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Podcast

Tariffs, Trump's Economic Endgame, Market Chaos, Bitcoin Reserve, CoreWeave IPO

All-In with Chamath, Jason, Sacks & Friedberg

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  • Fentanyl Crisis and Tariffs
    • Joe Lonsdale recounts encountering families impacted by fentanyl in the Senate dining hall.
    • He highlights the seriousness of the fentanyl crisis and its relevance to Trump’s tariff negotiations with Canada. Transcript: Joe Lonsdale Trump’s negotiating right so i actually ran into david sacks each senator gets one guest we were both guests in the senate dining hall hanging out with a bunch of these guys multiple Of the guests some of them were spouses of the senators multiple of the guests were people who’ve lost kids to fentanyl right and so it’s actually it very serious issue. It’s a big thing on the populist right, as it should be for all Americans. We’ve lost, you know, tens of thousands of young people recently to fentanyl. And Canada has done nothing about their border. And so, you know, you just reported breaking news. I hadn’t even heard yet that Mexico might be off. Canada’s still on. He’s using this to negotiate. So I talk to the senators and I ask them what’s going on, because obviously, I import things all over the place. I’d like to know what the hell the rules are. But they want people to actually crack down on this stuff and save American lives. And I think it’s a reasonable thing to use to negotiate and force them to do that. Jason Calacanis Okay, so you believe it’s negotiation, because of the fentanyl issue. Chamath, let me go to you, because many people are saying this has more to do with some great reset and (Time 0:09:09)
  • Tariffs and Economic Rebalancing
    • Chamath Palihapitiya believes Trump’s tariffs aim to rebalance the US economy and its reliance on the dollar.
    • This involves rebasing deficits and boosting American companies’ economic vibrancy. Transcript: Chamath Palihapitiya Think that this is the first week where I’ve seen the first real schism in how people are interpreting what’s actually happening. I think that Trump and Elon were very much in a honeymoon period until this week. And I think there was the benefit of the doubt. But what I saw on X was a real divergence where, on the one hand, there were people that were basically saying, Doge is deranged, Elon is crazy, Trump is lighting the world on fire in one Camp, and the other camp saying he’s sticking to the plan. And when I thought about this a little bit, if you went back to November the 5th, I do think it’s important to remember that we were at this moment where you had this fork in the road and you Had all these important issues where I think the best way to generalize it was that the Democrats believed that the lines should continue to be blurred. So whether that was on gender or race or merit versus some other immutable trait or fiscal and monetary policy, things were just getting more and more blurred. And then Trump and Elon basically showed up and said, actually, we want to refocus and we want to make the lines very visible and clear on all those dimensions. And a majority of Americans voted that in. But I think what you’re starting to see now is the difficulty in actually implementing that plan. And what I mean specifically is tariffs are very nuanced and complicated. On the one hand, there’s the short term wins. There’s these impacts, you could deem them positive or negative to the dollar. There’s impacts to US bonds. There’s impacts to US bond markets. There’s impacts to how countries deal with foreign reserves. And then there’s this impact that happens when the markets react to a tariff, and then Trump takes that off the table, and then they snap back. So you have this weird set of boundary conditions right now. So I think right now we’re in the very difficult part of sorting through what the long-term implications are. (Time 0:10:14)
  • The Master Plan
    • David Friedberg suggests a “master plan” involving tariffs, reduced income taxes, and reduced government spending.
    • These aim to encourage domestic production, unleash capital, and shift towards a consumption taxation model. Transcript: David Friedberg Head, and I don’t have any direct line of communication to folks that are constructing the theory and the policy. If I were to say, what’s the most masterful plan in an optimistic way of what could be going on here? What’s the master plan? I would kind of craft it as follows. Tariffs aren’t being done in isolation. They’re being done along with a coordinated policy effort to reduce income taxes and another policy effort to reduce government spending. So those are three actions, three legs on a stool. So tariffs, reduced income taxes, reduced government spending. And they are related to each other. They’re related to each other because if we increase tariffs, one element of that is that to import products is more expensive. For example, I buy LED lights in my greenhouse. And the price of the LED lights just went up by 25%. This week, I actually spoke with the CEO of an LED company and I was like, why don’t you guys make the LEDs here? And there starts to become a crossover point where it actually makes economic sense for the company to make the LEDs here instead of sourcing them from Asia. And there’s 100,000 examples of this. When the industrial supply chain goes to the lowest part of production, it’s going to end up offshoring when there’s no tariffs. And if there are tariffs, then you start to do production here. So you’re increasing both kind of security for the US supply chain, but also increasing demand and creation of a workforce. Now, I think that the income tax piece is critical here. Because in order to make the capital available to build that industry here, we need to unleash capital and reducing of income taxes, the economic theory would be that capital will now Flow into these entrepreneurial activity, these opportunities that have emerged, where suddenly it makes sense for me to make textiles, to make metals, to make materials, to make Cars, to make all this stuff here in the United States that I otherwise wouldn’t be making. So both the corporate and the personal income tax, by reducing it unleashes capital, then instead of going into the government, it now goes into the private sector into building businesses. Okay, I think that there’s another theory about this, which is as you drop the income tax. One of the kind of key theories that I’ve heard spoken about a lot lately, and I think we’re going to hear about it a lot more this year, is trying to get the United States to move away from An income taxation model to a consumption taxation model. So effectively, what the tariffs do is there’s a tax for you buying certain things. So now instead of getting taxed when you earn money, as an individual, you get taxed when you spend money. And some people think that that’s both a more fair system, and a more kind of economically vibrant system, because that will drive investment in the things that people want to produce Because the money’s going into production. Jason Calacanis Do you think that, Freeberg? I’m curious. I don’t know. It’s a really interesting economic theory. David Friedberg I mean, I am not opposed to seeing some sort of an experiment play out where we look at a shift from income taxation to consumption taxation and see if it actually does have an effect on Economic growth and productivity. It has not been done in 150 years. There’s a lot of economic theorists on both sides of the equation saying this does work or doesn’t work. And let me just say one last thing. By reducing government spending, we are moving workers from the government into the private workforce. So as those new industries pop up, as those investments start to get made in building new industry on shore, where are the workers going to come from? Remember, the government’s 30% of the US GDP today. So if that’s not a great way to invest money, maybe the private industry is better at investing money and employing people that will unleash the workforce and it will counterbalance The inflation that we’re experiencing. So there’s a lot of inflation because of tariffs. And by reducing government spending, that’s the offset to inflation. So those three actions, I think, are three legs of a stool. And they actually are all interrelated to one another. (Time 0:13:59)
  • Shifting Workers and Domestic Production
    • Joe Lonsdale agrees with Friedberg, emphasizing the need to shift workers from government to the productive economy.
