whoa whoa whoa sax found the gel oh my God this guy he's running for office if he shows up with the red tide next week we're [ __ ] that's the end of the show he shows up with a red tide a blue shirt are you coming out of your law retirement are you going to be an active lawyer defending Trump sax you look really good I got to say with the with
the job that was that's a really good look for it let's go to the shower use the comb oh the weekly shower in Italy good luck right it's not a bad look did you use soap did you uh oh no I didn't have time didn't have 90 seconds yeah I didn't want to keep you guys waiting another two minutes [Music] Rain Man David son we open source it to the fans and they've just gone crazy [Music]
all right everybody welcome to another episode of the all in podcast it is August and we just might have had the most consequential week in terms of politics and science in a long time could be it could be the week of the year freeburg's been going nuts inside the group chat because everyone is trying to replicate this LK 99 room temperature or semiconductor
experiment superconductor superconductor yes so God I mean this has been what has it been like 10 days and now everybody is on Twitter trying to recreate this maybe I should just let you cue this up Freeburg since this is the first time perhaps the last that we're going to start the show at science corner so science Corner takeover week tell us is this legit because you flip
from this is a fraud to this is changing the world like every day you you seem to have a new piece of evidence where where are you today with this is this the real I mean it's probably it's probably somewhere in the middle but it leads to a path that could get us to the Holy Grail which is room temperature superconducting material which we've talked about twice on the show before
and I encourage folks to go look at the episode we did a couple ago after the original claim was made a few months ago that turned out to not be true but the description in the paper that came out on how to make this material was chased by hundreds of labs around the world over the last few days folks have been live streaming it on these Chinese
websites Billy Billy and Twitter and twitch everyone from Russian scientists to Chinese to Korean to American to European I will say one thing that I think is really profound which it is this is the first time in a very long time that I've seen so many people share a unified voice about optimism about an abundant future optimism about a big breakthrough rather than get on
social media to share a voice about fear and anger at someone or something and to hear everyone around the world get together and be excited about the potential of this discovery and its applications it's really profound to see and it's really amazing and wonderful to see now where we are a bunch of labs took the described chemical structure of this
material LK 99 which has lead and phosphorus oxygen and some copper in it and put it into these modeling systems these computer modeling systems to try and understand where do the electrons flow where do the electrons sit in this material if this material is made the way it's described and five different Labs have now published papers that show that the way that this
material is supposedly produced it should create these Pathways or these energy states with the electrons that theoretically could enable superconductivity at a very high temperature and so that's an um a very confirmatory signal that computer modeling of the electron clouds because remember electrons even though they move around the nucleus of an atom we only
kind of have a probability statement of where they are so if you look at all the probability statements of all the atoms stuck together and you try and figure out what's the aggregate probability of where electrons are it indicates that there are these Pathways that theoretically could allow for electrons to move freely through the material and
be completely void of any sort of resistance which is superconductivity and and so that's what's really profound about the modeling outputs from five very separate independent Labs just so we're clear when electricity normally moves down an electric wire or in computers and CPUs gpus whatever there's resistance that resistance results in loss it results in Heat and the only way
we've been able to reduce that loss is by making it freezing cold like significantly cold totally right yeah so now if we were to do this when we didn't have to make a call that means it these superconducting experiments move from the laboratory where it's forced to be called to the real world our desktop you use an analogy in chat although it was really interesting of like a
superconducting road where and then you don't lose energy right now how much energy do we lose transporting into our houses right so you know I would say on the order of 70 of energy we produce is lost to heat and friction think about moving a car down the road when you move a car down the road you're having to put energy in to overcome the friction of
the car hitting the road so if the car could hover above the road the friction goes away and the energy needed to move the car goes way way down when you build a data center the electrons that are moving through the copper and the semiconductors bump into other atoms when they bump into the atoms in the material they shake those atoms when atoms shake that is heat so that's why
copper wire heats up when you put electricity through it you're moving electrons through it some of those electrons bump into the copper atoms shakes the copper atoms they get hot and then some of the electrons make their way through the rate at which electrons are bumping into other atoms is the resistance of the material so um and so so all this energy is going into cooling
down data centers and all this energy is lost in Computing uh to heat and uh same in electric motors could be reinvented semiconductors to integrated circuits would be reinvented and like I said if you had an off of this material you could put it in roads and because superconductors also reflect magnetic fields you could put magnets on the bottom of cars and Float them above the
ground and cruise around without any friction this 70 loss of and then all this energy put into cooling data centers we could be looking at doubling or tripling the amount of energy available because we've built a certain amount of energy infrastructure so this would be all gains if we could figure out how to yeah technology massive and massive abundance
it would lower the cost of electricity by 10 100 I mean look assuming huge infrastructure Investments which would take probably decades to do sure you would you would get there but in the near term there are these incredible applications quantum computers are built using little superconductors as the qubit and so the superconductor holds the qubit state so this idea that we
could now have room temperature Quantum Computing is also a very profound one game changer low cost and and the first thing that would be changed is likely electronic components so we would take electronic components and redesign them using superconducting material that would allow you to reduce heat loss and energy loss and that would have a big
transformative effect on for example the big effort right now to make more AI chips GPU chips to do Matrix Transformations there are some precedent for this people are now creating Optical Bridges between gpus and CPUs in order to reduce the heat so they're using Optics basically light to transfer data interconnects yeah yeah that's been the big lift right now from what I
understand in gpus and data centers is yeah it's it I mean we could go on for hours on that but like yes I mean this would just be a game changer Electronic Component photonic chips right yeah photonic chips but look this this is obviously a little bit separate but here's where we are so LK 99 there's all these simulation models that show this thing could work but there's two
two things I will say came out of this from some of the simulations the first is remember this is a crystal with mostly lead atoms and these lead atoms some of them get replaced by copper and when when they get replaced by copper it causes the crystal structure to change by 0.46 degrees is what the Koreans say the angle changes by 0.460 race and when
that happens that bending causes the electrons in all the atoms and the Crystal to overlap slightly and that overlapping effect causes this free-flowing electron tunnel uh that theoret that is the theory for why the superconduct now what the simulation showed is that you have to replace only one of the lead atoms not any of the other ones in order for this to work and
that could explain why everyone's having different results in the lab trying to reproduce this because when you bake this stuff in an oven if the copper gets into the wrong atom space in the crystal it doesn't work and so that's why some of these things might end up looking good and some of them don't look good and some of them there's a lab yesterday in China that published no resistance
but they had to cool it down to 100 degrees below freezing and so it wasn't at room temperature but it did superconduct it did have no resistance 170 Kelvin I think yeah so 100 100 below zero so there is a key there is a key here in the molecular structure that you have to just thread perfectly right you have to replace the right lead atom with the copper in order
for this to work and so that's a technically very and what happens so that's a Fidelity issue that's a tool issue like you have to have the right tool to do it or is it luck or right now so here's the crazy story and I'll tell you guys this I don't know how real this is but the guy's claim so remember these two scientists Lee and Kim supposedly saw this material in a lab in 1999
that's why it's called LK Lee and Kim 99. and so in 99 they came across this and they could not replicate it and they had no idea how to make it again and it disappeared and they didn't have the sample again they then spent the next 20 years of their life one was a college professor and the other one worked for LG for as a battery engineer and they
just had these random normal everyday lives it reminds me of Dennis Quaid in the movie The Rookie where he had like this amazing arm and he was going to go to the MLB and then something happened and he spent the rest of his life at his High School PE teacher and then 20 years later he gets his arm back and he goes to the MLB and he plays in a Major League baseball game because all of a
sudden in during covet these guys got some funding they set up a company they went into a lab and they rediscovered this material and apparently this is the rumor I don't know if this is real the rumor is they had it they were baking it in an oven in a vacuum sealed tube and when the guy took it out of the oven he accidentally bumped into a table and the
tube cracked and when the tube cracked it did something to the material and then they measured it and oh my God it's room temperature superconductor that's the current theory of what the rumor of what happened in the video that's like Peter Parker being bitten by a radioactive spider I mean it doesn't make any sense so here's the drama this guy one got
inserted to oversee them as like their CTO the guy that gave the money to Q Center said he's got to oversee you Quan apparently got fired from his job in March and he was kicked out of this company was no longer Affiliated and the rumor is that Quan took all the lab data and these guys in 2020 during covet they discovered this they started filing patents and working on the manufacturing
