E32: Behind the scenes of Elon hosting SNL, CDC failures, America's real-time UBI experiment & more

1. 0:00 – 23:36

   Jason goes behind the scenes of Elon's SNL appearance

   1. DFDavid Friedberg0:00

      (singing) Look at this red on my stock screen.

   2. CPChamath Palihapitiya0:03

      (laughs)

   3. (laughs)

   4. DFDavid Friedberg0:03

      I can't believe what is going on.

   5. CPChamath Palihapitiya0:07

      (laughs)

   6. JCJason Calacanis0:07

      Stocks are down.

   7. CPChamath Palihapitiya0:09

      I'm laughing now.

   8. DFDavid Friedberg0:09

      Doesn't mean I'm a loser. I don't know. I need some self-worth now.

   9. CPChamath Palihapitiya0:16

      (laughs)

   10. Oh, God.

   11. JCJason Calacanis0:19

       In three, two-

   12. NANarrator0:22

       I'm going all in. Let your winners ride.

   13. JCJason Calacanis0:25

       Rain Man, David Sachs.

   14. NANarrator0:28

       I'm going all in.

   15. DSDavid Sacks0:29

       And I said we open sourced it to the fans and they've just gone crazy with it.

   16. CPChamath Palihapitiya0:33

       Love you, bestie.

   17. JCJason Calacanis0:34

       Queen of quinoa.

   18. NANarrator0:35

       I'm going all in.

   19. JCJason Calacanis0:38

       Hey, everybody. Hey, everybody. Welcome back. The All In podcast is back. Apologies about last week, I had a personal emergency.

   20. CPChamath Palihapitiya0:44

       Are we, are we allowed to say why?

   21. JCJason Calacanis0:46

       Of course. I mean, uh, we-

   22. CPChamath Palihapitiya0:48

       You can say it. Go say it. Say it. Say it.

   23. JCJason Calacanis0:49

       Anyway-

   24. CPChamath Palihapitiya0:50

       It's a humble brag.

   25. JCJason Calacanis0:50

       With us today on the program-

   26. CPChamath Palihapitiya0:51

       Say it and you know the program-

   27. DSDavid Sacks0:52

       Explain it. Explain.

   28. CPChamath Palihapitiya0:53

       Say it. Explain why. Stop.

   29. JCJason Calacanis0:55

       ... is the queen of quinoa, David Freiberg, Chamath Palihapitiya, The Dictator-

   30. CPChamath Palihapitiya0:57

       Oh, my God.
2. 23:36 – 39:10

   CDC failures, misleading information on COVID spreading outdoors

   1. JCJason Calacanis23:36

      yelled it across the store, you know?

   2. NANarrator23:37

      (laughs)

   3. JCJason Calacanis23:37

      And I said, "Oh, sorry," you know? Just kinda-

   4. DSDavid Sacks23:38

      (laughs)

   5. JCJason Calacanis23:38

      ... you know how when they fall off you don't notice it? Then I got to Austin, and when I'm in Austin I'm walking down the street. I'm the only person in Austin wearing a mask. And somebody points at me and goes, "You don't have to wear that mask, son." And I was like, "Oh, uh," and I look around. There's nobody wearing a mask. I'm, it's my first day there. And he goes, "You been vaccinated?" I said, "Yeah." He goes, "Then you really don't need to wear a mask." So I take the mask off. I get to Florida. A friend of mine was out, uh, you know, uh, at a, having a cocktail at a bar. Invites me-

   6. DSDavid Sacks24:06

      (laughs)

   7. JCJason Calacanis24:07

      ... to meet him for a cocktail. I go to meet him for a cocktail. There was a DJ and there was 200-

   8. NANarrator24:11

      He who shall b- he who shall not be named.

