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¶ Personal Stories and Movie Review
Hi everyone, this is Pivot from New York magazine and the Vox Media Podcast Network. I'm Kara Swisher.
And I'm Scott Galloway.
Guess who I spent a several wonderful days with this week?
Several.
Several. My son Alex, legs. We had a great time. We I took him to New York. I had to go up and interview Joanna Stern who's written a boat book called I Am Not a Robot, which uh Alex really enjoyed the the said the it was at the ninety second street, why. But it was really nice. And and I have a new proposal for us, Scott. I have a new idea. I think it's really nice to spend quality time with one kid at a time, right? To like do something s you you do that, don't you? Like take one
Not both, but like one special thing for like a day or two, wh whatever they want to do. What do you think? I think that's a great thing.
Iver pretty much every Saturday night I do dinner with one of them and I take I take trips I would say if it's not a family trip, I do a trip with one of them, not both of them.
Yeah, yeah. I thought that you do that and I was thinking that. I was thinking that's a really good thing. It was such a nice quality time to and I don't I don't like the word quality time but it actually was. It was where'cause everyone's You know, as you know, I have a talkie family so everyone's competing for for you know, it's just a lot of people all at once, but it's just nice to have concentrated time with one kid at a time.
Yeah, it's nice. Um Oh I went I went and saw um Devil Wears Prada Two. And took an edible, went and got
Why? Did you take your wife? What what was the cause of you going?
I did my favorite thing in the world. I I'm I'm here just solo with the kids. I took an edible. They didn't want to see it with me. And uh they don't like they don't go to movies. And I went and I ate at the bar at this place called Lina, which is this Italian restaurant at the bottom Of Marlebone or of is it Marlon High Street, yeah. And then I walked over to the Selfridge's Theatres. And I gotta admit, I liked it more than I thought. I only walked out about after an hour.
True story. I waited until I saw you. I thought you looked really good. I waited until I saw Justin. I thought he nailed his part perfect. And then I and then I pieced out.
Yeah, you don't know what happened then in the end.
I know what exactly what fucking happens. That's it's the same goddamn movie again. There's no differently that you know what's really even stranger? They all look like they've been frozen. They don't look any different. It was twenty years ago.
I know, don't they look great?
Everybody looks exactly the same. It's the same story. Oh, there's Annie who wants to be a journalist and she's been a journalist
No, you're wrong. It's a huge global hit. I love how you like try to trash
Which doesn't mean it's good. Marvel Controls the box off.
No, no, no, no. This is doing rather well. All these individualized movies are doing really well and you love to resist it, but it's the case. People who people are liking you're into story right now, very much so. And like s smaller story.
Yeah. And you wanna see something that's well done? Watch Running Point, which also stars Justin.
I love it. I me too. I watch the entire thing uh on the
I will say that.
Flying back from Europe, yeah.
It was such a walk down memory lane. I moved to New York in two thousand and that was literally the heyday of magazines and Condonast was the bell of the ball. And it it I mean, it's such candy. It reminded me Francis Ford Coplin, maybe you remember this. He did a movie, it was three or four movies in one, and the production values just dripped off the screen. And it wasn't it reminded me of that movie. Oh, I think it was called New York Stories.
And it was just three different um it was a nineteen eighty nine and it was uh th three different sort of New York stories, such great talent, such great production values, but the stories just weren't that compelling. That's how I felt about this. I could have I just enjoyed watching it. Because the the fashion is so beautiful and it just takes you back to a really kind of I think an iconic time. You never realize you're in a golden age until it's gone. Yeah.
Absolutely. And this was sort of reminiscent of that golden age. And they did pay some homage to the disruption of digital, talking about social media. But the talent The talent and the visuals and the cinematography and the fashion, and everyone's so fucking good looking. That's worth the whatever it was, twelve pounds, but it's a pretty thin story.
Oh I don't know. I think Justin was fantastic. I think that's I think it was i you know, they're so good. Like watching these people do their stuff is just completely punishable. And it's beautiful talent. Beautifully made is what I like. You know, it's like looking at a beautifully made thing. I thought it was actually a lot deeper. And I thought I think because of uh the interplay between Justin and Meryl Streep and that one scene it's which you might have missed was really amazing.
I didn't see that. I did enjoy Merrill Street having an HR person following.
I n I know. I feel like you know what I w we'll finish this up, but I feel like I should get someone like that for you going
It's like I want to kill myself.
Don't say that. Don't say that. She was wonderful. That actor uh was uh she's from uh uh Bridgerton. She was in Bridgerton. She's amazing. She's everybody
Is it Rogerton?
Yeah, she's the wife. She's the it's second last season. Married uh the other Duke of Earl. She's beautiful. But she was fantastic the way she she like you can't say that. I I literally was thinking of getting you one of those. It's like a helper. Anyway, uh
¶ AI's Impact on Relationships
I am. That's true. I do. You can't say that. You can't say that. Um, okay, let's get into it. Before we get into news, I wanna chat about a piece in wired titled The Sad Wives of AI. You author details. how the AI boom has created a wave of women, especially in tech heavy circles'cause men working
in or obsessing over AI or emotionally and mentally consumed by it. One therapist mentioned in the piece says her client base is almost entirely women whose husbands are professionally adjacent to AI, over seventy percent of AI skilled workers are men. I I I um just made me laugh. I'm not I'm not really a sad wife of AI, but you you I was interviewing Joanna Stern uh this week at the ninety second street Y. She's written a book called I Am Not a Robot where she
lived with AI for a full year and I was thinking well I I discussed how much you use it compared to me, which was interesting. I don't know what you think about sad wise of AI, but it's interesting.
This article really shook me and I think it calls on a much bigger issue, more with young men, but Uh I think what's going on here is that it's it this isn't about men falling in love with machines. It's about men choosing control over connection. And I think it's I think it's a dangerous trend, especially among young men who are forming their approach for their to relationships their entire life. And that is the following. Real relationships require friction.