    • He points out that tariffs incentivize domestic production, especially in defense and negotiations. Transcript: Joe Lonsdale No, listen, I agree with what David was saying, Jason. And it’s a really important point also that we should mention is that the last four years, the economy’s looked okay. But part of that is because government’s been hiring like mad. And so the point he made is that actually, you know, having twice as many people, you know, harassing me, I just got back yesterday, no action on an audit that’s been harassing me on for Three years, they found nothing. Having twice as many people doing things like that, and or like, you know, running TSA or pushing papers around in the Department of Labor, doesn’t actually add output to the economy. And so, you know, it does seem like it makes a lot of sense. Let’s take a million workers out of the consulting class around DC, out of the paper pusher class around DC, and let’s actually deploy them to the actual productive economy. Elon and Trump have both been saying that. I think David’s 100% right. And it is true. A lot of my companies, thanks to the tariff stuff, are looking to build stuff here. So I’m not a huge fan of tariffs personally, but they definitely make sense for things in defense. They definitely make sense for negotiating with countries. And it is true. It is pushing certain people, including me, to build some more things in America. Here’s where tariffs make a lot of sense. Chamath Palihapitiya If you have markets where there are domestic alternatives and or where things are fundamentally commodity, there’s no reason why tariffs can’t work to create the incentives to redomicile Economic productivity inside of the United States. That’s a slam dunk, I think. Joe Lonsdale And Shemath, there’s another twist on that too, which I think we should all acknowledge is that America does have some really tough environmental laws. Despite what Jason may think of me, I actually don’t want my daughters growing up with messy air, messy water, screwed up country. Jason Calacanis Oh, I don’t think that of I know that you’re a nature guy. But here’s like a classic Bush nature guy. But here’s the thing. Joe Lonsdale In China and Indonesia and all these other countries, they are just over the environment as they make things. I think tariffs are very reasonable in that case. Like, it’s not fair to make it more expensive for us because we’re doing it well. And then we outsource it for them to destroy things. So there are some things there where it doesn’t make sense. Chamath Palihapitiya And what I would say is the other side of the tariff knife is that (Time 0:18:52)
  • Fair Competition in Government Contracts
    • Joe Lonsdale shares an anecdote about his company’s superior drone technology being overlooked in a government contract.
    • He advocates for fair competition and outcome-based evaluations in government procurement. Transcript: Jason Calacanis The minerals? Joe Lonsdale This is why it’s so frustrating to build for the government, guys. This is what Palantir and SpaceX had to deal with. This is why they both sued the government, is that all the friends who used to be the CIO, used to be the general, made the right donations, had the right kid on the board. It’s all corrupt. And then it’s actual substantive people. You have to work like hell. Chamath Palihapitiya How do they give $7 billion in 30 days? What could you- We’re going to find out. David Friedberg You got a bunch of Democratic operatives on the board. Well, let me challenge you guys on one point. There are now claims being made by reporters and by third parties that are saying it is a new form of kleptocracy with all the friends of Silicon Valley installing their friends and agency Heads as undersecretaries and so on. That’s going to benefit Silicon Valley investors, Silicon Valley companies. Joe, Chama, JCal, I mean, how do you guys react to the claims that there’s now, you know, this new kind of kleptocratic movement? It’s the old guard is gone, but now there’s a new guard. You have Palantir, you have Andrel. So go ahead, you answer it, Joe. Joe Lonsdale Let’s talk about this. I mean, when we go to DC, when I go to DC, what I am asking is I want there to be a fair competition. And if I win, I want my company to actually be able to win the contract because the way it’s worked for 20 years, like Epris, you just raised $250 million this week. It’s a great company. We had a big contest four years ago, L3, Raytheon, Northrop. These guys, in and out of government for decades, they’ve gotten tens of billions of dollars to the same technology area. When we went head to head with them, we didn’t just beat them by a little bit. We shot down the hardened drones nine and a half times farther away. Same size, same power, nine and a half times. Completely wiped the floor. Jason Calacanis What was the cost difference between the bids? Are you saving us massive money? Joe Lonsdale Massive money. I invested only 30, 40 in the whole thing at that point. And they’ve spent billions. And we have much cheaper, much better, not even a question. And you talk to the, and you talk to like at the time, the chief of staff of the Air Force, the guy who wrote the four star. And he says, well, Joe, this was written three years ago. It looks like Raytheon probably did help write it. And they required all these things and your way you’re doing it. I’m like, yeah, I’m using a chip instead of a cathode ray tube. That’s why it’s working so much better. It’s like, yeah, but it was written for the way they’re doing it. And I could overrule it, but it’d break a lot of glass. So you’ll probably win again in three years because everyone knows you’re the best. But it’s too stressful to give it to you right now. (Time 0:33:09)
  • Transparency in Government
    • Chamath Palihapitiya and Joe Lonsdale advocate for transparency in government.