   9. JCJason Calacanis24:13

      Anyway-

   10. DSDavid Sacks24:14

       (laughs)

   11. JCJason Calacanis24:14

       ... I went to have a cocktail, as one does, in Miami. There's 100, 200 people, 200 people in the club. The only people wearing masks are the staff, who are wearing them as chin guards. And I'm like, "That's not the purpose of a mask, but okay." So, and then I get to New York-... and everybody in New York is wearing one or two masks on the street on, I walked down an empty street.

   12. CPChamath Palihapitiya24:36

       Okay. So we should talk, we should talk about that CDC article that was in the New York Times, 'cause that's an incredible summary, Jason, of, of this whole issue in a nutshell, which is, it, it's, it's unbelievable.

   13. JCJason Calacanis24:45

       And then to just give Saturday Night Live a nod. Every day, everybody tested. You got, you know, two tests like the, I don't, I forget the names of them now since I stopped taking them. But you did like the, the big one and the small one. Every day you got tested. Every day you got wristbands. You had to wear a mask 100% of the time and then when you were in the studio, you had to wear the glass shield. So if you saw the picture I did of myself and Elon and BloodPop, Michael, who's a famous producer for Justin Bieber and Lady Gaga who's a friend of ours, Mike had to wear it too. So we're- I mean Elon had a mask on 'cause he had to take it off to do skits, but all the rehearsals, everybody was masked up, including the actors. And everybody was vaccinated. So they really are taking this seriously. And I understand because they, in New York, they had a ton of people die and to get a s- my understanding is what I heard second hand, was that Lorne Michaels had to get a special variance to keep Saturday Night Live on the air from, you know, the governor and the mayor and everybody had to sign off on it. But, um, I tweeted-

   14. DSDavid Sacks25:48

       This is not, this is not taking COVID seriously. This is, this is basically an irrational fear of COVID.

   15. JCJason Calacanis25:54

       Well, they, because they got hi- hit the hardest, David. So I think that they get hit the hardest and I tweeted, "Why is everybody wearing a mask in New York?" And of course, I got like 100, "Uh, because there's a pandemic." But then what, the, the two reasons that made sense were so many people died and there was so much suffering in New York, that people out of a sign of respect are still wearing them until they hit h- herd immunity officially. Um, which I know you could roll your eyes at David, but you know, they did have, it would be the equivalent of this-

   16. DSDavid Sacks26:18

       I don't, I don't think that's the real reason. I don't think that-

   17. JCJason Calacanis26:20

       No. Well, anyway, I do actually do think it's the real reason because peop- multiple people said to me, it's a way of showing people that you actually care about them and that you're going to really take this seriously until the end.

   18. DSDavid Sacks26:29

       No. I think it's, it's more what Ezra Klein said, which is this is the Red MAGA hat for Team Blue. This is pure virtue signaling.

   19. JCJason Calacanis26:36

       It's possible. Possible. The other thing they said was on a practical basis, in New York, you're, you know, on the subway, your office and in, you know, going into a cafe, you have to wear it and you're doing that 17 times a day. So taking the mask on and off just becomes less work than just leaving it on. That's, those were reasonable answers I got. But anyway, w- some- somebody summarize the story.

   20. DSDavid Sacks26:57

       Another, another reason I think is that, look, if you're, if you're in a blue part of the country, um, the media sources for Team Blue are still promoting this idea, uh, that outdoor spread is a thing, that it's, it's a risk. Um, we're, we're finally now getting... I mean, we- we've known since last summer that there were no cases, no documented cases of casual outdoor spread anywhere in the world. The Atlantic was reporting on this, okay? This is not a conservative publication. This is a liberal p- a, a skewed liberal publication.

   21. JCJason Calacanis27:30

       Yeah. Liberal leaning.