Right. Yeah.
remove friction and I uh amongst my friends who and I've talked about this openly and I've said this, I modulate my consumption of porn. Because I want that energy and that Having sex with someone takes real work. And you know what it does? It turns you into a better man. It it it makes you think about what turns that person on. It makes you think about connection. It makes you think about how you become more attractive.
And when men start finding, you know, opting for control in frictionless relationships.
It's not just porn though, it's just like spending time with it, right? Like really
Is a substitute, porn is a substitute for intimate sexual connection. And AI is becoming slowly but surely a replacement for I I sit down with I'm doing a lot of virtue signaling right now. I sit down with my son when I put him to bed every night and it's he talks to me about his day. I won't let him be on screens in his room because I'm worried at some point he's gonna just start talking to his AI about his school day and asking him for advice. And Yeah.
What is usually the right thing is usually the hard thing. And relations nothing is harder and nothing is more rewarding than relationships. And w when you come across when you're young, you can start believing that real relationships feel unnecessarily hard and therefore less appealing or more bluntly, when the alternative is a partner relationship that never disagrees. Relationships in reality start looking like a bad deal and we become more disconnected.
No, I well I did that interview with Sherry Turkle for the the my uh my series and she was like it used to be a sidelight there was always an odd person who used these things like that. And she goes, And now it's nearly everybody. Like it's very mainstream. And I think, you know, people say it's men and women, but it's largely men. Like men.
I I've been very seduced by AI around business, but I've decided and what I tell young men is you gotta earn your sex. Don't d try really try to modulate your porn. You gotta earn your relationships, your intimacy, and your sex. And when you do, that's what makes it really rewarding because d memo it's really hard. When you need advice,
Go to France.
Go to your go to your parents. If you're looking to brainstorm and you're looking for additional data, what it it's bad for men of my age. It is a fucking disaster for kids under the age of eighteen.
Yeah, and they're consumed by it. You know, one point I made to Joanna in this interview where she used it a lot is Um she's like, Why do you she goes she was noting it was many more men than women and I said and more many more men making it or creating it and everything else and she goes, What do you think? And I said I think men can't have children and this is a version of children. Like they're creating a being. Like they they're creating an
shaping a being in a way that they want to, with control, which is exactly what you said. And I think it's it's a real it's a version of that of total control over a being, which I think is very attractive.
We're be bec we're becoming less mammalia. We see declining male participation in relationships. When men don't have a romantic relationship, their friend network goes down. When women don't have a romantic relationship, their friend network goes up. And it results in increased isolation. We are men, especially men, are substituting relationships with digital alternatives, gaming, porn, and now AI. And this is what happens.
When you become increasingly digital, you become subject to the whims of shareholder value, which want to take you to the extremes. And also elevate incendiary content, nationalist content, misogynist of content, content that demonizes immigrants or demon demonizes trans kids, and you end up with a cohort.
Yeah.
Of people who take their natural aggression, which can be very positive if channeled the right way in terms of risk taking, in terms of saving other people's lives. But when it's channeled through digital means and you start blaming other people. It can lead it can lead to nationalisms, strong men. I think this is a really big issue.
It is. It's I had a really interesting discussion with Alice. I was asking him how he used it. Actually I found the way he used it. I said, I want to know exactly how he used And I think he's they're very honest with you, my kids. He uses it, for example, he he puts problems in it and then he said it's like in his
It's like an assistant a tutor, right? An assistant tutor that they go through. He has very complex math problems obviously th with his school'cause he's in such advanced uh calculus and everything else. He said I I walk through like it's a it's a a teaching assistant and then I put it away and do the problems myself, and then I have it look and see where I went wrong, and then I do it again myself. So it's a really she he uses it in a way that I think is smart. Anyway.
Um but he doesn't use it for you know, he has a nice girlfriend and he you know, they get into beefs and this and that, but it's um but they're they also have a relationship and I think it's I think that's not a dumb way to use it. Anyway.
¶ Trump's China Summit Analysis
Uh it's a really sad story. You should read it. It's in Wired. So let's get to the news at the time. Speaking of men, men, men, men, men. Uh the the photos out of China are really quite disturbing. It's only men at the table here. um President Trump and uh Chinese President Xi uh have met for a little over two hours right now at and attended a state banquet.
to start off their two day summit in China. In Gee's opening toast at the banquet, Gee said, achieving the great rejuvenation of the Chinese nation and making America great again can go hand in hand he's snickering at Trump behind his back though. The White House said both sides agreed that the Strait of Hermuz must remain open. She warned that Trump that mishandling Taiwan would cause clashes and put the entire relationship in great jeopardy.
Trump is joined in China by seventeen American business leaders, including Elon Musk, Tim Cook, and Jensen Huang. uh a surprising lack of women on this strip everywhere. Uh we and also China experts. We asked Alice Hahn, uh director of Green Mantle and co-host of Prof G's own China Decode podcast. Uh, for her thoughts on the summit, let's listen to what she has to say.
So US President Donald Trump is heading to China. This is the first visit by a sitting US President since 2017 when Trump was last president. I'm carrying a three-point scorecard going into summit in terms of rating it. Number one, will there be any indication as to tariffs and trade? Number two, will both sides agree to freeze or maybe even loosen certain export restrictions on chips and rare earth?
And number three is a thornier geopolitical question. And I think both sides will have two very different readouts on Iran, but certainly both leaders will be talking about it. And I believe that Trump will apply some personal pressure on Xi Jinping to help resolve it, although the I suspect the Chinese
will be reluctant and push back on any kind of collaboration over Iran. I think this will be largely summitary without substance and it does pave the way for more summits to come with potential t for two or three other meetings and a Shi visit. to the US later this year. One concrete prediction I have for this summit is that China will increase Boeing purchases of aviation equipment. I think the fact that the CEO of Boeing is going there with Trump is an indication of that direction.
Interesting. Um obviously uh she does summetry is a really good word. Um It's uh y you know, it's interesting because a lot of the coverage out of it is that China thinks we're a declining empire. And uh of course who he brought was interesting. You typically bring business people on these things. It's absolutely true. And he brought all
mostly tech people or tech adjacent people. Um, I think most people feel that n as as she says, nothing's gonna come out of this and it'll be interesting to see. what signals uh she sends uh versus Trump, I think. I think he's a more important person to pay attention to. Your thoughts?
