
[4:06] capital allocation to it is, what
[4:08] Bitcoin is relative to it. Bitcoin is
[4:11] not an AI competitor. Bitcoin is money
[4:13] and AI is intelligence. Those are not
[4:15] the same thing. Uh but I think the
[4:18] market is starting to finally digest,
[4:20] okay, what is this thing? What's the
[4:22] proper capital allocation? Who are the
[4:24] winners? Who's actually going to get
[4:25] paid back? And now that there's all this
[4:27] excess sloshing fiat sitting around,
[4:30] where should it go? And I think Bitcoin
[4:32] will on the back half of all of that
[4:33] catch a bid. And so I like to keep a
[4:35] pulse on how the AI story is doing. I
[4:38] have a very particular opinion on how
[4:40] this story will end. And I think it's
[4:42] really starting to heat up. We're really
[4:44] starting to enter the early innings and
[4:46] into the middle of this game. Um, and
[4:48] it's becoming clearer and clearer and
[4:50] clear to me what's going to happen. So
[4:52] first before we get started um the
[4:54] feedback from you guys is to keep this
[4:56] part short. So we will um the four
[4:58] questions conflict in Iran it can't be
[5:00] ignored obviously 20% of the oil market
[5:02] being taken offline a hot war that
[5:05] involves uh two nations that are bombing
[5:08] each other and building weapons. I mean
[5:09] this is a big deal. It has impacts on
[5:11] inflation has impacts on human lives. So
[5:13] we cannot ignore it but we're not going
[5:15] to waste our time chasing around
[5:16] politicians. So the four questions we
[5:18] always ask is the straight of horm still
[5:20] closed? Is this conflict still ongoing?
[5:22] Are global supply chains still being
[5:23] disrupted? And can the global debt that
[5:26] we have accumulated all over the world
[5:29] survive this level of disruption? The
[5:31] answers remain the same. Uh the strait's
[5:32] still closed, conflict still ongoing,
[5:34] global supply chains remain disrupted,
[5:37] and global debt cannot survive this. So
[5:39] just checking in on the straight, we'll
[5:40] keep it short. The straight of horm is
[5:42] back back to premo
[5:45] levels. MOU memorandum of understanding.
[5:47] that was that we agreed to a deal to
[5:50] agree to a deal to agree to a deal to
[5:51] agree to a deal. Um, and you can see on
[5:54] the far right, uh, for those of you
[5:55] looking on YouTube, you can see the
[5:57] little bump that that gave the traffic
[5:59] in the straight of horn moves. And now
[6:01] we're back to PMOU levels. So, just uh,
[6:06] summarizing what is visually represented
[6:08] on the screen for the podcast listeners
[6:10] out there. I mean, we were doing
[6:11] anywhere between 100 to 160 vessels
[6:14] through the straight a day. Um now we're
[6:16] at four um as of yesterday. So um is the
[6:21] straight of horror muse back in
[6:22] operative? Uh the answer is
[6:24] unequivocally no. Um is the conflict
[6:26] still ongoing? This was from the
[6:28] president of the United States,
[6:29] President Donald J. Trump earlier today
[6:32] on July 20th. He said every time Iran
[6:35] kills an American soldier, they will pay
[6:36] for that killing many times over. This
[6:38] directive has been passed on to the
[6:40] Secretary of War, Pete Haggsth, Chairman
[6:43] of the Joint Chief of Staff, Daniel
[6:44] Kaine, and every leader of the military,
[6:47] President Donald J. Trump. So, I think
[6:49] it is safe to say that this conflict is
[6:51] still ongoing. In fact, the fact that we
[6:53] call it a conflict is arguably
[6:55] misleading. At what point is this just a
[6:57] war? I mean, we've been in war since the
[7:00] last week of February. Um, I don't know
[7:02] the difference between a conflict and a
[7:04] war, but whatever it is, it uh is
[7:06] obviously still ongoing. So, I know that
[7:08] we just got a low inflation print. We
[7:11] saw oil starting to come down. Well, oil
[7:13] is back on the rise. Is inflation going
[7:16] to come back? How long is this
[7:18] conflict/w war/ whatever it is going to
[7:20] last? Uh, we don't know. We don't know.
[7:22] But we're not going to spend too much
[7:24] time on it because chasing around
[7:25] political headlines and whether they
[7:27] agreed to agree to agree to agree or
[7:29] not, um, as as I've said before, it's
[7:32] just a waste of time. It's a waste of
[7:33] time. Um, don't let politicians uh spend
[7:36] the scarcest resource you have, which is
[7:38] your time. Uh, we are short politicians,
[7:42] long Bitcoin on this channel. Okay, so
[7:45] chapter one. Uh, the AI story is is
[7:48] really starting to heat up in my opinion
[7:50] in regards to I think the market is
[7:53] really starting to chew through what's
[7:54] going on here, what the pros from AI,
[7:57] what the cons from AI are. So I don't,
[7:59] you know, I'd be curious your guys'
[8:00] feedback is after this episode because
[8:02] it is largely AI dominant, which you
[8:05] know, I'll obviously all roads lead to
[8:07] Bitcoin. Everything's good for Bitcoin.
[8:09] Don't forget that. So um I'll bring it
[8:11] all the way back to Bitcoin. Um but I
[8:13] would love uh to hear any feedback if
[8:15] this is interesting to you guys, if
[8:16] you're learning um or if there are
[8:18] better AI shows that meet you at the
[8:21] cross uh intersection of Bitcoin and
[8:23] you'd rather me spend my time elsewhere,
[8:24] let me know. But I got to admit, this
[8:27] has been uh taking up more and more of
[8:28] my research time and I've really been
[8:30] enjoying it. I'm enjoying watching the
[8:33] market realize that companies have to be
[8:35] profitable. Economics matter. The free
[8:38] market reign supreme. Uh Bitcoin and AI
[8:40] aren't competitive. You shouldn't think
[8:42] of them as equal capital allocations.
[8:44] You know, one is counterparty risk.
[8:45] betting on a company, taking a lot of
[8:47] risk into can pre-profit businesses
[8:50] actually pay you back versus the other
[8:52] is the best savings, excuse
[8:54] [clears throat] me, the best savings
[8:55] technology in human history. So,
[8:58] first and foremost, I just want to say
[9:00] um AI is real. I use it every day. It's
[9:04] materially benefited my life. And like I
[9:06] said, I'm an AI bull. Um I do think that
[9:09] the story of humanity is commercializing
[9:11] energy from the sun. is our ability to
[9:14] harness energy from the big thing in the
[9:16] sky and generate uh human prosperity and
[9:21] build society with each other. Um we
[9:25] have energy money now in Bitcoin. We
[9:27] have energy intelligence now with AI uh
[9:30] our food caloric energy. Um, and so e
[9:33] energy and our ability to commercialize
[9:35] it, harness it, and make use of it has a
[9:38] direct correlation to human prosperity
[9:41] and the development of any given
[9:42] civilization. Obviously, when
[9:44] politicians tell you that you shouldn't
[9:45] be using all this energy and using
[9:47] energy is bad, they're full of [ __ ] Uh,
[9:49] a politician's opinion is a politician's
[9:51] position. That probably means they're
[9:52] short energy. Um, but anyway, that's for
[9:55] a separate Jack Mer episode. Uh the
[9:58] point here is that I'm an AI fan and I
[10:01] don't want uh the opinion on record to
[10:04] be anything other than that. Um that is
[10:07] not my debate. My question to AI is
[10:11] whether everyone financing the buildout
[10:14] of this new industry is going to make
[10:16] money. Let me say a different way. Let's
[10:19] take Bitcoin. Bitcoin had lots of
[10:22] infrastructure built out, exchanges,
[10:25] mining, all sorts of businesses. Has
[10:28] everyone that's been involved in Bitcoin
[10:31] made money? Or has there been at times a
[10:35] misallocation of capital? People that
[10:38] totally misunderstood Bitcoin mining,
[10:41] the difficulty adjustment, how a global
[10:43] energy market is going to work, the fact
[10:45] that Bitcoin doesn't need marginal
[10:47] energy. It can work with whatever energy
[10:50] is available. There's been tons of
[10:52] people that have got blown out. Tons of
[10:54] Bitcoiners quote unquote not actual but
[10:56] I guess proclaimed that are sitting in
[10:58] jail like Sam Begman Freed Mount Gaus
[11:00] went down. So the point is Bitcoin as an
[11:04] innovation here to stay. Yes. Now every
[11:08] single person that's ever been in
[11:09] Bitcoin, an entrepreneur um in Bitcoin,
[11:12] has there been misallocation of capital?
[11:15] Have people been marked to zero? Yes. So
[11:19] I think that there needs to be analysis
[11:21] done at I mean we're seeing this is the
[11:24] greatest infrastructure buildout at
[11:26] least nominally in the history of
[11:29] mankind. Humans have never gathered to
[11:32] spend more capital on any given effort
[11:35] ever in our history. Fiber optic cables,
[11:39] railroads, the internet, this is the
[11:42] biggest ever. And so the question is, is
[11:45] everyone going to get paid back? Is
[11:47] there going to be misallocation of
[11:50] capital? And the reason again that this
[11:52] is relevant as Bitcoiners is because we
[11:54] are trying to educate the world that if
[11:57] you have capital that needs to be saved,
[11:59] okay, not invested, that implies
[12:01] counterparty risk, that implies a
[12:03] roadmap gets executed, that rem that
[12:05] implies profits grow, that implies a
[12:07] payback schedule. Saved. No counterparty
[12:10] risk. hard money, enforcable scarcity,
[12:14] self-s sovereignly held on your own. We
[12:17] are on a mission to monetize the world
[12:19] on hard money. And when you have an
[12:21] investment wave that people
[12:23] misunderstand into competing with that,
[12:27] um it it matters to our mission uh to
[12:30] people have said time and time again,
[12:32] AI's taking Bitcoin's throne, blah blah
[12:35] blah. It's obviously all [ __ ] It's
[12:36] obviously all momentary and temporary.
