All In Podcast Episode 105 Notes November 19 2022

 

November 19 2022

• Intro

  • Sacks stiffed Chamath on his jet

• Last week pod hit #16 overall in the world - maybe #14

• Lot of DC staffers listen to the pod

• Trump announces 2024 presidential bid

  • Sacks has lot of fans in DC
  • Jake Sullivan being voice of reason
  • Sacks got into it with Ian Bremner - who is a weather vane for the blob - now they are also coming around to peace
  • Both parties are very hawkish on foreign policy
  • Sacks would serve his country if asked by the President 🙂
  • Menu of ambassadorships - unspoken - UK is $10M for example
  • Chamath’s friend was UK ambassador under Obama
  • SBF’s parents would get ambassadorship to some place?
  • FBI says it was ego not secrets for Trump’s motive for taking the documents - Sacks was right as usual
  • Biden administration wants Trump to run - keep him in the news
  • Dem strategy to prop up MAGA candidates in the mid terms worked - as hypocritical or machiavellian as it might be
  • Trump will lose presidency if he wins Republican nomination
  • His numbers for general are bad but in republicans he might win - can be DeSantis
  • He is the ultimate MAGA candidate
  • How can you claim Trump is a unique threat to democracy but then prop him up in the news
  • DeSantis is now the favorite among Republican primary voters
  • JCal hitting Friedberg childhood trauma - not the best look?
  • Any Dem candidate will crush Trump
  • Trump is capped at 45% of the vote - can’t win candidacy with that
  • Trump is able to fire up his base very effectively
  • Doesn’t even seem to be a policy reason to pick Trump vs DeSantis - why lose on style points?
  • Have to pick the most electable candidate
  • Major troll job by Rupert Murdoch paper about Trump candidacy
  • Voters want to work you on the future, not the past
  • Things to be concerned about

    • Debt by US financial system

      • More scary than nuclear war and climate change
      • Global human ramifications will be worse
      • Technology can help climate change - people will cool off on nuclear war, everyone has a family
      • Charlie Munger said - democracy people realize they can vote themselves all the money

    • Huge decision to deglobalize has big risk of introducing a hyper inflation loop

      • 1 chip coming from TSMC and efficient supply chain vs 6 places making chips because of CHIPS act - either becomes inflation because consumer pays more or debt if government subsidizes it
      • Joe Manchin deserves great credit - prevented $6T being pumped into economy - inflation would be 15% against 9% - same for Sinema - $3.5T of BBB - so Republicans also maybe deserve credit

    • Lets dial back foreign intervention - so both recession and foreign policy are important

    • Culture of excellence - schools - grades, advanced math, sound border policy, crime under control in cities - quality of life

    • IRA makes all energy production types equal

    • China is building 450 nuclear power plants - 1-5 c/khw - but US is paying 15-20 c/kWh, solar and wind off grid is 3-7 c/kwh so its more competitive

    • Current fed debt is $30T and GDP is $23T - so 5% interest rate is $1.5T per year - so thats 6-7 % of GDP - so every transaction will be taxed that much? Plus another $3-5T per year in spending

      • If you take entitlements away people will struggle to pay their bills

        
        
        

        
        

    • US has reserve currency of the world

    • Trump suggested good policy on this - refinance our loans - but wasn’t listened to because no one wanted to

    • G-8 countries are also in debt - so US can also do this

    • US is 130% debt to GDP

    • Spending is 27% of GDP - it should be 15%

    • There is nothing stable about the point we’re at

    • Same thing happened with British Empire - read Ray Dalio’s book

    • Crowding out phenomenon - money goes into risk free rate of return and equity investments go down

    • Ross Perot ran his candidacy on debt to gdp - then it was 41%

    • IRA is < $1T over a decade but could enable multi trillion dollar industries

    • Sequester was interesting way to control spending for a brief period of time

    • 57min segment!

• Big Tech Layoffs

  • Google salaries are way higher than Microsoft and other companies

    • Incredible business

    • 187000 employees

    • Have grown 25% YoY

    • 2004-2005 10% of bay area grads had CS degrees, now its 60%!

    • Google has made people soft

      • Google paid the most so others also paid a lot - lot of people are hired

    • Google does a lot of stuff for free so internet works better - their DNS and Time Servers, etc

    • Urs infra team is greatest engineering team on planet earth

    • Headcount has gone up by 4x in the last 9 years

    • Amazon is very good at taking stuff that doesn’t work and knowing when to kill it

    • Google needs to do that

      
      
      

      
      

      • But does it really?

    • Ruth Porat is CFO - she is hard core - has a wall street lens

    • Sundar is an engineer

  • Things are hitting a nerve
    • Western society is learning how to take care of their impecunious nobles

• SBF interview with Vox and NYT

  • He played NYT and woke people - be woke and have indefinite career progression

  • Left has the power to define what virtue is - that is why people work at NYT - they define what is virtue and vice - who else are you virtue signalling to?

  • In 2012 Twitter had 1000 employees and 200 MAUs so they will be fine - now their stack is better - they only have 50% more MAUs now

  • Professional managerial class is rewarded independent of dilution

  • So Elon is showing that Hustle Culture is just the work

  • Elon giving them an option is actually the right thing to do - Media is giving him so much crap for it

  • SBF isn’t being covered like this

  • Its because NYT and others have been complicit in his reputation laundering

  • Elon rhinos tweet is absolutely the right problem

  • Balaji tweet is right

    
    
    

    
    

  • FTX auditor was apparently based in the metaverse

• David Sacks beat Magnus Carlsen at Chess

  • Their partners were Pragganandha and Yuri Milner (party host)’s daughter

• Total money burnt by half of tech IPOs since 2020 is bad

  • 48% of them are 0.2 times all the money that went into them
  
  
  

  
  

  • Power law exists in growth and post IPO also
    • Anecdote - a reputable VC - 180 companies in growth portfolio, but 85% of their return comes from 10 companies
  • The jobs program for surplus elites is going away - if you went woke, you make go broke - professional managerial class is in trouble