Not who he brought, it's the ratio. He brought 17 CEOs with him and three diplomats. So it feels as if America's just becoming an operating system for the wealth of the top one percent and they try to
Billionaires on a plane, like snakes on a plane.
What's the minimum amount of cheap calories and And entertainment, you know, bread and circuses we can throw at the bottom ninety nine such that they don't, you know, revolt. It it i in there's no there's no policy, there's no prep. He sounds like an eighth grader with terrible you know, who's had to take he's failed English so many times he's gonna have to take it as English as a second language. It's like, Jesus Christ, can can someone buy the guy
He just No, the speech wasn't crazy. Chinese restaurants? I I didn't even understand what he was talking about. They're laughing at us. You can feel it.
And they uh i I thought the most important statement, because you can be clear, while he's sort of he's sort of improvisation with a mic, you can bet she calibrates every word.
Yes.
And the words that she said that I think should send a chill down everyone's spine is he said that he hoped that America's current approach, some of the effect of America's current approach towards Taiwan could result in a clash. And Trump hasn't really said a lot about Taiwan. He's not flying to Taiwan with Speaker Pelosi and and and publicly cementing our relationship with the ally there.
It was a warning. It was a warning. Yeah.
Or or not even a warning. It was more I saw it more as like a preview that we are gonna start we are seriously considering some sort of
soft or not so soft repatriation, acquisition, invasion, whatever w use whatever word you want of Taiwan. And I think had Trump had more elegant diplomats with them, they would have immediately responded and put out a statement along the lines of You know, uh we are all both nations are committed to peace and just as I'm sure we've witnessed the incredible fighting force of Ukraine when armed with technology, they can repel a much larger aggressor.
Which in my opinion would be an elegant way of saying, stand the fuck down when it comes to Taiwan.
Right.
And he would never he doesn't think he doesn't he doesn't have the diplomats of the IQ. to respond to what was really the only substantive statement made at this summit and sending Huang over Jensen used to have ninety percent sh share of chips over there. It's gone to zero. Because China's figured out that if I provide my local entrepreneurs with the incentives to catch up, they just might.
And uh our trade has gone from twenty-three percent of their exports used to come with us, now it's seventeen percent. They have bigger trade. with the with ASEAN, the Asian, the Association of Southeast Asian Nations. And also they do more trade now with Europe.
Yes they do.
So w we showed up, you know, it it looked less like diplomacy than sort of two casino owners trying to refinance each other's debt. Sh but she but she is the house right now. Trump c came in as the guy asking for an extension on his marker or his credit. We are mutually Each of us has a foot should we decide on the other's
Carotid artery. They own seventy percent of rare earth minerals and ninety percent of the processing. We own or control with Taiwan, eighty to ninety percent of sophisticated chips.
Which is why Jensen was there to be able to sell uh this is something Trump barred, by the way, and then now he wants to sell the chips into China.
Yeah.
Can I make a comment about all the business people as you said? I mean it really was was. Uh in warnings, just the way we're with this group cooperating on scary shit. And this group is all in on Whatever. It's there's nobody who is a c everything they do, nobody is a critic of it. This is like, you know, flying billionaires on a plane to China to get shit. Seems problematic from a visual point of view.
You're exactly right. This should have been an opportunity to develop the modern day equivalent of Interpol. We have cooperation even amongst Russia and China around nuclear weapons. We cooperate and we go kill people if we think they're trying to mix up a biological, you know, a bi uh you know, a bioweapon. We cooperate and we go find those people and we arrest them or kill them. We should be doing the same thing of cooperating around a
Publicly. Publicly. I I suspect there's behind the scenes stuff happening, but of course there is. But at the same time with this gang, just like with the advisory council on AI, it has nothing to do with safety in AI or anything else. It has to do with let's do some business here. And as long as it's good for us and my rich friends, I'll do it. But it it was so it was he looked tired, he looked old, he looked addled.
And then he was tweeting his were tr truth in his little heart out, like with his apparently the piece in the Wall Street Journal. I don't know if you saw that piece of him
Tru two hundred truths in a four hour period?
Whatever. It's this lady who helps him, this young lady who has a startling uh uh resemblance to Ivanka. uh who stays up with him late at night and does this and the even the White House people don't know what to make of the situation. And the journal was implying some stuff, like they were trying not to, but she facilitates him posting this crazy stream of lunacy and
When I'm old I just hope I have someone facilitating me.
Anyway.
We got it planned out. His name is Manny.
Okay, I know. I know. Manny is gonna the soft hands. Manny with the soft hands. I'm gonna I'm looking for man anyone named Manny with soft hands, call me and I'm gonna get you ready for Scott, which should be in about.
You should know that.
Ten years.
I'm difficult, but I am very generous in terms of
I know you but when do you think you'll be going down? Like going down.
I think the correct term is went.
Went. No no, but really going down, like hard. I mean like in the need for a manny. In the need for a manny. I'd say eighty two for you.
Jesus, that early? My dad, my d I'm assuming I'll follow the pattern of my dad. At about ninety-three my dad needed help.
Ninety three. Okay, yeah. All right. Okay, Manny, get ready. So Manny might not be born.
Yeah.
Yeah.
Just back to it for a moment, back to the summit.
Okay.
Uh Trump doesn't recognize the evolution of China since the last time he was there. China's no longer trying to copy Silicon Valley. They're trying to replace it. That's great. Alibaba alone is gonna spend fifty-three billion dollars on AI. We're so focused on the hyperscaling and the capex here. You know, US hyperscalers are spending six hundred and fifty billion, but fifty three billion from one company. China usually typically has the ability to make their dollars go much further.
And what they offer is uh the fastest zero to a billion dollar companies in history have one general business strategy. And we like to think it's the innovator. No, it's not. The second mouse gets the cheese, or specifically the shareholder value, and the most dramatic or The most accretive business strategy in history is to provide the following: 80% of the leader for 50% of the price.
