Inflated GDP?, Google earnings, How the media lost trust, Rogan/Trump search controversy, Election!

Jason Calacanis 0:00 We had dinner last week, and Sacks and I got bombed last week.

David Sacks 0:04 (laughs) Oh my God.

Jason Calacanis 0:04 We had dinner and we drank a quadruple Casa... What? Azul.

David Sacks 0:10 I've not seen JCal drink like that before.

Jason Calacanis 0:12 Ooh, I was so drunk.

David Sacks 0:13 I stalked him for a few minutes while he was drinking.

Jason Calacanis 0:14 I mean, Casa Azul-

David Sacks 0:16 He tore my house apart getting back in.

Jason Calacanis 0:19 Oh my God, that's so true.

David Sacks 0:20 Like a, like a bear. Like a bear.

Jason Calacanis 0:21 I went Brooklyn style.

David Sacks 0:22 He was like a bear. He was like a drunk bear.

Jason Calacanis 0:24 But, uh, I spoke to the lady of the manor and I will be staying at Sacks' house next time, so I will be able to-

David Sacks 0:31 Nice.

Jason Calacanis 0:31 ... refresh the ranch's soap and-

Chamath Palihapitiya 0:33 Wait, really?

Jason Calacanis 0:33 ... towels. Yeah, I'm staying at your place.

David Sacks 0:35 (laughs)

David Friedberg 0:35 (laughs)

Jason Calacanis 0:35 I need... You know what? I forgot to get towels when I was at Chamath's. He's got these amazing embroidered towels, so I'll just hit those up when I hit your place. Um, but I-

Chamath Palihapitiya 0:43 It's gonna be really funny to go to JCal ranch and there's gonna be a big S on his towels.

Jason Calacanis 0:47 (laughs) There'll be an S.

David Sacks 0:48 (laughs)

Chamath Palihapitiya 0:48 We'll just be like, "Wait, why, why is there an S on-"

Jason Calacanis 0:50 I got the robe that says DS on it.

Chamath Palihapitiya 0:52 "... All our towels at JCal Ranch?"

David Sacks 0:52 (laughs)

David Friedberg 0:52 (laughs)

Chamath Palihapitiya 0:52 (laughs)

Jason Calacanis 0:53 I've got a robe on the back, it says MAGA. (laughs)

David Sacks 0:57 (laughs)

David Friedberg 0:57 (laughs)

Jason Calacanis 0:57 I took all the MAGA robes from-

David Sacks 0:59 What does, what does the S stand for? He goes, "Grifter." (laughs)

David Friedberg 1:03 (laughs)

Jason Calacanis 1:04 Oh, it's so funny.

Chamath Palihapitiya 1:05 Steals.

David Sacks 1:07 (laughs)

David Friedberg 1:08 (laughs)

Chamath Palihapitiya 1:08 (laughs)

David Sacks 1:08 He's got a bunch of towels that say C as well, cheap.

Narrator 1:14 I'm going all in. Don't let your winners ride. Rain Man, David Sacks. I'm going all in. And I said. We open sourced it to the fans and they've just gone crazy with it. Love you guys. Queen of quinoa. I'm going all in.

Jason Calacanis 1:30 All right, listen. Happy Halloween to everybody, and we've got a great docket for you today, but I just upfront wanted to let people know that we will be having the All-In Holiday Spectacular on December 7th at the Palace of Fine Arts in San Francisco. It's gonna be amazing. Allin.com/Events. And next Tuesday, that's right, November 5th, if you go to our YouTube at 7:00 PM Pacific Time, 10:00 PM Eastern Time, we are going to do an election night live stream for the fans. We're almost at 700,000 subscribers, so subscribe to comment and join us on our live stream on Tuesday night.

David Sacks 2:11 There'll be guests, right?

Jason Calacanis 2:12 There's gonna be some fun guests. I think Hellmuth is still banned by Chamath for life, but I may bring him on and let, give him a second chance. Chamath, is that okay-

David Sacks 2:21 Mm-hmm.

Jason Calacanis 2:21 ... if bring him on for a second chance?

David Sacks 2:24 Sure.

Jason Calacanis 2:24 Okay. So f-

David Sacks 2:25 (laughs)

Jason Calacanis 2:25 ... we're gonna give Hellmuth a second chance-

David Sacks 2:28 Dick Dickner has spoken.

Jason Calacanis 2:28 ... but we'll see. He's gonna be on a very tight leash. If he makes it about himself in seven seconds or less, seven seconds to Phil Hellmuth, he's gonna get kicked right off the show.

David Sacks 2:37 Okay, holiday party. Did we announce that?

Jason Calacanis 2:40 Yeah.

David Sacks 2:40 Yeah.

Jason Calacanis 2:40 So the holiday party-

David Sacks 2:41 Pretty cool.

Jason Calacanis 2:41 ... go to allin.com/Events if you wanna come. It's gonna be great.

David Sacks 2:45 You guys aren't gonna be happy, but we are setting... Uh, we are gonna spend a million dollars on this party. (laughs)

David Friedberg 2:51 (laughs)

Jason Calacanis 2:51 How did you spend a million dollars on a party?

David Sacks 2:53 (laughs)

David Friedberg 2:53 (laughs)

Jason Calacanis 2:53 Dude.

David Sacks 2:54 I think, well-

Jason Calacanis 2:54 Did you see the set he built last time for-

David Sacks 2:56 The, the- That sounds like a lot of founder mode.

Jason Calacanis 2:58 Yeah.

David Friedberg 2:58 That's a lot of f-

David Sacks 2:59 It's gonna be-

Jason Calacanis 2:59 Yeah. About 300,000 in founder mode.

David Sacks 3:02 We'll probably, we'll probably lose money on the party, but it's gonna be... It's not meant to be, call it a profit center, but it's just gonna be super fun. Gonna be a great party.

Jason Calacanis 3:08 You cannot put a price on a good time. And, you know, if you're gonna get that-

David Sacks 3:12 Freebird.

Jason Calacanis 3:13 ... premium founder m- mode-

David Sacks 3:14 Did you always want to be-

Jason Calacanis 3:15 ... it's actually-

David Sacks 3:15 ... a party promoter when you were, like, in high school and in college?

Jason Calacanis 3:18 So when I was in college, I had a DJ setup-

David Sacks 3:21 Oh, okay.

Jason Calacanis 3:21 ... I had, like, synthesizer setup, which I plugged in and I did live-

David Sacks 3:24 (laughs)

Jason Calacanis 3:24 ... electronic music with my DJ set.

David Friedberg 3:26 I'm gonna drop the beat, Chamath.

David Sacks 3:29 Yeah.

David Friedberg 3:30 (laughs)

Jason Calacanis 3:31 (laughs)

David Friedberg 3:31 I'm gonna drop the beat.

David Sacks 3:33 (laughs)

Jason Calacanis 3:33 Here it comes.

David Friedberg 3:34 (laughs)

Jason Calacanis 3:35 A couple of, uh, my startups now are doing something interesting. Ethena, uh, bought, like, a pack of tickets and they're doing, like, a holiday party there with their top-

David Sacks 3:43 For our event.

Jason Calacanis 3:44 For our event. They basically bought a bundle of VIP tickets and they're giving them to the top customers and their top employees to come-

David Sacks 3:50 That's cool. Yeah.

Jason Calacanis 3:50 ... and make it like their holiday party in San Francisco with our customers, so that's kind of neat. Smart move by them. And so if you, uh, have a startup and you wanna bring your startup, you can buy a, a pack of tickets as it were.

David Sacks 4:01 That's actually a really good idea. A bunch of these small startups should just co-opt our holiday party as your holiday.

Jason Calacanis 4:07 Precisely.

David Sacks 4:07 (laughs)

Jason Calacanis 4:08 Yeah, just buy 10 tickets and come.

David Sacks 4:10 Hey, Freebird's gonna go blow a million bucks-

Jason Calacanis 4:12 (laughs)

David Sacks 4:12 ... he might, he just might as well-

Jason Calacanis 4:14 (laughs)

David Friedberg 4:14 Wow.

David Sacks 4:14 ... co-opt it.

Jason Calacanis 4:14 I'm hopeful today we're gonna sign this DJ, um, which is-

David Sacks 4:18 Ooh.

Jason Calacanis 4:18 Everyone, everyone knows the DJ and it is gonna be pretty sick if we can get that started.

David Friedberg 4:21 He's a degenerate gambler. We know him. We play poker with him. (laughs)

David Sacks 4:24 (laughs)

Jason Calacanis 4:24 Whatever we pay him, he's gonna lose-

David Sacks 4:26 Yeah.

Jason Calacanis 4:26 ... twice as much at the poker game. Let's just-

David Sacks 4:28 Yeah.

Jason Calacanis 4:28 Let's call it what it is.

David Sacks 4:30 Sacks, can you host, um, poker at your house after the party?

Jason Calacanis 4:33 Yeah.

Chamath Palihapitiya 4:35 No.

David Sacks 4:36 (laughs)

Jason Calacanis 4:36 (laughs)

David Friedberg 4:36 (laughs)

David Sacks 4:36 (laughs)

Jason Calacanis 4:38 What a team player.

David Sacks 4:40 (laughs)

David Friedberg 4:42 (laughs) He built an entire poker building and he's used it, like, seven times.

Jason Calacanis 4:45 (laughs)

David Sacks 4:46 (laughs)

Jason Calacanis 4:46 So funny.

David Sacks 4:46 He's like, "David Sacks is just the absolute best."