    • They suggest open standards, publishing RFPs and evaluation criteria, and measurable decision-making. Transcript: Joe Lonsdale Acquisition reform, right? So like this is a really important story. You guys probably know. We were in the Philippine jungles in early 1910s, needed new pistols. Our pistols were terrible. They had like a one-page thing, what they needed. There were six arm manufacturers competed. That’s how we got the Colt 1911 in like three months. It won by a large amount. It’s an awesome gun. 12 years ago, we had a 700-something page document that the bureaucrats spent years on outlining what they needed for a new pistol. It probably needed to do DEI i have no idea it’s like a long comical document they still don’t have a new pistol today and so the way we do it is we have a very clear process where it’s very Specific on the outcomes not on the inputs and you have a contest and and then and then you make sure that you know it’s not it’s obvious who wins guys it’s not like we’re like slightly better It’s like we’re shaming them So the only way they can stop us is by playing these games because we’re just so much better. Chamath Palihapitiya I think that if you’re in the administration or if you join some part of the administration, whether you’re a full-time employee or a GSE or just a volunteer, there’s going to be that Perception of impropriety or influence peddling. That comes with the territory. So how do you avoid it? And I think that Joe is exactly right. When the administration was getting formed, one of the things that happened, I had an opportunity to work with some of the folks to write some proposals for what theoretically could Happen in some of these bigger government organizations where there’s just huge pockets of spend. Where I spent most of my time is what Joe talked about. How do you create open standards so that it’s very clear what the competition is, so that the rules on the ground can’t get manipulated by people who are rolling out of government into Private industry or somebody has a very deep relationship because of lobbying. Those are the things that pervert the clarity of what should happen, because then what happens can be far afield of that. So number one is I think knowing that this time around, a different class of people are going to be seen on the quote unquote popular side. It’s really critical that all of us that are involved in this promote extremely transparent open standards. Publish every RFP, publish every spec, publish every evaluation criteria, make these things as mechanistic as possible. So for example, if you’re going to go and field a drone, there’s an incredibly detailed set of data that you should be publishing in. It’s not dissimilar to how an FAA asks for flight test data. And you should be able to review that so that then it can be escalated. So that if somebody then gets a deal because of preference and you think you’re structurally better on the data, there needs to be an escalation and a release valve that says, hold on, This is just being manipulated. And I think that’s how you fight back on not just this version of a potential winning side versus losing side, but forever in the future. The government should be open, the government should be transparent, and every single point at which they’re making a decision and giving money should be measurable and known. (Time 0:35:39)
  • Main Street vs. Wall Street
    • Chamath Palihapitiya argues that the Trump administration prioritizes Main Street over Wall Street.
    • This is reflected in policies aimed at deflating asset prices, lowering interest rates, and reducing spending. Transcript: Jason Calacanis Issues. We obviously, it seems like in some ways, maybe the Trump campaign is not thinking about the stock market as much as they’re thinking about the bond market. Explain to us your take on markets right now. Chamath Palihapitiya Yeah, I think that there’s three markets that are important. There’s the US long end of the curve. So this is the 10 year bond yield. I think then there’s the US equity market. And then the most next important market are the European bond and equity markets together. And I’ll explain why in a second. But just on the first few, I mentioned this before, but I really do think we’re in a secular shift where I think the MAGA majority and the base of people that can be a reliable voting block In the future, as I’ve said before, are working and middle class folks that don’t necessarily own a ton of stocks, nor do they own homes, of which there’s a lot. Second cohort are people that are pro-innovation and pro-tech. And the third are patriotic business owners. I think that cohort is very large. And I think that when the core strategists inside of MAGA figure this out, one of the big takeaways is that they’re not going to care about the stock market and Wall Street. And a lot of the policies will be viewed through the lens of Main Street. And I think that you started to see this rhetoric now, one from Besant, and we’ll play this clip in a second. And the second was just today from Trump himself. But Nick, do you want to play the Besson clip if you have it? David Sacks I think over the medium term, which is what we’re focused on, it’s a focus on Main Street. Jason Calacanis Wall Street’s done great. Wall Street can continue to do fine. But we have a focus on small business and the consumers. So we are going to rebalance the economy. We’re going to bring manufacturing jobs home. Chamath Palihapitiya That was the first one. The second one was just today, Nick, I sent it to you. Do you want to just show it to these guys, which I think is really interesting? Jason Calacanis So it says breaking news from, I guess, unusual wells. Trump has just said he’s not looking at the stock market. Okay. Chamath Palihapitiya So I’m not sure I believe that, but okay. So why is this actually valuable? Well, if we are incentivized, if the government of America is incentivized to implement policies that crack the equity markets, it’s actually really good in some ways. Number one is if you deflate asset prices, you also deflate inflation. Okay. Give an example there for the audience so we make it clear. NVIDIA is ripping at all-time highs. You are like, oh, wow, I’m so cash rich. You can go get a margin loan. You take that money, you reinvest it in a second home and a third home. You sell some stock, you start to buy cars, all this other stuff. It drives consumptive behavior that on the margin isn’t there if the markets were much, much lower than this. So if you rebase the equity values that people have, what you do is you actually depress the amount of free cash flow that they have to spend on other things. So it’s a deflationary tactic. How the bond market reacts to that is if the stock market goes down is you start to become a flight to quality, right? Oh my gosh, there’s volatility in the stock market. Oh my gosh, I don’t want to deal with the stock market going down. Let me just sell, take some chips off the table and buy 10 year bonds. When you buy the bonds, the interest rate goes down. Why is that good for America? We have $10 trillion we need to go out and borrow in the next nine months. And so if we can pay 3%, 3.8%, 4%, we save ourselves trillions of dollars versus if we had to pay 4.5%, 5%, 5.5%. So that’s the second thing. And then the third thing is that right now, what we had this week because of the Ukraine and Zelensky thing is basically Trump say, we are totally risk off this war. And I’m not going to debate whether that’s right or wrong, but that’s what he said. We’re going to curtail the aid. We’re not even going to share intelligence. They’re on their own. What did that force? What happened this week was the Europeans had to basically circle the wagons and they said, okay, we’re going to step up. And what they announced was a four-year plan to borrow money to invest in defense. What they also did, which was really interesting, is the UK specifically said, we’re going to borrow it in this clever little way. This is their interpretation. So that it doesn’t actually count in the debt to GDP calculations of my country. So they’re starting to play. So then how did the bond market react to it? Nick, you can show it. They’re like, you know what, guys, if you want to fight this war, obviously you’re allowed to do whatever you want, but the cost that you’re going to have to pay is going to go up. This has been going up every day. And you’re at a point now where this is severe fiscal pressure on these governments. I do not know how they sustain their deficits and raise more debt. So all of this is happening all at the same time. I think Trump is pro-Mainstreet. Equity markets basically do not get bid. The bond markets respond positively. Yields go down. Good for America. They extract themselves from spending programs like, again, it’s more than a spending program, but I’ll just say it in this context narrowly. Russia, Ukraine is a spending program that if you take off the table, that balance of responsibility goes to Europe. And then the markets are saying, this is not right. We want this war to end and we’re going to make it more expensive for you to litigate it. (Time 1:03:47)
  • Multipolar World and Abundance
    • David Friedberg suggests a shift towards a multipolar power dynamic, influenced by techno-optimism.