My first strategy engagement at profit was d basically this idea, and that was a lot of people couldn't afford the gap in the nineties. A lot of people think of it as being uh uh kind of a middle class retailer. The gap is expensive for a lot of people. Most people can't afford twenty two dollar pocket tees. And the idea was let's tap into this huge population of single mothers who are very conscious about their children's confidence at school and offer fifty percent
Or I'm sorry, eighty percent of the gap for fifty percent of the price, Old Navy, fastest two billion dollar retailer in history. Southwest is essentially When it started, 80% of the majors for 50% of the price. China's entire strategy is we'll give you eighty percent of a semen cell tower for forty percent of the price.
Yep, they're very innovative too. I let's uh let's say you know, w this idea of what they they're they are a very dynamic autocracy. Let's just say they are a very like dynamic and nimble autocracy.
Just incredible.
Yeah, and they have tons of problems. There was just an interesting I mean, similar stories, decline in marriages, decline in kids. Um they certainly plan that for
Demograph. I mean, they have their own issues. Youth unemployment, demographics, uh real estate over leverage in real estate.
morale, stuff like that. Yeah. Which is prob more problematic in an autocracy. But it's a problematic here too. Um all right, Scott. Uh we'll see what happens. Nothing. It's a nothing burger. We'll see if they have do more. But the I agree with you. Taiwan is where we need to fake focus. Um that will be a disaster of a di that will be our greatest crisis of this year, I think. Um okay, Scott, let's go on a quick break. When we come back, Sam Altman takes the stand.
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¶ Sam Altman's OpenAI Trial Testimony
Scott, we're back. It was Sam Altman's turn in the hot seat this week. At the Elon Musk Open AI trial, Sam denied Elon's claim that he tried to steal a charity and said Elon supported Open AI becoming a for-profit company as long as Elon had total control.
That sounds pretty good.
accurate as far as in my experience. Let's go through some of the other highlights from Sam's testimony. Sam described, quote, a hair raising moment when Elon suggested control of OpenAI should pass to his children after his death. That is hair raising. Sam said Elon's departure from OpenAI in twenty eighteen was a morale boost for employees who did not like his hardcore management style.
I was there during that time. That's exactly what they described. I have to say I heard from a lot of people. He was like a big giant fucking baby. And he he does that with all his comes. He comes in, yells, kicks a can, and then leaves and they can't wait till he leaves.
When pressed on his open AI equity stake, Sam acknowledged that he holds a passive stake in the company through Y Combinator. I also want to mention that Kara Swisher came up in the trial this week. I was surprised not more. Well Microsoft's CEO. No, because I was texting a lot with
I was surprised I wasn't mentioned more.
I texted with them all during this time. The Microsoft Sacha uh Nadella was testifying Elon's lawyers were questioning uh Nadella about the nature of Microsoft's relationship with OpenA and pointed to comments he made during an interview with me after Sam's uh firing. He was he c he was all in for Sam during that period.
Uh closing arguments are getting underway right now. So again, you're la any I don't think there's any more last minute surprises. Elam was not supposed to leave the country, by the way, according to the judge, but he did anyway. Um, he was supposed to be, you know, on call essentially, but he doesn't care. Um any last minute surprises, anything? It seems like it's going the way we talked about. Thoughts with this jury?
I don't have any additional color here. Again, I think this is grievance cosplaying a legal argument. So it's the g so this is a traditional jury trial and the jury decides that.
It's a jury decision and then the judge will decide remedies. So it you know, he she if he lose if if Musk wins, they might say, Well, we're leaving it as it is. and going with the California thing and they can pay him money or whatever. We're not gonna get rid of the CEO. That's one of the things he's asked for. I d I think he can't pos I think this jury can't possibly side with him. W I mean, ultimately I don't think they proved anything and
It's a sort of he said, he said kind of thing and Elon's the most loathsome of the pair, right? By far, by country mile. So I think Elon's made a spectacle of himself. If he wins it would be something else, like I'll tell you that. Um but I can't imagine the jury thinks this guy got the got a short end of the stick or that he's stupid and didn't know what was happening to him. I think
That's really he's sort of played this I'm a genius. Well, if you're a genius, how did this happen kind of thing? You're not a dupe. And so um so I think they probably think he's lying. And there's enough there's enough evidence that he is. Um, or or just as you said, grievance theater. In any case, I have a feeling it's gonna be quick, but we'll see. It would be a real shocker if he won.
¶ Inflation and Trump's Stance
Um and the latest inflation numbers are out and the news is not good. Consumer prices rose three point eight percent last month, the biggest increase in three years. Energy costs obviously current accounted for more than forty percent of the monthly increase.
with gas prices up twenty eight percent, grocery prices rent, and airfares also climb sharply. President Trump, however, does not appear to be overly concerned. Let's listen to how he answered a reporter's question as he left the White House for his China trip.
When you're negotiating with Iran, Mr President, to what extent are Americans' financial situations motivating you to make a deal?
Not even a little bit. It the only thing that matters when I'm talking about Iran, they can't have a nuclear weapon. I don't think about Americans financial situation and I don't think about anybody. I think about one thing. We cannot let Iran have a nuclear weapon. That's all. That's the only thing
Oh wow. That was that was some quote. That was like an ad. Like they just he cut an ad for them. It was that was astonishing, I have to say. I mean it's what I it's what I think he thinks. And this nuclear weapon thing, we're less safe now than we were doing the Obama days when we had most of the um enriched uranium and a deal and the Strait of Hermuz was open. So Any thoughts about what he's doing here? Why? Or he's just just an old addled man who just says whatever's on his mind. I don't know.
Yeah, so look at the same thing. With this administration, so th the quote unquote objectives of regime change. Oh wait, no no nuclear weapons. Oh wait, unconditional surrender. I mean, there there really isn't it's so back and forth and, you know, erratic that it's difficult for him to outline or be taken seriously. Having said that.
I do believe that loosely speaking, the way what he said there is how presidents should approach wars. Wars are more than gas prices. Wars involve killing people and putting our own men and women at risk.