Jason Calacanis 4:50 All right, let's get to work. You know what's winning as well, is the US GDP. Here we go. It grew a slightly slower than expected, but the top line numbers are healthy. Looks like the soft landing might be baked in. We'll see. On Wednesday, the Department of Commerce reported that real GDP grew 2.8% in Q3. Uh, that means it's adjusted for inflation. And, um, you know, you ha- you can't look at these things in a vacuum. You have to look at the other Western countries and, uh, their GDP. Japan, 0.7. Australia, 0.2. Germany, 0.2. Canada, 0.5. The world is not growing. US is growing briskly and, um, in terms of how to think about it, 2 to 3% is, uh, sort of the sweet spot for mature economies. Above 3%, positive, but can also signal overheating like we experienced during ZIRP in 2021. Under 2%, yeah, stagnation. Uh, US GDP was 30 basis points below the Dow Jones consensus forecast of 3.1%. There's your chart, uh, if you missed it. And, um, obviously inflation, we talked about this last week, is at 2.4%, very close to the 2% target. Unemployment, 4.1%, close to historic lows. 10-year Treasury, 4.3%, and obviously stock market at-... its all-time high again. There's your S&P, Dow, and Nasdaq. As we've talked about over and over again, Chamath, the federal debt is the issue, 35 trillion in debt. We have a trillion in annual interest payments on that debt. And Freberg, your pet peeve, 23.5 million directly and millions more indirectly. As we know, federal government employees now at three million. That's about one percent of the country. And, uh, state government employees, 5.5 million, local governments, 15 million. Put it all together and we got almost 25 million people working for our government. What do you think the prescription here is, Freberg, as we, uh, uh, come up on Election Day and we look towards next year? Do you believe we can cut this crazy spending? What do you think is gonna happen to the economy? Will it overheat? Soft landing? You're running a company now, so you have to think about this, obviously.

David Friedberg 7:05 Uh, well, I'll separate running a company, because I think that's got to be treated independently from macro. You can't build your business around macro. But 10-year Treasurys are sitting at just around 4.3%. I think what the market is telling us... And remember, that's off of a low. Right when the, the rate cuts were happening, if you remember, in mid-September, we got down to just around 3.5%. The market is telling us that with the sort of economic growth we're seeing, low unemployment, and, you know, call it modest inflation, this is not the time to be cutting rates. And the market is saying, "We are expecting higher rates for longer." So, I do think that that's one big kind of turnaround that's happened in the last 90 days, which is really a, I think a big surprise to a lot of folks, is just how robust things are relative to where folks thought that they were about 90 days ago, urging, pleading, and, uh, supposedly needing a big rate cut to get the economy moving again. But I think at the end of the day, everyone is looking to the election as kind of the next big moment-

Jason Calacanis 8:04 Yeah.

David Friedberg 8:04 ... in the economy. Both Trump and Kamala have made fiscal proposals that would be deeply expensive if you assume the, you know, these, these budgeting groups that go out and take their policy proposals and try and build a model against them, that they're both gonna add trillions of dollars to the debt, they're gonna increase deficit spending, et cetera. But the reality is that neither of them are actually gonna end up theoretically being able to execute all those policies, and there will likely be some degree of-

Jason Calacanis 8:33 So-

David Friedberg 8:33 ... of difference-

Jason Calacanis 8:35 ... that's a great point.

David Friedberg 8:35 ... to where we end up on spending.

Jason Calacanis 8:36 Chamath, a lot of talk about DOGE, the Department of Government, uh, what is the last word?

Chamath Palihapitiya 8:44 Efficiency.

David Friedberg 8:45 Efficiency.

Jason Calacanis 8:45 Efficiency, that Elon might be collaborating on. What do you think the chances are... He said there could be two trillion in, in savings that could occur. What are the chances that any meaningful cuts happen and we reverse the trend in, if Trump, say, he wins and he, and he, and he creates that position?

Chamath Palihapitiya 9:03 I think the first question that'll inform how dramatic the cuts are is whether we organize ourselves around an accurate sense of where the actual economy is. If you look at the print today, it would actually tell you that things are pretty okay and that we are not sort of near an unsustainable turning point. However, and Nick, if you wanna just throw up this chart, if you back out the percentage of government consumption that is included in GDP, you start to see a very different picture, which is that over the last two and a half years, all of the economic gains under the Biden administration have largely been through government consumption. What that means is that private industry has been standing on the sidelines somewhat, and that actually maps to a lot of this intuition that I've had over the last few months when I've said I think we're in a low-key recession. Because what I could never figure out is why I would look at the earnings transcripts of a bunch of companies who would constantly talk about softening demand... And by the way, this is across the board. It wasn't just CPG companies but Dropbox as an example, same sort of thing. They just laid off 20% of their staff and the, and the memo was about weakening demand. So, this is a broad-based softening as far as companies experience the economy, but the high-level number is positive, which would make you think that everything is fine. But when you look at that chart and you back out the percentage of the positive news that the government is responsible for, what it means is the economy is flat and the economy isn't growing, which means that roughly there are a bunch of folks that are seeing contraction. So, I think that if you normalize on that view of the world, I think the cuts that Elon will effect will be meaningful and necessary.

Jason Calacanis 11:18 If you, uh, pull up this chart, Nick, of the, uh, federal net outlays as percentage of GDP-

Chamath Palihapitiya 11:24 I mean, you're, you're-

Jason Calacanis 11:24 ... you get a good idea of the spending.

Chamath Palihapitiya 11:25 ... basically at a, you're, you're at a flat, stalling economy.

Jason Calacanis 11:29 Well, if you look at this, you know, we, we basically have had high teens during our lifetime, Clinton era, '70s and '80s, and then, uh, it's gone up into the 20s now. So, that is definitely something, the amount of spending we're doing.

Chamath Palihapitiya 11:44 No, but, uh, sorry. Just, uh, again, this is where you can get a little confused by data. Jason-

Jason Calacanis 11:48 Yeah, sure.

Chamath Palihapitiya 11:48 ... this is net outlays.

Jason Calacanis 11:50 Yeah.

Chamath Palihapitiya 11:50 And that's different from total gross government spending, which also includes QE. So, if you go back to the other chart, why is this one going down and the other one represents 85% of GDP? It's because that one is a more accurate sense of what the government is doing across all of its tentacles in the United States economy. It includes the money printer going brr, which the net outlays chart doesn't include.So just to be clear about what's happening, 85% of this quarter's GDP was induced by the government. If you sub- if you sub it out, so take 2.8% and multiply it by .15, that is the true growth ex the United States government that exists in the United States economy today.

Jason Calacanis 12:33 Sax, your thoughts here on the GDP. Obviously looks pretty good for Biden-Harris to have all these stats going in their favor, but there is the caveat, obviously, about the government spending in there.

David Sacks 12:48 Yeah. No, I think that's right. I mean, I- I think that for Harris in this election, it's probably a little too late for this GDP report to be helpful.

Jason Calacanis 12:58 Hmm.

David Sacks 12:58 If you go back all the way to 1992 where the whole election hinged on the economy, remember that was Bill Clinton running against George H.W. Bush and Clinton's message was it's the economy, stupid.

Jason Calacanis 13:10 Yep.

David Sacks 13:11 And, um-

Jason Calacanis 13:11 Carville, right-

David Sacks 13:12 ... H.W.-

Jason Calacanis 13:12 ... came up with that?

David Sacks 13:13 Carville came up with it, and- and Clinton beat Bush because we had a recession in, I think, '91. But by '92, it was over already, and in the final week of the campaign, Bush tried to tout a similarly positive GDP report that showed 2.7% growth. That report would later be revised up to 3.9% growth. So the recession was definitely over and the economy is growing again, and nonetheless, Bush lost because voters' impressions of the economy had already formed and solidified by the final week of the campaign. So, I think it's probably too late here for the GDP numbers to have a big impact on the election. I think the other thing is that voters' impression of this economy isn't based so much on the GDP numbers. It's really based on their perception of inflation over the last four years, and there's no question that the cost of living has increased a lot over the last four years and voters are really feeling that, and that, I think, is- is playing into their perceptions of the economy, and I don't think that Harris has a great answer for that. So- so I think the- the bottom line here is I don't think this report's gonna have a big impact on- on the election. In terms of where the economy is going, the- the thing that I would come back to is interest rates, and this is the thing that Friedberg was talking about, which is even though the Fed has cut rates by 50 basis points, the long-term rates, the 10-year Treasury, has not gone down. In fact, it's gone up slightly. You know, it's gone up to, call it 4.3%. And so we have this real issue where as the Fed is cutting short rates, long rates are not going down, and I think that is because of the government deficit and the government debt and the fact that there's so much debt that needs to be serviced by the bond market.

David Friedberg 15:09 And the market for Treasuries.

David Sacks 15:11 Right, and-

David Friedberg 15:11 There's just no... The buy- the buyers are all leaving the market for Treasuries. The Chinese, we talked about this last week, have been selling down their Treasury position. There just aren't buyers anymore, which is, um...

David Sacks 15:20 Right, and I- and I think this could- this could ultimately have a very detrimental effect on the economy. You already saw that... I think, uh, this hasn't been widely reported, but I think it should be a major piece of news, which is the prime rate hit 8% today. So it now- it had a seven handle on it before and now has an eight handle on it. Well, this matters a lot if you want to buy a house and get a mortgage. It's much more expensive. Then you got to think about all the people who already have debt.

Chamath Palihapitiya 15:50 Doesn't this look recessionary?

David Sacks 15:53 Totally, because a few years ago, you could get a- a home loan at a three to 4% interest rate, you know, and amortize that. Now your debt service costs can be twice as high, so you just can't buy as much house.

Chamath Palihapitiya 16:08 It's a very bad place if the economy's in the toilet, but we can't even talk about it because there is no structural way to get an accurate read because the government just perverts the effect it has in the economy. Like you can't have-

Jason Calacanis 16:23 Distortions. Yeah.

Chamath Palihapitiya 16:25 Yeah, distortion, fine. You- you cannot have a nonprofit entity representing the plurality of the economic activity of a country and expect the capital markets to function properly. At some point, the capital markets will basically throw their hands up in the air and puke it all out and say no. And I think that you're starting to see a little bit of these fissures, so I think we're gonna have to clean up our balance sheet pretty aggressively here.

David Friedberg 16:52 Yeah, and if you look at the importance of that rate, that rate drives the value of bonds. As the current market rate for Treasuries or for the prime rate climbs, the value of an existing bond that pays interest at a lower rate goes down because you have to pay a lower basis in order to get back to the new high rate that the market is telling you. So there are several trillion dollars, and we can pull up the- the graph here, Nick, of loans and bonds that are sitting on the balance sheets of many commercial banks in the United States that are now so significantly underwater where the value is now below the book that they paid for those loans or that they issued them at, that those banks now have unrealized losses. And I think that this number is one of the other kind of facts. You see a few articles come out here and there about this, but the number, as the rates go up, the number of unrealized losses, the- the dollar value of the unrealized losses of banks' balance sheets in the United States has climbed so considerably that it represents a real crisis. In fact, the unrealized losses on banks' balance sheets today is higher than it was-

Chamath Palihapitiya 17:58 Trillions.

David Friedberg 17:58 ... in 2008.