process trying to figure out how to replicate it and do it again they had all this data but they weren't going to publish it they didn't want the world to know about it yet and then all of a sudden Quan gathers all this data probably disgruntled after getting fired puts it into a paper and puts it on the internet so that's the first paper that came out because there's a website
called r-a-r-x-i-v is there a pronunciation for this website so this is where you can open source file scientific papers right okay so this is a place for dropping papers outside of the the traditional Journal yeah the traditional Journal process requires peer review and there's editors at the journal that decide whether or not to publish your paper so
sometimes the keepers yeah Gatekeepers and so if you don't want to do that you just want to get a story out to the world right away so during covet everyone was publishing on the site all their updates on Research they were doing to help the world figure out what's going on with covid so it's a great place to just hit the world with your data hit the world with your
findings this is like acoustic raw papers and it's called archive a-r-x.org if you want to go see it archive so anyone anyone can publish a PDF no one knows if it's real or not it hasn't been peer reviewed Etc so this guy is one yeah so Quan drops the paper with his name he came and Quan on the paper only three people can win a Nobel Prize so the theory is he did this to
get his name out there to make sure he could lock in his name for the Nobel Prize wow and then within a day Lee and Kim and four people they've been working with some including some folks in the U.S publish another paper with better data but it was also rushed out and so both papers are pretty ugly I gotta be honest they're like pretty messy they
don't have a great deal of clarity there's errors in them there's mistakes there's redundancy there's little basic chart editing errors stupid stuff clearly this was a rushed job but these guys rushed out and said you know what if this is going to be public we now have to correct the the story and say what happens they wanted to get their claim in to get their Nobel Peace Prize
which would indicate that would lean towards a piece of evidence as would people funding them 25 years later that would indicate maybe there's something there two things worth noting on the simulation stuff number one obviously you got to get the copper in the right place and the production way to do that how do we actually engineer that to happen it's not really clear baking it
in an oven clearly it's creating what's called heterogeneous results meaning everyone's getting different results around the world that have been doing this for the last couple days and everyone's really confused is this real is it fake I don't know but that simulation explains why there's maybe lots of different results another comment it turns out that one of the
simulation teams said hey if you put gold instead of copper in the spot it's a better superconductor it could actually be a better material so it's opening up all these paths for exploration that we had never considered before that there's this whole new approach to creating superconducting materials that was not on anyone's radar before so this is opening up a whole new
realm and I think this is going to unfold over the next couple of years with more material Discovery more invention coming off of this initial discovery simulation model that then up offers all these other opportunities for creating potentially new materials that maybe are easier to manufacture and better to produce and the final thing I'll say is that there are some teams
that are commenting that are saying that this thing may be superconducting but only on one dimension which means along a line of atoms or line of molecules in the material so normal superconductors think about them as like a 3D Matrix and the electrons can flow through freely through any direction through the Matrix through the Crystal and in this case
they're saying the electrons can only flow freely across a line in this material and so now there's another question of wait how do you manufacture lots of lines to run in parallel to make this thing truly superconducting at scale so that's all the hard technical stuff that's emerging right now whether or not this actually does turn into a room temperature superconducting
material that can be industrialized and used in all these applications everyone's really excited about I think it's probably months to years away from knowing but at this point there's a great set of indications that oh my God we might be onto something new there's a whole new path of Discovery a whole new path of engineering and invention and it's amazing to just see everyone gather
around this I get so excited about it because it really will uh changed so much about the world and create extraordinary abundance and prosperity for Humanity if this proves to be real and industrializable and scalable can I ask a simple question when you say if this proves to be real if nobody has reproduced the result why is there any belief that this is
real there are properties of this that look I think we have to take a step back we have found superconductive materials in the past there are many ceramics that are superconductive Mercury is superconductive there's all kinds of elements and materials and compounds in the physical world that we've already figured out have these properties so
this is not like a new thing that's never been found before it's just this idea of trying to find it at a certain temperature where it could exist naturally in the normal world without all this expensive cooling okay but there is a separate thing which is that we also have found a whole bunch of materials that look and behave like superconductors but are really not
they're what's called just diomagnetic and I think right now what what people are trying to sort out is is this a clever diamagnet is this diamagnetism or is it superconductive and these are huge differences that swing this from yeah it's kind of a cool thing and yeah whatever there's a bunch of other materials we found that are like this to wow this is transformational and right
now we don't know any of that and I think that all of the mystery around this is mostly because people can be on one side of the debate or the other literally by the second based on what new simulation or what new piece of research people are putting out there but you have to remember like diet magnetism is like a property of matter superconductivity is a state of
matter it is totally different all superconductors are diamagnetic but all diamagnets are not superconductive so we could just be extremely excited about not much of anything or this could really be a breakthrough if what the Chinese guy said is that they were able to cool this thing down and get it to be super conductive then that doesn't identity K it doesn't mean
much in my opinion right it's not room temperature but it does indicate that this material can be super conductive look there are many materials like this there's like a lot of forms of red matter that we've already found that at that temperature gradient at that range of temperatures can be superconductive it's not practically useful at that
point yeah that's right I don't think you're going to see like some massive Revolution so on the betting man I make bets I think I've talked about when there was this guy Rhonda Diaz that had to try this stuff and he was sort of refuted in what he was working on but 18 months before that happened I was trying to get a deal done with the University
of Rochester to buy all that IP so I've been grinding in and around this space for a couple of years my intuition on this is that this is diamagnetic and I think and I think we're going to find that you know it was it's like yet another material added to the list of materials and it's okay but hopefully what it really does is it is it Sparks an interest in um in a lot
of other people putting more money behind this Nick if you could pull up this manifold markets uh there's a prediction Market called manifold.markets that people have been sharing a link from betting markets where people bet either side of this will LK 99 room temp ambient pressure serving conductivity pre-print replicate before 2025 and you can see it's about 30
chance you what do you think of the prediction markets assessing this Free Bird yeah I think relevance probably that's probably a good handicap for where we are I'll say when you look at a diamagnetic material and so what that means a die magnet will expel magnetic fields of both polarities a paramagnet will reflect the North or the South Pole its North Pole will reflect the North
Pole of another magnetic material right diamagnets you can put North or South Pole and they reflect both and there's plenty of videos you can watch of putting a frog in like a 10 Tesla machine and the Frog floats technically a frog is diamond magnetic but what happens typically with diamagnetic materials is they Orient themselves while they're while they're
freely floating into a particular direction so there's going to be three things people are going to be looking for in terms of confirmatory proof on LK 99 the first is does this material float like a superconductor over a magnetic field because remember superconductors perfectly expel magnetic fields they are dimagnets to the uh absolute degree they perfectly reflect all magnetic fields so
if you put a superconducting material above a magnetic field it should kind of float freely and spin around and stuff if it orients back to one position it probably means that there's something going on where it's maybe not a perfect superconductor now all these video the second thing you're going to look for is zero resistance so can you actually pass
an electric charge through it and have no resistance in the material so you're seeing data coming out now that's indicating we're seeing that but we're seeing at a low temperature no one's yet replicated this at room temperature and the third thing is a transition which means that there's a point where it shifts because that's a classic characteristic of superconducting
materials if there's a transition temperature transition phase where the material becomes superconducting or it's not super conducting um so those kind of generally those three experimental proof points or what everyone's looking for thus far the videos we've seen look like UFO or Bigfoot videos they're friggin grainy they're like you know you guys have seen
some of these videos that have come out they're like at a distance it's like wait why didn't you do the whole angle why did you only take a picture why didn't you do the video there's this woman in Russia right now in UFO territory people are look at this I mean it's super like there's a rock there's a little flake of here's a video of a little flake of a material that someone
supposedly made in the lab or it could be done right and they put it over the super over a very strong magnet and this is the video they got it's super blurry there's a woman in Russia and she totally reinvented the manufacturing process she's actually well-known scientist so she's not BS and she said I made this thing in my house using a furnace and I used a whole new process
so she does this whole new process she live streams the whole thing and then she puts out a video of the thing floating in a straw it's sorry a video photo and it's a blurry photo and people are like show us the video show us that it's real and she's refusing to so this whole thing is feeling a little like there's UFO Bigfoot type people out