And I think uh and he's not the guy to do this, but I do think the president should be willing to have an adult conversation with the American people and to say that the reason We have decided to put our own men and women in harm's way and commit this type of treasure and talent and potentially kill many of their citizens.
is because we think it's worth it. And this is why we think it's worth it. And quite frankly, we don't go to war unless we, as your leaders, have decided that the American public are going to have to sacrifice. George Bush told us we could go to war and cut taxes. And Americans believed him.
So I think an adult conversation with the American public around we have consulted with Congress, we've consulted with our allies, and we believe whatever the objectives are are worth some sacrifice. I think that is the right thing for a president to say. But i i this requires an adult conversation, more leadership, more gravitas, and clear objectives. And none of those things are uh, you know, evident with this president. But
Again,
I think the president should be the person to say to the American public, I'm not going to take you to war unless I think it's worth it and also unless I am willing to ask you to sacrifice.
That's not how he asked it. He's like, I don't give a fuck. He doesn't have any objectives. It's worse than before. He's made it worse and it's not a war. Like it's not it's uh he's kind of right. It's not it's something else where it's just a disaster just a big
fucking mess, the same his this casinos and you know, everything he touches turns to this in some way. Just even the even the New York Times story about the reflecting pool, what a mess. He gave it to some group of people who can't fix it. There's already leaks already. It's being painted a color that's not gonna let it reflect. It's gonna be the non-reflecting pool. Everything he does is shoddy and haphazard and unplanned and with a huge whiff stink of corruption attached to it.
And you know, and then telling them I don't really care about you is really I think disastrous. It's why his numbers are going down is nobody believes him about anything that he says, except that he doesn't care about you. And I think that's a I I agree, uh President should say things honestly, but I don't think this is honest. I think this is just he could give a fuck is what he's saying to you and doesn't have any plan except for disaster.
¶ Economic Inequality and Policy Solutions
Well there's the perception and there's the reality. And I think the I think the perception after kind of eight or ten very bad weeks for the president, I think it's actually had a good couple of weeks. I do think he looks presidential with she although nothing got accomplished other than some saber rattling from she, um the Virginia I think Virginia's a big deal. The Supreme Court rejecting the attempt to redistrict. I think he's had actually a a decent cover.
I think the Supreme Court's gonna give it to Virginia because it gave it to everybody else, and I think it's gonna
I'm sorry, can I give it to Reginald?
It's going to the Supreme Court, that decision is going the Supreme Court has to be.
You think you think the redistricting will be allowed?
Yes, I think it'll be allowed and'cause these they've allowed it everywhere else. It's very hard not to allow it if they've allowed it everywhere else and they Texas. As we said last week, he can do whatever he wants cheating, but polling doesn't lie. And polling is showing that you he can't outrun the polling no matter how many times he cheats. I think he has had a bad couple of weeks actually. and he looks older and more addled than ever. I just I think that this was a typical
He's just saying whatever's on his brain. He wasn't doing it to be, you know, tough with the American and he didn't do it with care. I don't care what anybody's. Like I don't think about anyone's financial s American's financial situation. I don't think about anybody. That's ridiculous. And he you know, we were safer before and we're less safe now.
When's the last time you think he had a good two weeks, Kara?
Uh when he won. Okay. When he won. I don't think it's this is I think this has been a I thought part of his first term, some of the stuff was okay.
So it's been seventy eight weeks of constant.
No, I do think no, I think when he won. I think when he won and he had a real opportunity.
Yeah and a half.
Yeah. Yeah, I think it's been like a series of like the um one forgets the immigration disasters, the shooting of US citizens, the um all the stupid people he's hired, the drunken cash patel, the lunacy of R F K. I don't think there's any Uh well, we shouldn't have dyes in our food. Yes. Sounds good. Like I don't know what to say. I think it's very small little ones and um and I think the stock market's done well, but I don't think it's I think it's detached from everyone else's uh experience.
Um and you know, billionaires have had a good time, that's for sure. Uh tech billionaires. Um, but i i this rise of inflation to me is the only thing that matters at this moment for most people.
People miss we're very focused on unemployment and we think that unemployment causes unrest. It's actually not unemployment that causes the greatest levels of unrest. It's um what really upsets people and moves them to political action and sometimes even some form of revolution, which I think we're already in. is not people who aren't working, it's people who are working and yet still hungry.
And that's what's going on here. The unemployment rate is 4.5%. That's not what ails America. What ails America is that people have two jobs and can't afford healthcare. So when and when now we have inflation or prices outpacing wages, that just translates to the following, the quality of your life goes down. And w and the problem is America, and I lay a lot of this, Trump doesn't have the IQ or the integrity.
or the honesty to do this or the the confidence around him. But I would also argue that America isn't ready for an adult conversation because if you're gonna be serious about inflation, it's very long term difficult things. It's there's a relationship between essentially the economy breaks into three buckets. There's labor, that is the earners, there's shareholders, the owners, and then there's consumers.
And because of a lack of antitrust, because of tax policy, we have decided to massively transfer power and economic well-being from consumers and earners or laborers to shareholders. And everything we do, every tax policy, keeping minimum wage low, uh riding off all capex, subsidizing certain energy uh certain industries, everything is about how do we consistently take money.
From earners who minimum wage was 725 15 years ago, it's still 725 the NA despite the fact that the Nasdaq has quadrupled and push more and more money into shareholders. And also the most boring thing that no one wants to talk about.
is that when you go from twelve chicken companies to three, when you go when you let pharmaceuticals consolidate, when you let health systems consolidate, when you let healthcare verticalize when you let one company control ninety percent of search, fifty percent of e commerce, seventy eight percent of social media, they will extract greater and greater rents from
consumers and earners and transfer it to owners. It requires antitrust. It requires a really interesting or more severe, quite frankly, entitlement policy where we reduce our entitlements. You're gonna have to reduce the military budget, you're gonna have to increase taxes, 40 percent AMT across corporations and millionaires.
And then slowly but surely create more competition, lower rents on consumers, and a transfer of capital back from the owners to the earners. But the American public doesn't have a political election cycle that that creates a serious conversation around these things.