Chamath Palihapitiya 17:59 It's trillions. It's trillions. Buffett warned B of A publicly.

David Friedberg 18:04 He's been selling off. He sold off, right? B of A?

Chamath Palihapitiya 18:05 Well, he warned B of A publicly, although a bit obliquely last year during his annual conference, and it was very clear. It's like, listen, this is an opportunity for folks to just mark to market these securities properly and/or sell them and get them off the books.... I don't think B of A acted quickly enough. And so what did Buffett do? He just basically started dumping, and he's almost completely out of B of A, B of A, if not completely out altogether. So there's a lot of talk, if you look-

David Friedberg 18:37 A crisis is brewing.

Chamath Palihapitiya 18:38 There's a lot of talk in Finfoot if you go into sort of, like, the, the deep, far-reaching bowels of, of the, of the FinTech community on X, that there is a huge credit crisis looming amongst some of these large charter holding banks because of this exact issue.

David Friedberg 18:55 And the relation-

Chamath Palihapitiya 18:55 Yeah.

David Friedberg 18:55 ... between the Fed and the prime is typically 3%. So the Fed cuts rates and then the banks put 3% on top of it when they give people, creditworthy people, mortgages and credit cards. So as the Fed cuts, this should come down. But if it went up, what explains that? I'm curious if anybody knows.

David Sacks 19:16 Well, the Fed sets short rates. It sets the, the Fed funds rate, which is the-

David Friedberg 19:20 Yeah.

David Sacks 19:20 ... the rate of overnight lending between banks. But it does not set the 10-year Treasury, for example, the long-term, uh, debt-

David Friedberg 19:27 The market sets that.

Chamath Palihapitiya 19:28 The market sets that.

David Sacks 19:29 The market sets it. And the market now requires a higher rate of interest in order to accept, you know, the risk of investing in those bonds or i- it's not really. Since it's a US Treasury, it's not really risk, it's more about the time value of money and their expectations of inflation, how much that money's gonna be worth in the future. So I think what we're seeing is that the Fed can cut short-term rates, but it hasn't had the impact on long-term rates that everyone was expecting. I think everyone was expecting that we had this sort of, um, burst in inflation, the famous 9% inflation rate. I think people were expecting that that would work its way through the system and that we'd get long-term rates back to where they were. But that's not happening, and it's not happening for the reason we're saying, which is there's just too much debt out there. So now think about the impact on the real economy. Let's say that you're a home buyer and you got, like, a five-year interest-only ARM-type mortgage for your house.

David Friedberg 20:27 Tick-tock.

David Sacks 20:28 Yeah, so now, you know, you probably got that in the 3 to 4% range. If you have to refinance it this year at 8%, your monthly payment's gonna double. That has a real impact on people's wealth and o- and their spending power. Maybe they can't even support a payment like that. Now, go over to the commercial side and it's, it's very similar. There's a lot of commercial real estate out there, you know, buildings and so on, where they've got debt on it. You can't get 30-year mortgages in commercial. The typical commercial loan is five to seven years, okay? We're now coming up, I think, in the next few years, on a lot of that, that debt will need to roll, it'll need to be refinanced. If it gets refinanced at twice the interest cost, roughly, a lot of those buildings may be underwater. I mean, they may not be, you know, income positive-

David Friedberg 21:22 There's no equity value. Yeah.

David Sacks 21:22 There may be no equity value. And a lot of people know this now, but they don't really have to mark those positions to market. If they did, their equity would be worth zero, but they're kind of all on borrowed time right now, hoping that rates will go back down. And what we're seeing is that the long rates are not going back down. It's a pretty scary proposition. And then, of course, you know, a lot of the, the, the debt on those buildings, it's all owned by the commercial-

David Friedberg 21:45 Yeah.

David Sacks 21:45 ... banks that you're talking about, the regional banks. So they're sitting on a lot of bad debt that they haven't had to mark to market and they're just kinda hoping that this problem will get sorted out before, you know, before there's a default.

David Friedberg 21:59 And by the way, as these numbers climb, the cost to borrow for the federal government climbs. So the new bonds, we have to reissue a good percent, I think nearly $10 trillion, I think, of our debt has to be reissued in the next year. That's gonna get reissued now at this higher rate, and that higher rate means that the annual expense just to pay the interest on the existing debt is now climbing at a faster rate. And that means you've gotta issue more debt to pay for your interest on your current debt, so it becomes- It's quite paradoxical that the Fed sets that rate, right? (laughs)

David Sacks 22:29 Yeah.

David Friedberg 22:29 (laughs) Well, this, this becomes the compounding problem when your G- your debt to GDP reaches a certain level and you don't reduce federal spending fast enough, it becomes a compounding problem you cannot get away from. And this has been the beginning of the cataclysmic economic collapse of every great empire in the last 500 years. I know I've said this, you guys can joke about it all day long, but this is how it starts, is it starts at a point where you're arithmetically not able to get out of your debt spiral. And, uh, the markets are telling us that if the US doesn't take drastic action in reducing its spending and reducing the deficit levels so that we can actually address the payment obligations on the outstanding debt that we've already issued, the US dollar is gonna have a real problem and the creditworthiness of the United States is challenged. That's what the market says, but I know that there's other issues with the fact that there's no other better place to put money today and there's not a lot of other, you know, great economies out there and so on and so forth. But the stability of the United States, the hegemony of the United States and the dollar is challenged, in part by the fact that you've got this BRICS organization out there now that has greater GDP and aggregate than the US. And so there may be an alternative that emerges in the next couple years, and maybe everyone's kinda putting their assets away in, in gold and, and others, in Bitcoin and other stuff while they're waiting for the transition to find another place to buy. We'll see.

Chamath Palihapitiya 23:44 All right, well, and-

David Friedberg 23:45 But it's scary.

David Sacks 23:45 But what it, what it implies, if, if rates have roughly doubled, let's say, in the last few years, and they're gonna stay at that level, they're not going back down, it implies there's gonna have to be a big deleveraging, right? Because, you know, you can't support those interest payments. I mean, let's say that you own a building, right? And now all of a sudden-

David Friedberg 24:05 Well, that, it's, it's, well, in fact, it's ac- actually deleveraging or inflation because the alternative-

David Sacks 24:11 Right.

David Friedberg 24:11 ... is the Fed monetizes the debt, they start buying all the bonds, which means you're pumping more US dollars into the market, and that means that the cost of everything goes through the roof. So you have this effect of economic inflation, which is the way that you inflate away the debt problem, assuming people still wanna use your currency.

David Sacks 24:26 Yeah. Well, I mean, that's at the government level. I mean, I was talking about, uh, uh, the, the private sector. I mean, just think about it-

Jason Calacanis 24:30 Right.

David Sacks 24:31 ... at the level of, like, an individual building. You've got a loan on it, now you need to refinance the loan. Interest rates are twice as high. That, let's say that that doesn't, the, the building no longer produces operating income at that level of debt, so you have to pay down some of your debt. It's called an equity in refinancing, where you're not pulling money out, you're putting money in. You have to de-leverage in order to make your sort of income statement work, right? It's just too much debt at th- at that new level of interest rates. So, if rates stay high, there's no choice but for many people to de-lever, whether it's on the commercial side, or the, or, or on the consumer side. You just can't afford as much debt, right, at that higher interest rate. So, think about the impact that has on the economy when everyone has to de-lever.

Jason Calacanis 25:16 Yeah.

David Sacks 25:16 That's a very negative effect. And then, of course, you, like you're saying, at the government level, you have to figure out what to do about that, because our interest payments on the debt are already, what, 20 to 25% of federal revenue?

Jason Calacanis 25:29 Y- yeah, it's about trillion five.

David Sacks 25:30 Trillion, yeah.

Jason Calacanis 25:31 Yep, it's about $2,500 per American. Yeah. 3,500. So, so, so you already see it there where there's less money to spend on current programs because you're paying for interest on the debt. So, what do you do about that? So, I, I think that the next president's gonna face a pretty wicked set of problems and trade-offs here. Even though the GDP numbers are fine, they're good, I still think there's like a wicked set of problems related to government debt and interest rates. Yeah.

David Sacks 25:56 And there's no way to really skin this cat without some, some pain.

Jason Calacanis 25:59 I think they're, yeah, they're, they're... I, I think the only path is you have to cut spending, which is recessionary, government spending, which is recessionary, so you're gonna trigger an economic recession. You're gonna have to have some amount of inflation. And you're gonna have to have a spike in unemployment. And if you don't do the first two things, you're gonna have a lot more inflation, which is really hard to get out of. So, it, it just, it d-

David Sacks 26:19 Well, I, I agree, I agree that we have to cut-

Jason Calacanis 26:20 There doesn't seem to be a win, a win-win scenario here. There's n- there's no, yeah.

David Sacks 26:24 I agree we have to cut government spending. I don't, I personally don't think it's recessionary. I think it helps the private sector when government gets cut.

Jason Calacanis 26:30 Right, right.

David Sacks 26:30 Uh, however-

Jason Calacanis 26:32 Because, Sax, that means-

David Sacks 26:34 The mo- the money will be invested smarter.

Jason Calacanis 26:35 ... the private sector gets to service that function.

David Sacks 26:38 The government won't be consuming all these resources that the private sector could use better. It also won't have as many government bureaucrats acting as brake pedals on the private sector. So, I tend to think that the government, the i- the real economy will perform better with a smaller government. However, I, I think the reason why it won't happen is because it's politically difficult. It's extremely difficult to cut spending politically, right?

Jason Calacanis 27:02 Right. Well, I mean, as we saw-

David Sacks 27:02 I mean-

Jason Calacanis 27:02 ... this cycle, every single proposal seemed to be a payoff to different constituencies. It was like-

David Sacks 27:10 Right, those, those line items got in the budget somehow, right?

Jason Calacanis 27:13 ... Christmas for everybody.

David Sacks 27:13 Somebody, somebody fought for every single line item in the budget, some special interest, and they're gonna fight like hell to keep their appropriation.

Jason Calacanis 27:21 It's not even special interests. It's the representatives in Congress doing their job, which is to fight for their constituents getting their fair share or their fair shake at the money that's being spent. And that's just the way that the legislative branch has evolved over time. If someone's getting something, in order for me to vote for it, I want to get something too. And so the whole thing over time becomes functionally inflationary.

David Sacks 27:44 Right, but I, I think that whole shell game-

Jason Calacanis 27:46 I've seen it. Yeah.