[12:40] Um, but that's why I think it's
[12:42] interesting because it's all starting to
[12:44] fall apart. So, first and foremost, you
[12:46] know, this show is about this is back to
[12:48] basics. You're not going to get a
[12:49] Harvard PhD listen to this show. Um, I
[12:52] don't even have a college degree. So,
[12:54] this is about basics uh by the common
[12:56] man for the common man bringing um
[12:58] finance and Bitcoin and some of these
[13:01] broad world topics to the streets. Okay.
[13:03] Um, let's get to brass tax. None of
[13:06] these AI companies that you know are
[13:08] profitable. I'm going to say that again.
[13:11] None of these companies are profitable.
[13:15] And I've said this before to you guys.
[13:16] To me, profit is a moral obligation
[13:21] before a financial obligation. Because
[13:23] because profit really is if money is
[13:26] value, which I think we all agree it is,
[13:29] well then by producing more money for
[13:32] your company than you spend, you are
[13:35] literally it is the financial expression
[13:37] of producing more value than you are
[13:40] consuming. It is the financial
[13:42] expression of making the world a better
[13:44] place. If making the world a better
[13:45] place was to be measured and denominated
[13:48] in value creation, then being profitable
[13:51] is the expression of that. And so this
[13:53] would be like a very libertarian free
[13:55] market Austrian economics way of
[13:56] thinking is producing profit is the goal
[13:59] because it is the way that the market is
[14:02] telling you you're doing good for the
[14:05] world. You are creating value. So I you
[14:08] know and obviously Keynesian economics
[14:11] and fiat and this mess that I was born
[14:13] into and that we live in today has
[14:16] greatly complicated this idea. You know,
[14:18] you've got these companies that never
[14:20] plan on making profit, that infinitely
[14:22] raise money when fiat when when money
[14:25] can just be printed out of thin air.
[14:27] Well, then you get the master of all
[14:29] misallocations of capital, all
[14:31] malinvestment, because money is easy. If
[14:34] money is as easy as snapping my finger,
[14:36] then why do I give a [ __ ] about how it's
[14:38] invested, where it's invested? If I lose
[14:40] it, I'll just get bailed out. If I need
[14:42] more, I'll just print more. And so we've
[14:45] lost sight of just how how really simple
[14:48] society should be governed. Uh you need
[14:52] to make money. You know, it's it's a
[14:53] form of Darwinism almost. If you're a
[14:55] business that is uneconomical, you
[14:58] should fail because we want the human
[15:02] energy and human resources and human
[15:04] capital to be focused on places that are
[15:06] productive. We don't want everybody
[15:09] wasting their time building something
[15:11] that's never going to be productive,
[15:12] valuable, and help us. Why would we want
[15:15] that? As sad as it is, shut your
[15:17] business down. Do something better with
[15:18] your life, brother. Okay, so the first
[15:21] thing for you you guys to understand,
[15:23] none of these companies make money.
[15:25] Supposedly, Anthropic claims they can be
[15:28] profitable by 2030. Open AAI has no path
[15:32] to profitability. Zero. I'll get to that
[15:35] in a second. um X AI Elon's thing which
[15:38] is now rolled into SpaceX and stuff they
[15:40] don't make money either.
[15:43] So the first thing to understand which
[15:45] is critically important is that none of
[15:48] these companies can finance themselves.
[15:50] Say that one more time. If you can't
[15:54] produce a profit, you are wholly reliant
[15:57] on somebody else to pay your bills,
[16:00] somebody else to finance the conviction
[16:02] that you have in the future. So, these
[16:05] companies are all incredibly indebted to
[16:08] build out what I just told you guys is
[16:10] the greatest infrastructure buildout in
[16:12] the history of humanity, but they don't
[16:14] produce any profits. So, you now have
[16:17] borrowers. So, when I say they're
[16:18] indebted, they're borrowing money. You
[16:20] have people borrowing money that can't
[16:23] pay off their own debt. They can only
[16:26] refinance their debt. Someone else has
[16:28] to keep financing them. They have to
[16:30] keep borrowing and refinancing just to
[16:33] sustain the business or else the whole
[16:34] thing goes kapoof. And by the way, this
[16:37] is actually exactly why these companies
[16:40] keep raising private up rounds is
[16:42] because as long as the equity keeps
[16:44] being revalued at a higher price, you
[16:47] can refinance your whole capital stack.
[16:50] But I dare these businesses to actually
[16:52] go public so that the public markets
[16:54] which are ruthless can tell you the
[16:56] truth and mark your equity down and then
[16:59] the whole thing blows up because you
[17:01] can't actually um pay with profit. But
[17:04] we'll get there later. Um another
[17:05] reminder for you guys. So for one, none
[17:08] of these businesses produce profits.
[17:09] Critically important to remember that
[17:11] and just why profits are important. If
[17:14] you don't have profits, then you can't
[17:17] finance yourself. You don't get to
[17:20] decide what payroll is, what your salary
[17:22] is, how much debt. It's up to someone
[17:25] else. At the end of the day, I encourage
[17:27] every entrepreneur to immediately try
[17:30] and produce more than you consume. I
[17:31] encourage every individual, every
[17:33] family. You guys listen to this show,
[17:35] earn more than you spend. Find ways in
[17:39] your life to consume less. Find ways in
[17:41] your life to save more. that is a it's a
[17:44] very honorable thing that that uh how do
[17:49] I say it it honors your dignity as a as
[17:52] a person as a man as a woman by saying
[17:55] my future is valuable I'm going to
[17:58] consume less I'm I'm going to say you
[18:01] know what I don't need the superers size
[18:03] me meal or the Uber black or to fly
[18:06] private this time I'm going to delay
[18:08] gratification consume less which
[18:10] prioritizes my future lowers my time
[18:13] preference. Okay. Now, the second lesson
[18:16] that you guys need to understand, brass
[18:17] tax, very simple, is that AI is not a
[18:20] software business. AI, unfortunately,
[18:23] the markets are just now starting to
[18:25] understand this. We've been talking
[18:27] about on the show, a lot of the things
[18:28] we're going over today, we've been
[18:29] talking about on the show for months.
[18:30] So, if you listen to the show, you got
[18:32] some serious alpha. But AI businesses
[18:35] are not like internet companies because
[18:38] internet companies were fascinating
[18:40] business models because you had two core
[18:43] expenses. One, you got to plug your
[18:45] servers in somewhere and two, you got to
[18:48] pay your engineers, but that's it. And
[18:51] you could have a fixed amount of
[18:52] engineers and the software scales
[18:54] infinitely just to get to you know going
[18:58] from a million users to a billion users
[19:01] doesn't require the same amount of scale
[19:03] when it comes to engineers. We've seen
[19:06] now with with AI and and all of the
[19:09] cloud servicing and engineer we've seen
[19:11] a group of 10 engineers scale software
[19:14] to a billion people because of things
[19:16] like the iPhone because of the cloud.
[19:19] Okay. Now, AI is categorically not that
[19:23] business. Those businesses were the
[19:24] greatest businesses of all time. Meta,
[19:27] Microsoft, I mean, you have fixed
[19:29] expenses relatively
[19:32] and growing amounts of pure cash flow.
[19:34] These are insanely high margin
[19:36] businesses. You're selling products to
[19:39] billions of people and you're employing
[19:41] thousands of people. You're making tens
[19:44] of billions, hundreds of billions of
[19:46] dollars a year of pure pure pure cash.
[19:50] Okay? AI businesses are not that because
[19:53] they require physical buildout. They're
[19:57] the opposite of low cost, high margin.
[20:00] They are extremely high cost because of
[20:02] the things on the screen. You got to
[20:04] build out data centers, you need GPUs,
[20:06] you need chips, you need electricity,
[20:08] you need cooling, you need power
[20:09] infrastructure. So instead of low cost,
[20:11] high margin, they are high cost and so
[20:14] far negative margin. These companies
[20:17] don't make any money. They're
[20:19] uneconomical so far. Now, obviously the
[20:22] the whatever Silicon Valley guy, if he
[20:25] were arguing with me and debating me at
[20:27] a conference, he would say, "Well,
[20:29] Amazon was this at 1.2."
[20:32] Like eventually though, Amazon was able
[20:34] to grow out of that and became one of
[20:36] the most profitable companies ever. It's
[20:38] a staple in in society. That's all true.
[20:40] Fine. Fair. But the point is that AI
[20:43] right now is priced as a software
[20:45] business as if they get a multiple.
[20:48] Really AI is like a real estate business
[20:51] or a physical infrastructure business
[20:53] that you know has an app on the app
[20:55] store as well.