   22. DSDavid Sacks27:30

       Okay? Yes, exactly. So we've known since last summer. I mean, when Gavin Newsom declared that we weren't allowed to go to the beach, it was widely mocked. And so only now is the CDC getting around to loosening its guidance on outdoor mask wearing, but it's still not loose enough. And so there was a great article by David Leonard in the New York Times that just came out, I think, yesterday or two days ago called, about the cautious CDC and, and what he said is... By the way, this just validates everything we've been saying on the pod for the last few months. Leonard chronicles the, the sort of absurdly conservative, um, guidance given by the CDC. Basically, the CDC continues to suggest that outdoor transmission accounts for up to 10% of cases when the real number is certainly under 1%, is probably under 0.1%. And this is all based on a single study in Singapore where, that was misclassified, it was based on a construction site that really wasn't even an outdoor spread. And yet the CDC still insists that unvaccinated people need to wear masks outdoors, that vaccinated people wear them in large public values, and that children at summer camp wear them at all times. This is the current CDC guidance. And so yesterday when the head of the CDC was pulled in front of a congressional hearing and asked about this, uh, she doubled down on this less than 10%. And, and the reason why it's so misleading is technically speaking, less than 10% is correct, but when the real number is 0.001% or something like that, it's highly misleading to give 10%. And the reason-

   23. CPChamath Palihapitiya29:03

       Well, the, the line in the article which I loved is, "It is accurate to say that sharks eat less than 200,000 humans a year, but it is also more accurate to say sharks attack 150 humans a year."

   24. DSDavid Sacks29:16

       Right.

   25. CPChamath Palihapitiya29:16

       And the 150 is very different than 200,000, but if you say sharks attack, you know, 200,000 people or less a year, you would think that it's a, it's a much bigger problem than it actually is. And I think that's the whole point, which is we, um, we're not being scientific. We're being emotional and reactive.

   26. DFDavid Friedberg29:34

       And the paper that Leonard, um, references, basically they took this data that identified how spread was occurring empirically and identifying, you know, through tracing, you know, where are people actually picking up COVID, and that's really where this empirical evidence suggests we're talking about a less than 0.1% casual outdoor spread rate. And you can see that empirically in the data, but then there's also this deterministic kind of approach where you could say like, "Look, how does spread happen?" Spread happens with viruses. We know that viruses need to live in liquid in order to survive. When you're outdoors, if there's any amount of wind or UV light, um, the virus can very quickly degrade, the protein can degrade, the RNA doesn't transfer. And so there's a deterministic rationale for, scientific rationale for why that may be the case. And this evidence that this paper which have now shared kind of gathers together shows that, um, you know, that, that is indeed what the statistics are showing. Um, and so yeah, you're right, but I think the, the precautionary principle, David, is where the argument would be made on the other side which is, you know, what's the cost of wearing a mask if there's any risk at all? Um, and by the way, I'm not, I'm not making this case personally, but I think that's where a lot of people would, would make the counterargument...

   27. CPChamath Palihapitiya30:43

       ... um, rather than debate the fact and the evidence and the science, they would say, "But who cares? It's just a mask. Why does that matter?" Um, and so I think the question is why does it matter, right? Like, why does it matter if they're telling us to wear masks? Is there really that much of a cost to people to do that?

   28. DSDavid Sacks30:59

       Well, I mean, if people are doing it voluntarily, that's their right to, to do so. But the question is mask mandates. Should we continue to have mandates on the population for something that isn't necessary? And look, I was one of the first people in March of 2000 to call for mask wearing and mask mandates because we were seeing the data out of the Asian countries showing that they were effective. They were high-cost, or high-benefit, low-cost. So I was in favor of it when there was a p- a pandemic raging. But when T is zero, the rate of transmission is in free fall everywhere, and now we've learnt that outdoor spread is not an issue, I don't support restricting people's freedom. And i- f- y- you know, for- for- for- a, uh, uh, for a reason that's not rooted in science. And, you know, the problem with the CDC guidance is that people really act on it. So you've got politicians, you got local jurisdictions who will not-

   29. CPChamath Palihapitiya31:51

       Oh, yeah. Schools. Schools.