¶ Fed Chair and Interest Rate Outlook
I get that. I get that. I'm talking about people feeling it, like at all levels. And you do you do when you when you go out. I mean, I I was I I I know it sounds dumb, but I do d I do do m Amanda and I split the grocery shopping but I went to get a quart of milk and I I was like, What? It was like six or seven dollars and I was like, Are you fucking kidding me? And it's not just looking at the gas pumps or there was something I was in a airport and there was a sandwich and they were like
$14. I'm like, what? Like it was it was, you know, uh I I I I didn't get it. I I was like, Well, that's a lot of money for a sandwich, like kind of thing. And so I don't begrudge them having to raise prices. It's that it was it's just I think people who are price resist like price insensitive are noticing it.
It's you can't help if i unless you're just holed up in your house, you can't help but notice things have gotten a lot more expensive. But there's there's shock and there's a reduction in the quality of life and then there are threats to your own personal safety. Correct and those When you see Affordable Care Act subsidies go away, you have someone who's literally dependent upon diabetes medication for their life.
see their insurance bill go from one hundred and seventy eight dollars a month to seventeen hundred. And it's as if the government has said to them, We don't care that you're working hard. We've decided that you're gonna die. And i i those are the I think those are the kind of what I would call you you're going to have I I think we have bad economic policy that results in inflation and a decline in prosperity. What is unacceptable is that someone is worried when someone starts rationing
their prescription medication. That just should j that just can't that should not happen in a
Or cuts off, you know, there was a a really upsetting story in the New York Times, a woman writing about her kid who died of cancer. But like they've cut cancer pediatric cancer things and so these you can't get in these studies'cause they don't ex they suddenly disappear, these advanced studies and everything'cause
you know, he doesn't say we're not gonna help ch peri pediatric cancer anymore. What he says is we're cutting all over the place, so in essence that's what we're doing. Anyway, the rise of inflation comes as Kevin Warsh takes the reins as Fed chair Warsh was narrowly confirmed by the Senate this week in a fifty four to forty five vote. It's usually an unanimous, which is the where we are. Um he's certainly qualified. The question is most people don't think the rates are gonna be cut and
So juggling this inflation with Trump's demands to lower interest rates, most people think he will not be lowering interest rates at this moment, given the inflation numbers are so high and there's no signs that they're going down. Just th very quick thoughts on that?
We like to talk about we like to simplify things in the media that this guy's gonna come in and cut rates, but people don't wanna actually pay attention to the mechanics of the Federal Reserve. And that is uh the federal open market committee is the one that decides whether to cut rates or not. So while the Fed chairman has the bully pulpit and sets the agenda, he's one of twelve he's one of eleven or twelve votes.
Powell is still there, as you said.
Yeah.
Kevin Warsh.
W while uh you know, a really disappointing testimony at a Senate confirm uh confirmation hearing, he's not stupid and he doesn't want to go down in history as the guy that ignited an upward spiral of inflation. So i there's g there's not going to be a rate cut. And and as a matter of fact, Calce says there's a seventy two percent likelihood there's no rate cuts for the rest of the year.
because you still there these Fed gov governors don't want to be known as the people that that created breadlines. Yep. And when you have a when you come off a print of three point eight percent, there's no fucking way. If someone if if Warsh started making noises that we should cut rates, those guys would go on background to journalists saying, this guy's fucking insane and threatening a Weimar Republic like inflationary economy here.
Yeah. I mean I think it's it's the deficit and everything else. Maybe they shouldn't consult Zoran Mamdani, who balanced the New York budget.
What did he cut? I'm curious. I haven't been following.
Some consultant stuff, a bunch of things. He's doing a rather good job with services. He opened the streets for um the soccer the FIFA matches he in front of schools. He closed off streets so kids could play soccer. Like learned to play soccer and brought in all these soccer players and stuff like that.
He's very good at services, this guy. I'm just saying. I think Trump's gotta focus in on providing services to citizens. That's what you're talking about. The idea of that people get something out of government and it's not to be kicked in the fucking teeth. And I think that's really the the difference between lots of cities and a lot of both Republican and um Democratic sent governors and mayors who are providing people better services.
uh in a smarter way. Anyway, that to me is the goal for everybody. Anyway, we're gonna go on a quick break. When we come back, we'll talk about the biggest donors uh for the midterms.
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¶ Andreessen Horowitz Political Influence
Scott, we're back. The biggest donor for the 2026 midterms may or may not surprise you. It's Andreessen Horowitz. The V C firm and its co founders, Mark Andreessen and Ben Horwitz, have already spent more than a hundred and fifteen million dollars this election cycle, outspending both George Soros and Elon Musk. Uh much most of the money is spent on the right. It's Musk, Jeffy S and uh
These two. Um, Soros is is the is the opposite, but much smaller in comparison. A major chunk of that money is going towards pro crypto and pro AI super PACs. What a surprise. What's where their investments are.
Trump and the GOP are also benefiting. Uh Andreessen Horowitz and his founders have together donated roughly twelve million dollars to Trump's super PAC, MAGA Inc., and a trust link to Mark Andreessen gave nearly nine hundred thousand dollars to the Republican National Committee in March. Um You know, not a surprise. I mean not that this guy has moved, you know, firmly. It's mostly Mark, but Ben is right along with him as always,'cause he's this little follow little follow puppy.
Uh just typical. Just typical. I mean this is not a surprise. And then he tells nonsensical stories about how he be went right, none of which are true. Uh your thoughts?
It's smart.
Yeah. Uh it's wrong, but it's smart. It's the greatest ROI any firm can get right now.
He's figured it out.
Yeah. This is pay for play. And by the way, uh Horowitz used to give a lot of money to when he thought Kamala was gonna give it a.
He did. Mark used to be a big gore person as I recall a long time ago. He wasn't every people are like, Oh, he used to be democratic. I was like, Mm, not if you pr if you spent any time with him, he was certainly wasn't. He certainly was he was Mark is one thing which is self interested in the most extreme way you're ever gonna meet someone.