[20:58] But it there was a very viral blog post
[21:02] that went around. Um maybe you know I
[21:04] can point you guys to it towards the end
[21:06] of the episode. It's a really long read,
[21:07] but it's very good. Which says basically
[21:10] the AI bubble is much closer to the 2008
[21:14] housing crisis than the dot era. The.com
[21:17] era was just everyone was way too
[21:20] exuberant and excited about these
[21:22] technology equities and gave them far
[21:24] too much multiples, were way too
[21:26] optimistic about the future and the cash
[21:27] they'd be able to produce and gave them
[21:29] the benefit of the doubt that they'd
[21:31] have uh easy revenue models and easy
[21:33] monetization streams that they'd be able
[21:35] to implement and just got way too
[21:36] exuberant and the equity just had to be
[21:39] marked down.
[21:40] The AI stuff is very different because
[21:43] none none of these businesses produce
[21:45] profit and they're building physical
[21:48] literal infrastructure like they're
[21:50] building physical data centers taking
[21:52] over land like needing to invest in
[21:55] these are they're spending trillions and
[21:58] trillions and trillions of dollars as an
[22:00] industry. That money is all borrowed
[22:03] uncolateralized.
[22:07] That's not like buying an equity and
[22:09] having it get marked down and you're
[22:11] like, "Well, [ __ ] you know, I'm still
[22:13] bullish Amazon. I'm gonna hodddle. I'm
[22:15] gonna keep No, no, no. You're you're
[22:17] you're borrowing. This is
[22:19] uncolateralized. This is like what
[22:20] happened in the housing market. This is
[22:22] a physical industry." Okay. So, I
[22:25] created this meme. AI has always been a
[22:27] cost inensive business. So, the meme is
[22:30] AI is more of a credit driven real
[22:31] estate cycle than a technology cycle.
[22:34] and the guy pointing the gun. It always
[22:36] has been. It always has been, guys. It
[22:39] always has been. You're starting to see
[22:41] the Mag 7 multiples compress because
[22:43] they're going from software businesses
[22:46] to physical highcost businesses. These
[22:49] these MAG7 hyperscaler businesses are
[22:52] losing profitability. They're now piling
[22:55] on debt, which is leverage. So, you've
[22:57] gone from pure cash flow stock buybacks
[23:00] to highly levered and unprofitable. the
[23:03] market is at some point the market is
[23:05] going to realize what the [ __ ] am I
[23:07] paying a multiple for? Why would I own
[23:10] that instead of something else? And as
[23:12] we'll get to that something else at the
[23:13] margin is going to inevitably be
[23:15] Bitcoin. Bitcoin is really like one
[23:19] giant long- winded story of fixing
[23:22] capital misallocation throughout the
[23:24] world. Oh, you were you meant to save
[23:27] money for your future, not to take a
[23:29] highly levered physical infrastructure
[23:31] AI bet. Oh, shoot. You were meant to
[23:34] invest in Bitcoin, not in, you know,
[23:36] Open AI series E2.
[23:40] Anyway,
[23:41] um, so what has happened recently, which
[23:44] has gotten me really excited, uh, and
[23:47] listen, I'm cheering for everyone. I I
[23:48] hope I hope no one's lives gets ruined
[23:50] or whatever, but the reality is like a
[23:52] lot of this money should be focused on
[23:53] Bitcoin and saved in Bitcoin. And
[23:55] there's a lot of misallocation in
[23:56] capital and AI. A lot of people have
[23:58] been really slow to understand. It's
[24:00] just so hypy. It's so frothy. Um,
[24:05] so what happened recently is competition
[24:07] changes everything. You've had these
[24:09] businesses that go they they were worth
[24:11] 10 billion dollars two years ago. Now
[24:12] they're worth a trillion dollars. You're
[24:15] going to attract global competition as
[24:17] you should. Competition breeds
[24:19] innovation. We want the free market to
[24:21] govern how resources are allocated,
[24:24] where our focus should be, where to
[24:25] optimize, where to be more efficient.
[24:27] Uh, so what has happened? Chinese
[24:29] models. As guys, for the loyal
[24:32] listeners, you guys got to have my back
[24:34] here. You got to have my back here
[24:36] because I've been talking about how
[24:38] these Chinese models are coming for the
[24:42] American models ass because China China
[24:46] graduates more engineers per year than
[24:48] the US has in some. We know that they
[24:52] have been better at building things than
[24:54] us, especially the physical hardware
[24:57] side. But it's also unclear to me if the
[25:00] software side uh is also uh an an issue
[25:05] as well. And I've been saying time and
[25:07] time again, don't count out China. Don't
[25:09] count out China. Don't count out China.
[25:11] The story of China over the decades
[25:12] competing against the US is they're
[25:15] relatively on par as far as quality, but
[25:17] the pricing is a fraction. Is a
[25:20] fraction. And it was just as soon as
[25:22] last episode we went over this. So, some
[25:25] of these Chinese models are now
[25:26] approaching frontier model quality, like
[25:28] the best you can get from Claude, the
[25:30] best you can get from OpenAI. Now, going
[25:33] back to the first slide, is this a bad
[25:34] thing for you and I? No. Is this a bad
[25:37] thing for Strike? No. Is this a bad
[25:40] thing for Bitcoin? Absolutely not. This
[25:42] is great. We're getting cheaper, better,
[25:45] higher quality intelligence. The
[25:48] marginal cost of intelligence is driving
[25:51] itself and grinding itself to zero. Not
[25:53] to mention Chinese models are open
[25:55] source. It's great. So the question is
[25:58] [snorts] who loses? Who loses because of
[26:02] this? Well, those that invested poorly.
[26:05] Imagine this. Let's just say I'm using
[26:07] round numbers. Someone invests in an
[26:09] open AI investment. Assuming that the
[26:11] cost of the marginal cost of AI is going
[26:14] to be a,000 bucks a user and China comes
[26:17] out with a model that's open source and
[26:20] is a penny a user. Well,
[26:24] you know who loses?
[26:27] Well, the guy that was assuming he was
[26:28] going to get paid back on that thousand
[26:30] per user model.
[26:33] Is that a bad thing? No. Investments go
[26:36] bad all the time. And it's how, you
[26:39] know, is this how humans get better? You
[26:41] learn from it. What went wrong? What did
[26:42] I miss? I didn't understand the Chinese
[26:44] market that well. I didn't understand
[26:46] how powerful open- source technology
[26:48] was. These are really critically
[26:50] important things. It's not a bad thing.
[26:52] But what I'm telling you guys is we have
[26:55] a national security uh in AI. This is
[26:58] national strategic imperative. We've
[27:01] spent trillions and trillions. Mind you,
[27:03] AI has attracted more capital than the
[27:06] initial COVID print. Like the order of
[27:08] magnitude of investment is extreme. So,
[27:11] if you guys think that credit markets
[27:14] aren't going to seize up, that like set
[27:17] another way, if all of a sudden all
[27:19] these people that have lent all this
[27:20] money and invested all this money aren't
[27:22] going to get paid back, they're going to
[27:24] have to start selling their treasuries
[27:25] to make rent. They're going to have to
[27:26] start selling their Bitcoin. They're
[27:28] going to have to start selling their
[27:28] equities. It's going to be a serious
[27:30] issue. Now, the question and and what we
[27:31] all assume is that the government will
[27:33] step in and and and make everything
[27:36] okay. But this is what happened uh since
[27:38] I last talked to you guys. So, a Chinese
[27:40] model has climbed the ranks. Uh, Kimmy
[27:42] K3, uh, which is a new model. Uh, I'll
[27:47] just read the tweet. Big news. Kimmy K3
[27:49] by Kimmy Moonshot is now the number one
[27:52] front-end code arena with 1679 points,
[27:55] surpassing Claude's Fable 5. That's a 17
[27:59] place jump from Kimmy K2.6.
[28:02] In front end, Kimmy K3 is number one in
[28:05] six of the seven domains. Brand and
[28:07] marketing, reference-based design, data
[28:09] and analytics, consumer product,
[28:11] simulations, and content creation tools
[28:13] landing number two and only gaming
[28:15] behind Fable 5. And by the way, it's a
[28:18] fraction of the cost. A fraction of the
[28:21] cost. So, what did we talk about last
[28:24] episode? Uh, what did we expect for one?
[28:27] I called it. I hate to I hate to be the
[28:30] guy that says, "I told you so, but I
[28:31] told you so." So, what else did we say
[28:34] last week? We said, "Well, if you're a
[28:36] business, if you're Strike, if you're
[28:37] any business, do you want to use the one
[28:40] that cost 10 times more or 10 times
[28:43] less?" Well, it's obvious. I want to use
[28:46] the one 10 times less. And by the way,
[28:48] um I I'll also use the open source one
[28:50] because I can see are there any back
[28:52] doors? What are you doing with my data?
[28:54] Um so, open source and it costs 10 times
[28:57] less. I mean, you got to be kidding me.
[28:59] So, what did we see this week? Just in,
[29:02] US companies reportedly use Chinese AI
[29:05] models more than domestic alternatives.
[29:08] No [ __ ] Why would I? It's just a
[29:11] no-brainer. That's the free market at
[29:13] work. So, then a headline that followed
[29:15] that today
[29:17] just in, Trump officials are reportedly
[29:19] weighing blocking US access to top
[29:22] Chinese AI models.
[29:25] Okay. Well, we talked about this last
[29:27] week as well. If you're the government,
[29:28] what are you going to do about it? What
[29:31] are you going to do about it? And this
[29:32] goes, guys, this goes all the way back.