   30. DSDavid Sacks31:53

       You have schools. I mean, so the schools have remained closed. And by the way, the schools have been open in Texas and Florida for six months. We know, based on empirical data in the real world, seeing what's happening in Texas and Florida, that you're not seeing an increase in COVID cases in those places because of school reopening, and yet the CDC has not moved its guidance on school reopening. You have summer camps now that, for liability reasons, will make kids wear masks because they can't take the risk of getting sued. And then you've got politicians like Evan Newsom who won't wipe their ass without the CDC's permission to do so. So it has a real consequence in the real world that the CDC is stuck on this ridiculous guidance.
3. 39:10 – 48:32

   Reacting to Stanley Druckenmiller's thoughts on current Fed policy, decoupling of capital markets from policy

   1. DSDavid Sacks39:10

   2. DFDavid Friedberg39:10

      By the way, I think this is a good transition to that Druckenmiller interview, because, um, you know, uh, Sax, I just retweeted, uh, what you had sent, which was a link to the, uh, to the video, uh, interview. So, um, you know, Stanley Druckenmiller is this, uh, um, uh, incredible, uh, in-

   3. DSDavid Sacks39:25

      Goat.

   4. DFDavid Friedberg39:25

      ... incredible investor. The- the goat, the-

   5. CPChamath Palihapitiya39:27

      G-O-A-T, goat.

   6. DFDavid Friedberg39:29

      There's a- there's this- there's many stories about Druckenmiller. At one point, you know, he's the guy that notoriously, they say, broke the Bank of England, where he was betting against the British pound and forced the- the- the- the central bankers in- in the UK to devalue the pound. And he's made billions of dollars managing initially George Soros's money and then, um, s- spun off and runs his own money now as an investor. And so he- he's a- a- a macro guy, so he thinks about kind of macroeconomic conditions and effects, and he talks a lot about Fed policy. So he gave this interview on CNBC, um, and I think the, uh, you know, the- the- the most kind of prescient quote, uh, and- it was also based on an op-ed he wrote, right, Sax? In- in The Wall Street Journal?

   7. DSDavid Sacks40:07

      Yeah. Yeah.

   8. DFDavid Friedberg40:08

      Yeah.

   9. DSDavid Sacks40:08

      But the interview is fantastic. The TV interview is great. Just watch that.

   10. DFDavid Friedberg40:11

       The interview's great. And he said, uh, in- in- in the writeup, he said, "Clinging to an emergency after the emergency has passed," uh, "is- is what the Fed behavior indicates right now." And I think that, you know, kind of what we're talking about broadly is perhaps the emergency in the United States where you have this uncontrolled increase in COVID cases, that's not the case today, so the emergency has passed. We still have COVID, but it is not an emergency. And the point is, there's a lot of institutions and individuals and businesses that are still operating as if we were in the throes of the emergency. In- and so Druckenmiller is making the case-

   11. DSDavid Sacks40:47

       The Fed.

   12. DFDavid Friedberg40:47

       ... that the Fed-

   13. DSDavid Sacks40:47

       Especially the Fed.

   14. DFDavid Friedberg40:48

       ... and the Fed policy is acting as if we're in an emergency. But broadly, we're seeing this across a lot of institutions like the teachers unions and others, where people are effectively, you know, never let a good emergency go by without taking advantage or whatever the- the saying is.

   15. CPChamath Palihapitiya41:00

       Never waste a crisis.

   16. DFDavid Friedberg41:01

       Never waste a crisis. And the crisis- keep the crisis going is kind of the model everyone's in right now, which is like-

   17. CPChamath Palihapitiya41:06

       Milk the crisis.

   18. DSDavid Sacks41:07

       Totally. They are.

   19. DFDavid Friedberg41:07

       ... milk the crisis.