David Sacks 27:46 ... might just be over now, because there's no more money left. I mean, it's all been spent. In fact, we-

Jason Calacanis 27:52 (laughs)

David Sacks 27:52 You know what I mean? So, like, all the federal government probably will end up doing in the near future is entitlements and defense. That's it.

Jason Calacanis 28:01 (laughs)

David Sacks 28:01 Because those are the core, core functions of the federal government. I think everything else that's, that's sort of "discretionary" is probably gonna get cut, 'cause there's no more money left.

Jason Calacanis 28:11 Tragedy of the commons, folks. Uh (laughs) , yeah, everybody acting in their self-interest and, yeah, not a lot of coordination or ability to win office if you actually do what's in everybody's collective best interest and take the medicine. Moving on through the

Jason Calacanis 28:26 docket. Tech earnings this week, Google had a great quarter. Let's go over that a bit here. You're all momada, Friedberg. They beat top line and bottom line, stock popped 5%. Looks like Cloud and YouTube are the story here. Total revenue, let this sink in, (laughs) 88.3 billion, up 15% year over year. Search was, uh, 49 billion of that. And, uh, their operating income is now up 34% year over year. I think the CFO is getting some work done there, 28.5 billion, and net income was 26.3 billion. Interestingly, people are expecting even larger profits. They got a new CFO over there who said they could push a little further on cost cutting, and she said the company will use AI to cut costs by streamlining workflows and managing headcount physical footprint. I think that means more layoffs are coming to big tech. YouTube had a tremendous quarter, ad revenue 8.9 billion, Chamath. That's up 12%. But Sundar said something interesting. He said YouTube surpassed 50 billion in total revenue over the past year. And so, if you do a little, uh, BOATE math, that's the back of the envelope math for those of you at home who haven't heard that acronym, Google doesn't report YouTube's non-ad revenue, but we know YouTube had 35 billion in ad revenue over the last year. That means they're doing about 15 billion in premium paid products. YouTube TV, NFL Sunday Ticket, YouTube Premium, which is the greatest (laughs) product ever. It takes ads out of YouTube and makes it usable. So, a 70/30 split. Cloud had a blowout quarter. Google Cloud, I see that all the time now, 11.4 billion in revenue on 35% annual growth with 1.9 billion in operating profit. I mean, it's printing money. There are seven quasi-monopolies in the world. They're all American, and if we allow them to flourish, we'll be good. If we hamper them a little bit-

Chamath Palihapitiya 30:33 ... and allow other companies to pick up the white space, will be great. Over to you.

Jason Calacanis 30:39 Okay, there's your an- That's called analysis, Chamath, and it's great analysis.

David Friedberg 30:42 And what if we break them up, Chamath?

Jason Calacanis 30:44 And if we break them up?

Chamath Palihapitiya 30:46 I think that you'll have a lot more... The, the sum is greater than the parts.

Jason Calacanis 30:51 I mean, clearly YouTube would be-

David Friedberg 30:53 The, so, so if you, if you take the, if you take the...

Chamath Palihapitiya 30:53 ... one of the great companies right now and spun them. ... perspective of if you own stock in any of these companies, the sum of the parts analysis would tell you that the breakup value is greater than the way that these companies get discounted. You can look at the multiples that they trade at, and you can see that. So if you're a shareholder of the company, you actually silently probably want them broken up because you'll get individual shares that are each will be worth more. Separately, if you are a shareholder of the United States economy, you also probably want them broken up because then you'll just have many more companies creating economic value, which then drives the tax rolls, which benefit the United States' balance sheet. It's hard to see unless you're an employee of the company or you derive a lot of ego from the existence of a company the way it is, that you would need it to stay where- how it is.

David Friedberg 31:51 Well, let me challenge your point on two fronts. In, in Google's case, both YouTube and GCP required many, many, many, many billions of dollars of investment over many years, same with Waymo by the way, at this point, that took a long time and a lot of capital to get the payback on. If those were standalone businesses and they didn't have the profits being derived from search and ads over many years, they would not have been able to build those incredible businesses. So if you do break these businesses up, what you do lose is the ability for an American juggernaut to be able, just like Amazon did with AWS and Apple did, and we can go through the list, to build these new businesses that require the cash flows from the old businesses. As separate companies, it becomes much harder to make that degree of an investment.

Chamath Palihapitiya 32:38 That-

Jason Calacanis 32:38 You're s-

Chamath Palihapitiya 32:38 That angle, that angle of bellyaching is not gonna pass muster because it's all about litigating the past, and you gotta play the ball where it lies. Where it lies is, this business is in a position where you can probably demarcate four or five logical business units. Again, I'm not saying-

David Friedberg 32:55 Today.

Chamath Palihapitiya 32:55 ... that it should happen.

David Friedberg 32:56 Today, for sure. Yeah.

Chamath Palihapitiya 32:56 But it will happen and, and the, the argument of, "But the past," is not gonna work.

David Friedberg 33:00 No, no, no. I'm not, yeah, I'm not disagreeing with your point about like, "Hey, if these things broke up, people would make money." I'm just ar- I'm just trying to understand this point about American dynamism, or whatever you want to call it, that these companies are all in America, they've all been su- successful because they've been led by amazing founders. They've reinvested so much of the profit they've generated back into building insane new businesses that took a lot of capital and a lot of time, and eventually they paid off and they became the next generation of ginormous new businesses that would have not have possibly existed if not for the will and the cash flows coming from those old businesses, the w- the-

Chamath Palihapitiya 33:33 But you also have a companion economy in the capital markets where there's hundreds of billions of dollars that go and fill in the gaps, and I think the reality is, the people in the capital markets are not stupid, and if these big companies hadn't spent hundreds of billions of dollars, the capital markets would have. So I don't think that that-

David Friedberg 33:49 If Google didn't, if Google, you know, l- let's just play a scenario, and I'm, I'm not trying to relitigate the past, but if Google did not own YouTube, what do you think would have happened with YouTube?

Chamath Palihapitiya 33:56 It would have been fine. It would have gotten funded and it would have been fine.

David Friedberg 34:00 It would have raised the billions-

Chamath Palihapitiya 34:01 It could-

David Friedberg 34:01 And the reason- And built the infra- 'Cause do you, do you remember, YouTube had a real infrastructure problem?

Jason Calacanis 34:04 They were under a serious lawsuit. I think they would have shut down.

Chamath Palihapitiya 34:07 The reason is because people are smart enough to understand when then there's the potential to make money, okay, and the free markets do a really good job of highlighting where that's possible. Again, there is no point relitigating this, but I think it would have gotten funded-

David Friedberg 34:26 Could GCP or-

Chamath Palihapitiya 34:26 Yeah, it would have been fine.

David Friedberg 34:27 Could GCP or AWS get funded with $10 billion?

Chamath Palihapitiya 34:29 Yes.

David Friedberg 34:29 Yeah.

Chamath Palihapitiya 34:29 Because-

David Friedberg 34:29 I guess that's what OpenAI is, right?

Chamath Palihapitiya 34:31 Why does, why does, why does CoreWeave get funded today?

David Friedberg 34:33 Yeah.

Chamath Palihapitiya 34:33 How is CoreWeave allowed to even exist? Why doesn't it all go... Because investors are smart, they see that there's an economic rationale for there being multiple players, and then there's a smart founding team that creates a justification that gets it going.

David Friedberg 34:49 So the era of the monopolies' monopoly on building new monopolies is over. (laughs) Is that right?

Chamath Palihapitiya 34:55 No, I don't think it's ev- I don't think it's ever existed, but I think the point is that big businesses are there to eventually grow a GDP so that they can be disrupted by small companies.

David Friedberg 35:05 (laughs)

Chamath Palihapitiya 35:05 That's what you want. Because if you had the same seven or eight companies, then you could make the argument that we should have stopped at the East West India Company and everything would have been great. It's not true.

David Friedberg 35:15 Yeah, I mean, it is what we did with the railroads, it's what we did with the AT&T, it's what we did with Standard Oil. Like, when, when these, when these monopolies were built in the S they were all broken up and, yeah.

Chamath Palihapitiya 35:25 But hold on, it's not necessarily what we did, it's the boundary conditions that enabled other people to then go and fill the gaps, and I think that that's a, a reasonable-

David Friedberg 35:32 The economic boundary conditions.

Chamath Palihapitiya 35:34 You know, Sax had this great tweet this past week and I almost quote tweeted it, but I thought, "I don't want to create a lot more noise where there doesn't need to be."

David Friedberg 35:44 Sax is paying attention now.

Chamath Palihapitiya 35:45 But he had this tweet about taking back the licenses for the main-

David Friedberg 35:50 Yeah.

Chamath Palihapitiya 35:50 ... broadcast channels, and I thought that was an excellent thing and I quote tweeted something where I was like, "Yeah, we should buy that for all in." And I said it half-jokingly, but-

David Friedberg 36:01 (laughs)

Chamath Palihapitiya 36:01 ... I did, because I think that if those licenses were up for grabs, what would happen is-

David Friedberg 36:07 Yeah.

Chamath Palihapitiya 36:07 ... a bunch of private equity people would get behind Rogan, a bunch of private equity people would get behind us, and we would all bid and the outcome would be better. So, the point is that these small structural changes, and I know that it may seem large to break up Google, it's not. It's a small thing in the grand course of American business history. It's not gonna really matter that much. Would be good generally through the lens of the individual shareholder and through the lens of the shareholder of the United States. That's it.

David Friedberg 36:38 Sax, can you tell us about the...

Jason Calacanis 36:40 ... broadcast licensing comment that you made. I thought it was actually pretty good too.

David Sacks 36:44 Yeah, there's a history to this. I mean, originally in the US we had three major broadcast networks, ABC, CBS, NBC, and they were given licenses of public spectrum from the FCC, and those licenses were free, but in exchange for them, the major broadcast networks had these various requirements to serve the public interest, to be fair-

David Friedberg 37:05 This was pre- pre-cable, and this was broadcast-

David Sacks 37:08 Oh, this goes back, like-

David Friedberg 37:09 ... over the air. Right.

David Sacks 37:09 This goes back, like, 100 years, and it-

David Friedberg 37:11 Just, just to be ... It's im- I think it's important to be clear because I, I, I don't think everyone understands that back in the day, all t- the TV networks only broadcast over the air, so they needed radio spectrum-

David Sacks 37:21 Right.