[29:34] I, you know, this will be long
[29:37] long-winded and repetitive, but I got to
[29:39] do it. This is because the dollar's the
[29:42] global reserve currency. And I sound
[29:44] like a religious Bitcoiner, but bear
[29:46] with me for a second. The reason that's
[29:48] the case is when you are the world
[29:50] reserve currency, your job is to export
[29:53] the currency. You have to structurally
[29:55] run deficits. You can't run a surplus
[29:57] because how's the world going to get the
[29:59] dollars in the first place? You have to
[30:02] end on net owing dollars.
[30:06] You can't you you cannot on net be owed
[30:11] Chinese juan or Brazilian real. You have
[30:14] to on net owe dollars. So you're
[30:16] constantly exporting the dollar which
[30:18] means you you're you're a net importer
[30:20] of stuff. And so over time,
[30:22] globalization is everyone else around
[30:24] the world produces stuff that Americans
[30:26] consume. And what do Americans export?
[30:28] Financialization, Wall Street, Silicon
[30:30] Valley, the dollar,
[30:33] futures contracts, paper contracts,
[30:35] exchanges, right? So
[30:38] all of this is because China spent
[30:41] decades
[30:43] building cheap stuff. They're the
[30:46] world's factory. And this is a policy
[30:49] decision. If you want to start to
[30:50] reverse this, very simple, don't be the
[30:53] world reserve currency. Let the dollar
[30:55] be worth whatever it needs to be worth.
[30:58] It is artificially strong because of
[31:00] that world reserve currency status
[31:02] because it has demand that it otherwise
[31:04] wouldn't if it wasn't the world reserve
[31:06] currency. So if you just remove that
[31:08] from it and you remove all of the
[31:11] artificial demand that comes with that
[31:13] then the dollar will get significantly
[31:15] weaker which that's another way of
[31:16] saying gold bitcoin will go up
[31:18] significantly but then the dollar will
[31:21] be so cheap that it will be affordable
[31:23] to hire people for labor to produce
[31:26] iPhones here to produce chips here to
[31:28] produce whatever you need here in
[31:30] America.
[31:31] But this is all a matter of a policy
[31:35] decision to be the world reserve
[31:36] currency, to want to own the money
[31:38] printer, to want to utilize the Federal
[31:40] Reserve, to want to bail people out and
[31:42] weaponize money. It's all it's all comes
[31:45] down to that choice, point blank. And
[31:48] so, how did I know that Chinese AI
[31:50] models were going to show up one day and
[31:52] start kicking our ass, guys? I It's not
[31:54] like it's not rocket science. It's all a
[31:57] function of the pol of trying to
[32:00] monopolize money. Very simple. It's
[32:03] exactly what happened to the US with
[32:04] bluecollar work. Remember when
[32:07] bluecollar workers were like, "Yeah,
[32:08] yeah, Chinese version is cheaper, but
[32:10] it's not, you know, it's not US. It's
[32:12] not the quality of America. It's a
[32:14] shittier version. China's versions are
[32:16] shittier." Sure, if you want cheap,
[32:17] shitty Chinese version. And then over
[32:19] time, it was like, "Oh, is is the China
[32:21] version that shitty? It kind of is the
[32:23] same quality. it's a fraction of the
[32:25] cost. Oh, they're also able to build,
[32:27] produce, and scale it far wider and
[32:29] further. And then before you know it,
[32:31] you know, bluecollar work has been
[32:33] eviscerated in the United States, and
[32:35] China's the world's factory.
[32:37] It's the same thing is happening. What
[32:40] What am I seeing on Twitter? Well, I
[32:41] don't I'm not going to use the Chinese
[32:42] version. I'm American. No. Hey, Num
[32:45] Nuts. It It's not about that. Like,
[32:48] don't politicize everything. It's about
[32:50] it. It's an open-source AI model that's
[32:52] a tenth of the cost at at best if you're
[32:55] American. It might be a hundth of the
[32:57] cost. You'd have to be an idiot. You're
[32:59] just sacrificing money.
[33:02] You say, "Okay, but you know, the China
[33:04] version is not. It's I mean, it might be
[33:06] cheaper, but it's no open AI." No, it is
[33:09] though. It is. And by the way, people
[33:12] are saying, "Oh, yeah. Well, that's
[33:14] because China is is stealing open. It's
[33:17] it's downloading chatbt and testing it
[33:20] out and then able to kind of reverse
[33:21] engineer. Okay, who gives a [ __ ] Guess
[33:24] what? I don't give a [ __ ] I just want
[33:27] the cheapest intelligence I have access
[33:28] to. I don't care. You know who cares
[33:31] are? Are the people that invested
[33:32] trillions of dollars assuming Chat GBT
[33:35] had some moat that was defensible and is
[33:37] going to be worth $10 trillion as a
[33:39] company. Yeah, I feel bad for those
[33:41] people. Those people should have stayed
[33:42] humble and stacked stats. They're not
[33:44] going to get their money back, are they?
[33:46] But that's that's as the world goes.
[33:48] That's how it works. You invested money
[33:50] into something that didn't work. Sorry.
[33:54] You should have bought Bitcoin. If
[33:56] people want to save money into their
[33:58] future without counterparty risk and
[34:00] without taking on risk, that's what
[34:03] Bitcoin is for. Stop comparing these
[34:05] two. Bitcoin is not going to change.
[34:07] It's not the consensus rules aren't
[34:09] going to change. You're not going to all
[34:10] of a sudden wake up and there's now 42
[34:12] million Bitcoin. Bitcoin is Bitcoin.
[34:15] Now, if you want to take risk, that's
[34:16] fine. You could lose it.
[34:19] Pretty simple. So, now from David Saxs,
[34:23] basically admitting to everything that
[34:25] I've been saying. I'll read his tweet
[34:27] verbatim. This is concerning. For the
[34:29] first time, a Chinese model Kimmy K3 has
[34:32] taken the number one on front-end code
[34:33] arena and is scoring at or near the
[34:36] frontier on other benchmarks. Meanwhile,
[34:39] America is tying itself in knots.
[34:41] Politicians and bureaucrats are banning
[34:42] new data centers, piling on state
[34:45] regulations, and pushing for new federal
[34:46] agencies to pre-approve frontier models.
[34:49] This is how you lose the AI race. The
[34:51] rest of the world won't play by our
[34:53] rules if we bog ourselves down.
[34:55] Permissionless innovation is how America
[34:57] won the internet and became the
[34:58] technological envy of the world. We can
[35:00] do it again with AI while addressing
[35:02] risks in a targeted way, or we'll watch
[35:05] our lead evaporate.
[35:07] So, I move on. What is David talking
[35:10] about? Well, um, what state do you guys
[35:14] think was the first to start banning AI
[35:17] data centers?
[35:21] Ding, ding, ding, ding, ding. New York.
[35:24] Of course, it was New York, which will
[35:26] be part of my grind my gears section.
[35:28] This from CNBC. New York becomes the
[35:30] first US state to impose AI data center
[35:32] ban. The key points highlighting the
[35:34] article are as such. New York State
[35:36] Governor Kathy, I don't know how to
[35:38] pronounce your last name, on Tuesday
[35:40] signed an executive order uh barring the
[35:42] construction of new hyperscaler data
[35:44] centers using 50 megawws or more of
[35:47] power for up to one year. It is the
[35:50] first statewide data center ban in the
[35:52] US. Though similar measures, also
[35:54] referred to as moratoriums, are being
[35:57] considered by other states. Public
[35:59] polling has shown significant increase
[36:01] in opposition opposition to data center
[36:03] construction as voters face soaring
[36:06] electricity bills and fear the jobs
[36:08] impact of AI. And this is from Sophie
[36:11] Cunningham, which is a WNBA player in
[36:14] the United States. She is Caitlyn
[36:16] Clark's teammate. I don't know. I mean,
[36:18] I've got a ton of uh non-American
[36:21] listeners, so you know, I have a tough
[36:23] time having you guys understand who like
[36:26] LeBron James and Michael Jordan are.
[36:27] There's no way you're going to know who
[36:29] Sophie Cunningham is, but she's a US uh
[36:32] women's basketball player. And uh she
[36:36] tweeted out, "So, how do we save our
[36:38] farmland and stop all these dumb data
[36:40] center buildouts?" And here's the other
[36:42] problem with the Great West is
[36:45] government has gotten big and people are
[36:48] elected to print money and give you free
[36:50] [ __ ] What do I mean by that? Um, let me
[36:53] go to
[36:56] the Uh let me go to this slide. Um the
[37:00] what we're looking at here is GDP is
[37:02] highly dependent on AI spending. So AI
[37:06] spending is now 8% of all GDP
[37:10] and it's contributing to over 25% of
[37:12] GDP's growth. on the right this from the
[37:16] economist
[37:18] the the visuals titled the AI crutch US
[37:22] private non-residential fixed investment
[37:23] as a percentage change of previous
[37:25] quarter annualized
[37:27] nonAI spending is in the gutter it's now
[37:30] below zero AI related is hovering around
[37:33] 20%.
[37:36] And so it's it's like which way, western
[37:38] man?
[37:40] Okay, fine. AI is causing your
[37:43] electricity bill to go up and AI is
[37:45] going to take your jobs. Okay. Well,
[37:48] then we go into a deep recession and the
[37:51] economy collapses.
[37:55] And this is the problem with modern
[37:57] society and government getting too big
[38:01] is because you have people that are
[38:04] going to run a as prominent politicians
[38:08] that are going to I mean their their
[38:13] plan is to listen to what you're
[38:15] sensitive and emotional about say they
[38:17] can defy the laws of physics for you. Of
[38:19] course they can't and it's going to
[38:21] result in a bunch of printed money. it's
[38:22] going to result in inflation and and the
[38:24] cycle continues. Society thinks that all
[38:27] we need is the right political leader
[38:30] that all of the world's problems are
[38:32] solely because we don't have the right
[38:34] person. Have you guys lost your [ __ ]
[38:36] mind? Are you that stupid?