   20. DSDavid Sacks41:08

       They're keeping it going as long as they can. And Druckenmiller gave some pretty amazing quotes. He said that... Well, first of all, he described our current monetary fiscal policy as being the most radical he had ever seen. And this guy's been watching markets for decades. The Fed has pumped 2.5 trillion of QE into the economy, post-vaccine, post-retail recovery. He said that right now retail demand is five years above trend, meaning not only has retail demand fully recovered, it's where, if you look at the trend line, it would be five years from now. So they are pumping, like, demand like crazy. They've issued six trillion of new debt. And then this is the thing I didn't know at all, he said the Fed is buying 60% of new debt issues. Without this, the bond market would be rejecting this massive fiscal expansion, because interest rates have become prohibitive. And he said that when- when interest rates revert to the norm, the historical norm, interest expense on our debt will be 30% of the government budget. So, I mean, think about that, that-

   21. CPChamath Palihapitiya42:08

       Well, just... Ju- look, the- the- the markets have had to intervene, and we have essentially decoupled, um, what the government thinks is happening with what the capital markets needs people to know. And that's a really unique dynamic. Like, I mean, I'm- I- I'm not nearly as successful as Stan or have been in the markets as long as him, but in my 20 years, this is the first time I've really seen it. So just to give you a sense of this, you know, the markets are now acting to establish inflation expectations that the Fed just seems to not want to do anything about. And what was... So for- just to give you guys a sense of this, like, you know, when... In February, the markets really kind of had its first capitulation.What happened was that all of a sudden people digested all these facts that Stan just said and realized, "Wait a minute, like, all of this money is going to drive prices higher." And so what they did was they took the, they took the yield on the ten-year bond up by, like, 150... 100 basis points and the markets freaked out. They went from, like, 0.75 to 1.75. And the Fed came out and said, "Hey, hold on, nothing to see here. This is... Everything's gonna be fine." But then everything since then has been tr- sort of leading to this realization. Commodity prices are up 50%. There's this kind of, like, joke that, like, you know, you see a bed of lumber moving across a railroad, that's like a billion dollars of lumber, just 'cause of how expensive it is. You know, there are shortages everywhere. You'll be shocked to know that today Chipotle put out the following guidance, which is, they said they are increasing the minimum wage to $15 and that within three years, you can make $100,000 a year at Chipotle.

   22. JCJason Calacanis43:57

       Yeah.

   23. CPChamath Palihapitiya43:58

       That is as much as some engineers and coders in the United States. Dara Khosrowshahi, the CEO of Uber, said on, uh, the Uber earnings call last week that the, um, average hourly rate that some drivers in New York, Uber drivers in New York were getting paid was 38 bucks an hour.

   24. JCJason Calacanis44:19

       What?

   25. CPChamath Palihapitiya44:20

       $38 an hour. So what does all of this mean? I think what Stan is trying to say-

   26. JCJason Calacanis44:24

       That's 100,000 dollars a year.

   27. CPChamath Palihapitiya44:25

       But we're in this weird place where we've decoupled. The government institution that's responsible for fiscal stability and then the overall capital markets used to work in tandem and they're no longer working in tandem, because you have a narrative and a set of data points that aren't supported by the facts. And so this is an interesting thing. So in the CDC versus the American people example, there's no way to push back, right? I mean, governors can act independently, cities will act independently, but at the end of the day, you know, the teachers unions are working with the, the CDC, the school camps have this guidance and you're stuck in this morass. In the capital markets, that's not necessarily true, and so you can change and you can, you can re-rate asset prices based on sentiment. And I think what everybody is saying in this example is, "We're past the emergency. We've put too much money in the economy. We need to reopen and we now need to face the fact that there are massively rising prices, which means that there will be inflation. And if you don't act, the capital markets will continue to act for us." And so this is an example today where you're just seeing a bloodbath in the markets. And by the way, the, the only time the two government officials tried to be on the either side, Janet Yellen last Friday kind of casually in an interview kind of put her toe out in the water as Treasury Secretary and kind of said something that said there could be inflation and literally was hand slapped and had to put out something that disavowed her comments less than 24 hours later. Um, so that's where we are.