David Friedberg 37:21 ... allocated to them to th- to do that, which was a, you know, 100-year-old, kind of ... That's 100-year-old situation. Doesn't exist anymore. Sorry, go ahead.

David Sacks 37:28 Yeah, it was the only way to get information broadcast on TV, was through this, this public spectrum. And so it kinda made sense in a world in which there are only three networks because that was the only way to get information, to have these fairness requirements and public interest requirements, and so it was heavily regulated. Well, now it's a century later and there's so many ways to get information. You've got cable, obviously, meant that we went from three or four networks to hundreds. And then, of course, you've got the internet and you've got streaming. So there's now an infinite number of ways to get information in real time, including video and, and that sort of thing. You've also got social networks, you've got X, you've been ... And all the rest. So there's no shelf space limit anymore. There's no scarcity. And so therefore, tying up this very valuable spectrum by giving it for free to the, to the broadcast networks just doesn't really make sense in the same way. And what we should do is just auction off this spectrum, use the money to pay down the national debt, and, and in that way, it'll go to its most highly valued use. The market will figure out what that use is. If the broadcast networks are the most highly valued way to use this spectrum, then they'll win the auction. But I suspect they won't-

Jason Calacanis 38:57 Wait, isn't that exactly ... 'Cause they did-

David Sacks 38:58 ... because this doesn't make sense.

Jason Calacanis 38:58 ... they did this auction in 2016, right? For 15 years.

David Sacks 39:01 They've been gradually auctioning off more-

Jason Calacanis 39:03 Yeah.

David Sacks 39:03 ... spectrum, but we're talking about here, this is, like, the most choice, valuable part of, of public spectrum. So for example, one of the reasons why this spectrum is valuable is because it can easily go through walls, right? Like, you can watch your TV inside your house, and-

Jason Calacanis 39:22 Yeah.

David Sacks 39:22 ... this broadcast spectrum is good at getting through those walls. Imagine the types of GPS apps you could enable with that kind of precision, right? So there's many other ways, in theory, that this spectrum could be used, and you would be able to unleash, I think, a lot of innovation in next generation wireless apps if this spectrum were available. I don't think the public would lose anything because ABC, CBS, NBC, first of all, I mean, these networks are basically a commodity now. There's so many other ways to get news, and they'll still be available through the internet and through cable. This is what-

Jason Calacanis 39:57 So you're saying to speed up these auctions, 'cause they do occur every 15 years or something to that ...

David Sacks 40:03 I think what happens is that the, um, the licenses are actually granted to local stations.

Jason Calacanis 40:10 Mm-hmm.

David Sacks 40:10 Like your, you know, your local ABC or whatever.

Jason Calacanis 40:13 WNBC. WNBC.

David Sacks 40:15 Right, and then collectively, they have a lobby called the NAB or National Association of Broadcasters, and this is why they have so much power, is you've got all these local networks, let's call three or four of them in every geography, and they all come together as part of this lobby. And so this is why nothing ever changes. But does this model still make sense? No. I mean, it's completely obsolete. But those local networks will all go crazy if they lose their free spectrum.

Jason Calacanis 40:43 Well, they pay for it. They don't get it for free.

David Sacks 40:45 They don't pay for it now. They get a l- a free license from the FCC in exchange for the fairness requirement and these other requirements.

Jason Calacanis 40:53 I think that they pay billions of dollars for these, and, like, hundreds of millions-

David Sacks 40:57 No, not these licenses.

Jason Calacanis 40:58 ... on a local.

David Sacks 40:58 No. Every six years or so, they come back up and they get renewed by the FCC.

Jason Calacanis 41:02 Huh. I was just talking about the spectrum auctions. I'm looking at it right now.

David Sacks 41:06 That's different.

Jason Calacanis 41:06 Yeah. Okay. All right. Interesting.

David Sacks 41:10 No, look, the, the FCC has auctioned spectrum before, but not the spectrum that the broadcast networks are sitting on, which is some of the most valuable spectrum.

Jason Calacanis 41:18 Got it.

David Sacks 41:19 And the only reason why it's being used this way is because of legacy.

Jason Calacanis 41:24 Legacy. That's right.

David Sacks 41:25 Because this is how it worked 100 years ago.

Jason Calacanis 41:27 Well, and then this parallels into, I think, some of the research that's going on right now around legacy media and trust in media. A bunch of reports have been coming out about this. It's not shocking to anybody who listens to this podcast, but confidence in institutions is tracked by a number of different organizations, Gallup being one of them. And if we look (laughs) at how Americans feel, uh, and trust has generally been going down in everything. The military, police-

David Friedberg 41:57 It's also being tr- it's also being tracked in the WaPo op-ed section.

Jason Calacanis 42:01 (laughs) Yeah. Exactly. Uh, we'll get to that.

David Friedberg 42:04 Are you gonna pull that up, JCal? Do you have that or no?

Jason Calacanis 42:06 Uh, yeah, we'll talk about all that.

David Friedberg 42:07 Bezos's letter?

Jason Calacanis 42:07 Yeah.

David Friedberg 42:07 Okay.

Jason Calacanis 42:08 But here, if you take a look at from 2021, 2022, and into 2023, television news went from 16 down to 11 and back up to 14, but is amongst the lowest in terms of trust in ... And 40% of Americans have no trust in media at all, according to this Gallup poll. Here's, uh, how it breaks down by party, Republican, Independent, and Democrats. Confidence by the Democrats, 58%. Independents, 29%. Republicans, 11%.... in mass media. Your thoughts, Friedberg? As we look at just trust in general in institutions, this transitionary period we're in, and specifically the media.

David Friedberg 42:59 I do think, we've talked about this a number of times in the past, so without rehashing too much, I think that many of the institutions that have offered media have had to move away from providing data and information because data and information has commoditized. It's available broadly through the internet and other places. So the actual gathering of information is now democratized. You know, agencies put their data on their website. Stock mar- stock markets are published on the internet. So the internet has democratized access to information. So the media companies that have historically been arbiters of information have had to become, effectively, content businesses. They've had to provide more than just information. And what has happened is a iterative feedback system whereby the more, kind of, angry they can make someone, the more upset they can make someone, the, the more emotive they can make a, a reader or a viewer or a listener, the more clicks they get. The more the kind of limbic system triggers that consumer to come back and consume some more of their media. And so the iterative development cycle is that things look like they're one side versus another side in nearly every context. In every piece of media, everyone is opinionated and making a position point from a side, from a perceived side that they are representing because it is emotive to the readers, and the readers come back and they align with that side, and they wanna have more of that because it insights their limbic system.

Jason Calacanis 44:24 Tribalism.

David Friedberg 44:25 So that's what happened. And as, as a result, when people look at it and assume that it's what it used to be, which is objective truth, fact-finding, information-gathering, and it is not that, they're like, "Well, this isn't even news anymore." And the truth is, it's not, because information is democratized. It's available to you anywhere and everywhere you want it. You can get it through citizen journalism, via blogs, via podcasts, via Twitter, via many other places. And so the o- the legacy media companies have effectively become emotive content companies in order to drive clicks, drive views, sell ads. That's really all this whole story is, and I don't think that that's gonna shift. I don't think that Jeff Bezos's attempt to try and return WaPo back to being a fact-finding organization is gonna be successful. I think all the consumers that read WaPo today, they love the one-sided nature. They love the bias that they read. It makes them feel good. I think that the people that work there love the bias. They love writing those opinion pieces. It makes them feel good. I don't think anyone actually wants boring news anymore, because you know what? They can go to a website from the government itself or from a company itself and just read the information, and frankly, if they wanna get unbiased, honest, factual information, there's 100 other sources.

Jason Calacanis 45:34 Well, and then here on this-

David Friedberg 45:35 And the commentary, the com- Yeah, the commentary about off-the-cuff, et cetera, you know what that is? That's called authentic conversation. That is how people speak. When we all get together, we are not journalists. We are not necessarily well-versed (laughs) . Let's be honest, we mess things up a lot. We say off-the-cuff comments that are wrong very often. But that's just how people speak, and it feels authentic, and when we do have signal, I think that listeners and viewers are smart enough to separate that signal from noise, and they are going to make their own decisions about what they find to be truth and factual and what they're gonna use to make decisions in their life. And that's, I think, how people wanna consume information now. It's not being told what the truth is by some fake authority.

Jason Calacanis 46:16 And here is a clip from the podcast, uh, last year.

David Sacks 46:20 Podcasts could play a huge role. Just like in 2016, social media broke through and played a huge role-

Jason Calacanis 46:25 Yeah.

David Sacks 46:25 ... I think in 2024, I think that podcasts could break through-

Jason Calacanis 46:28 Podcasts will decide the election.

David Sacks 46:30 ... and be the way that unorthodox candidates get their message out. It could be really interesting.

Jason Calacanis 46:33 It could be the way all candidates get their message out. We're moving from traditional media defining these candidates to direct to consumer, direct through Twitter/X, direct through podcasts, this podcast included. What we're witnessing right now is the transition from traditional media and the establishment defining who the great candidates are, to the public and the people on podcasts and social media who are the tip of the spear and the vanguard, they're gonna pick the winners.

Chamath Palihapitiya 47:01 I love you both. You guys totally nailed it. Look at that.

Jason Calacanis 47:05 Sachs, your thoughts on this sort of transition? Interestingly, as we know, Rogan had Trump on, over 40 million views now.

David Sacks 47:13 I think they're up to 100 million views now for that Rogan-Trump interview.

Jason Calacanis 47:17 Oh, including X, I'm sure, yeah.

David Sacks 47:17 Despite the fact that you literally could not find it if you searched for it in (laughs) Google or YouTube. It's quite amazing.

Jason Calacanis 47:22 Well, we'll get to that in a second. Yeah, that's a, an interesting one. I got a take on that. But what do you take from Rogan getting, let's say, many more views than the last two presidential debates? Trump-Harris, 67 million viewers-

David Sacks 47:37 Yeah.

Jason Calacanis 47:37 Trump-Biden, 51 million viewers. I think maybe Rogan, combined with his two episodes, will get more (laughs) than the first two debates.

David Sacks 47:48 Yeah, look, I think this is the first podcast election-

Jason Calacanis 47:51 Mm-hmm.