[38:38] There is no human being that can sit as
[38:42] whatever political in whatever political
[38:46] position and fix every problem.
[38:50] It's far more systemic than that. You
[38:52] have to you like viewing these
[38:55] politicians as anything other than
[38:57] virtue signaling like nonsense that just
[39:00] perpetuates and propagates all of the
[39:02] issues even further by making promises
[39:04] that they cannot follow through on. It's
[39:08] ridiculous. So yeah, I mean what is
[39:10] America going to do? Here we are where
[39:13] China is building cheaper
[39:16] onpar versions as America
[39:20] and what issue does America how is
[39:22] America going to compete with that? So
[39:23] Trump's initial reaction was he was
[39:25] going to ban us from using the Chinese
[39:26] models.
[39:28] Okay, that sounds like a terrible idea.
[39:32] Um I mean that is literally saying the
[39:36] United States is no longer a free
[39:37] market. what's you know what is like
[39:39] capital controls but for AI intelligence
[39:41] controls. Um that that sounds like a
[39:44] very bad idea. Um but we have this issue
[39:47] where there's far too many politicians,
[39:49] far too much regulation, the
[39:50] government's far too big. Nobody can
[39:52] build anything. Nobody can I mean people
[39:54] are trying to compete in the free market
[39:57] um and win the AI race and you have
[39:59] athletes and politicians in New York
[40:02] banning you from doing so. So of course
[40:04] we're going to lose the AI. I mean what
[40:06] are we doing? So like what are crazy
[40:10] ways that the US can compete with China
[40:12] whilst trying to you know figure itself
[40:14] out through Congress and state
[40:16] regulations and all this stuff. Well if
[40:19] for example Trump just subsidized
[40:22] uh open AI tokens. So he said hey open
[40:25] AI tokens are basically on the house.
[40:27] You can use chatbt for free.
[40:31] Boom. Problem solved. American AI is
[40:33] just as cheap as Chinese AI. Um, but
[40:37] again, that's a bailout. That's money
[40:39] printed. And if I go back to this
[40:41] article I've been referencing the last
[40:42] few weeks, OpenAI reportedly pitches
[40:44] granting US government a 5% stake in the
[40:46] company. Um, and then by the way, after
[40:49] that, uh, this I think is from Wall
[40:52] Street Journal. Uh, OpenAI leans towards
[40:54] waiting until next year for its IPO.
[40:57] This is critically important signpost
[40:59] here because the reason Open AAI would
[41:02] not go public. Listen, if you're a great
[41:04] business and you make money and you want
[41:08] to continue to finance your build out,
[41:10] you should go public. If you're not,
[41:12] then you don't. So, it's very simple.
[41:15] They aren't going public because it's a
[41:18] bad idea for them. The other thing is
[41:20] when you're a business that's building
[41:22] out physical physical projects, you're
[41:25] borrowing money owing hundreds of
[41:27] billions of dollars and you aren't even
[41:29] profitable on your own. Not only are you
[41:31] not profitable against your expenses,
[41:33] but there's even there's there's step
[41:35] one is just like earning more than you
[41:36] spend as a business. Step two is earning
[41:39] enough to pay off all the debt you've
[41:40] accumulated. So, not only are they not
[41:43] even remotely close like in the same
[41:45] universe as being able to pay off all
[41:47] the debt they've accumulated, they don't
[41:49] even make more money than payroll.
[41:52] The problem with going public is in
[41:55] order to continue to perpetuate this
[41:58] bubble, you have to keep getting a
[42:00] markup on your equity because they're
[42:02] refinancing all their debt with their
[42:04] equity. So open AI was worth 80 billion,
[42:06] then 150 billion, then 300 billion, then
[42:08] 500 billion, then 800 billion. That
[42:10] number has to keep going up because as
[42:13] soon as someone says, "Okay, now you're
[42:14] worth a trillion," then they get to
[42:16] refinance all of their debt.
[42:20] My spidey senses are that they don't
[42:22] want to IPO because they don't want the
[42:25] public markets to tell them what they're
[42:26] worth. Because if they IPO at 800
[42:28] billion, like I bet they saw what
[42:30] happened to SpaceX and they said, "Fuck
[42:33] that. This is way too scary
[42:37] because SpaceX is tra I mean SpaceX has
[42:39] lost a trillion dollars of market cap
[42:41] already. And if that happened to Open
[42:44] AI, they would not be able to survive
[42:47] because you would not be able to
[42:49] refinance and kick the can on all of
[42:51] this indebtedness.
[42:53] None of these businesses make any money.
[42:55] So yeah, is is AI here to stay? Yes. Is
[42:58] AI is all of this good for you and I, by
[43:00] the way? Yeah. Hell yeah. Give me the
[43:02] cheapest form of intelligence. Like I
[43:05] get I get access to open source Bitcoin
[43:08] and open source intelligence. I mean,
[43:10] I'm living well over here. I'm living
[43:12] great. But, you know, there's trillions
[43:15] and trillions of dollars of capital
[43:17] misallocation that that is going to need
[43:20] to be handled. Either all of it's going
[43:21] to be allowed to fail and that's going
[43:23] to be highly recessionary. I mean,
[43:26] people are going to blow up. Um, stock
[43:28] market's going to get sold off
[43:29] tremendously. Assets are going to get
[43:31] sold off tremendously, right?
[43:34] or I mean just the just the like
[43:38] political dogma and how big government
[43:40] has gotten and how how big government
[43:42] has interfered in all of our lives. What
[43:44] do you mean you can tell me what what I
[43:48] get to build business-wise in my state?
[43:52] So, so what is the US going to do about
[43:54] that? Just lose the AI race? It's an
[43:56] option. We could just say [ __ ] it.
[43:58] Whatever. China wins. That's fine. Now,
[44:01] the Trump administration has said that
[44:03] that is not an option.
[44:07] So, what are you going to do? Go to war
[44:09] with the state of New York?
[44:12] Start to subsidize open AI other ways?
[44:15] But you guys see why this is all of a
[44:16] sudden fascinating. the a the whole AI
[44:20] thing is starting to unwind a little bit
[44:23] because for the longest time it was like
[44:25] all you had to do was throw money at AI
[44:27] and you were a genius and like everyone
[44:29] was going to get a return on investment
[44:31] and it's like yeah but none of these
[44:33] companies are profitable so how is
[44:35] anyone going to get paid back and it's
[44:37] crazy because who am I not the smartest
[44:39] guy in the room
[44:41] why why is it take me to ask
[44:44] kindergarten level questions guys no
[44:47] one's making money. So who how are you
[44:49] going to get paid back?
[44:52] And this slide I wanted to show you guys
[44:54] this is the credit spreads for the
[44:56] hyperscalers.
[44:58] So the credit spreads is another way of
[45:00] saying okay these companies are now all
[45:02] borrowing money. Now what how do I
[45:06] simplify this? What rates are they get
[45:09] getting money at? Because if the market
[45:11] is basically if the rates they're
[45:13] getting market at at money at is rising
[45:16] that means higher credit spreads
[45:18] widening credit spreads um that means
[45:20] that the market is not really confident
[45:22] in their ability to get paid back. They
[45:24] need to be compensated more.
[45:26] It's not it's not like risk- free like
[45:28] oh yeah all all these hyperscalers are
[45:30] good for it. They'll get me back because
[45:33] it's super obvious how they're going to
[45:34] produce a bunch of profits and make me
[45:36] whole.
[45:39] And I'll tell you guys this, it's gonna
[45:41] take one of these companies like a
[45:44] Facebook or a Microsoft to come out and
[45:46] say maybe all this spend isn't a great
[45:48] idea.
[45:50] Maybe we shouldn't just be like
[45:52] degenerately
[45:53] plowing our profits and taking on debt.
[45:55] Like we might have gone over our skis.
[45:58] We might have gone from like incredibly
[46:01] profitable cash flow king to like a
[46:03] levered highly indebted like AI and now
[46:06] like we didn't realize China is as good
[46:08] as they were. I first of all I don't
[46:10] know how people got blindsided by that.
[46:12] I again like who am I to be calling this
[46:15] before everybody else. It's bizarre. Um
[46:17] whatever. I don't know. Bitcoin
[46:19] Bitcoiners have a way of I don't know
[46:21] our worldview is is a superpower. I
[46:24] don't know what it is. Um Bitcoiners
[46:26] also called COVID first. I don't know.
[46:28] weird. Anyway, um
[46:32] yeah, so I mean these credit spreads
[46:34] widening are telling me that the market
[46:36] is starting to figure out everything I'm
[46:38] saying. They're starting to call
[46:39] [ __ ] and like hold on a second. How
[46:43] is everyone going to get paid back? And
[46:45] the reason, again, guys, this is
[46:46] important is when you got trillions and
[46:48] trillions of dollars that are like,
[46:50] well, hold on a second. Maybe our money
[46:52] isn't best invested in all of this
[46:56] stuff. Um, there might be better, safer
[46:59] ways for us to preserve capital. Where
[47:02] does it go?