   28. DSDavid Sacks46:01

       Well, there, you know, there, there's, there, there's a bloodbath in the markets today and there's been one for the last couple of months, and in particular, all the growth stocks have been hammered. And just to build on what you're saying, Chamath, so there's a announcement today, there's some data that the, the, uh, inflation, the CPI is up 4%, uh, and climbing. And so people are now pricing in big interest rate increases and so that makes growth stock, that hammers growth stocks because all the earnings are in the distant future, and so they get now discounted at a higher rate, and so the valuations get absolutely hammered. So w- you know, it's, it's, it's absolutely souring, uh, the, the markets are basically souring on this Biden agenda and, you know, I just, you know, I, I, I'm beginning to wonder if Biden's gonna be a Jimmy Carter here because frankly all he had to do was leave things well enough alone. COVID was winding down, we had a vaccine, all they had to do was distribute it to as many people as possible, end COVID, let the recovery take shape, and instead they pushed this insane $10 trillion agenda of taxes and spending that are now over-stimulating the economy, that are causing inflation, that are now-

   29. CPChamath Palihapitiya47:12

       Now hold f- hold on one second.

   30. DSDavid Sacks47:12

       ... creating interest rate increases.
4. 48:32 – 1:05:23

   America's real-time UBI experiment, Business Insider's piece covering All-In

   1. CPChamath Palihapitiya48:32

      not working and that-

   2. JCJason Calacanis48:33

      This is the key issue right now for a lot of businesses. I mean, you have restaurants that are overbooked, cannot get servers. Jim Kramer was saying he's, he's up to $18, you know, per hour per servers. He's gonna move it to 20, it won't make a difference because with that extra 300 I think in federal st- uh, federal unemployment plus 300 to 700 I think depending on where you are, you're now at 60%, 70%, 80% and people are like, "Well, people will still go to work." And it's like-Yeah, but you're saving commuting and you probably have side hustles and you've lowered your commuting expense, so what is going to incentivize people to go back to work? We are now running a dry run with cryptocurrency and, you know, stimulus, uh, UBI experiment. And the result of this UBI experiment is, uh, negative economic growth or, uh, throttled economic growth. We cannot be productive if people don't want to work and contribute. We- we- we-

   3. CPChamath Palihapitiya49:27

      So just to your point on- on Friday.

   4. JCJason Calacanis49:29

      ... need more people to go to work.

   5. CPChamath Palihapitiya49:30

      So just to your point on Friday, Montana, which was part of the federal government's, um, you know, pandemic-related UI benefits program, basically said that we're canceling those benefits and we're opting out. And on top of that, I think they're now offering a $1,200 bonus to return to work. And the problem is because state- Montana now has a severe labor shortage, but it's not just Montana, it's every state in the union. So we have these two opposing forces, right? We have so much stimulus. We have, um, an under-motivated labor force. We have more taxation that's also just going to be wasted, so very poor ROI. And then now we have input costs going up, um, and prices going up to try to attract people. It's- it's all going to drive price inflation.

   6. JCJason Calacanis50:14

      Here's the, um, here's the quote from the governor of Mississippi, "The purpose of unemployment benefits is to temporarily assist Mississippians who are unemployed through no fault of their own. After many conversations over the last several weeks with Mississippi small business owners and their employees, it has become clear that the pandemic unemployment assistance and other like programs passed by the Congress may have been necessary in May of last year, but are no longer so in May of this year." And can you imagine the hit you're going to take from voters, from woke mobs, from people who believe in income inequality when you say, "I think we have to stop sending people free money so they go back to work." Like this is a very hard position to take, um, and i- we now have this occurring on a micro basis in California. We have a s- is- is it true we have a $75 billion surplus this year as the city devolves?

   7. DSDavid Sacks51:06

      Yes. Yeah, well-

   8. JCJason Calacanis51:06

      And now we're going to take that, and instead of lowering taxes and maybe trying to get Tesla or Oracle or other venture capital firms that have left, instead of doing that, what would be-

   9. DSDavid Sacks51:16

      Right.