David Sacks 47:51 ... where you can make the argument that podcasts will decide the election, and there's a couple of reasons for that. One is podcasts have gotten big enough that there's enough audience that they just have the reach now to play a big role. Second, the format is, is highly informative to viewers. You get to see a candidate expound in long form, being asked questions and having to go for potentially hours at a time. I mean, Trump went for three hours with Rogan.

Jason Calacanis 48:20 Impressive.

David Sacks 48:20 And it's very hard to hide who you are when you're going for that period of time in an unscripted environment. I would argue even the hour that Trump spent with us demonstrated that he knew a lot more about policy issues than people were giving him credit for, and it's, and it also showed his personality was a lot different than the media had portrayed him. So, I think that podcasts have been a, a great advantage for Trump. He's been willing to do them, and I think he does them quite well. I think it's...... particularly helpful to him in a context where the legacy media has been trying to portray him as a very extreme figure, as, as literally a Nazi or literally the reincarnation of Adolf Hitler. When the media is, is telling the audience that you're that, and then you can go on Rogan for three hours and show that you're a normal, funny guy who actually knows a lot about policy, it's just such a different impression than what the media is trying to portray, that has been incredibly, I think, useful and advantageous for Trump. By the same token, Kamala Harris has not been willing to do Rogan, at least not on Rogan's terms. Apparently, she was willing to sit down for one hour with him, but-

Jason Calacanis 49:32 But not in Austin, according to-

David Sacks 49:33 But not in Austin. What Rogan said is, "No, we have to sit down in our studio for three hours." So far, she hasn't been willing to do that. I think that speaks volumes in and of itself is that she hasn't been willing to subject herself to the same sort of, you could call it interrogation or really just long-form conversation that Trump has been willing to. But in any event, just I think my bottom line on this is that I think Trump's biggest challenge in this election is just to get people comfortable with the idea of a second Trump term, to get people comfortable with him. And I think that him going on all these podcasts, including ours, including I thought the Andrew Schulz one was really good too, has helped him, I think, just get people comfortable with the idea of, of Trump, which I think was his biggest obstacle in this election. 'Cause people definitely want to change and they're not happy with Biden-Harris.

Chamath Palihapitiya 50:25 You know, the one thing I'll say is, before you go on Rogan, there's a sense of anxiety that I had, which was, "Do I have enough interesting things to say for three hours?" That was really at the top of my mind. I j- I think, Jason, I talked to you right before-

Jason Calacanis 50:43 Yeah.

Chamath Palihapitiya 50:44 ... I went on and, and that was a big thing for me. And then you go and you get in the seat, and he's incredible in the way that he kind of, like, moves the conversation along, and then you end up, you're like, "Oh, it's already been three hours." That's his superpower. The reason that she should find a way to go to Austin and do it is because he has the ability to allow you to be your true self over a long period of time. And I think, again, just going back to the basics, she deserves for herself for the American people to vote up or down who she really is. And all the campaign strategists aside and all of the other nonsense aside, I would want, if I was running for president, one shot at people being able to see me for who I really am. And that's why she should go on Rogan.

David Sacks 51:41 I think she's afraid of that. I mean, she has mostly ducked media interviews and ducked any podcasts that would be perceived as adversarial-

Jason Calacanis 51:50 She's definitely gone with the friendlies.

David Sacks 51:52 ... or not super friendly.

Jason Calacanis 51:52 But she stopped-

David Sacks 51:53 Yeah, she's-

Jason Calacanis 51:53 She stopped ducking them, I think, in fairness to her, like maybe after she was, like, in the third or fourth week, she started doing them.

David Sacks 51:59 Yeah, she's done Call Me Daddy, she's done Howard Stern.

Jason Calacanis 52:01 She did the friendly, she did the friendlies.

David Sacks 52:02 She's done the ones that she knew would be super friendly.

Jason Calacanis 52:03 Yeah, of course, yeah. Doing adversarial is probably-

David Sacks 52:05 But don't you think that Trump did our show because he thought it would be friendly?

Jason Calacanis 52:10 Of course. Yeah, he started with friendlies, yeah. Why would he do oppositional?

David Sacks 52:13 Well, I think when Trump did... I mean, we were on the first podcast he went on. Were we the first-

52:17 Kamala went on that Fox, she went on that Fox News thing.

52:19 She did Fox News for 26 minutes, Freeburg, and her staff was waving.

Jason Calacanis 52:23 (laughs)

David Sacks 52:23 They're on the sidelines waving frantically to get her off of there. Um, but in any event, was, was, were we the first podcast to interview Trump?

Jason Calacanis 52:32 Second.

David Sacks 52:33 Oh, 000000000000 were first, I guess we were second.

Jason Calacanis 52:36 Uh-huh.

David Sacks 52:37 I think that it was really unclear what would happen when you, you know, put a major candidate for president on a podcast for an hour. At the time he did it, I think he took a little bit of a risk. Um, and I think it worked out for him and then he's done a lot more since then.

Chamath Palihapitiya 52:51 I mean, other than Rogan, Rogan and us have consistently tried to get everybody on all sides to be on the podcast. I think we did a really good job looking-

David Sacks 53:01 Yeah.

Chamath Palihapitiya 53:01 ... back on... We've gotten everybody except one person, Kamala Harris.

Jason Calacanis 53:04 Uh, yeah. I mean, I wish I had time to have asked you about-

Chamath Palihapitiya 53:07 We had all the dems-

Jason Calacanis 53:08 ... January 6th.

Chamath Palihapitiya 53:09 We had all the pseudo-dems.

Jason Calacanis 53:09 That was the only thing I didn't get to on my questions.

Chamath Palihapitiya 53:11 We had all the independents and we had all of the credible Republicans.

Jason Calacanis 53:16 And to his credit, we took-

David Sacks 53:17 We were the first for RFK, right? We were the first with-

Chamath Palihapitiya 53:20 Yeah, we were the first for RFK.

Jason Calacanis 53:21 He credits us.

Chamath Palihapitiya 53:22 We were the first, first for Dean Phillips.

David Sacks 53:24 Dean Phillips.

Jason Calacanis 53:25 And Vivek.

Chamath Palihapitiya 53:26 The first for Vivek.

Jason Calacanis 53:27 I think we were the first for Vivek. And so yeah, give us some, some credit there. On the, um, search issue, I looked into that. There... Vivek, sorry. I always get

Jason Calacanis 53:35 that wrong. The search issue, there was some complaints that YouTube might have been, like, I don't know, hiding the video, which didn't make much sense to people. So I did a, an investigation of that facts. You're laughing. Go ahead.

David Sacks 53:49 Well, finish what you're saying.

Jason Calacanis 53:51 No, no, no. Go ahead.

David Sacks 53:51 I have a different point of view than you on this, but-

Jason Calacanis 53:53 I didn't even get my point of view.

David Sacks 53:54 I know. I've, I've seen it on Twitter, but keep, keep going.

Jason Calacanis 53:57 (laughs)

David Sacks 53:57 Oh. Well, no, I did, um, a search on Bing. You're gonna defend Google, I know.

Jason Calacanis 54:01 No, no, I'm not defending Google. I'm just explaining to people how search works independent of it. I went to Bing, DuckDuckGo, search.Brave.com, Google, YouTube, Google Video. And what people don't understand about how the search algorithms work is they are designed to increase advertising dollars, and Freeburg will back me up this, he worked at Google, and session length. That's the goal. Am I correct, Freeburg, with algorithms, whether it's TikTok, YouTubes, et cetera?

David Sacks 54:32 Yeah, I, I'm not gonna speak as an authority on this.

Jason Calacanis 54:32 Increase session time, increase revenue.

David Sacks 54:35 I know more about search results. I don't know as much about the video stuff, so-

Jason Calacanis 54:38 So when you look at that, it's, it's a very nuanced thing. But Joe Rogan doesn't monetize his search. It is not... Make any money for them. And then clips do make money for YouTube, and the clips have flooded the zone. So if you do a search on any search engine, whether it's Bing or-... Brave or DuckDuckGo, Google or YouTube, any of them, what you'll find is the clips beat out the main episodes all the time. This happens to our podcast. When people clip our podcast, they will do keyword stuffing and they'll beat us, and it will beat the algorithm because the algorithm wants to get ads, and we don't have ads turned on either. So, people have this frequent frustration with This Week in Startups, my other podcast, All In Here, and Joe Rogan, that anything that's not monetized on YouTube doesn't rank high. And if you look, all of the clips, and this makes sense if you just think logically, the clips will s- will generate more engagement because you get to watch the highlights. So, it's kind of like sports highlights. Sacks, would you like to conspiracy theory this and tell us that Sergey is-

David Sacks 55:45 Well, I don't, I don't see it's a conspir-

Jason Calacanis 55:46 ... sandbagging for the Democrats or something by hiding the YouTube video?

David Sacks 55:49 Well, I don't see it's a conspiracy theory.

Jason Calacanis 55:50 Oh.

David Sacks 55:50 You can just... I mean, if you go to Google every single day and just type in a Trump-related search term versus a Kamala- r- related search term, you'll see the difference in coverage. But back to the, the Rogan thing. Look, Google is a search engine. This is what they're supposed to be good at. You have an interview between the biggest podcaster in the world and a former president who's probably the most famous person in the world. It's massively trending. It's got something like 100 million views. At the time that people noticed that you couldn't find it on YouTube, it already had something like 34 million views. What I'm saying is, you have to work pretty hard as a search engine for your algorithm to be so bad that you can't find that interview. Okay? When I went to YouTube and tried to find it, at first I typed in Trump Rogan interview, couldn't find it. Then I typed Trump Rogan interview podcast, couldn't find, it was just clips. Then it was Trump Rogan full interview, full pul- podcast, still couldn't find it. There's no question that just as a factual matter, this episode was suppressed in YouTube's search. If you went to the main Google search engine and did a similar search, what you would have found as the number one search result was an article from the Arizona Republic, which is a publication I've never even heard of, that would have told you that the Rogan interview with Trump was a brain-rotted waste of three hours. That's the number one result. Somehow Google decides that its number one result for the Rogan interview was this Arizona Republic story. Okay? I, I mean, that is not a search engine doing its job. So, it's pretty obvious to me that they're using other factors in deciding what to surface here, and somehow the results end up being almost universally negative towards Trump, and almost universally positive towards Kamala. I think you've got to, at this point, have your head buried really deep in the sand not to think that Google is incredibly biased in this election-

Jason Calacanis 57:49 So-

David Sacks 57:49 ... against Trump.