there that we're not really seeing Clarity on is this real and then obviously the resistance data there's very credible academic universities coming out and I will also say there are a number of labs there's one in China and the one in China that measured the the zero resistance at negative 100 degrees they created 8 000 samples so they found
one that worked there's another lab that did eight different Pathways of manufacturing it in China and they said we can't find any of that work yet so you know there's a lot of negative indications as well which is why the prediction markets are probably right but I do think that this theoretical explanation that you have to get the copper atom to replace the correct lead
atom in the crystal structure explains a lot of the heterogeneity and results and the reason why people may not be able to replicate this and if someone could crack the code on how do we actually engineer this thing and produce it correctly uh based on the theory maybe we'll see different better results but again that's also theoretical because no
one seems to have nailed a manufacturing process here so lots of data coming in every day by next week we could be clapping and you know cheering or you know we could sort of be on this very long grind sort of like Russia Ukraine just a long grind and it's a it'll last years and maybe someone will win maybe someone won't or maybe it just opens up a whole new set of Explorations for new
superconducting materials at room temperature that could change the world I gotta say the thing I love most about this is like we have this Oppenheimer film comes out and at the same time this happens we got the UFO testimonials you know uh Congressional hearings all of this energy at the same time of people who are just really stoked do Material
Science to do basic science to figure out big problems and uh I agree with you the optimism around all this is is I mean something else tell me something else in our lifetime in our in the last decade or two where we've seen the whole world say in a positive way something great Could Happen instead of something bad could happen and someone's to blame for something I mean it really
is in my mind the first time I've really seen this happen in a very long time maybe the internet was a was it yeah yeah everybody being connected everybody being able to share information they're doing it on Twitter and Billy Billy and YouTube and like all sharing this stuff and saying my gosh we could have this breakthrough together as a as a civil as a species not like a country
not a individual not a who messed up who did something wrong who's to blame who's on the other side it's like dude if we all do if this happens we're all gonna be like chilling on the beach it's gonna be amazing like this is awesome we're gonna have a rash of VCS running into this next and start funding the stuff Material Science yeah yeah I mean my attitude is
kind of like wake me up when you know it's real it's nice that if this is real then it's great that there's all this positive energy around it but that's like a big caveat until we know that there's something real here I think it's premature for everybody to say that this is like some wonderful thing now if we find out that the science is real and then it's just a debate over
commercialization of it then yeah I agree that would be like a really positive moment I just love the fact that when something positive in the world happens or when something negative happens we have this amazing platform for everybody social media x.com formerly Twitter where everybody can get together around this campfire and just start discussing
it and speculating now some people don't like speculation obviously if there's a school shooting or a tragedy a building burns down uh the fog of War as we've seen in the constant Ukraine coverage you know you can have it's very easy to make mistakes the stuff in real time but I love the real-time nature of the world and the pace we're moving at it's it's kind of delightful it's not a problem
with the speculation and there is a fun element to it but when you start talking about investing in it like I said wake me up when you know it's real there's a really funny meme that VC Bragg's posted [Laughter] and not paying attention to the drowning kid it's sort of like the guy who's holding hands with his girlfriend but looking over his shoulder and whistling
at The Other Woman by and superconductors is the happy little kid VCS is the mom and Jenner of AI is drowning but then they show him the underwater yeah somebody who's tied to a chair with chains of the last hype cycle yeah the last hype cycle Creator economy crypto we have three yeah it's pretty funny it's pretty it's pretty sexy I um
I told you about this when we were in Italy last week but uh when I was 13 years old Jay Cowell can make fun of me now I did a science fair project on superconductor actually I was doing it when I was 13. and I bought this superconductor from the back of Popular Science magazine you know this old Atrium barium copper oxide that was the one that won the Nobel Prize you could
buy it for nothing and I got liquid nitrogen at UCLA and I get a demo at the science fair and I did a poster board and I I had hyper card on a Macintosh LC and I showed everyone this is the future we're about to have room temperature superconductors it's about to happen and we're gonna have flying cars and we're gonna have Limitless energy and Limitless battery storage for energy by
the way which is one of the big applications and it's it's just on the break and this was when I was 13 years old 1993. you know here we are 30 30 years old 30 years later and everyone feels like this moment might be upon us but it has been this thing that's always been elusive that everyone's always thought it's around the corner well it sounds like cold
fusion you know we've always been 10 years away for some breakthrough in cold shoes self-driving cars artificial general intelligence yeah well I think there's a difference between this physical world Material Sciences type Innovation and then software Innovation and one of Peter thiel's critiques is that we've had tremendous Innovation and software but
in every other aspect of the economy there's been little snow Innovation planes for example are getting slower not faster would you believe that position from from him I I don't buy that position well I mean with the exception of like what Elon has been doing with the genomics the genomic Revolution he misses life science entirely in that point I don't know I mean genomics I
mean largely software based at this point if you look at that Revolution driven by Gene editing oncology the breakthroughs I mean look it's all slowing down I do agree with him if you look at the number of um approved drugs every year and the cost per drug cost per drug is going the wrong direction and the number of drugs per year is going in the wrong direction
so there is an argument to be made there but there there are arguably some Quantum leaps in the types of medicine that we're applying we didn't have biologics you know 40 years ago we didn't have gene therapy 10 years ago these are new modalities for for therapies that didn't exist as we've engineered the molecular world to do amazing things in the biochemical
application space so I think um there's elements of this that I disagree with but I think the general trend lines as he points out is totally true yeah but with planes I think we made a conscious decision he always cites the plane issue hey we don't have the Concord we're going backwards in terms of speed I think that was a deliberate cost cutting measure because people
aren't willing to pay to go faster and burn more fuel so they're particularly enough Innovation the price gets cheaper that's right that's right yeah same with the electricity same with energy electricity is getting more expensive not cheaper but if you look at the NASA if we wouldn't have the massive gains in artificial intelligence and machine learning if it hadn't been for the
revolution in GPU storage and data centers and microprocessors and that's kind of the point is that we were promised flying cars and instead we got 280 characters not that Twitter slash X is bad but that's just where all the innovation has been is an I.T that I agree with you so they figure it out they keep figuring out how to put more circuits on a transistor or whatever and
you know keep Moore's Law going or I don't know I could show you can use but I could make a different argument by showing you human lifespan and agricultural yields I mean agricultural yields continue to climb because of our ability to engineer in a smarter and Better Way Every Generation there there's a there's a lot of counter arguments to them I would say what's
valid about it is we go ahead I was going to say the reason you we don't see these kinds of Innovations is because the ruling class has clogged up and sclerodically dominated all the places where you'd have this massive forms of innovation like regulatory capture no they're not no no no that's like I'm talking about that's like a boogeyman so get the boogeyman out the
regular Droid capture is there forever like why was this paper published on arkson because every other form of publishing mechanism is sclerotic it's establishment it's hierarchical it's about people basically dominating their own little forms of Paola right and so nature Jama all of this stuff works this way and so what happens you don't get
fundamental innovations that happen in Labs you have things that feed research proposals that feed people who need to basically establish their Supremacy you saw the Stanford Professor get booted up because of stuff that you know he the president of Stanford the president said so why is all this happening well Peter is right the reason why this stuff is
happening is that instead of places where true fundamental Innovation can happen if you look at the Nobel Prize winners and you do distribution by age what do you find people win no bells in their 60s for work that they did in their 20s and 30s right and so you have a system now that rewards people staying in their positions I wrote this in one of my annual letters if you look at the
average age of like leading people in schools they're like 70 years old if you look inside of Congress so there's this all of this stuff that just kind of sclerodically prevents young naive people from basically going out and really pushing the boundaries in specifically this case of Science of fundamental science and so for every Innovation I think the question to ask
is what other Innovations are we missing and if Innovations are on a fundamentally well-established pathway that defends a bunch of work of senior people before it it'll get supported and I would say that genetics is a perfect example of that the other if you look at the if you look at the number of rare diseases that have still that are still like unsolved or
the lack of understanding of immuno disease it's just crazy like it's I just think that that's really what's happening I think Peter's more right than he's wrong the other issue here sax is and I like to get your feedback on this is if you look at how Venture Capital works you got a 10-year window you want to get returns for your LPS you look at how this fundamental research we
just said this started in 1999 that's why it's called Dash 99. this thing took 25 years to get to this point is is part of this issue that you have this big opportunity zone between say Ventures window 10 years and then Academia which you put at like four decades there tomorrow 20 you know year olds getting their rewards in their 60s how much of this has to do if we don't