   10. JCJason Calacanis51:17

       ... what would be, what would, what could we do, David, with that $75 billion?

   11. DSDavid Sacks51:19

       Okay, well, okay, so great point. So the $75 billion surplus, one-third of that is a f- is from the federal bailout, which obviously we don't need, and that's the money printing that's coming out of Washington. (laughs)

   12. JCJason Calacanis51:28

       So we're giving that back, right, to another state that could use it?

   13. DSDavid Sacks51:30

       (laughs) Yeah, good luck. Good luck. Exactly. No.

   14. JCJason Calacanis51:32

       Yeah, okay.

   15. DSDavid Sacks51:33

       The other two-thirds is because last year, we had all these unexpected tax receipts from the stock market boom, and so you had-

   16. JCJason Calacanis51:39

       Ah.

   17. DSDavid Sacks51:40

       ... all these California taxpayers paying capital gains on that.

   18. JCJason Calacanis51:43

       Mm-hmm.

   19. DSDavid Sacks51:43

       So, but- but what this highlights to me is, and I want- what I wonder about, is how many of those taxpayers have left the state? Because we know that we had net migration loss of a 182,000 in 2020. So how many of those people left the state and won't be paying taxes this year? And if Biden breaks the stock market through this insane tax and spend, then where is this, like, surplus going to come from next year? And what this highlights to me is, I think we have people in Washington and Sacramento for that matter, who've lost sight of the fact that ultimately, the private sector and the- and the public sector are a partnership, because the private sector generates the largess and the wealth to fund the public sector and to fund the creation of these public goods, to fund education, to fund law and order, to fund social programs. And they've stopped seeing it that way. They see the private sector not as something like a cow to be milked or a, you know, or- or, um, you know, or a sheep to be sheared, but they want to skin the sheep instead of- instead of shearing it. And, um, and so they're- they're really at risk of- of, or, you know, killing the golden goose. I guess you could put it, put it that way. Um, you know, and I think that, you know, during the Clinton years, just to take, uh, just to take a contrast, we had a- a government spending as a per- federal government spending as a percent of GDP was between 8.5 and 22%. That was the range, and we had a boom. Uh, so when you have a federal spending as a percent of GDP around 20%, it works, right? And that doesn't mean you can't increase government spending. It just means that government spending will increase as the economy gets bigger. But what you have now is federal spending over 30% of GDP and everything is starting to break. That's the problem.

   20. CPChamath Palihapitiya53:27

       Very, very big problem.

   21. JCJason Calacanis53:29

       A- and of course-

   22. DSDavid Sacks53:30

       And that's why we're all getting red-pilled, right? How many people in Silicon Valley, frankly, who make a living off growth stocks are now starting to scratch their heads going, "Gee, what did I vote for?"

   23. JCJason Calacanis53:40

       Uh, it's definitely becoming a thing, and, uh, uh, I would say the- the purple pill party, you know, like chop it up. Let- let's mix-

   24. DSDavid Sacks53:48

       (laughs)

   25. JCJason Calacanis53:48

       ... these two things. Let's candy flip, whatever it takes-

   26. CPChamath Palihapitiya53:50

       (laughs)

   27. JCJason Calacanis53:50

       ... like to get out of this... You know, we got to get this party restarted, because-

   28. CPChamath Palihapitiya53:54

       Centrism is the answer.

   29. JCJason Calacanis53:55

       It absolutely is. And you know-

   30. CPChamath Palihapitiya53:57

       Centrism is the answer.
5. 1:05:23 – 1:19:15

   Friedberg's science corner: synthetic biology IPO/SPACs, stem cell breakthroughs & more

   1. JCJason Calacanis1:05:23

      hey, um, there's a lot going on with synthetic biology. We saw two, uh, different IPOs in, I believe, the last month or so. Tell us about, um, the, the gink- Ginkgo Bioworks public offering and the Zaragogen IPO.