    • Abundance through AI and automation lessens the need for conflict over resources, potentially impacting NATO’s relevance. Transcript: Jason Calacanis Right let’s address that specifically with ukraine you’re a bit of uh a hawk an american exceptionalist joe and um we are looking at a situation where we spent 175 billion there were Some other numbers that trump was floating around that were incorrect and they got fact checked 175 billion is what we’re actually in for according to all accounts this was done as i Said many times on this very program and got laughed at and joked about done on a lease loan trump because these things were done on a lease loan now has the upper hand with zelensky and He’s a great negotiator and he said we want 500 billion back don’t need to make this about dollars and cents here because obviously this is life and death and people’s democracy we’re Talking about their sovereignty but that 175 billion if he gets that 500 billion back that’s a 42 percent irr in three years on this even if we just got our money back that would be fine For the american people how do you look at the war in ukraine both financially and in terms of containing put. And finally, in terms of our participation in NATO, is it time for us to leave NATO? Joe Lonsdale. Joe Lonsdale Wow. Well, you know, Jason, Putin’s a bad guy. That’s number one. He shouldn’t have invaded. Thank you for saying that. Jason Calacanis It’s refreshing to hear it on this podcast. Joe Lonsdale You know, I do think the last administration mismanaged it. I don’t think he would have invaded with Trump as president. He certainly would have invaded with a competent person threatening him. But now we have to have peace. And I do want peace. I don’t want to have the war continuing but to get peace you got to get both sides to come to the table i prefer peace through strength i prefer being really strong on putin and showing why He has to have peace but then you need zelensky to be a partner for it too and i do think listen i do think zelensky had the wrong idea on the white house last week he should have been thanking Them He should have come more humbly. He should have actually been directed towards really wanting a peace. And listen, I agree that Ukraine’s a very corrupt country. We may find out that he and his cronies have been taking a bunch of money. I don’t know if they are or not. Either way, he has not really been signaling the right way to be open to peace. And a peace that does, I think, have to give up a little bit of Ukraine in order to get there. I think that’s the option on the table right now. And that’s the direction. Jason Calacanis What about the NATO question? What’s the you know, and thank you for being so candid here. What’s the NATO outcome here? Is it time for maybe Europe to just go it alone? Because they don’t seem to like what happened last Friday at the White House. They Yeah. And maybe do you think it’s time maybe that we we bow out and let them arm up? Joe Lonsdale This is really tough for me because some of the people I care about most in the world live in places like Germany and around there, and I want them to be safe. I also think that the historic relationship between the UK and the US is this very, very valuable thing that we have. They shouldn’t just be tossed aside. These are critical, very longtime allies and cousins. I think Europe’s in a very, very bad place. It’s very dysfunctional, man. It’s, it’s, it’s, I did not see European civilization going the right way the next 20 or 30 years. I think JD’s right to criticize them on, on anti-free speech on like, you know, arresting people who criticize the Islamic threat, like more than the people actually doing the rapes And stuff. It’s crazy. These places have lost their minds. You know, it’s bonkers. So do I want to totally give it up? No. But do I want to demand fiercely that the certain things get fixed and to use our foreign policy apparatus to make sure we fix those things if we’re going to stay in the relationship? 100%. Jason Calacanis What do you think, Chamath? This NATO question seems like Europe is kind of signaling that they’re willing to go it alone. And should the United States just say, okay, go for it, we’re out? Because that’s literally what Sachs retweeted recently and just said, hey, we’re out. It’s your problem. And I think the administration has given him free reign to discuss the topic. He discussed it here for many years. What are your thoughts? Should we be out on NATO? Chamath Palihapitiya Well, I think the question is, do these transnational organizations outlive their utility? That’s the question on the table. And it’s not just a question for NATO, but it’s a question for a bunch of these other things, the WHO, NATO, the United Nations. There’s many of these organizations. What you’ve seen is that there are competitive organizations now that are just as important, if not more. So if you didn’t like OPEC, well, then there is this OPEC++ thing. If you didn’t like how the Europeans and the Americans did intelligence gathering, then all of a sudden, five eyes came out of nowhere. If you didn’t like the G7, there’s the bricks, right? So there’s this tendency for the world to create these startups to try to challenge incumbency as the conditions on the ground change. I think the most important thing right now that Europeans need to do is acknowledge this one critical fact. Individual governments of Europe are vibrant and powerful. The European Union itself was created almost without any real teeth. And so what happened is the folks there started to pass inordinate numbers of laws. And that has made it really complicated to be a European company, a European citizen. And that has to get sorted out. What is the real decision there? Is it about being Italian? Is it about being European? What is the separation? And I don’t think that that’s clear. And I think once they figure that out, all this other stuff is much easier to figure out. Jason Calacanis Well, you also have, yeah, other organizations, Interpol, right? We have that. You have the UN. I mean, it is maybe time to just re-underwrite each of them. Freebrook, what do you think? David Friedberg I think that there is a viable case for a peaceful transition to kind of a multipolar power dynamic. And if you’re a techno pessimist, you’re going to have a point of view that there are more limited resources available to humans on earth. And therefore we have to have influence to access those resources. If you’re a techno optimist, you will believe that through AI and automation and all these other technologies that we could spend quite a bit of time around, that we are going to have Abundant housing, abundant fuel, abundant materials, and generally an abundance of everything that one particular group might demand or need. And you don’t need to go be an empire to access the resources that your people are demanding. And what I mean is the mining industry is a good example. There is this discovery, which I think we put on the docket for the science corner today, of a giant thorium reserve in Inner Mongolia, which can be used to make a thorium molten salt reactor. And there’s enough thorium in this reserve in China to produce enough energy for 60,000 years of consumption based on current consumption rates. I saw a fantastic presentation this week by a startup that’s using AI and other sensing (Time 1:14:17)
  • New Job Class in AI
    • Jason Calacanis describes a new job class emerging in the AI field: AI trainers and fact-checkers.