have a platform in between Venture and Academia that's not the problem I mean so it's true that VC funding typically you want to go to the commercialization of an idea and that the underlying platform shift it already exists and usually that comes from some sort of breakthrough that happened in Academia I mean that's basically what happened with
the internet so yeah you do not want VC funding typically going to basic r d you know fundamental science r d it's just really expensive takes too long and too unknown so you want that stuff kind of done more at the academic level the question I have is how much of what's happening in Academia is basically either irrelevant or fraudulent such a mouth you brought the Stanford president
I think the the story there is he had five papers about Alzheimer's research and you know related topics like that where they found out that the papers are basically bogus and quasi fraudulent so how much of the the work that's being done in Academia how many of these papers are basically bogus well the thing with peer review is like it's presented like it's a great
incredible solution to the world's problems but I think what it has inherently wrong with it so the positive part of it is theoretically you have error correction right but here what you don't find is that that error correction actually even happened and so it takes like some young 20 year old kid at Stanford who's a journalist whose family
were journalist to basically figure that out so instead what were those what were those papers doing they were supporting a rising up and coming person because they thought that you know he would support them at some point this is like the whole corrupt Fouche system at the end of the age and sax are presenting academia's corrupt do you agree with that I don't
know if corrupt is the right term because I think that implies male intent I think that the incentives are wrong so in order to get funded you have to show results no one gets a grant to disprove someone else's work no one gets a grant to do confirmatory work on someone else's work should that Grant you get it yeah I mean that's that's the argument that that some folks make you get a
grant to do breakthrough research and have breakthroughs and if you have breakthroughs you get more money that's the way the system is set up but this is this guy this is why well let me just say it's corrupt I think so it's corrupt there's no funny breakthroughs come on okay whatever you want to Define it as the guy the guy at Stanford if you read
some of the testimony from people in his labs they said that he encouraged people to have big findings and if you get big findings you get to progress in the organization you get more funding Etc so the the incentive structure that he set up for people was not necessarily to go in and disprove stuff or try something and show that it didn't work if you try something and show that it
didn't work and publish a paper on that it's going to be very hard for you to turn around and get a trophy or get some money there was like a bunch of error in the data that they went back and were like hey this is this is incorrect and he's like oh yeah it was sloppy I just didn't do a good job of reviewing it so yeah so what happened was if you read some of
the testimony the people that worked in his Labs the students and the The Graduate students and so on they said that he basically encouraged people to get good results and in that process and in that way there was some fuzziness in the data or some tweaking of the data that he didn't double check for sure but he was encouraging this sort of system of performance and the system of
performance says you've got to show results you can't show non-results and if you show non-results there's no money and there yeah the reason they're doing that is marketing they want to Market and get more attention so they get more donations yeah exactly the problem with with a pure research is that you have to get funding to do your research where do
you get your funding from you get your funding from federal agencies from non-profits from your um you know your donors and so in order to get that money you have to say here's what I'm going to do here's not what here's you don't say I'm gonna go not prove something you see I'm gonna go proof something no no the problem is you're hiding the cheese can you part of the Jesus
Jesus are saying I'm not I'm not most of these people are working on very thin incremental extensions of work that's already been done because it allows them a more defined path to get tenure ship to be a well-respected professor to work through the hierarchy of a university that's what's happening today and the reason why that stuff gets funded is that those are the same people
that are in charge of the funding infrastructure at NIH and all these other places what we don't have is something that says go and write the most ambitious proposals and I'm gonna go fund it I think both things are true I'm sorry let's get mechanism I'll just say both things are true because what you're saying chamoth is a point of failure if you say I'm gonna go try
something crazy like do a search for a room temperature superconductor using lead crystals you're not going to get funding for that it's two out there I mean you guys today are talking about how low probability stuff isn't that interesting I'm not going to fund it until it's real and so when things are real you have some molecule that has some effect on cancer cells then you get
funding to make that molecule go to the next phase or go to the next stage that is more fundable than the outlandish crazy thing where the probability of it going to zero is 99 you can throw Elizabeth Holmes into that right I mean she came up with this absurd idea that she could do 200 tests on one drop of blood that was just a statement about
engineering that wasn't ready another company it just got funded to do the same thing that thoroughness promises gonna do yeah do you see this but I I did not say that no yeah I mean some pretty good VCS invested in it actually and they expressly said we know this is the same idea as theranos but for that very reason we think it's very unlikely
to be fraud because it's being held to such a high standard of scrutiny I want you guys to think about this I want you guys to think about this as VCS an entrepreneur comes to you and the entrepreneur she says I've done this thing I did this thing I did this thing I did this thing I did this thing five different things none of them were I want to have money to do this next
thing you're less likely to fund that person than the entrepreneur that shows up and says the first thing I did work the second thing I did work the third startup I did worked they weren't home runs it and I had good results that's basically what happened in in you know the scientific research is you've got to get something that's fundable and often
that means not doing something that's likely to go to zero and that's where the incrementalism comes in chamoth is that orientation I think that I hate to uh give my playbook but one of the great successes I've had is finding people who got their asses kicked on the last two companies talking to them about why they got their asses kicked and then how they're going to avoid getting their
asses handed to them with this third company then if you look at Travis with Uber he did scour got you know sued for a quarter trillion dollars he did Red swoosh he got like a 30 million dollar exit and then he did Uber right his first two companies were very hard Steve jervinson and future Ventures he took his Venture fund and he told the LPS
it's a 15-year term not 10. so he specifically is trying to do a little bit of a longer window I think that is actually a possible solution here I think smart independent thinkers find ways to make money I've been looking at this superconductor space for the last two years and so it's not like people are are shy and have money and aren't willing to write the checks I just don't
think that's what it is the body of work that's coming out of academic institutions today for the amount of money that's put in is modest and I think that's the best way to describe it it's the ferris way and the reason is modest is not because of the intellectual capacity of the people it's because of the incentives and the hierarchy and the establishment elitist politics that
infuses how these organizations run and I think the only way to break that apart is to basically disrupt who is in charge of these institutions Nick just throw up this chart these are people that for decades and decades and decades are in a grind and who are now in control and so what is the incentive of these folks to explain the change yeah what is this this is a chart that I
put together which is just the generational distribution of academic leadership across all the leading research institutions in America you had the most important person hold on the most important person probably in the federal distribution of grants in the medical field was fauci right he literally was running the NIH since the 1980s he's been there for 40 something
years and the mass was peeled away during covet and we saw how much power he wielded really I think in a corrupt way Jason used the word corrupt you had that letter to the landsat that he got a whole bunch of scientists to sign that claimed that covid was not made in a lab that was a conspiracy theory that the only place it could have come from was
the sort of the zoonotic leap naturally occurring from animals we know that he used his power over grants to basically pressure those people into signing the letter where they thought it would be in their interest to do so even though fauci had already been updated by a bunch of scientists that it likely had come from a lab they could just look under a microscope and see if you're in
Cleveland sites which are The Telltale sign so they knew that this thing likely came from a lab there was no basis for calling it a conspiracy theory certainly and yet the whole thing you got behind that but technology did you see that slack messages where they were trying to manipulate the New York Times science writer I mean they basically but the
question you have to ask is why were all these scientists willing to go along with this because these guys have been grinding for 40 or 50 years in a hierarchy and so to all of a sudden put a pin in it and just say you know what I'm going to dispense with all of it and now I'm going to basically like be completely open-minded How likely was that the odds of that were very low look look at the
number of people who have basically grown up in one segment of society that are sclerotically in charge of every single leading research university in the United States that is why we don't have flying cars this is why because after 40 years of working in a specific hierarchy being rewarded in a very specific way with a very specific set of incentives when
some young Brash 22 year old naive person writes an extremely ambitious research proposal you're like no you will not be a part of my lab to do that but you can do this incremental thing that that further reinforces my leadership in society that is what this chart shows yeah it's also perverse inside of government we didn't talk about it I don't think last week but
Mitch McConnell I don't know how to say it but I guess he froze while he was speaking and you know we got to have an upper age for the Dianne Feinstein thing remember when she said a speech and their staff are Whispering saying just say I you know and she starts going on this I mean filibuster we have a sclerotic political system run by oxygenerians because the boomers are