Jason Calacanis 57:50 ... let me pull up some facts to show how wrong you are. If you pull up YouTube here-

David Friedberg 57:57 (laughs) That's so great.

Jason Calacanis 57:57 ... here's an image of the YouTube search results that I just did for the Trump-Rogan. And what you'll see is, as I explained previously, clips perform better and make money. They make money, so the algorithm favors those. And what you'll see here is Fox News, et cetera, and all these clips, and then eventually you get to the Joe Rogan interview. And if you look at Bing's search results for Rogan Trump interview, what you'll see is all the search engines put news up first, then they go to organic. So, it's just a fundamental misunderstanding of how search is designed for users. They start with news on every search engine today. And then here's Google's same thing, and then what you'll see here is on the Google and on the Bing images you have a collection, you know, typically five or six news stories, then they go to the first organic. So, people just don't understand how search works. It's always news first when you type in a politician's name. And then when you look at the news, or you e- it has New York Post, right-leaning, you have people who are dead center like AP in there, and you have Fox News there in the Google one. So, of the first five, two of them are right-leaning. Uh, and AP is obviously in the middle. Forbes, I don't know, maybe Forbes is right-leaning too? Freeburg, or what about you?

David Friedberg 59:09 Well, I was gonna say, I read somewhere, so I have no direct knowledge about this, I actually pinged several people at Google to ask them what was going on, and I did not get a clear response. I didn't, I, so, like, I have no insight as to what actually happened. But what I read online somewhere was that someone reported that someone at Google said that there were, there was kind of a, a whole bunch of people that clicked inappropriate content flagging on the video. So, like anti-Trump people-

Jason Calacanis 59:37 Oh, yeah.

David Friedberg 59:37 ... went to the video, clicked that it was inappropriate, and when g- uh, when YouTube gets that many people clicking that this is inappropriate, it automatically flags it.

Jason Calacanis 59:46 Mass flagging, yes. It's a-

David Friedberg 59:47 It mass flags, yeah.

Jason Calacanis 59:48 ... it is a, it is a technique people will use. They've used it on our program here, where they flagged it, yeah.

David Friedberg 59:52 Right. So if you get like a million people that say at once, like, "Hey, there's inappropriate content in here."

Jason Calacanis 59:56 Yes.

David Friedberg 59:56 The default is-

Jason Calacanis 59:57 Known trick. To pause it.

David Friedberg 59:58 ... to hide, to hide the video, well, to hide the video from search results while it's investigated. But clearly there's something messed up here because they should have been on top of that and responded immediately, where the video that has such a large number of views and such a large audience, to allow that to happen and, and drag on for so long... But someone said that that may have been what happened and then they fixed it. I, so I don't know, but I- I just want to point that out, that it may not necessarily have been a kind of overt action by Google, but just the way that the system is set up that anyone can flag, and if enough people flag, you get this sort of trigger.

Jason Calacanis 1:00:29 Yeah. And I can tell you, I know firsthand that Google is aware of the claims of bias, and y- I think you're starting to see it, just like CNN is aware of the claims of bias and they added-

David Friedberg 1:00:40 Totally.

Jason Calacanis 1:00:40 ... CNN is aware of the claims of bias.

David Friedberg 1:00:41 They're super sens-

Jason Calacanis 1:00:42 Yeah, they're very sensitive to it.

David Friedberg 1:00:42 I mean, like all these companies are super sensitive to it. Well, they're thoughtful. A- so is Facebook.

Jason Calacanis 1:00:45 Right, yeah.

David Friedberg 1:00:46 Mark, Mark Zuckerberg's very sensitive to it. I know Sundar himself is very sensitive to it. I, I don't want to kind of hide the fact that these people think that they're going out and being biased, uh, that they have these kind of information empires, 'cause they know that they're gonna lose trust and they're gonna lose customers and revenue-

Jason Calacanis 1:01:00 Absolutely.

David Friedberg 1:01:01 ... and et cetera, so.

Jason Calacanis 1:01:01 CNN has done, I think, an exceptional job. I don't know if you watch it at all.... Sacks, but they have been having Trump supporters and right-wing commentators in CNN on the desk every-

David Friedberg 1:01:12 They have?

Jason Calacanis 1:01:12 Yes. It's really changed the nature of it from being like MSNBC or Fox-

David Friedberg 1:01:17 Did you know that, Seth? I didn't know that.

Jason Calacanis 1:01:18 ... to being something in the middle.

David Friedberg 1:01:19 I've never wa- I never watch, I never watch these shows, but like...

David Sacks 1:01:22 Before we go off on this topic, people throughout this election have been posting Google search results when you just type in Trump versus Harris. And I've done it. Every single time, it's massively biased. I mean, let's just go through them. This was a search result I got months ago where I just typed in Donald Trump, and you, the first carousel was about Kamala Harris. I remember joking on the pod that if you want to find the latest news about Kamala Harris, just search for Donald Trump, and then you go down and the first carousel that's about Trump is negative stories. This one was about Project 2025, which has nothing to do with Trump. Nonetheless, this was a major Democratic talking point at the time is that somehow that Project 2025 is what Trump would do in his second term.

David Friedberg 1:02:06 I just did this, and it's different now, obviously. This is, you said this is a few months old?

David Sacks 1:02:10 I've been doing this on a recurring basis over the last few months.

David Friedberg 1:02:14 Uh-huh.

David Sacks 1:02:14 And the point is that whenever you search for the candidates-

David Friedberg 1:02:19 Mm-hmm.

David Sacks 1:02:19 ... the news is very positive towards Harris, and it's very negative towards Trump. And even when you search for Trump, they'll give you positive news about Harris. Now, go to the, go to the podcast, and you search-

David Friedberg 1:02:29 And again, Sacks, you don't, you don't think this is a function of the fact that so many media outlets are being so negative about Trump and positive about Harris, and so therefore the ratio is just off the media?

David Sacks 1:02:37 Well, how does, how does the Arizona Republic end up being the first choice when you search for Rogan Trump? They're not, you know, like PageRank can't explain that. They're just not a major publication. They're not being linked to by a lot of people. Doesn't make any sense. Here's another example. Okay, stay on this one for a second. This was after Trump went on the Andrew Schulz podcast. That podcast was a very positive experience for him, as we just talked about. Helped his campaign a lot. What's the number one result when you look at, for that? New Republic, "Podcast hosts laugh in Trump face as he struggles to defend rambling." That's when he had that hilarious story about the weave.

David Friedberg 1:03:13 (laughs)

David Sacks 1:03:13 If you actually watch the clip, the podcast hosts were, they were definitely laughing with him. They were not laughing at him. That was a ridiculous mischaracterization. The New Republic is not the objective s- uh, source for anything. I don't know how you could say that objectively PageRank should get you to the New Republic as the number one source for the Andrew Schulz interview of Trump. That is bias. I mean, it's just biased. You, there has been so many examples of Google giving these ridiculous results, and they find obscure publications and obscure articles that have no basis in the truth to, to elevate to the top. It's almost like they're trying to find the most negative article they can find on Trump and make that the number one result.

Jason Calacanis 1:03:59 Yeah, it's not the search engine, it's just the corpus of media that's being indexed. Um, if you look here at Google, they just gave-

David Sacks 1:04:07 Why isn't it New York Times then, as the number one thing?

Jason Calacanis 1:04:09 Well, I mean, just, you know, here, if you look at Donald Trump, you know, if we were to look at these news sources, there's NBC, NPR, Politico, and New York Times, who are left-leaning. If you were to do this on, um, I think I have Bing as the next one you can open, and you can look at the next one, Nick, which is DuckDuckGo. In all of these cases, the problem is only 3 or 4% of journalists at publications today are right-leaning, and most of the right-leaning publications are opinion publications like Fox, et cetera. And so you just, you don't have a lot of representation in the index of Republicans. And that's like a big opportunity, I think, for Republicans, is to make more publications or take more publications over, like we're seeing with the LA Times and Washington Post-

David Sacks 1:04:52 There's plenty of conservative...

Jason Calacanis 1:04:53 ... which I think are gonna move right-

David Sacks 1:04:53 ... publications if Google would choose to surface them, but it decides that it doesn't want to.

Jason Calacanis 1:04:59 It's- it's... On a percentage basis, it's very small, is the problem.

David Sacks 1:05:02 Here you go. This is Arizona Republic rocketing to the top of search results for "Joe Rogan Trump interview." That's a publication that is local to Arizona that no one's ever heard of. It has no basis being the number one result in Google. New York Times is second. Okay, I can see the logic of that, because New York Times is a big publication. Then you go down one row to the carousel. Oh, there's New Republic again. Why? 'Cause it's calling Trump appearing on Joe Rogan shady. And then you've got-

Jason Calacanis 1:05:30 Okay, Sacks-

David Sacks 1:05:30 ... another one-

Jason Calacanis 1:05:30 Listen, I think-

David Sacks 1:05:31 You've got another one there from The Independent-

Jason Calacanis 1:05:32 Yeah.

David Sacks 1:05:32 ... calling Trump a predator. I mean, come on. This is ridiculous.

David Friedberg 1:05:36 Okay, so you've shared these examples. Um, what I, what I would recommend is I think we get someone from Google on the show. We could arrange that.

Jason Calacanis 1:05:42 Totally.

David Friedberg 1:05:42 And they can kind of talk about-

Jason Calacanis 1:05:44 Come on the show, Google.

David Friedberg 1:05:44 ... how the algorithm works. 'Cause I don't think any of us are gonna be able to provide a reasonable counterpoint or understanding-

Jason Calacanis 1:05:49 No.

David Friedberg 1:05:49 ... of what's going on. And if there is bias, um, and there's some kind of manual intervention in this, in this process, maybe it can be kind of discussed and talked about why and how, and you know, what the automation is that causes this to happen, and let's just try this-

David Sacks 1:06:02 Yeah, I'd love to do that.

David Friedberg 1:06:03 ... let's try and, let's try and uncover.

David Sacks 1:06:03 I'd love to understand that.

David Friedberg 1:06:04 So, so I'll-

Jason Calacanis 1:06:05 Sure.

David Friedberg 1:06:05 ... I'll take that as a to-do, and I'll try and find someone that we can talk with-

Jason Calacanis 1:06:08 I mean, they listen. They- They know.