    • This involves refining AI models and could offer substantial salaries, benefiting all users. Transcript: Joe Lonsdale True. Jason Calacanis Let’s talk about this chat GPT. I guess they came out with 4.5. It was such a dud. I didn’t even realize that they launched it. Chamath, you monitored this or Freeberg? Did you try it? Because I’ve been using Grok as my default now then gemini then chat gpt that’s my order right now because i wanted to see how good grok is and man grok is it’s really caught up and i don’t Have an interest here in uh you know i don’t have equity in any of these companies i own google in the public markets but i don’t own the other two but pretty amazing yeah what do you think Of this 4.5 dud what it means, Jamal? Well, I use them in the company building context and specifically at 8090 because of what we’re building. Chamath Palihapitiya And what I would tell you is that I think Anthropic just continues to do an incredible job. I think Claude37, it just kicks ass. Oh, you’re on Claude you’re using on the back end, yeah. We use it for a lot of automated code generation. And its models on code generation, I think, are just exceptional. They are the best in market. Then what I would say is as a consumer, I’ve mostly flipped my usage to Grok 3. And reason is that it’s in line with where I consume most of my information. Jason Calacanis It’s elegantly integrated inside of X. Yeah, to point this out, to explain it to people, when you’re in Twitter, now X, on the top right hand of a tweet, there’s an XAI button. When you click it, it just gives you the full context of the tweet. So I was reading one dara’s from uber’s tweets about autonomy i guess they added two more partners when i clicked it it gave me more than i ever could want it was almost like a deep research Of the context of a very short retweet he did and i didn’t have to cut and paste and form a question so owning a social network equals instant and here we’re going to show it with Joe Lonsdale’s, Where he says, hey, listen, the crypto tax feels like taxation to me. And look, it goes and finds four web pages. You can see there. It tells you which ones, Wikipedia and CNBC amongst them. And then it gives Joe’s position. This is like very elegant. Chamath Palihapitiya This is super elegant. And I think there’s a small tweak to this that Elon and I were talking about actually on X, which is then just the nature of being able to analyze a post for its veracity becomes really valuable. That extra little thing when it’s available, I think will have a really big impact on how people use it in this context. So I use Grok for the consumer applications. For all of our code generation, we’re using Sonnet 3.7. It’s exceptional. Which is Anthropics, which is doing a major round of funding. Got it. Okay. Yeah. And I think the thing with the GPT-4 is that it’s kind of like good. Now, here’s a tangent. Let me just do a small little rant, which is we’re at the bleeding edge of where these benchmarks are useful. Meaning part of why, Jason, maybe you weren’t necessarily watching this as closely. And I think where the media and the sense-making organizations get confused is they don’t know now what to say. Say, hey, look at how I did on Sweebench. Look at how I did on IMO. Look at how I did on Amy. And the problem, the dirty little secret of these model makers is that these guys are so trained on the evals that they’re overfitting. And all this overfitting basically makes it pretty unreliable. Jason Calacanis What this means to translate into plain English for humans listening is they basically are optimizing for the test that are the benchmark, which is kind of like a person in high school Or optimizing for the SATs. It doesn’t mean they’re going to be a great student, but it may mean that they just spent a lot of time taking SAT tests. Yeah. Chamath Palihapitiya So we have one problem, which is that I think it would be very valuable for the industry that it be solved, which is that we need to have extremely difficult and always changing third-party, Independent, verifiable benchmarks. Oh, that’s a great idea. Number one. Jason Calacanis Like the safety test for cars that’s not run by the companies. Got it. Chamath Palihapitiya Less about safety though, more about capability. Sure. And I think if we’re reporting on that, then these leaps will mean something more than what they are today, right? So when Alibaba pushes Gwen this week, it was an exceptional model. It’s probably one of the better open source, if not the best open source model out there. Deep Seeks, I think, is also quite good. It doesn’t get any press anymore. So I think we’re starting to get to this place where there’s such abundance that actually people are just kind of like overwhelmed with all the choice and they don’t know how to differentiate. This is like a hundred Michelin star restaurants opening up in your city. You just don’t have enough meals to eat. Jason Calacanis We’re basically drowning in abundance to Freeberg’s point. I don’t think we understand exactly how golden this golden age is in terms of technology. Chamath Palihapitiya Distribution becomes really important. I think that’s why- Absolutely. We discussed this, right? X is very valuable. But also, I think Google just said that they’re going to drop an AI button right into the front door core search page. I don’t know if you guys saw that, but- No, Google’s doing it. Jason Calacanis When you’re logged in, you will get the snippet at the top. Inside of YouTube, they’re doing summaries of the chat and the comments. And then you think about what Meta could do. You know, they already put the AI box up there, but you know they’ll they’ll knock some of that off no i’m obviously the google front door like google.com does anyone use that anymore Chamath Palihapitiya Well i mean google searches are still going but and facebook is about to launch a competitor to chat and grok yeah well they’re going to do a straight up a standalone app and the thing that They are so good at is whenever they launch an app it doesn’t matter when they launch it they’ll just get it to a billion people. Yeah. I mean, that is super extreme. Jason Calacanis All this, I think, leads to so much abundance. What I’m seeing in startups, I was the first investor in a company called Superhuman, very elegant software, luxury software for email productivity. Give it a shot. What he did was, I didn’t mean that’s a super plug here. But anyway, I’m so in love with the company and the founder. I just had them on this week in startups. He’s like one of the best product minds I’ve ever met. Cheap to do AI that they are composing in this beta. I’m in all of the replies to your email in real time on the back end and you can see potential drafts. They summarize everything, even if you never read the summary. That would be cost prohibitive six to 12 months ago. But now it’s a no brainer because they’re paid software. It’s like, so this is going to get very interesting very quick. Joe, your thoughts on this abundance? Joe Lonsdale Yeah, I’m actually building something on email, like you said, that works with your team to automatically kind of like, you know, create reports on everything that comes in and route It for you. Because a lot of our friends, when you’re a CEO, you basically become a traffic cop. It’s actually the email is going to do it for you. It’s going to be really nice. But I’m invested in Grok3 and I’m biased towards Elon. But, you know, a lot of our companies will build on top of multiple of them as well. And I think you’re talking about Cogen. I’m in Cognition. A lot of my companies using (Time 1:24:30)
  • Crypto Reserve and Stockpile
    • David Sachs explains the creation of a strategic Bitcoin reserve and digital asset stockpile, fulfilling a Trump campaign promise.