That's called a corporation.
I agree. But I'm saying it's really quite it's really quite he doesn't even pretend. He's really the s most selfish person to ever come.
Exactly.
Scott, I get it.
I mean
Never seen it.
Incentives. It's just i if the greatest ROI, if you're the CEO of a company or the head of a venture capital firm and the greatest ROI on any spending is not hiring more people, it's not investing in planned property and equipment, it's to give money to a president. Who will who will pass legislation or block legislation that takes the value of your portfolio companies up? 10, 20, 30 billion dollars, that$115 million investment is the best money you can invest.
Absolutely. So I agree.
Again, it it's the boring shit. Term limits on the Supreme Court, no gerrymandering, get rid of Citizens United. Until we do those things. You're gonna have strong men or women or fascism from the far left or the far right. You're right. You're you're always gonna have it. And we're outraged at Andreessen Horowitz. Soros okay. There'll be Democrats that'll do it. I bet Jensen Huang is about to write a three hundred million dollar check to somebody.
Who knows? Who knows? I would you know it's interesting because look, they they have shifted, right? But I I my point is Mark was never never liked anybody. Like that's all it
I doubt he does now.
N he never does. I it's very I agree with you, it's the right corporate thing to do. I've never met someone who is so anti people in my life. Like just has such disdain for humanity in a way that's really remarkable actually. Just doesn't like anybody, like essentially. And he would do it to the left or right depending on what suited him. W whi someone was asking me, Well, there are left wing people who are gonna give me I'm like, I don't want
Who knows what they're gonna be next week? And I don't want any like individual rich person left or right to be able to take advantage of this way. It seems unfair. Other people don't get a an audience with the president, and they have an un unnecessary advantage based on money. And that's kind of gross in some ways. It should be a
Gross. Elon Musk after the SpaceX IPO Might be worth between seven hundred billion and a trillion dollars.
Dollars.
If he takes one percent of his wealth or ten billion dollars with his command of technology, he can decide who the next resident is.
That's what I'm saying.
Is that what you want? Taxes are our Kevlar and our vaccine from power. I we need to stop thinking about taxes as something that is inherently evil and slows down the economy. That's bad taxation. Taxation protects us. I don't want to call them billionaires because I don't want to demonize them. Taxes protect us from an unhealthy aggregation of power.
Due to money.
Hundred percent. Yeah. We shouldn't have any individual I don't care if it's Soros, I don't care if it's unions, I don't care if it's Lorraine Powell Jobs, uh although I think she's a wonderful woman, and I I'm not this isn't a character assessment. You can't have an individual with this much power. And taxes are the only way Our only protection, our Kevlar against the aggregation of this type of power. And Citizens United. I gotta get rid of it.
¶ Anthropic's Valuation Surge in AI
Speaking of which, all my friends have decided you become a lesbian because of Pierre Ter. Piotratare.
Hey, bro.
They were like what?
They weren't expecting that?
No.
Oh by the way, a lot of my friends are like get sending me messages like, What the fuck? Shut up.
Scott is a lesbian from San Francisco now. Speaking of virtue signaling. that would value it up to nine hundred and fifty billion dollars. Uh if completed the company's valuation be two point five times what it was just three months ago and higher than open AI's valuation of eight hundred and fifty two billion. Of course there's the overhang of that trial with OpenAI right now. Um, i it's a huge thing. Overinflated. Uh I don't know. I don't know.
Look, uh we've never seen a company scale like that. Um so and i we've also never seen Pepsi overtake Coke or or avis overtake hurts as quickly. We've never seen this type of of transition or pivot or reversal in fortunes. And and also I still think open AI's valuation uh uh IPO is probably gonna be a hit. So get this. In March of twenty twenty five, Anthropics valuation was sixty one billion. So it's up fifteenfold? It's up fifteenfold in the last year.
Lot of parties in Silicon Valley.
Well, okay. It was nine billion in annual recurring revenue in December. Last month it was thirty billion. They think this month it's on track to reach fifty billion. Um, for the first time, more businesses are using Anthropic than Open AI, thirty-five percent versus thirty-two. Anthropic's business adoption quadrupled over the past year while open AI has grew is basically flat.
And so a board decision uh on this financing is expected later this month with a and they think the IPO might happen as early as October.
Yeah.
the fun. Yeah, and Kalch is saying it's a seventy percent chance it goes public this year. Um, and then there's also a 60% chance that they have the best AI model at the end of the year. I don't know what that means. Like, I don't uh this company is it's just absolutely firing on all cylinders. Having said that, my thesis is that go long GLP one and short AI because I don't think I think it's impossible to maintain a lead in AI with AI. And that is if you look at the technical specifications
It's moving more towards parity than differentiation. And I think it's going to be difficult for any one company to maintain a technical lead here. And that that will drive down margins. And then when these openweight AIs, when she starts engaging in AI dumping, which is what I would do if I were him, I think it's gonna drive down their margins. And the good news is I think similar to vaccines or PCs or jet transportation, the winners will be us, uh, not these companies.
There'll be one or two companies that will dominate. Probably uh Anthropic is one of them at this point. Interestingly, probably Google is the other. I don't
Yeah, it'll be uh it'll be really interesting. But when you look, we have become used to any innovation resulting in a small number of companies capturing trillions of dollars in shareholder value. Again, my thesis is that AI might be more like Jet transportation vaccines and PCs and that no one company is able to sequester shareholder value.
Yeah, I get your point. So it would be funny if Apple spent nothing and ends up benefiting the most. Which is pretty much
Yeah.
Yeah.
Hundred percent
¶ Google's Orbital Data Center Plan
That's sweet. Uh just the last thing, Google speaking of Google is in talks with SpaceX for a rocket launch deal to put orbital data centers in space. The deal is based on currently unproven technology that Elon said is the next frontier for his rocket company.
I I kinda like this idea. It's totally unproven and Google has a history of investing in wacky schemes. At one point they had uh um they were investing this sounds like a Sergei Bryn thing happening here. They used to beef over some girl, but now they're getting along, I suppose.