[47:04] And I think Bitcoin's going to catch an
[47:06] enormous, enormous bid because there's
[47:09] been so much misallocation of capital
[47:12] into this buildout. And I'm again, you
[47:14] got to divorce the two. Does that mean
[47:16] AI is a bubble and it's all a fad and
[47:18] we're all going to have to uninstall
[47:19] Chat GBT? That's not what I'm saying.
[47:22] That's not what I'm saying at all. AI is
[47:23] here to stay. But there's been trillions
[47:26] of dollars that have been misallocated
[47:28] and either need to be bailed out,
[47:29] smoothed over. The US either needs to
[47:33] tip their king and resign the AI race or
[47:36] they need to start subsidizing it and
[47:38] financing it. And doesn't surprise me
[47:40] that the Trump administration's in bed.
[47:42] Open AI is the weakest link, by the way.
[47:44] It's the weakest link. It's the furthest
[47:46] thing from profitability. It's got the
[47:47] most debt. It's got the most promises.
[47:49] Um and and and that's the other thing is
[47:53] the these these pools of money are so
[47:55] intertwined that it takes one of these
[47:57] guys to blow up to blow the whole thing
[47:58] up.
[48:02] So it's getting really interesting. It's
[48:05] it's still far too early. I'm not saying
[48:07] that this new Chinese model is blowing
[48:10] everything up and everyone's going to
[48:14] All I'm saying is I spent months saying
[48:17] the same [ __ ] about AI and a lot of
[48:20] people are like, "You're nuts, dude.
[48:21] What are you you think China is going to
[48:23] be able to compete with Silicon Valley?"
[48:25] Like, yeah, dude, I am. Like, call me
[48:28] crazy, but you cannot just print dollars
[48:31] for decades and do [ __ ] all and then
[48:34] expect to be competitive with the people
[48:36] that have been productive for the world.
[48:40] I'm telling you, it's going to be a
[48:42] wake-up call for us.
[48:45] So I I I do think the markets in the
[48:48] world is starting to warm up to this
[48:50] idea of like and I'll tell you what,
[48:52] what about all the foreign capital
[48:54] that's invested in the US stock market
[48:56] just trying to get AI exposure and they
[48:58] realize hold on maybe we're overweight
[48:59] on this whole AI trade cuz like yeah
[49:02] it's a good technology trend but who's
[49:04] going to be the winner and how are we
[49:05] all going to get paid back? They start
[49:07] pulling money out of the US stock market
[49:09] and stocks start to slip a little bit.
[49:10] The NASDAQ has been incredibly weak
[49:12] recently. I'm just telling you guys this
[49:15] not the world's not going to work like
[49:17] this giant like oh this is a 2008
[49:19] financial crisis we're going to wake up
[49:20] Lehman Brothers is down it's not what
[49:22] I'm saying what I'm saying is Bitcoin
[49:26] just when everyone's counting out
[49:27] Bitcoin why would you buy Bitcoin when
[49:29] you can invest in AI what is like that
[49:32] question within itself is the most
[49:33] moronic stupid dumb like you need to go
[49:37] back to kindergarten
[49:39] all I'm doing is asking very basic
[49:42] questions like hold Why is a why is a
[49:45] physical almost like a real estate
[49:47] business the way that they are borrowing
[49:50] money to build out physical like real
[49:52] estate like land sites chips? Why is a
[49:56] real estate business trading like a
[49:57] software business? Why is a business
[49:59] that's never ever produced a profit and
[50:02] isn't remotely close to producing
[50:03] profit? Why is everyone assuming that
[50:05] they're going to pay everybody back with
[50:07] what money?
[50:10] H how how are those groundbreaking
[50:13] questions?
[50:15] It's it's fascinating that Bitcoin has
[50:18] brought about just like very simple
[50:20] common sense logic to the world.
[50:23] It's crazy. Oh, you're a business be
[50:26] profitable. Super simple.
[50:31] Crazy. Crazy. So, we'll see. I continue
[50:34] to believe that this is immensely
[50:36] bullish for Bitcoin cuz this to me just
[50:38] it it reminds me of different parts of
[50:40] history. I mean look up how the
[50:41] railroads were built. Look at how fiber
[50:43] optic was laid. Look at how the dot
[50:45] infrastructure was built. The point is
[50:47] all of this stuff was successful. We
[50:49] still have railroads. We still use the
[50:51] fiber optic infrastructure. We obviously
[50:53] still have the internet. Um so all the
[50:55] technology was successful but many many
[50:56] many many investors lost money. And this
[51:00] goes back to the point I was I was
[51:01] making earlier. Like
[51:04] I don't consider myself an investor. I
[51:07] own very specific things like equity in
[51:10] my businesses which I don't necessarily
[51:12] consider an investment. It's just I'm
[51:14] owning the future of my work. I'm owning
[51:18] like if I I I have a claim on the
[51:20] productivity and value that I produce
[51:22] for society. And then outside of that I
[51:24] own Bitcoin and that's it.
[51:27] I don't want to like listen there are
[51:29] great investors out there and investing
[51:32] like is valuable to society. I'm not
[51:33] saying no one should be an investor but
[51:35] it's not like for me n no no no no no
[51:39] like I need to get to know the
[51:40] leadership team and understand the
[51:42] products and dig into the filings and
[51:44] say okay well you know they their their
[51:46] profit could grow to this by the year
[51:48] 2030. Yo hear me on this. [ __ ] that.
[51:53] [ __ ] that. What are we doing?
[51:56] No, no, no, no, no, no. Earn more than I
[51:59] spend. Saving in Bitcoin. Enjoy life.
[52:02] That's what I do. You got me [ __ ] up.
[52:05] I'm gonna spend my uh football Sundays
[52:08] trying to understand what cash flow for
[52:09] a business will be in the year 2035. And
[52:12] by the way, everybody thinks that that's
[52:14] what all these investors are doing.
[52:15] They're like, "Yeah, and that's why my
[52:16] hedge funds returning 8% kagger." It's
[52:19] like, "No, dude. Your your stock
[52:21] portfolio is up because they keep
[52:22] printing money. your stock portfolio
[52:24] measured in gold or in Bitcoin is down.
[52:28] So, you don't actually know what their
[52:29] cash flow will be in the year 2035.
[52:32] You're justifying this profession.
[52:35] You're just we're all beneficiters of
[52:37] the money printer as long as you can own
[52:38] assets. But you're not outperforming
[52:41] Bitcoin. That's the other funny thing
[52:42] about this stuff is all I do is try and
[52:45] do valuable [ __ ] for other people,
[52:47] ensure that I'm consuming less than I'm
[52:49] earning, and I save it in Bitcoin. And
[52:50] somehow I'm the best performing hedge
[52:52] fund all in this [ __ ] world. How is
[52:56] that possible? Over the last 14 years,
[52:58] nobody's outearned my hedge fund, which
[53:00] has just been staying humble and
[53:01] stacking SS.
[53:03] Keep it simple, guys. Keep it simple.
[53:06] Um, so the end of my AI section, can AI
[53:09] change the world while becoming one of
[53:11] the largest episodes of capital
[53:12] misallocation in human history? I I keep
[53:15] a close eye on this. And again,
[53:17] Bitcoin's an exit door. things like
[53:19] Bitcoin, gold are, you know, everyone
[53:21] runs towards the exits. Um, and so I
[53:25] think it's all everything's bullish for
[53:27] Bitcoin because now Bitcoin will
[53:28] there'll be so much Bitcoin education of
[53:30] like, wait a second, AI equities and
[53:32] Bitcoin weren't competing this whole
[53:34] time. No, of course not. On what planet
[53:36] were they competitive? One is money with
[53:38] an enforcable fixed supply and the other
[53:42] I tried to tell you guys you're taking
[53:44] risk on Sam Alman. Like, at what point
[53:48] was that not implied and understood?
[53:51] Have you lost your [ __ ] mind? The guy
[53:54] has no plans of producing a profit.
[53:56] Nobody knows his backstory. He's he's
[53:59] launching WorldCoin that's scanning your
[54:01] retina. They're talking about how open
[54:04] source is bad.
[54:07] The lead strategist of Open AI said
[54:10] China is communist for having open-
[54:12] source AI. What? You're taking
[54:15] counterparty risk with these guys.
[54:18] Sorry, you should have just bought
[54:20] Bitcoin. And I think over time the world
[54:23] will learn that. And [clears throat]
[54:24] there'll have to be money printing.
[54:26] There'll have to be bailouts. There'll
[54:27] have to be yield curve control. And I
[54:29] think all of the people gloating and
[54:31] showboating that they were AI equity
[54:33] investors and they're not buying
[54:34] Bitcoin.
[54:38] We'll see who's on the right side of
[54:39] history of that one. Good luck getting
[54:40] paid back by people that don't make any
[54:44] money. Um, again, it's a kindergarten
[54:47] level of understanding here. Uh, and and
[54:51] there [clears throat] are, don't get me
[54:52] wrong, there are people that have made
[54:55] money in all the AI investing, but you
[54:58] make money by buying low and selling
[55:00] high. So, you're a perpetual bag seller.
[55:02] All these junkies, all these VCs and
[55:04] these bag selling junkies, they're
[55:06] itching themselves like they buy a bag.
[55:08] They're when's when's the next up round?
[55:10] When's the next up round? I need to mark
[55:11] up my investment and tell my LPs and
[55:13] they're itching themselves like, "Hey,
[55:14] hey, hey, hey, hey, hey. Are you
[55:16] providing liquidity? Can I get some
[55:18] secondary? Hey, hey, hey." It's like
[55:19] these bag junkies. So, it's a game of
[55:21] hot potato. It's who can sell the last
[55:23] bag? Who's caught holding the bag?