    • The reserve focuses on long-term Bitcoin preservation while the stockpile allows for active management. Transcript: Jason Calacanis All right, everybody. We’re suited up. We’re suited up because the czar, the wolf of the White House, is here. My brother, David Sachs, we were trying to get you on the program. You were going to make a drop-in to talk about all this great crypto news coming out of the white house and uh let’s face it this was a um some people saying chaotic some people say intense This is a pretty amazing intense week for the administration so we’ll get into a little bit of that but you’re here specifically to talk about the crypto reserve so welcome back to your Program the all-in podcast david sachs good to be back i see that you’ve suited up here yeah i mean i figured i was for people who uh weren’t here for the pre-show i get on sachs is wearing A white shirt and a tie i’m wearing a blazer and a white shirt so i’m like ah i gotta go put a tie on he’s like ah jay cowell wear a blazer i gotta go get a blazer so then we came back and here we Are. David Sacks Well, look, I just have to correct one thing. I think it’s been a very smooth week at the White House. The president has lived up to one of his campaign promises. This is not something new. I remember you go all the way back to his national speech during the campaign and he reiterated this many times that he wanted to create a strategic Bitcoin reserve. Sometimes he called it a digital asset stockpile. What we’ve ultimately done here is both. He also, in his week one EO on crypto, you guys remember I came on the show to talk about that. He asked our president’s working group on digital assets to evaluate the idea of a reserve or stockpile. And we made a recommendation and this administration is moving at tech speed. It’s really great to work for an administration where you can actually get things done and things move quickly. We made our recommendation and then we worked with the lawyers to implement it and the president signed it last night. But this is fully consistent with everything he’s always said. Jason Calacanis Agree on that. I guess the one criticism that you’re going to get when you go face the media, so I might as well put it here, is the order in which you’re doing things. Sometimes Mr. Trump is very expressive on the social medias, which is better than, let’s say, the previous administration, which just wasn’t available and in cognitive decline. So I guess the the the question of he announces something and then you guys explain it deeper. Is that the optimal way to do this? Should we not worry about it? Should you come out with like more official stuff? I guess that’s the move fast break things that we are used to in Silicon Valley, but that people, you know, whether it’s in business are maybe a little concerned about that things are Maybe different now in the White House and in how we’re running our government. Maybe you can expand on that. David Sacks Have you ever considered that maybe you just had an overreaction to a tweet? Jason Calacanis Well, OK, so if we’re going to place the blame on me. Well, I’m just saying that I wasn’t the only one. The original crypto OGs were like, wait a second, why is he picking these three and not these three? You know, so that made a lot of people putting myself out of it like, whoa, what’s going on here? Is he picking favorites? And that’s, I guess, everybody’s big concern. David Sacks So maybe you could have swage that yeah we’re not picking favorites obviously except i will say this we do think bitcoin is special and i can get into the reasons why that’s a great thing Yeah well i mean bitcoin is the original cryptocurrency it’s the first one it’s the only one that doesn’t have an issuer right it’s it’s very decentralized it’s you know crypto they Call this the immaculate conception. We don’t really know how it got here. We don’t know who Satoshi is. It’s almost mystical, you would say. Yes. It’s the most valuable one. It has a $2 trillion market cap. And it’s the most secure. It’s ever been hacked, right? So we’re now, you know, over 15 years into this journey. And there’s been a lot of people who’ve been skeptical along the way. And there’s been a lot of ups and downs. But here it is. I mean, I remember back in 2011, I think it’s the first time I bought a Bitcoin. I think it was at $120. Now it’s at $90,000. Again, there have been all sorts of wild swings along the way. But this thing just keeps chugging along. And you can think of that $2 trillion market cap as like a $2 trillion bug bounty. If there was a way to hack this, there’s every incentive in the world. And by hack, I mean, like to double spend, create basically a counterfeit Bitcoin, I guess, would be the way for people to think about it. It is a miracle. Jason Calacanis It hasn’t been compromised. I think we can all say that. Well, I don’t know if it’s a miracle. David Sacks I think it’s exceptional design. Sure. And so I think what you could say is that it’s been tested in a very robust way. And there’s been every incentive to basically break the encryption and it continues to chug along. And so I think the price has gone up as the protocol has gotten more acceptance. And this is another point is that Bitcoin is the most widely accepted as a store of value throughout the world. So we do believe it should be treated special. Now, that being said, we’re also creating the digital asset stockpile. So all the (Time 1:37:32)
  • Proposed Crypto Tax
    • Jason Calacanis proposes a simple crypto tax to fund the stockpile.