Uh th anyway, th this is something. Google has done this. They had wind they had wind up in wind kites at one point. They were gonna do a chair lip in San Francisco. They had a uh a a ship, uh an energy ship parked off the uh the city in San Francisco. This is nothing this is feels l smells like Sergey Bryn to me. And so he would try anything and this would seem cool to him. So sure, why not? Why not invest in it? What's the difference? If it works, it works. If it doesn't it.
I think these guys they want to put chips down and options on anything they don't have insight into so they can get investor updates, have a chance to work with them. It's smart. Everything is so interconnected. Those graphs that look like You know, the God's eye, remember those in the seventies where everyone is invested in everybody else and everybody's suing everybody else.
Yeah, just like Anthropic is doing a deal with Musk. Not a s everyone was like, How d hell you Dar you? I'm like, Are you kidding? Of course he did. Of course they do. They don't. They like beef and then they hug. It's like the mob. Anyway, one more quick break. We'll be back for prediction.
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Buzzwords like progressive and affordability are thrown around all the time in politics. But what do they actually mean?
For me, being a progressive means at least two things. One Being willing to unite. Lots and lots of people, all of the folks that are getting screwed over against the powers that be that are making your life worse. And then second, being progressive is essentially a hopeful enterprise. I think, I think that the world can be much better, that we don't have to settle for crumbs or settle for the status quo.
And is there a difference? what it means to the elected officials and what it means to the people.
So money is essentially the root of everything. I don't care if you're gay, I don't care if you have All that th that's like secondary, third, like that doesn't that's not a prior
That's this week on America Actually. Let's dig in.
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Complex and unprecedented, the Spanish authorities are calling it.
del desembarco, asintomáticas.
Passengers who'd been stuck aboard the Hanta or maybe Hanta virus-stricken Dutch cruise ship disembarked in the Canary Islands this weekend, prompting the highest-stakes game of where are they now since maybe COVID? Some of the evacuees, American and French, have since tested positive. And yet public health officials seem remarkably calm.
We do have one individual um who was uh taken to the biocontainment unit early early this morning and we uh assessed that individual Yeah.
Possibly because this is not the one to freak out over. Today Explain drops every weekday afternoon.
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Yeah.
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¶ Market Prediction and Economic Outlook
Okay, Scott, let's hear a prediction. I will note that people should something we have talked about and have been in our predictions, a New York Times investigation, which you should all read, found that over eighty polymarket users have placed bets with suspicious characteristics and one money across nearly
thirty topics. There the insider trading stuff of this stuff is just getting started on all these predictions markets. So we we thought this might happen, but that just just f please go read that'cause it's a really interesting piece. Go ahead, Scott. Prediction.
So my prediction, chipmaker Sarah Bros went public today at a forty billion dollar valuation and that's up from its twenty three billion dollar valuation. in February and eight billion in twenty twenty five. I believe it's over I believe it's playing into this massive uh historic run up in chips. And after an initial pop I think it'll fall. Since last year its revenue has increased. less than two X while its valuation has increased uh sixfold.
And the forty billion dollar valuation implies is seventy-six times revenue multiple. In other words, it's this shouldn't be a public company. It's it's it's drafting off of what has been an unprecedented increase in value in the sector. So as an example, NVIDIA trades at twenty-six times revenues and still controls eighty five percent of the AI chip market and is growing faster. Cerebrus tried to go public in twenty twenty four, but withdrew
They're uh filing at the last minute over intense scrutiny of its heavy reliance on a single customer, uh, the Emirati AI firm G forty two. I don't rem if you remember these guys. It's basically like j actual giant big chips, physical giant big chips. It strikes me as kind of quite frankly a shitty company. And this is this is simply massively benefiting from an unprecedented updraft in chip stock.
And anyways, m my prediction is that the initial pop, this company, uh which I think is actually a fairly mediocre chip company trading at seventy-eight times revenue, is not gonna sustain
And I like the highly specific
stock thing. And then that that same customer, which makes up the lion's share of the revenue, group forty two. accounted for twenty four percent of revenue last year and uh state owned UAE university accounted for sixty two percent of revenue. Given what's going on in the UAE, given their dependence on one customer, given the seventy-six times revenue. This feels like one of those bad Chinese firms that could just go down 95%.
Well, it's a good warning for people. Anyway, there's a lot of froth happening for sure. And and so there it's hard to separate the good from the bad. Anyway, we want to hear from you. Send us your questions about business tech or whatever's on your mind. Go to nymag.com slash pivot to submit a question for the show or call eight five five one pivot elsewhere in the Karen Scott universe this week on Prof D Markets. Scott spoke with Oswath.
De Motorin, a professor of finance at NYU's Stern School of Business, one of Scott's favorites, to break and he's terrific, I think so too, to break down what's standing out to him. in the markets so far this year. He shared his thoughts on how the conflict with Iran could ripple through the economy. Let's listen to a clip.
The catastrophic risk here is not that oil uh gas prices stay higher than they were before the conflict, is whether they'll go even further up, because there is that chance of that happening. I think if uh in in many ways what the market seem to seems to be building in is the economy can survive with gas prices being four fifty or five, depending on what part of the country you're in. and that it might not be as robust as you thought it was three months ago, but it's okay.
But I think the the the the worry still remains that this crisis, while it's on a slow boil, at any point in time could become a fast boil, at which point you could say what what happens to earnings now.
Yeah, that's interesting. Four four fifty-five. I've seen six seven now. It's really across lots of cities. Anyway, uh that's the show. Thanks for listening to Pivot. Be sure to like and subscribe to our YouTube channel. We'll be back next week.
Today's show is produced by Larry Neyman, Joey Marcus, Taylor Griffin, and Todd Wiseman. Ernie University engineered this episode. Thanks also to Drew Bros, Ms. Vera and Anchalon and Shot Cora's Oxmuse Executive Producer of Podcast. Make sure to follow Pivot on your favorite podcast platform. Thank you for listening to York magazine, box media. We'll be back next week for another breakdown. And business. Kara, have a great weekend.
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