not relinquishing political power they're not relinquishing bureaucratic power can we just pull up this Lancet letter for a second they say here's zoom in this the rapid open and transparent sharing of data on this outbreak is now being threatened by rumors and misinformation around its Origins We Stand Together to strongly condemn conspiracy theories suggesting that
covid-19 does not have a natural origin how could they say that at that point in time all the evidence suggested it was made in a lab now certainly I think you could take the other side of that but to condemn the loudly Theory as a conspiracy theory that was corrupt I'm not sure that that's corrupt you know what's corrupt is not retracting that and apologizing
that's where the real corruption is we have not gotten our posts a letter was organized it was organized this is just like the 51 spies who lied claiming that the hunter buying laptop was disinformation this is the establishment willing to use its credentials and respectability and expertise to sign a letter they know is false to perpetrate a fraud on the American people in order
to protect the people in charge that's the motivation here because fauci had fun to gain a function research in the Wuhan lab I think the same Rod that is in some of these leading research institutions and leading academic institutions and politics they all share the same commonality which is we are sclerotic we are in desperate need of a generational shift of power
and right now there is no incentive because at the same time you know the people that are 70 and 80 are thinking to themselves well are probably going to live to 100 what should I do for the next 20 years being in power is pretty good right so we're we're in this weird Clash I was thinking a lot about the fiscal spending problem in the US and we should
talk about the Fitch rating downgrade that happened this week I've got some data I'd like to share one thing I was thinking about was how tied the age of congresses to our fiscal spending problem if you think about someone who's young they're going to want to invest for their future and think about the future if you're someone who's old you live for the day
and you don't think about the future and I worry so much that the Aging of the establishment that makes the decisions about how money is spent creates a a cycle yeah or positioning that's all about giving away all the money today instead of making the right decision to make sure that we have a prosperous tomorrow and that's why I think so many of these things
kind of slip through if you put a 20 year old in charge that was well informed in charge of some of the fiscal policy Environmental Policy energy policy decisions defense policy it would be a very different set of decision making than someone who's in their 80s inheritance tax yeah yeah I mean so anyway we should talk like you want to talk about the Fitch downgrade because I think it's a
really important story this week Fitch the rating agency downgraded the US's long-term debt by one Notch from AAA to AA Plus only nine countries have AAA ratings from the top three rating agencies s p Global Fitch and Moody's those are Germany Denmark Netherlands Sweden Norway Switzerland Luxembourg Singapore and Australia what you can take from that is you got to have a good
balance sheet and you have to have high functioning governments the highest functioning governments in the world are the nordics that's why you see Denmark Netherlands Sweden Norway there according to NPR the negative reaction hasn't been as strong as uh 2011 that was the first time the US was downgraded from AAA to AAA Plus by the s p that
also had to do with the debt ceiling the Market's kind of shrugged off largely Shrugged off the fish downgrade main reasons for the downgrade is obviously higher interest rates aging population the debt to GDP ratio which we've talked about here but government kept coming up over and over again and how dysfunctional our government is and the debt ceiling is one of the key
manifestations of that your thoughts on this for the first half of the show freeberg you're an optimist but are you now going to switch to the finest I wouldn't say declinist are you going to switch to declinist mode now or are you still in Optimus mode I mean in Jacob's view unless you're a cheerleader for every student government policies I know it's Jake out listen it
I want to be honest I I don't think so I think he like and I I concur I think you can highlight that there are concerns with U.S fiscal policy that are putting us in decline in our spending spiral with the U.S currency reserves which there are now diversification efforts underway and I'll talk about this in one second and that doesn't mean that the US isn't
the most exceptional place to do engineering and entrepreneurism and have freedom of speech and thought and so on but there are elements of the US that put things at risk so let me just point out these two charts if you guys pull the first one up this is a pretty striking chart and I think I showed this before this is federal government interest payments that are being made
we're we're now up to you know a trillion dollars the chart as you can see a year has spiked and by the way that number is spiking further and we'll talk about this in one second as a result of rising interest rates and increased fiscal spending so this is now becoming a pretty sizable part of our budget and as of now paying the interest on our debt is a
larger capital outlay for the federal government than defense spending the second chart shows what happened in the last week which is that 30-year treasuries have been sold off and as that's happened treasury yields have climbed so there's been about a 10 decline in pricing on a you know a concurrent nearly 10 increase and Bill Ackman you know basically said today
that he's shorting 30-year treasuries he thinks we're going to go to five and a half percent long-term rates currently the 30-year treasury sitting at 4.3 and remember I told you guys this after this thing I went to a few weeks ago that there were two prominent economists who shared that they think were going to be facing long-term rates in the five to
seven percent range very long-term rates for a very long period of time that it is a new fiscal regime and then if you pull up the last link I sent Nick this is a report made by the treasury borrowing advisory committee of the Treasury Department and I just want to read a couple of quotes from this report this just came out uh today and it was published that it was sent over to the
Secretary of the Treasury yesterday and it said since the advisory committee convened in May two-year treasury yields are about 100 basis points higher while tenure treasuries have increased by about 40 basis points the Bank holdings of non-mortgage-backed government securities mainly treasuries have actually declined by 146 billion so far this year so that means banks are
selling off their treasuries the committee goes on to say at the same time treasury investors have noted that treasury Supply will need to increase to address the rise in public deficits as tax revenues have come in weaker and government spending has increased issuance needs will be additionally impacted by the timing of a recession so on then they said based on the
marketable borrowing estimates published on July 31st treasury this is crazy treasury currently expects privately held net borrowing of 1.007 trillion dollars in this quarter with an assumed end of September cash balance of 650 and then they said we expect another 852 billion dollars of borrowing next quarter that means treasury is going to try and issue and sell
two trillion dollars worth of Treasury bonds in the next two quarters that's two trillion dollars of new borrowing by the federal government to pay our bills at the start of the year they were estimating 1.6 trillion for the year which was an insane number now we're talking about 2 trillion and just two quarters so rates are climbing as a result we need to borrow more and this
is a perfect manifestation of the debt spiral problem that we've talked about multiple times our fiscal spending outlay and the rising interest rates combine to create an insurmountable debt spiral that is now manifesting in the fact that we need to sell two trillion dollars of um treasuries and here's the crazy statistic that they said in
reviewing recent demand for U.S treasuries in auctions the committee noted that an increasing percentage of supplies being absorbed by investment funds while foreign participation has remain range bound that means as we're trying to sell more treasuries governments Federal foreign governments are buying fewer of them which means that the U.S currency as a reserve is no
longer the place that everyone wants to plow their money as much as it used to be it is in Decline now the other thing I want to share which I think is is absolutely critical is how do we address this Gap well the one way is these entitlement programs and so several Republican presidential candidates Nikki Haley Ron DeSantis and Mike Pence have all publicly stated on
the the campaign trail that they're promoting programs to cut Social Security benefits for people that are 30 and 40 years old and here's the response to that so so they've gone out and they've started saying that a poll was done and on that poll 82 percent of Voters oppose the push to cut Social Security for Americans under 50. 82 percent so where is this going to take us this
is what is so scary to me jaycal I'm not an American declinist I believe in the American system it benefited me and my family but I do worry that we find ourselves in a Whirlpool that it's very hard to get out of because the populace says we don't want to make the cuts that are necessary in order for us to save ourselves that's what's so scary to me
and I've said it before I think it's worth saying again that's it I'm done it's not a problem with populism I mean the elites are saying it too there's no appetite in the DNC to cut or reform Social Security are you kidding it's very unpopular how do you get how do you get elected I don't know why those Republicans how do you get elected saying I I hadn't seen that
article I would advise all those campaigns not to touch that rail they're going to electrocute themselves I think Trump has the right political instincts on this point which is you cannot touch the security as a single party effort it has to be bipartisan and there is no bipartisan will to do anything so I think you're you're right about the larger Point chamoth you're a Dutch on
friedberg's Manifesto that 80 of the public does not want to cut spending they're in favor of social security for people under 50 years old and we have a trillion dollars in debt payments and we're in a death spiral because literally in 180 days we're borrowing an extra 2 trillion yeah the fiscal end of days at the start of the year the the expectation was
there we're only going to borrow 1.6 trillion for the year now we're borrowing 2 trillion in just these two quarters let me just State what I think about the downgrades it's irrelevant the s p did it 13 years ago Fitch is a marginal credit rating agency they're at a minimum 13 years late at a maximum they're just anxiety written like other people are that we're always dreaming
that the sky is true so that's my first point the second point and the more important one is that I I none of you who are always freaking out about this understand this conversation about relativism all of these conversations are relative to deal with them in absolutes on a relative basis Japan's debt to GDP is 270 and growing on a relative basis our debt to GDP is half of that