    • He suggests a small fee on every crypto transaction in the US, arguing it would be easy to implement and administer. Transcript: Jason Calacanis Okay well i had a very simple suggestion for this which i’ll float up the flagpole here and see what you think you probably we’ve talked about it on previous all-ins before you want it How about a simple crypto tax you know crypto wants to be legal you’re the crypto czar crypto wants to be regulated they want the rules they want the rails simple suggestion from your Bestie why don’t we charge every transaction in the united states 0.01 just about one bit in that native currency so you want to trade some solana for ethereum for xrp whatever you know Put in whatever names you want there the government says hey you want to have a great vibrant system here we’re going to need to take just the most modest of taxes de minimis in fact in the Native crypto and put it in the stockpile this seems to me like a very easy win. David Sacks That’s always how taxes start is that they’re described as being very modest. When the income tax started, it only applied to like a thousand Americans. And the legislators swore up and down that it would never be applied to middle-class people. So I don’t particularly like the idea of new taxes, even if it’s promised that they just won’t affect people very much. That sounds burdensome to me. Jason Calacanis But look, we have very successful- Well, this would, and just so you know, this would be like more like a sales tax that would be handled by Coinbase, would be handled by Robinhood, would Be handled by those platforms. They would administer it. It would be a transactional tax, not an income tax. So if you have a bunch, it’s not a wealth tax and a seizing tax, but I’ll let you percolate on it. David Sacks If you can convince the Secretary of the Commerce or the Secretary of Treasury to run with your idea, then it could potentially happen. I mean, they have the flexibility to figure out budget neutral ways to accumulate Bitcoin. I don’t know what those ways are going to be, but they’re creative. They’re very successful businessmen. And if they figure out a way to do this, then it can be considered. That’s the point. Okay, (Time 1:46:38)
  • Sachs Divestment
    • David Sachs clarifies that he sold all his cryptocurrency before joining the administration to avoid conflicts of interest.
    • He also divested from crypto funds, including Craft Ventures and others. Transcript: Jason Calacanis Cause this is ridiculous. Yeah. David Sacks Well, people came out right away and were saying that somehow I was engaged in a scheme to pump my bags or to basically create exit liquidity for myself and billionaire stuff like that. You have to understand that those accusations, I mean, they’re accusing me of a crime and serious crime and they’re doing it with no evidence whatsoever so these things are basically It’s more slander slander and defamation yeah i would say in any event what they didn’t know and what i then proceeded to put out there is that i sold all my cryptocurrency prior to day One of the administration because i didn’t want to even have the appearance of a conflict. And by the way, I could have waited. I didn’t have to do it like that, but I decided to do it and take it upon myself to do that because you just know that when it comes to crypto, there’s going to be a lot of fluctuations in the Market. You never want someone to be able to point at one of those fluctuations and say somehow that the cryptos are benefited from that and create a conspiracy theory, which is exactly what Basically happens. So first of all, I got rid of all my cryptocurrency prior to day one. Kraft also sold all this. Jason Calacanis And Kraft is the venture firm that you funded that’s done a lot of great work supporting founders here in Southern Valley. David Sacks So we basically sold, I think it was around $200 million of crypto, of which around $85 million was personally attributable to myself. And we cleared that before day one, paid taxes on it, and basically so there wouldn’t be a conflict. So then the smear shifted in another direction. It was, okay, well, maybe he doesn’t own crypto, but he’s in crypto funds. And so they pointed to Bitwise and multi-coin capital, and I was also in blockchain capital. And so then the fund managers came out and one by one all said, actually, David called us over two months ago and said, he’s going to need to divest from our funds. And so we also did that. So, you know, I think basically they’ve kind of given up on this, but look, it’s very easy. (Time 1:49:29)
  • Crypto Disclosure
    • David Sachs emphasizes disclosure as key for crypto projects.
    • He suggests disclosing token cap tables, insider holdings, sales plans, and token creation mechanisms. Transcript: Jason Calacanis Is good. David Sacks So just to go back to one other point you said about not picking winners and losers. I think that’s a very important comment that you made that I see as fundamental to my job. I mean, look, I think we do think that Bitcoin is special for the reasons I said. Beyond that, we do not want to be in the business of picking and choosing winners in the space. And again, if some other digital asset could prove that it’s as decentralized and as secure and as widely accepted as a store of value as Bitcoin, then maybe it could be elevated in the Same way that Bitcoin has. I mean, I’m laying out the criteria for you. But look, beyond that, we don’t want to be picking winners and losers in the space. And that’s not my job. I mean, my job is not to be a regulator or to anoint which ones are good or bad. It’s to basically be a policy advisor for innovation. And I’ll just tell you the way that I see all the digital assets in this space is that what’s fundamental is disclosure. If you’re an issuer of a digital asset, you need to disclose all the material facts about what you’re doing. And those facts have to be accurate. You can’t lie. My view is that if you, the issuer, lie about something the government should come down on you like a ton of bricks because that’s fraud okay but as long as you do this in an honest way people Should be able to trade these things i understand that you think a lot of them are garbage you might be right you could express that view in a trade but as long as everyone has been above Board in terms of disclosure people should have the right to trade these things and some are going to make money, some are going to lose money. It’s about the freedom to basically to trade, to hold these assets. The government doesn’t want to get in the way of that. It just wants to make sure that the information is out there, that it’s honest. And if people lie in order to profit, I’m all in favor of going after them. Jason Calacanis Well, and we already have a regulated market as an analogy. And when you tell a lie and you sell a share in a company, whether it’s a private or a public company, the SEC has a term for that. It’s called securities fraud. And we, you know, have this new type of device, it’s very innovative, it could be an NFT, it could be a trading card, it could be an actual utility token where you burn it in use of a service, Or it could be anything. It could be whatever the person describes it as. But what’s important is there’s an entity with a group of people, I think you would agree, who have said, we have ownership of this. We’re incorporated here in the United States, not in Panama, not in the BVI, not in some other place where maybe they’re a little faster or looser with regulations. You got to be here in the US. Maybe you have to be insured in some way. Maybe there has to be a board like there does in Delaware or in an LLC. There has to be some person where the buck stops. And if you lie, while committing a transaction