[55:26] Again, you guys want to play that game?
[55:28] You could go do whatever the [ __ ] you
[55:30] want. I But for me, I'm not playing. I
[55:33] don't want to play that game. What type
[55:36] of sane human being wants to play heroin
[55:40] addict VC bad junkie hot potato?
[55:43] I want to watch football, watch the
[55:46] World Cup. I want to get married. Um I
[55:48] just officiated my buddy's wedding over
[55:50] the weekend. Like I don't want to be
[55:52] stressed out of like, "Hey, hey, hey,
[55:54] hey, hey, hey." Um Open AI turned off.
[55:58] Um, remember when OpenAI turned off the
[56:00] secondary markets, guys? Why do you
[56:02] think they did that? They don't want the
[56:05] market actually valuing their company.
[56:07] They want their valuation to come from
[56:09] Soft Bank or from all of their buddies
[56:12] so that they can refinance their debt.
[56:15] It's it's a very carefully crafted game
[56:17] of sell the next bag to the junkie.
[56:20] Stay humble and stack stats, man. I'm
[56:22] trying to tell you. All right, let me
[56:23] get through uh chapter two. Just
[56:25] checking on the markets. Don't want to
[56:26] do an episode without it. Um, the
[56:28] biggest headline from last week is this
[56:29] Philly Fed manufacturing index. So,
[56:32] here's a quick TLDDR on this because I
[56:34] don't want this episode to drag too
[56:35] much. This thing never prints above 40.
[56:38] Um, so, as you can see, and and I'll
[56:42] voice over for everybody that uh is
[56:45] listening through the podcast waves, uh,
[56:48] the tweet reads, uh, July Philadelphia
[56:50] Fed manufacturing index is up to plus
[56:53] 41.4 4 versus the plus 12 a.5 estimate
[56:56] and 10 and a half 10.3 prior. Highest
[57:00] headline reading since November 2021. We
[57:02] all knew back then what that was. That
[57:05] was the top tick of the Bitcoin market
[57:07] with new orders surging to plus 37,
[57:10] shipments up to plus 33.7 and employment
[57:13] up to plus 10. Um so the point is this
[57:17] thing's never above 40. last time was
[57:19] during that peak COVID bonanza. And
[57:22] usually when this thing is at these
[57:25] levels, the Fed has to hike rates. And
[57:28] so this chart was posted by Luke. This
[57:30] is the US 10-year yield charted over
[57:34] this uh Philly Fed uh manufacturing
[57:37] index. And when this thing goes up, so
[57:39] do yields because it's presumably uh
[57:42] highly highly highly inflationary. Well,
[57:44] the indicator is is is assuming lots and
[57:47] lots and lots of inflation, lots of
[57:49] growth, lots of hot hot hot, and the Fed
[57:52] has to cool it down and raise rates. And
[57:54] mind you, that's what Jerome Powell did.
[57:55] November 2021, this thing printed above
[57:58] 40. We got the fastest rate hike that
[58:00] we've ever seen. Um, and that was during
[58:02] times of extremely hot inflation prints,
[58:05] right? And so, uh, what did the markets
[58:08] look like today? Uh, number go up, yield
[58:10] edition. 10-year yield up, 30-year yield
[58:12] up, 2-year yield up. And this is all on
[58:15] the back of what was a miracle inflation
[58:18] slowing print in June. Remember the last
[58:21] episode I was like, inflation is down
[58:23] all of a sudden, which I told you guys
[58:25] Worsh is not going to hike rates over my
[58:27] dead body. You got to be [ __ ] kidding
[58:29] me. And the point it remains the same.
[58:32] People say, "Oh, but Jack, what about
[58:34] the 1970s?" Or, "What about No, guys,
[58:36] guys, guys, guys. There's one thing that
[58:38] matters. The debt levels,
[58:41] the debt levels matter. That's not just
[58:43] like a random thing that you can decide
[58:45] to ignore if you want. When you're that
[58:48] indebted, you cannot raise the interest
[58:51] expense on that debt level.
[58:55] The 10year cannot look at the 10-year at
[58:57] 4.6. You cannot have it that way. Cuz by
[59:00] the way, guess who else this impacts
[59:02] besides the United States? People that
[59:04] want a mortgage. AI hyperscalers that
[59:06] want to borrow trillions of dollars to
[59:08] go build out data centers only to get
[59:09] their ass kicked by China that impacts
[59:12] everybody that wants to borrow money and
[59:14] and build and live have a credit card.
[59:19] So the fact that we got a plus40 print
[59:25] on the manufacturing index from the
[59:27] Philly Fed
[59:30] even a and yields continue to go up even
[59:32] after a slow inflation print because you
[59:34] assume oh slow inflation print yields
[59:36] are going to come back down the market's
[59:37] going to realize you know we're not in
[59:39] this you know hyperinflationary time. No
[59:43] yields don't give a [ __ ] The gig is up
[59:46] in my opinion. the gig is up. If they
[59:50] want to raise rates, they can, of
[59:51] course, they can do whatever they want.
[59:53] But, um, that will that will cause a
[59:58] debt spiral and send us into austerity,
[60:02] level of depression, recession. They're
[60:05] going to have to do do what? What are
[60:08] they going to have to do? Well, yield
[60:10] curve control. Like, what what have I
[60:12] tried to explain to you guys before? You
[60:14] can have the Fed print money out of thin
[60:16] air to buy the 10-year which drives
[60:18] yields down. But that's I mean you're
[60:20] literally printing money to subsidize
[60:24] the government. That's I mean that's the
[60:26] end game of fiat. It's like well then
[60:28] what are we doing here? What why would
[60:30] anyone hold D? like you'll you'll start
[60:32] to see, you know, not not overnight, but
[60:35] you'll start to see a repricing of
[60:37] things like gold, a repricing of things
[60:39] like Bitcoin of like, why am I even
[60:41] materially interested in this dollar
[60:42] thing anymore? So, we're getting to that
[60:45] point where the Fed and the US Treasury
[60:48] are going to have to start choosing the
[60:50] bond market over everything else.
[60:54] But, I mean, I thought this was awesome.
[60:56] Cool. Uh, Philadelphia Fed printed, you
[60:59] know, 41.4
[61:02] never gets this high. Okay, surely it's
[61:04] time to hike rates, right? Yeah, good
[61:07] luck. $40 trillion in debt. Good luck.
[61:10] Good luck. I call [ __ ] And this
[61:14] could be what Bitcoin is smelling. Why
[61:16] is Bitcoin at 65K? I don't know. Could
[61:19] it be that all of the AI capital is
[61:22] starting to realize no one's getting
[61:24] paid back and China is a legitimate
[61:26] competitor that no one factored in? If
[61:28] China's going to be open sourcing all
[61:30] this [ __ ] how's anyone going to get
[61:31] paid back?
[61:34] Whoops.
[61:35] And that also the Fed is caught in a
[61:37] pickle and is going to have to address
[61:40] all the all the yields that continue to
[61:42] rise. Now, is it going to be deliberate
[61:45] yield curve control or are they going to
[61:46] do a round sly out way? They're going to
[61:49] launch the ABCDE EFG program or whatever
[61:52] all these acronyms.
[61:54] I don't know. And by the way, could
[61:56] Bitcoin obviously go down? Listen, if if
[61:58] the stock market sells off 20%, if we do
[62:01] get some institution that goes under
[62:03] because of a private credit crisis or
[62:05] something like that, you know, Bitcoin
[62:06] could easily wick down in 50s, 40s,
[62:10] whatever, right? I'm not calling bombs.
[62:13] But what Bitcoin is probably I told you
[62:15] guys, Bitcoin will lead you down because
[62:17] it's the only free market. It's telling
[62:19] you the truth. It was the first down.
[62:21] Bitcoin was feeling the pain that
[62:24] everyone else is starting to feel now in
[62:26] February tells you the truth. First
[62:28] mover actual smoke alarm indicator
[62:33] and I can't tell yet, so don't hold me
[62:36] to it, but we'll keep checking on
[62:37] Bitcoin. I mean, it's healthfully
[62:39] grinding its way higher amidst all of
[62:43] the problems that AI and equities and
[62:46] and uh the Fed is starting to run into.
[62:49] It's really interesting. It really,
[62:51] really is. It really, really is.
[62:54] Um,
[62:56] okay. Uh, grind my gears. Try and make
[62:58] this one quick. It's kind of related to
[63:00] earlier, but I saw this from
[63:04] uh New York. Uh, the mayor of Madami. He
[63:06] hosted uh
[63:09] I forget what it was called, like a
[63:10] housing a housing speech or something,
[63:14] but basically, I mean, this headline to
[63:16] me says it all. uh Mandani plan would
[63:20] force landlords to pay for credit checks
[63:23] as activists rails that eviction is
[63:25] violence.
[63:28] And on the back half of what happened in
[63:30] Illinois where there was a proposal to
[63:34] just say, "Oh, you have Bitcoin in cold
[63:36] storage. Yeah, we're just going to start
[63:37] taking that shit."
[63:40] And now evicting
[63:43] someone from your property that isn't
[63:44] paying rent is violence.
[63:49] I mean, guys, property rights in America
[63:51] is starting to be undermined is maybe
[63:54] the polite way of saying it, but just
[63:55] threatened.
[63:58] Why would I own real estate in New York?