we are the most important economic force in the world it is going to continue to be the most economic force in the world and all I see actually on every single monetary basis is every other country struggling more than we are so my question to all of the chicken littles is what do you do if you're a central government where you have to have foreign Reserves
do you all of a sudden double down on the Euro do you double down in the Yuan which is basically a proxy for being for doubling down in the US dollar what are you supposed to do and I never get a good answer because on a relative basis the U.S will still continue to do well I think that debt to GDP is a red hearing for a lot of people and I think that the way that people run
their personal lives which should take income to debt into consideration I don't think applies as much to governments and I think these things are going to March forward as a group there's not going to be a single G8 country that all of a sudden moves away and starts printing surpluses it happened almost as an accident an aberration during the Clinton
Administration it'll never happen again and I think that we shouldn't worry so much because I just don't see an alternative so give me instead of telling me how bad this is because you think about your own life and how it would be bad if you had debt to GDP I get it as a country give me the alternative country but just start with that can you answer that question what is the alternative
country yeah where would you put your your wealth if not the dollar well let me paint a scenario that's not as dire as a collapse of the US Dollars the world's Reserve currency okay so on this fish right that's not that's not what I think happens right I think this is just purchasing power goes down that's it but go ahead sex relative to who anyone
but what does that what does that mean relative to anyone let me paint like a non-catastrophic scenario or non-apocalyptic scenario which is what you saw in this Fitch ratings downgrade is that the bond market did move at the margins there was a sell-off in the 10-year and as a result the 10-year bond yield moved up to 4.2 percent so it wasn't a case of everybody shedding all
of their U.S treasuries it's just that there were Market actors at the margins who adjusted their portfolios okay now Freeburg is saying that the treasury is going to have to do another two trillion dollar Bond offering and we have trillion dollar plus deficits as far as the eye can see and we've got entitlement liabilities on the horizon and then at political and willingness to
do anything about it so the deficits are only going to get bigger and bigger now what does that do it's supply and demand when the U.S treasury needs to keep issuing more and more bonds at some point the demand for those things gets incrementally saturated and they have to offer a higher yield so what happens well well the bond rates go up and so
the tenure goes up like Friedberg was saying from 4.2 to somewhere in the five to seven percent range and that doesn't mean that US dollar is not the world's Reserve currency it just means that it gets incrementally harder and more expensive to keep financing our debt now what is the result of that well if I as an investor could theoretically get
seven percent from the U.S treasury as the risk-free rate why would I want to take Equity risk and put it in the stock market which historically has yielded somewhere in the five to seven percent range so if I can get my five to seven percent from a risk-free U.S government Bond of course I'm going to do that so the discount rate on equities will go up that means that the stock market
relatively on a relative basis will go down risk Capital will go down and they'll be way less risk Capital available for things like venture capital and private Equity just risk-taking of all kinds and so the economy will just grow slower it's not like there'll be a collapse it'll just be this yeah huge Albatross yeah around the neck of the private sector and this
is called crowding out hey may I give a counter here I think if you look at the amount of sovereign wealth funds and the investment coming from around the world into U.S Venture Capital that will keep the Venture machine cranking here in America but three charts to just look at here Nick pull up the first one the 30-year Fed so to counter this argument
really the aberration has been 2010 to 2020 when we had you know low single digit mortgages three percent four percent the majority of our lifetime it was between five and ten and if it's six up in the five to ten basis that that's what we experience for most of our life and then the second chart this is the lowest unemployment we've had in our lifetimes if you look at the
unemployment rate in the United States 3.6 is unbelievable and then combined with it something we've talked about here for two years that we can't understand is when do all these jobs burn off we peaked you know during the post covet era at about 11 million job openings and then you know we're still over nine so for there's two or three job openings for every American who
wants to work and we've shut down the borders largely even though we have some illegal immigration coming in it is basically shut down the United States to immigration it's about a third of what it was before Trump and by myself I don't think we're looking at the same video that that I'm seeing yeah if you're looking at videos those are very distracting I would encourage you to
look at the numbers of the actual migration into the country it's a third of what it was just seeing what's happening in New York City they got again caught up in Clips uh on from the border I would just look at the raw numbers sacks and the raw numbers you know the raw numbers yeah because we count them and we can't we count them we have to estimate them
because they're illegal but they got seven million look at the numbers and the actual statistics than anecdotal videos because both sides will manipulate the heck out of them for their own purposes but the fact is America is just crushing it in terms of employment and that's why we didn't have this crash landing and the and I think the soft Landing is because of
employment and I'll just stand there and if we can keep ourselves employed and everybody from the Middle East to Japan to high net worth individuals in Europe are pouring their money into the U.S Venture ecosystem I think the setup here is we got to control spending as you've said correctly Freebird we get a little bit of control on spending hopefully and
then we are going to have absolutely burn off some of this you know debt uh come on this kind of debt payments here's a little data for you tomorrow this is from congressional research service off of fed data so foreign Holdings of U.S treasury have declined from 40 to 30 percent of total treasuries seventy percent of treasuries today are held by domestic investors
this is the data that was being described in the treasury advisory committee the borrowing advisory committee uh letter that I just said is that they're seeing less demand from foreign buyers of treasuries now I can argue we could argue theoretically about what else are they going to buy and what else are they doing with their money I don't know but the data is showing a
decline in purchasing attention by Foreign buyers of U.S treasuries and we're having to pick up the slack through investment funds held by the U.S mostly pension mostly retirement funds I would guess that are buying these treasuries that is not what this chart shows this chart shows the effect of quantitative easing that's what this chart shows because when you're buying
treasuries from the market and retiring them of course the percentage of foreign and domestic Holdings of publicly held debt is going to go down so this last period explained this x of QE explain it sorry I don't understand what you're saying this is a measurement of the amount of people that own treasuries is that right domestic versus foreign yeah so who who owns so as of
December 22 there was um I'm gonna assume because this chart is [ __ ] worthless if this if it doesn't assume that the domestic holding the gray bar that adds up to 100 doesn't include the FED which it must and that is because the FED has been buying treasuries from the market okay so just let me just give you the numbers for a second and then we can take out I'm just
looking at the chart the chart that says domestic Holdings I'm gonna give you there's an orange bar that says four Holdings you've had 10 years of the the FED buying treasuries I'm gonna give you the numbers there are 24 trillion dollars of treasuries publicly held treasury is outstanding 7.4 trillion held in foreign hands the foreign holding of publicly held debt
between December of 18 and December 22 increased from 6.3 trillion to 7.4 trillion while other investors increased from 16 trillion to probably 23 trillion so you know it's we're having to pick up the slack investment funds private investors are having to pick up the slack because of foreign demand for treasuries lagging at this point that that's the point of the chart I don't
know what I don't know what to tell you I think what this chart tells me is that the balance sheet of domestic Holdings grows gross because the FED has been buying treasuries and then in a world of QT I suspect that this bar chart will change in the next 10 years if you look at the histogram 10 years from now if you assume that QT sticks around so I
don't know you can interpret whatever you want to feed your anxiety it doesn't change that there's a relative problem at hand which is you cannot sell one thing without buying another that's just the way it works in financial markets the Federal Reserve during that same time period increased their treasury Holdings here's the exact numbers from nine 3.7 trillion to 9.7 trillion
so they bought 6 trillion of that debt I think the fact that we're going to go from quantitative easing to quantitative tightening over the next decades another overhang but because not only does the US government need to sell another 2 trillion of bonds every year to finance its deficit which is basically the addition to the debt you've got the FED
now shedding what like 8 trillion 30 bonds they're letting them roll off and they're not reissuing them but you actually said the right thing earlier which is that the risk premium has been shrunk so massively between equities and bonds these two trilliona bonds that these guys will issue that between the strip will trade from five percent all the way down to there will be a line
out the door I guarantee you and the reason why is exactly what you said before David which is like why not own five percent paper from the US government versus having to like all of a sudden speculate on the S P 500 or something else it's a no-brainer and I totally agree with you but that this last two trillion that'll be the easiest two trillion to sell there will be a line
out the door guaranteed well there's a line out the door at some price so my point is that the yield will have to go up to attract those incremental buyers and as the supply of t-bills becomes a glut obviously they're gonna have to make the yield more attractive in order to keep attracting that marginal buyer it's just that simple so yeah at some price
they'll be able to find a buyer but that yield will have to get higher and higher over time and then that Crowds Are private investment because why in the world would you invest in a risky stock when you get seven percent risk-free what's your alternative because again like what do you think the spread to jgbs is going to be if that's true if if U.S treasuries okay if third of your