David Friedberg 1:06:09 ... to have that conversation. They do. I- I... Look-

Jason Calacanis 1:06:10 Yeah.

David Friedberg 1:06:10 ... I mean, I've talked with a lot of people over there, and I have heard from a lot of folks that this is a real issue that folks are trying to address internally so that there's this perception of bias that they're trying to get rid of, and they really want to address it. This is what I've heard from people at Google, so I want to give them a chance-

Jason Calacanis 1:06:25 Yeah, yeah, no, I've heard the same thing.

David Friedberg 1:06:25 ... to kind of talk about it.

Jason Calacanis 1:06:25 Pull up the Bing I just sent you, Chris.

David Sacks 1:06:26 So, I- I- look, I- I- rather than having us all debate it, or I don't even have a strong point of view on this-

Jason Calacanis 1:06:30 That's it.

David Sacks 1:06:30 ... I'd rather just bring someone in and talk about it. So, let's just move on.

Jason Calacanis 1:06:32 So, just as a counterpoint here, Nick, pull up the Bing I just did for Donald Trump, and we'll just... If you do it as an exercise, that's always the way to find the objective truth here is to try the independent search engines or other search engines, DuckDuckGo, Brave-

David Sacks 1:06:42 Perplexity, try Perple- Perplexity.

David Friedberg 1:06:44 (laughs)

Jason Calacanis 1:06:44 Bing. Well, yeah-

David Friedberg 1:06:45 Try Perplexity. That's a good idea

Jason Calacanis 1:06:45 ... you could do that as well. We'll see. But anyway, if you look here, this Bing one, if you take out MSN... Well, no. If you go to Woke- MSN...

David Sacks 1:06:52 Woke- WokeSearch.com, J-Kel?

Jason Calacanis 1:06:54 MSN, USA Today, Charlotte Observer, Seattle Times, Washington Post. I think these are all left-leaning. So that is more to my point that, like, the entire corpus of news reportage is 95% left-leaning.... that's what's happening here. And so they need to, they're gonna need to manually, Sax, say, "These 5% should get represented 50/50," in the search results to please the other side, even though that's not what the corpus is. Um, the number of stories written by left-leaning just is probably 50 to one to right-leaning. Moving on through our-

David Sacks 1:07:33 Okay. I have a, I have an alternate explanation. Can we just-

Jason Calacanis 1:07:35 Okay.

David Sacks 1:07:35 ... pull up this, this, it's got some data. I'd like to just pull up this data if I could.

Jason Calacanis 1:07:38 What do we have here?

David Sacks 1:07:39 If you look at employee donations to party-

David Friedberg 1:07:41 We've looked at this.

David Sacks 1:07:42 ... biotech companies, it's all 90-something percent goes to Democrats.

Jason Calacanis 1:07:46 Except for Uber.

David Sacks 1:07:46 That's a pretty simple explanation for why the Google search results are horribly biased in one direction.

Jason Calacanis 1:07:53 Uber's 18%. (laughs) All right. Let's go to our final segment here. We'll talk a little bit about the election. Why don't you tee us up here, Freeburg?

David Friedberg 1:08:04 All right, guys. I'll quickly, uh, introduce our final political election update before our livestream on Tuesday. Obviously, a lot of daily freakouts, daily efforts at having an October surprise that will take down the other side, all sorts of drama, all sorts of insult. Not a lot of love in America right now. Super depressing and sad. All sorts of stuff happened this week. J-Cal, why don't you kick us off? What do you think is gonna happen on Tuesday? What are the things that you think are gonna move people between now and then?

Jason Calacanis 1:08:37 It's a toss-up. I mean, that's what everybody's saying. It looks like Trump's got a slight lead, and so I think it's gonna be a toss-up.

David Friedberg 1:08:44 Sax, agreed? Are we 65/35 as polymarket predicts, or are we 100% Trump, or are we 90% Kamala Harris? What are we, uh, looking at?

David Sacks 1:08:54 Well, you definitely can't say it's gonna be 100% anyone. I mean, but if, again, if you look at all the data, the data is definitely pointing towards Trump having an advantage. It's, uh, obviously the prediction markets are almost two to one in favor of Trump. The polling shows that Trump is ahead narrowly in the s- in all the swing states, I think every single one of them, even the, uh, sort of blue wall states of Pennsylvania, Michigan, Wisconsin, that Harris must win, I think, in order to have a path to victory. Whereas Michigan and Wisconsin are very, very close, like one percent or less in the swing state polls. Pennsylvania polling shows that Trump is ahead by, I think, two or three. That's what I've seen today. So it's, it is looking good for Trump, and if you look at the numbers that Elon's group, the, that America PAC put out, it looks like the early voting in Pennsylvania is trending 500,000 votes better for Republicans in the early voting than four years ago.

David Friedberg 1:09:55 But Sax, is that just pulling votes forward?

David Sacks 1:09:57 It could be.

David Friedberg 1:09:57 'Cause some folks have said-

David Sacks 1:09:58 It could be.

David Friedberg 1:09:58 Yeah.

David Sacks 1:09:59 It could be, however-

David Friedberg 1:09:59 Like insec- instead of showing up at the ballot box on Tuesday, a lot of folks are doing mail-ins and making sure they get their vote in in mail instead of going in person to those...

David Sacks 1:10:07 Right. So then you gotta look at polling of people who say they're gonna vote but haven't voted yet in Pennsylvania, who say they're gonna vote on Election Day. And I think those numbers are running about 18 points ahead for Trump, which is about double what he needs to win. So he, just to be clear, the early voting favors Harris, but not by the same percentages that it did four years ago. So right now, it looks like Trump is tracking to win that state. But look, I can't guarantee it. I'm not representing that, you know, that's exactly what's gonna happen. But right now, the numbers are looking good. Remember, Biden only won Pennsylvania by 80,000 votes. And again, the swing so far is, uh, the Republicans are doing 500,000 votes better than they were doing four years ago.

David Friedberg 1:10:55 So there's a lot of stories coming out on Twitter, on independent media, and on mainstream media, or legacy media as we might call it now, talking about, "Hey, I live in a house. I got 15 ballots mailed to me, all with different random names." And these sort of anecdotal stories are being pushed and then amplified by folks that are involved in the election. Chamath, is this kind of dangerous? Do we think that there really is a lot of this kind of election meddling happening? And if not, or if there is, is this kind of a dangerous thing to happen, where a lot of people are talking about this, where no matter what happens on Tuesday, people start to question the results of the election? How much should we be kinda worried about this rhetoric?

Chamath Palihapitiya 1:11:36 I think there are two things. There's the substance, and then there's the strategy. The substance is that, does it really make sense that the most advanced and important country in the world doesn't have a uniform system where one ballot is given to every single American citizen who is eligible to vote? That probably makes sense, so we should probably just figure out how to do that. Separately, the strategy of it is for both sides to lay the groundwork to say that this thing somehow wasn't totally right down the middle. I am hoping for a very clear, decisive victory. And frankly, whichever candidate wins, I hope that it's very clear and decisive so that everybody is forced to deescalate and move on. Now, that said, I think what the early voting data shows is something that you haven't seen in the past, which is that there are a lot of Republican people that are voting early. I don't know what that means for Election Day. But typically, it's the Democrats that dominate these early voting processes, and they build what's called the firewall, and in these swing states, these firewalls become very important going into Election Day. And as Sax said, a bunch of these states are different than they've historically been in the favor of the Republicans.

David Friedberg 1:13:15 I saw an article today that just said that they basically considered Nevada now in the Republican camp because, like, there's been so much early voting that it's about 60% of the total votes they think have already been cast since they've- they have a very clear Republican lead going into Election Day. So, there's all kinds of stuff here that's new. I just hope that it's just an absolutely crushing victory in one direction or the other so that we de-escalate and get- get on to the business of running the country.

David Sacks 1:13:45 So, I'm gonna break with my- most of my Republican brethren on this and say, I think early voting is actually a good thing. It's- it's very convenient, right? Like, why force people to only vote on just one day? Because what if you get sick or a kid gets sick and you have to pick them up from school? There's a lot of things that can go wrong. It is more convenient to have, say, two or three weeks to be able to cast your vote. I actually think that's not a bad thing. And in terms of who it helps, I'm not sure. But I think that as the Republicans become more of a populist party and the Democrats become more of an elitist party, I think higher turnout might actually- might benefit Republicans regardless. I think it's a huge convenience for voters, and I think early voting is something that we should keep. The thing we got to change is in the states where you don't have to present any voter ID to show who you are, that's just crazy. I mean, you just- you go up to the polling place and you give your name and I guess your address, and they look you up in a computer and they hand you a ballot, and there's no verification that you're- you are who you say you are. That to me is crazy. The other thing that's crazy is that you can even get registered and added to the voter rolls in a lot of states without any proof of citizenship. So, there are states where you can go get a driver's license without proof of citizenship, and there's just a checkbox to be added to the voter rolls, and no one ever checks you're a citizen. And now you're on the voter roll and you can go pick up your ballot without any voter ID. That's just crazy to me. So, I think that after this election, there should be some sort of bill that gets passed and signed by the president that sets a minimum standard for- for voter integrity and-

David Friedberg 1:15:25 For federal election. For federal election.

David Sacks 1:15:26 For federal elections, right.

David Friedberg 1:15:27 'Cause states can do what they want, right? Like, each state can vote how they want.

David Sacks 1:15:29 I guess states can do what they want, but I don't think states should be able to do whatever they want in federal elections 'cause that affects all of us.

David Friedberg 1:15:33 Sachs, I just want- I just want to- I wanna point out that each state is effectively voting for the folks that they want to have go to the electoral college, and that's really where the vote for president is cast. So, should there be-

David Sacks 1:15:44 Yeah, but that affects all of us. If there's- Hold on. If there's cheating in several states and- and a close election... By the way, I'm not- I'm not accusing that of happening, okay? I'm just saying that if we have several states that don't have basic voter integrity-

David Friedberg 1:16:00 I understand, but the way the-

David Sacks 1:16:01 And that- and that affects the outcome of a national election-

David Friedberg 1:16:03 But the way the r-

David Sacks 1:16:03 ...that has a huge impact on all of us.

David Friedberg 1:16:05 Let's just talk about this really important point, which I think a lot of folks ignore. It's not a direct democracy. It's not like everyone in the United States votes for the president. What happens is the states send a bunch of electors to go vote for the president. The- each state casts a vote for the president. How