[64:01] It's violent for me to say, "Hey, you
[64:04] got to leave if you're not paying rent
[64:06] and you're going to start burdening me
[64:08] with costs to say, is this person
[64:10] actually going to pay me or are they
[64:12] going to run to the government and say,
[64:14] "Fuck me and [ __ ] my property rights."
[64:16] It's just bizarre.
[64:19] It's bizarre. It's really, really
[64:21] concerning.
[64:24] It's really concerning. And I think
[64:26] we're going to continue to see. I mean,
[64:27] I know the UK is losing millionaires
[64:29] like no one's business. Um, I know
[64:32] Chicago is. I know New York is. I know
[64:34] California is. I think Texas, I mean,
[64:37] Texas, Texas is going to be running like
[64:39] a $50 billion surplus as a state.
[64:43] I know Miami real estate is like the
[64:45] best performing real estate in the
[64:46] world.
[64:49] It's really concerning if we don't have
[64:52] property rights was foundational in the
[64:54] foundings of America.
[64:57] This is it's terrifying. It's bizarre. I
[64:59] can't wrap my head around how anyone can
[65:02] reasonably say that evicting someone for
[65:05] not paying rent is violent.
[65:09] And the reason I wanted to put it in
[65:11] this show as grind my gears is this is
[65:14] another bullcase for Bitcoin cuz at the
[65:16] margins are you going to buy real estate
[65:18] as an investment or as a form of savings
[65:21] or buy Bitcoin? Because I tell you what,
[65:24] Mandani can't do [ __ ] about my sats in
[65:27] cold storage.
[65:30] He could go [ __ ] himself.
[65:33] The problem is real estate. You're a
[65:35] sitting duck. They're going to raise
[65:37] real estate taxes. They're going to just
[65:39] slowly take that [ __ ] from you. You're
[65:42] going to provide housing for people. And
[65:44] if those people don't pay you, tough
[65:46] [ __ ] Deal with it. What? Why would
[65:50] anybody buy real estate?
[65:55] So I guys it is is very concerning.
[65:59] California, Illinois, New York, the
[66:02] undermining of property rights, the
[66:04] attack on wealthy people is bizarre or
[66:08] or property owners. Like if you own
[66:11] property, you're an [ __ ] If you
[66:13] produce profit, you're an [ __ ] It's
[66:16] really bizarre.
[66:18] Um I I just I don't know. I like to be
[66:21] honest with you and I'm and I might be
[66:22] preaching just at a wall here because
[66:26] all my listeners probably agree with me.
[66:28] Maybe some don't. I don't I don't know.
[66:30] Um well I'll sure we'll learn. Sure.
[66:32] We'll check the comment section and and
[66:34] if it's angry in a riot that you know
[66:36] rent rent needs to be subsidized and
[66:38] free. If you own property it's your job
[66:42] to subsidize and pay for other people to
[66:44] live in it. I mean hold I can't even say
[66:47] that out loud without just mincing. Have
[66:49] people lost their [ __ ] mind?
[66:53] But again, if listen, property rights,
[66:57] if you need the government to enforce
[66:59] your property rights, then they're not
[67:01] then it was always a rented right. It
[67:04] was always a rented right. And when push
[67:06] comes to shove, if you're going to get
[67:07] enough political infighting and
[67:08] political violence, um, and you know,
[67:11] you've got rise in socialism, uh, and
[67:13] you're so indebted. The reason Illinois
[67:16] needs my Bitcoin is because they need
[67:19] they can't pay their bills any other
[67:20] way. They're just going to start taking
[67:22] your [ __ ] Pensions are underwater.
[67:25] Things need to get funded. Here's a
[67:27] proposal. Oh, those people have stuff.
[67:30] Yeah, we're just going to take it from
[67:31] them.
[67:33] And so if property rights needs to be
[67:36] enforced physically as opposed to
[67:39] politically, Bitcoin, there's no better
[67:41] asset than Bitcoin. Bitcoin is like the
[67:44] only pure form of property rights. I've
[67:46] said this before, but listen to how good
[67:49] Bitcoin is at enforcing property rights.
[67:51] If I have a house, so this house I'm
[67:53] sitting in right now, and someone wants
[67:55] to take my house, they can walk in here,
[67:58] put a bullet or put a gun to my head and
[68:00] put a bullet through my brain, and they
[68:03] get the house cuz I'm dead. And now it's
[68:06] their house. Same with gold. If I have a
[68:09] vault of gold and someone wants my gold,
[68:11] they can physically harm me, get me out
[68:13] of the way, and physically take my gold.
[68:15] Now, if I have 12 words that represent
[68:19] Bitcoin in my brain,
[68:22] the only way to guarantee that you don't
[68:25] get the Bitcoin is by killing me.
[68:28] Because then, I mean, I'm dead. I can't
[68:31] tell you the 12 words. You strategically
[68:34] have to keep me alive if you actually
[68:36] want the Bitcoin someday.
[68:38] So it is the property rights that
[68:40] Bitcoin allows for all of us is so
[68:43] severe and it is protected physically.
[68:48] You're incentivized
[68:50] to take care of me.
[68:52] You harm me, the Bitcoin is gone.
[68:57] So I I just think that the this is
[69:00] another thing to keep an eye on. One, I
[69:02] mean this is a disgrace. It's
[69:03] disgusting. If we don't have property
[69:05] rights in America, what do we have? But
[69:07] it's another bull Bitcoin. I mean, the
[69:09] combination of, you know, AI
[69:13] is
[69:15] it's concerning. How's everyone going to
[69:17] get paid back? Is this the right place
[69:18] to be placing all this investment?
[69:20] Should we take a look at Bitcoin? Is the
[69:22] marginal um investor or speculator going
[69:25] to start taking a look at Bitcoin?
[69:27] because it's the math isn't mathing with
[69:29] AI and the combination of that and
[69:32] property rights being violated
[69:34] throughout the United States in certain
[69:36] states. I mean, I think that's bullish
[69:38] Bitcoin. I think it's really, really
[69:40] bullish Bitcoin. The next time someone
[69:42] decides between Bitcoin and real estate
[69:44] in New York, I mean, that decision was
[69:46] just made for them. Real estate in New
[69:48] York is not yours.
[69:51] Why would you buy it? I'd rather rent.
[69:54] I'd rather rent, miss my rent, and then
[69:56] not be able to get evicted. Honestly, I
[69:58] might move to New York and just like not
[70:00] pay rent. [ __ ] it. I mean, this is
[70:03] ridiculous. What a clown world. Stay
[70:05] humble and stacks.
[70:09] Um, okay. Uh, strike updates. Uh we're
[70:14] about to hopefully start testing um our
[70:18] interest on cash our uh um giving you
[70:22] guys some interest on your idle cash on
[70:23] the platform. So we're really excited
[70:25] about that amongst a bunch of other
[70:26] things. We're launching inheritance this
[70:27] month which is really exciting. So um
[70:30] like I said uh we should have some next
[70:34] episode should be a bit bigger. Um I got
[70:37] no Dylan uh today so no real Q&A uh this
[70:41] week. I'm going to check the chat. I
[70:42] don't want to leave you guys super
[70:44] hanging, but um [clears throat] it's
[70:45] just too hard. Obviously, I can't be
[70:47] writing down questions while I'm
[70:48] speaking. So, no Dylan is tough. Um
[70:51] shorter episode, but uh lot going on in
[70:54] a good way. Um but Strike Strike
[70:56] continues to hum along. We we're
[70:58] launching, you know, feature or two a
[71:00] week. Uh continuing to grow despite the
[71:03] bare market. Really proud of the
[71:04] business. Uh and the big next really big
[71:08] few things are uh beneficiaries
[71:11] uh that you can add to your account,
[71:13] inheritance, all of that good stuff. Um
[71:16] and we uh will give you uh some interest
[71:20] on your idle cash on the platform which
[71:22] I know you guys are really excited
[71:23] about. Um okay,
[71:26] let's check
[71:30] uh the chat.
[71:34] The Chicago Bears still suck. That's
[71:37] true. That's true. All right, I'll tell
[71:38] you what. I'm just going to make this
[71:39] one a shorter episode. Um the chat is
[71:42] ruthless, you guys. It's a danger zone
[71:44] to go in there. Uh and uh it'll it'll
[71:47] make the end of this a little too messy.
[71:49] Um I got to wait. There's a lag. Uh it's
[71:52] just not going to be worth it. Um so
[71:54] we'll we'll make sure we do Q&A next
[71:55] week. I have a feeling next week will be
[71:57] uh will be uh a big episode. So with
[72:01] that, uh I'm out of here. Thanks for
[72:03] listening. Give me feedback on the AI
[72:05] stuff. Do you guys find it interesting?
[72:06] Do you find it relevant? Are you
[72:07] learning? Uh if not, it'd be good to
[72:09] know. Um and we'll keep a eye on
[72:11] markets. I mean, summers are usually
[72:13] boring. Um don't expect the world to
[72:15] change tomorrow. Um but with the World
[72:18] Cup over and and that that matters
[72:21] actually. The World Cup is over. Um
[72:23] people are back at their desks. Market
[72:24] is markets are starting to move. Things
[72:25] are starting to shake and happen. Um and
[72:28] we're already halfway through summer, at
[72:29] least how we counted in Chicago. So
[72:31] before you know it, um, capital might
[72:35] might start rotating a little bit. We
[72:36] got midterms coming up, so might be time
[72:38] to start paying attention. Keep those
[72:40] DCAs on. Stay humble. Stack sacks. Uh,