treasuries are all of a sudden in five and a half of Bill ackman's right which you could very well be the other part of what he's not saying is what did jgb's look like what do European bonds look like you know what they're going to be they're going to be trading at 300 to 500 basis points above that it is cataclysmic for the entire world economy and so we all move in
unison when we suffer we will suffer Less in other countries and when we win we will generally win more than other countries that has typically been true I suspect it will typically be true and I don't see anything changing that well hold on let's assume that you're right and what happens is that though let's call it the Western world and all these
governments which are basically mired in debts with a few exceptions I guess Australia's good Switzerland is good but the rest have massive debt to GDP as well so their bonds have to move up with ours and so their risk premium has to go up as well so you're right in lockstep with the U.S but now why wouldn't Global growth just slow down across let's call it this whole Western dollar complex
coupled with inflation coupled with inflation right which is inevitable that's basically what's happened in Japan right is that they have like a 200 debt to GDP and they've been very active in yield curve control and so they've controlled the interest rates but the price of that's been total they have demographic problems as well but that's the main issue there is it
young people there there's just not a lot of young people there I mean they're housing is crazy if you just look at it and I think the United States has a lot of innovation so we will innovate our way out of it is is my belief which is kind of what we you know what's so exciting guys we can have this conversation with Larry Summers himself September
we have Ray dalio yeah are they gonna be on a panel together are we really interesting to discuss this topic with the two of them maybe overlapping I'll look at the schedule everyone unfortunately all our speakers are in tight schedules on when they're in and out which is why I need jcal to respond to my I am to him about finalizing some of our other speakers
but hey Jimmy texted me because like apparently he's in like London or yesterday he's in London right you got to figure out how to get him back yeah yeah he said he'd fly out but we gotta figure out how to do that but yeah we can have this conversation in L.A September 10th through 12th well it's sold out so way to frustrate everybody I'm getting like all kinds of like LPS
and giant folks who are like can I buy a VIP ticket and I'm like listen it's sold out you had two months to do that so in other news the gop's lead candidate for the 2024 race Donald Trump has been indicted for trying to overturn the 2020 election and stop the peaceful transfer of power the indictment has four counts and is the third criminal case for those
of you playing along at home four counts include conspiracy to defraud the U.S conspiracy to obstruct an official proceeding obstruction of an attempt to obstruct an official proceeding conspiracy against rights Trump campaign not shockingly called it fake news the indictment feels like it's got him dead to rights and this is on top of the Oath Keepers founder of Stuart Rhodes getting 18
years and a bunch of other cases in addition to that the Doga prosecutors also accused Trump of ordering employees to delete security videos and the classified documents case the cover-up of course being worse than the crime looks like they got him dead to rights on that one as well all of this against the backdrop of DeSantis spending tens of millions of dollars and
falling in his percentage sax explain to the audience why this is Hunter Biden's fault and uh that's a deep state conspiracy I kid what are your thoughts on this when you say they have them dead to riots like what do you mean by that what's your basis for saying exactly rights on what charge yeah so in this uh indictment the 45 pages uh if you read it
you will see that they put up fake electorates and they knew that it wasn't going to work and they did it anyway after losing 60 cases so that's the belief of why this is such a serious case and then also the cover-up obstructing justice and it looks like some of these maintenance workers are potentially flipping and Mark Meadows they claim has flipped as well so but you know Hey
listen everybody's cases is sort of separate I mean I think we should just stick to this the big news here is what do you think of the fact that he tried this allegation that he tried to delete the videos do you think it's real or do you think it's made up no that that's a that's a detail about a piece of evidence in that case I do think the documents case is
on a Sounder legal footing then you're saying more dangerous too it doesn't involve as many novel legal theories now is it really dangerous I think the American people think that at the end of the day that Dawkins case is sort of a paperwork case and there are many other people who violated classified requirements rules like Sandy Berger like David Petraeus like Hillary
Clinton never prosecuted so I think if they have him dead to rights on any of the cases is the documents case but I also think that in the American people that in the minds of the American people feels like DC inside baseball now I think on this day about the documents guys what do you personally think I think if you're going to prosecute Trump for that you
prosecute all these other people who violated classified documents rules what do you think about him Sandy Berger who worked for Clinton was a national security advisor stuffed his pants yeah with classified documents from one of those lean rooms and got away with a slap on the wrist what do you think I'm trying to overturn the election well look do you think he tried
to overturn the election I mean just a basic fact let me state right away that I think that what Trump did in the wake of the 2020 election was indefensible I said so at the time I said I didn't say it what I said is that once the Supreme Court once the courts in general throughout his case and once the Supreme Court denied certiori it was time for
him to stop and he kept saying Yeah it was time for him to stop and he did it and so I think that his actions were indefensible however when you're talking about criminal prosecutions they can't just be an expression of condemnation you actually have to prove that somebody engaged your criminal Behavior and the issue here with this January 6 case is that it relies on novel legal theories
there's actually a really good article in the New York Times volplay places explaining this do you think there was a possibility that he if he could have he would have turned over the election if Pence had gone along with it you're getting into a bunch of hypotheticals here the question is whether these charges will actually stand up to scrutiny let me read you
what David Leonard from The New York Times reported because I actually think when you have the New York Times saying that the case is weak I think it's really indicative so what the New York Times says or Leonard says as shocking as it was Trump's behavior on January 6 did not violate any laws in obvious ways he never directly told those that January 6 rally to attack Congress
during his speech that day he even said he knew that protesters would behave peacefully and patriotically it was part of a long-standing trump pattern in which as my colleague Maggie Hammerman puts it quote he is often both all over the place and yet someone careful not to cross certain lines end quote as for Trump's broader effort to overturn the election result no federal law
specifically bars politicians from attempting to do so without such a loss Smith has relied on a novel approach she has charged Trump with committing criminal fraud God and violating conspiracy laws that were not written to prevent the overturning of election result and then he says the key part of these laws they revolve around a person's intent intend is core to the
notion of fraud only if someone is knowingly trying to deceive others can he be committing a fraud and he says that's why the case seems like they're evolved around Trump's state of mind so the problem with this is they have to not only prove that what Trump did in the wake of the election was indefensible and outrageous and all the things that you believe they have to
prove that Trump knew that he lost the election and knowingly perpetrated a fraud and I don't think you'll be able to ever prove that Beyond A Reasonable Doubt but even though yes there are statements that they point to yeah they got all those statements and then but Bill Barr Mark Meadows everybody slept on him Pence has slept on them they're
all flipped on him now same as by those people yes but Trump also had this whack pack of lawyers so you had Giuliani and you had and Michael Lindell the pillow guy they were all in the White House telling Trump that listen you won the election you've been robbed and there are loud legal grounds for you to contest this and Trump for years has been maintaining
the stolen election narrative even when his advisers have told him this is not good for you the guy has stolen election on the brain okay every interview he's brought this up even when it's manifestly harmful to himself and the Republican party so this idea that you can prove that he doesn't really believe the election was stolen the one thing I believe about Trump is that he really
does believe the election was stolen and I think you will never be able to prove Beyond a reasonable doubt that he is knowingly lying about that and as a result of this you can never prove this case now it also relies on this novel Theory they are turning the civil rights law into a pretzel to try and figure out a way to indict Trump or prosecute him
under this novel legal theory of committing quote fraud against the American people okay this is a novel legal Theory that's never been tried before and by the way if you're going to create that as a precedent I hope we're going to go after those the signers at the Lancet letter we talked about because they committed a fraud against American people I hope
that we will prosecute the 51 spies who lied because they perpetrated fought against American people I hope Austin I hope we will go after the authors of that steel dossier because they perpetrated or fault of the American people there's a lot of people in Washington who've perpetrated fraud in the American people I hope we're going to go after all of them but my
point is this it's not the job of a prosecutor to be creative with the law ever I mean they are supposed to apply the law strictly as written they're supposed to bring cases that are open and shut and what Jack Smith is doing here is going for this bank shot where he wants to charge Trump with incitement but he knows he can't win that case so he's going for this back door or a civil
rights law to sidestep the First Amendment problem and it might be this is an abusive prosecutorial power and once you let prosecutors get creative like this you're on a slippery slope to show me the man I'll show you the quantum as in Stalin's Russia so listen I believe that again Trump's actions were illegitimate and outrageous but again the purpose of criminal law is not
to express disapproval you have to be able to prove these cases in an open and shut way without novel legal theories I just want to say I need to give I need I need 10 for this last piece that was excellent absolutely excellent here's a question to ask you go ahead do you believe that Trump was guilty of inciting an Insurrection absolutely yeah when he told those