   2. CPChamath Palihapitiya1:05:41

      Zaragogen? Well, so-

   3. JCJason Calacanis1:05:42

      Zaragogen?

   4. CPChamath Palihapitiya1:05:42

      So, so the, the premise of synthetic biology, which dates back, you know, many years, right? Genentech is one of the first companies, uh, to, uh, effectively use synthetic biology to, uh, to, to make products. So, you know, Genentech and Amgen started making these proteins that, that became biologic drugs. And the way you, um, you can kind of think about synthetic biology is the DNA is software, and we can program the software to get the organism of the, uh, uh, you know, whatever DNA we're changing to make something that we want to use. And so synthetic biology is all about editing the genome or editing the DNA of an organism, um, editing its DNA, uh, and doing that in, in a way that you can kind of make a product. And so this was done initially for biologic drugs. Um, and, and over the last kind of 20 years or so, using synthetic biology as a, as a kind of approach, we've kind of thought about, well, how can we make things like fuel and increasingly more commoditized products like, um, you know, proteins that we might consume for animal consumption, uh, instead of using animals to make proteins. Um, and so the underlying technologies have all followed, uh, an accelerated path that's greater than Moore's Law. You know, DNA sequencing costs have dropped faster than Moore's Law over the last 10 or 15 years. The ability to synthesize or print DNA, uh, CRISPR per- per- you know, kind of provides us with a set of tools to do much more precise DNA editing and, and so on and so forth. And there's just a confluence of technologies, sort of like there were leading up to the, uh, personal computing revolution.

   5. DFDavid Friedberg1:07:17

      ... that are now gonna enable this incredible p- proliferation of a new industry that many argue will rewrite all industrial, um, uh, uh, systems. All industry that makes everything that humans consume, from materials, to food, to the chemicals, to the plastics. Everything that we use in our daily life can be rewritten using synthetic biology. And so the promise of this dates back, again, like, two decades or so. There was a company called Amyris that John Doerr backed, uh, that was one of the first companies that was one of the few companies from the original synthetic biology companies that actually survived and made it through, and they're still around. They're still a publicly traded company. And more recently, there have been these kind of more digitally enabled, at least that's the premise that they kind of make for, for what, for their businesses, companies. So Zymergen, which was, you know, got a bunch of SoftBank money, they raised a billion dollars as a private company. Uh, they got public with, like, I think 13 or 14 million of revenue. Uh, and then they're worth $5 billion in their IPO, so they just went public. Um, and this other company called Ginkgo Bioworks, uh, which is a similar sort of, you know, synthetic biology platform company, just went public, uh, ve- or just announced that they're going public via a SPAC at a $15 billion market cap with, you know, uh, uh, I think less than 100 million of revenue. So, um, you know, the, the game is on. And I, and I think one way to kind of think about this i- is, um, these businesses aren't great businesses today, but the promise of the next century being, um, all about synthetic biology, you know, where, where biology becomes software, and you can program biological organisms to make and print pretty much anything we as humans consume, is a premise that everyone believes is gonna come to fruition this century. And it will completely reinvent the industry, will improve sustainability. I think it is gonna be the great savior for this planet and for our ability to sustain on this planet. So these are kind of, you know, two big IPOs that validate that the capital markets are there. There's so many big institutional investors, Chamath can share more on this, that are, like, backing, quote unquote, "ESG companies." Synthetic biology is this kind of ESG, you know, moment. Um, and, uh, and, and, and, and I think-

   6. JCJason Calacanis1:09:19

      So-

   7. DFDavid Friedberg1:09:19

      ... these two IPOs happening at the valuations that they're happening at and the capital that's going in, I think these are kind of, like, the Netscape moments for synthetic biology, and we're gonna see a tremendous amount happen over the next couple of years.

   8. JCJason Calacanis1:09:29

      So Chamath, how close are these from being science projects in a lab to being scalable revenue companies, in your estimation? 'Cause these are de minimis amounts of capital we're talking about, so this feels like-

Episode duration: 1:23:26