or taking money for an asset, it would be securities fraud. And yes, people will come down on you like a ton of bricks. And if you promote things and you don’t disclose it, well, we have rules about that as well. We saw many celebrities get pinched last time for tweeting about cryptocurrencies. And this is the stuff that I think has to stop. I think it should feel more like what we do in angel investing, the private companies and in public companies. So that’s your job. When are we going to see, you know, that framework emerge? Because here, you’re only like 40, 50 days into this, I think. When do we see the actual bones of a framework? So if I want to do J coin, and I want to make an angel investing coin, or I want to do something fun, an NFT collection for all in or something, when will we have the actual rules of the road? And that’s going to be multiple agencies, right? David Sacks Yeah. What you’re describing is known in Washington or the area of policy that you’re describing is known as market structure. And market structure is about providing a clear framework for market participants. It would define what is a security, what’s a commodity, what’s simply a collectible, you know, a property, but it’s not a security. And then what are the rules for each category? That’s known as market structure. There is a bill that passed the last Congress in the House, but Biden basically, he didn’t veto it, but he basically, he and the Democrats stopped it. He stopped it in the Senate, the Democrats did. It was called Fit 21. And it was authored by French Hill, who’s now the chairman of the House Financial Services Committee. So we expect that he will be introducing a new version of his bill probably in the next few weeks. I don’t think I’m breaking any news by saying this. I think people expect it. And that’s going to provide the framework for market structure. And it’s going to provide a lot of the definitions that you’re talking about. Now, I agree with your sentiment, okay? But I will say that I might have a different view than you of what is a security, what’s not. I mean, to me, collectibles are not securities. But if it’s a collectible, you got to disclaim that, look, this has no intrinsic value, right? That’s a collectible. Think about a baseball card. A baseball card is a piece of cardboard. It has no intrinsic value. But the value comes from basically other collectors being willing to buy it from you. And you could just say that that’s irrational or whatever. But so look, I think as long as people disclaim that this coin has no intrinsic value, they should be able to issue meme coins. It’s a separate question why people would want to buy them. But look, that’s very, in my view, that’s very different than someone who goes out as an issuer and says, I’m issuing a token or a coin that has lots of functionality and has lots of value. And you’ll hear some of these guys even say that, hey, our token is more valuable than Bitcoin. You should value it more highly. Well, if you’re promising that and you’re saying that it’s going to have certain functionality, you better be telling the truth about it. Jason Calacanis Yeah, then we start getting into the Howey test and people can go look that up if they want. What I will say is there’s an educational process that has to come in here, which we’ve gone through as the United States, when people would buy interest in mines, people would buy interest In gold claims, oil fields. And that’s when a lot of these regulations came out in the 20s around accreditation. We’ve spoke about this before, it’s a pet peeve of mine, but I think there should be an educational framework here. And I think there should also be some nuance that you could work on specifically with this group of being clear that when you have a ticker symbol associated with something, or you do Charts associated with something, you know, it starts to smell like a duck, looks like a duck, it’s quacking like a duck. But then in the terms of services is, hey, this is a collectible, I think there needs to be some ground rules, which maybe it says, hey, these need to be presented in a certain way, at the Top level. So the nuance of disclosure is so important. When I tweet something, if it was an advertiser or a sponsor of All In or This Week in Startups or any influencer or you would should do this and you said, I love this brand. You and I both were, well, you were an investor in HLBIM. If we were to tweet about that, as investors, we don’t have to disclose. But if we were paid for that, the FTC has rules. You have to put this is a paid partnership. You cannot confuse consumers. And I think that’s where you’re going to have to do a little bit of cleanup work and structure as well is the disclosure and how this appears. And then also, maybe the educational system. So, you know, if you want to own a firearm, if you want to drive (Time 1:54:17)
  • Crypto Education
    • Jason Calacanis calls for an educational framework for cryptocurrency similar to other regulated markets.
    • He also suggests a ‘sophisticated investor test’ to protect consumers. Transcript: Jason Calacanis To accreditation. Sophisticated investor test is how I refer to it for all americans because 90 percent of people can’t participate in private companies your thoughts well disclosure is the key like David Sacks I said i mean these projects should have to disclose certain things i think for example the token cap table should be disclosed who are the great the insiders how much do they have when Are they selling you know that’s that’s information the market should always know, in my opinion. Jason Calacanis And easily done with the technology lauded by the crypto community, the blockchain. This could just be on the blockchain. This was always the problem we had as venture capitalists with, hey, this is a token project. Who owns the tokens? Where are they? When can I sell? When can you sell? The insiders. Yes. David Sacks Yeah. I don’t think you have to disclose everyone who owns a token. That could be hard to comply with, but I think you should have to disclose the insiders and their sales plans and their lockups. And I would also say how new tokens get created. I mean, if this is a fully centralized token where they can dismiss more, people need to know that because there’s no scarcity, right? But if there’s somehow an enforcement mechanism and there’s enforced scarcity, then that’s a different story. So, yeah, these things have to be disclosed. And by the way, I think the market structure bills will do that. There’s a version of this in FIT 21, last Congress. I think it’ll be the next one. And moreover, the SEC is looking right now at these rules and they’re going to create their own frameworks. They’re doing an excellent job. Jason Calacanis Who’s the new SEC chief? I was doing some research on him. He’s a really pro, actually, more Americans being able to invest in privates, private equity, et cetera. And he’s given speeches on it in the past. David Sacks So the person who’s been nominated for the new chair of the SEC is named Paul Atkins, and he has not been confirmed yet. The confirmation hearings still need to happen. Separately, Hester Peirce, who’s a commissioner at the SEC, is in charge of- I know Hester. Jason Calacanis I’ve had her on This Week in Startups a couple of times. She’s great. She’s excellent. David Sacks She’s very well-informed. And she’s very sharp, taking the lead on all the crypto-related stuff. So I trust her and I trust the SEC to produce those detailed frameworks that you’re talking about. I think that my role as call it innovation policy advisor is just to make sure that we have the big picture right. And I’m very confident that the SEC, the CFTC, and the legislators are going to figure out the balance here. (Time 2:01:43)