people to yeah when he told those people to go down why hasn't Jack Smith indicted Trump they've indicted Trump on all these different charges with over 500 years of jail time and they have not indicted why not they they could always add to the charges and so I suspect when they start flipping people they will but you know hold on hold on here's the thing you know what 30
percent of people in the Republican Party about 30 of this country have Trump Stockholm syndrome they cannot let go of trump and so there's no reason to debate it with the GOP they have TSS and it you're going to defend him to the dying day you're going to do what about isms the Republican party will never accept the fact that this person's a
criminal he's corrupt and he's a horrible human being and he is not fit to serve and you're going to serve him up as your candidate it's disgraceful the go p is a disaster for for actually supporting him guy has no morality and he would have overturned the government if he had the chance and he will do it again can I respond to this or maybe a couple of different points here all
right make as many points as you want yeah absolutely fixated on January 6th and it's the people who've been trying to whip this up and make it into a crime and invent all these novel legal charges and haven't stopped talking about it for the last two and a half years I'm so sick of talking about this whole January 6th thing I don't want this to be our
politics okay the people who've made it our politics include the the mainstream media it's all the people on CNN and MSNBC won't stop talking about it and part of the reason why I think Trump likely will be the nominee is because they are creating a backlash in the GOP where people basically think that he's being unfairly prosecuted and persecuted now to my question why aren't
they charging him with incitement that is the crime that the media says he has committed for the last two and a half years so why aren't they charging him because the doj looked at that at the beginning of 2021 Merrick Garland's doj looked at that and they did a report and found that they could not win that case and when that came out the media and
even Biden himself said that Merrick Garland was basically being a wimp and should be tougher and so that's when they appointed Jack Smith to be the special counsel to go find some other way of Prosecuting him and so that's why they've invented this novel legal Theory now I think the reason why we should care about this that has nothing to do with wanting to
defend Trump or make him the nominee is that I don't think our political system should be weaponized this way because when they can start inventing novel legal theories to get somebody that's what they've done here Jason it's show me the man and I'll show you that cry now overthrow and reverse the election and he tried to do that by putting up a fake slate and he tried to convince Pence to
go along with it Pence is an honorable person who wouldn't go along with it and everybody in his cabinet said this is a bridge too far his his supporters from bar to pens to Meadows all told him please stop what you're doing is illegal you cannot overturn the government the election results but are you saying this yeah he's doing that you're saying this
is an expression of condemnation against Trump or are you saying I think Trump I think it'll be proven that he broke the line I think we've proven in the documents case that he also tried to cover it up but that's just my opinion I believe that he's a criminal I believe he will be held accountable I think he should be held accountable for trying to overthrow the election he'll try to
overturn the election that is the most craziest thing you can do you can come up with all of your instructions charging with incitement they have not done that they've invented this novel theory that never existed before he's a very smart guy when it comes to avoiding accountability and I think that it's his the clock is running out for him you know what Jake Howell do
you not think that it's a little surprising that all of these charges are hitting years after this event took place in the months leading up to the Republican primary no I think it's that's the weirdest thing to me is like why would it take so many years to prosecute someone all those guys that went into Capital the Capitol Building they all got charged with crimes years ago you
know two years ago why did you stop falling on Trump today it's like they because in the case yeah and they pay it takes time to build these because I will say it does feel like it is interrupting a political process that if there were criminal charges to be filed I would have liked to have seen him file two years ago so this could all get adjudicated ahead of a political cycle
now that it's in the middle of a political cycle it makes me as a U.S citizen nervous about the fact that there are agencies interfering in the political cycle you're so right he could have given the documents back when they asked for them and he could have said don't delete it I'm talking about both yeah and it takes it you change the subject to the case
talking about those cases I'm talking about both cases concurring is more solid but less important okay actually Leonard says this in the New York Times but you asked me a question I I think it takes time to build a case properly and it took them a long time to get through the 400 people who attacked the capital and brought tens of thousands of rounds of ammunition to the
capital and put it in three hotels which is why The Oath Keepers got 18 years 400 people have gotten sentenced in that for good reason they beat cops they beat they broke down their way into the capital and they brought dozens of AR-15s and they bought tens of thousands of rounds of ammunition and placed them in hotels around the capitol these are
dangerous domestic terrorists being indicted for they I'm talking about who they they already got those Oath Keepers on 18 years I just want to read this one sentence from from Leonard just to wrap this up because this is the New York Times this is the New York Times he says you can think of the new charges being both more important and less solid than Trump's previous Federal
indictment yeah listen everybody's gonna have different opinions on this I I get that I just hope he has his day in court and I think he's guilty and I think it'll be proven that he's guilty and that it's time to start moving this towards a pardon and figuring out how to get him out of political life and give him a pardon for all these crimes he's
committed and let him off the hook but get him out and so that your party can fail to good candidate that's what I hope happens I think one of the really tragic side effects of these prosecutions where they're inventing novel legal theories clearly to get this man for what he did even though it was outrageous but I don't think criminal in the way you wanted to be Jason but the
really tragic thing the way I wanted to be I would rather he didn't do this criminal activity yeah I get it I get it I already denounced it I'm not defending his actions I'm defending the Integrity of our legal system sure really the tragic about this the tragic thing about this is that I want the 2024 election to be about issues it's not it's going to
be a referendum on what happened in 2020 and there is no way to convince either side of the American people that they're wrong about that the MSNBC CNN Crowder can believe that Trump is guilty of a crime no matter where this case comes out and by the way I think Trump's actually going to win this case maybe not in the DC jury pool but I think he'll win it on appeal because the
Supreme Court yeah I think if yesterday's report he's going to win it because there's just a novel legal Theory by the way Jack Smith took a case against the Virginia governor to the Supreme Court got overturned on appeal 9-0 because of an outrageous legal Theory there so that same thing could happen here I think it probably will possible but but those people who
believe in this will never be convinced and by the same token Trump supporters the other half of the country will never be convinced that this was not a political persecution it's tedious versus this one this will tear the country apart and to friedberg's point it's two and a half years later we could have just moved on there's plenty of other things they already have the
documents case so this is a political prosecution by Biden's do you have any way to get out of this what's your what's your solution to get out of this we should have just moved on not charge them yeah listen the the proper Forum to deal with this was the impeachment hearing the second impeachment was expressly on the correct charge which was whether Trump incited
Insurrection they already had this trial the proper form was that impeachment trial he made it through and it's up to voters I actually said the proper one was to go criminal so it was interesting yeah he said the impeachment was the wrong way to do it they should just do the criminal so here we are doing the criminal thing the country should have
moved forward and instead and this is what 2024 is not going to be about what do you think uh Freeburg which what do you think is a good path forward I kind of align with the fact that this is a little bit too late it's in the middle of an election cycle and the Damage that it will cause in terms of how our country views the intersection between the justice system
and the electoral process can be more damaging than the benefit we would gain from bringing an individual to justice for breaking the law in this case unfortunately the timing is just off and I think it's really scary all right Jason you have to ask what what is actually going to strengthen our democracy and what is the wisdom of bringing these charges I think this case
shows a lack of wisdom I don't think it's going to strengthen our democracy I think it's going to undermine it it's going to make this country more polarized and Hyper partisan and it's not going to help us move past this era of our politics and I believe is that a question towards me I think Trump is responsible for part of that polarization but I think Biden now is
playing into it from the other side I don't think we've had a president seek to indict his leading political opponent who's likely to be involved in this this is the justice department he's not he's not driving it wait a second that is not true okay yeah he's not involved in it no there's an article in which Biden said that when Merrick Garland refused the incitement charges
that he thought that it was weak in that Biden thought that Trump deserved to be prosecuted and that was a public articles in the New York Times and I'll provide the note okay what's your question for me do you have a question you said you wanted to ask me a question well no I didn't say a question oh um but my point is I now think that Biden has crossed the line here and just
remember this is not an independent prosecutor Jack Smith works for Merrick Garland who works for Joe Biden this is Banana Republic type stuff this is one president's doj seeking to prosecute his main political opponent who put Merrick Garland in but I didn't appointed him uh yeah so uh this has been the all in podcast chamoth had to bounce freyberg congratulations on ok99 I hope
it happens sax sorry about congratulations to you too congratulations to you two sex if it's proven to be real we will all benefit so it's great yeah right and we'll see you all good friends next time Rain Man [Music] we open source it to the fans and they've just gone crazy [Music] somehow [Music] we need to get Mercies [Music] I'm going all in