Returned, The Trade Wars Have | Ep. 019 Lemonade Stand 🍋

All right, ladies and gentlemen, shut the hell up.

Sorry, for one interview.

Seriously, let other people speak on this podcast.

You're right.

You're just dominating the conversation from minute one.

How do I make this podcast?

I can't get away.

Ladies and gentlemen, welcome to the lemonade stand.

We're back.

We got a good pep in our step energy because we've started doing horse electrolytes off screen.

I'm so tired.

I can't even fall.

I will literally do some horse electrolytes right now.

You already have literally.

Don't say it like it's an exaggerated, crazy thing.

You've already.

He's going.

I don't like that the tub's still here.

I don't yeah, me neither.

I think it brings because it does kind of imply he has been drinking them, which is, I can't not be more clear.

They're bad for you.

Very bad for you.

It's very bad for you.

Straight up, one of the most popular episodes, most viewed episodes, last five or six.

Horse electrolytes.

We have a data point, and the data shows clearly what the people want.

Other people have managed to make podcasts work without doing horse electrolights.

It's not like it's mandatory.

This is the future.

Yeah, and we're going to leave him in the dust, okay

in the salt this is what we need to break away dust crack it open is that a new

is that a new one no no no no it's the same type uh it's just very

unsealing

a few weeks ago it has to uh protect from horses

because they just want to keep it in there dude

their hooves can't open it maybe this is what jokic is taking because he owns horses too his horse just like won a race I mean, that would explain it.

Dude, what are we talking about?

This is bad.

This is bad.

I know it's a bit, but this is bad.

I think it's actually good.

I get it.

I get what he's doing.

All right.

He's bringing us back to a previous bit because we're going back to a previous news item.

There we go.

Today's where we have old news.

What are we talking about?

In that the trade war, which has been so forgotten about, is back on, baby.

It is back on in a major way.

I think like weeks ago, this was a big news item.

And everyone thought, oh my God.

And then we all forgot about it because Trump,

in response to borrowing costs for the United States going up and the stock market getting a little shaky, put a big pause, put a 90-day pause on the trade war.

Well, 90 days is now up.

There were supposed to be 90 deals in 90 days.

How many deals do you think we got?

89.

90 deals.

I mean, 90 deals.

So that's a deal a day.

Yeah.

I think he overperformed 100.

You're so close.

If I recall, at least he made one beautifully comprehensive deal with the United Kingdom.

You're right.

That is one deal.

One really signed deal in 90 days.

And that one was pretty minor.

So we're a little bit short of the goal.

I was just tiny, just 89 short.

How many countries are there again?

Like three?

There's like

three.

Which is crazy because he was at 90.

He was going to do a bunch with the same ones.

That's how confident he was.

Yeah, dude.

He came at the gate swinging.

So anyway, Peter, if you could pull up his Truth Social,

which is where I get all my political news nowadays,

the truth social today is a deluge of basically the same boilerplate letter to every, almost every country.

He's just tweeting truthing non-stop this letter.

And I'm going to read it to you.

I'm going to read you the one he sent to Japan's the first one because Japan is the most important.

I'm going to talk about Japan more in detail, but

dear Mr.

Prime Minister.

It is a great honor.

By the way, everything is random caps.

Like, I do think he actually wrote the original draft of this.

It has every one of his hallmark.

It is a capital G, capital H, great honor for me to send you this letter in that it demonstrates the strength and commitment of our trading relationship and the fact that the United States of America has agreed to continue working with Japan despite having a significant trade deficit with your great country.

Nevertheless, we have decided to move forward with you, but only with more balanced and fair trade, all caps.

Therefore, we invite you to participate in the extraordinary economy of the United States, the number one market in the world by far.

By far.

We have had years to discuss our trading relationship with Japan and have concluded that we must move away from these long-term and very persistent trade deficits engendered by Japan's tariff and non-tariff policies and trade barriers.

Our relationship has been unfortunately far from reciprocal, starting on August 1st.

Now, this is what I want to say.

So obviously the end of the deadline was today, was July, July 7th, 8th, 9th.

July 9th, I think it was actually the day.

But since we've reached this end of the 90 days and nothing has happened, there has now been an extension.

These letters all come with an extension to, which is now August 1st.

So another month, I guess, is the idea.

And, you know, some people are questioning, well, if we get to August 1st and there's no deal, is there going to be another extension?

I think that's a very fair question.

But right now, it's August 1st.

We will charge Japan a tariff of 25% on any all Japanese products in the United States, you know,

basically, which is the same number or around the same number they had in those original Rose Garden big poster tariffs.

Like, not much has changed.

We're just threatening the same tariffs and pushing the timeline.

Was there anything in place for the past 90 days?

Was it dropped to zero for that time period or was there something?

No, it hasn't been zero.

It's been the 10% universal tariff.

Okay.

That is, as that has been collected and been going on, but all of the talked about tariffs have still been delayed and delayed and delayed.

So that's where we find ourselves.

This is not only that Pearson, he sent it to, he sent Silent went to South Korea and, I don't know, like 50 other nations are all getting this letter publicly on social media.

I assume also mailed to them.

Honestly, you shouldn't assume that.

I assume that's only truth.

Only truth social.

You can't trust letters.

You can trust the truth.

Wait, I want to.

Let's see.

The last thing

is

you will never be disappointed with the United States of America is the last line.

So anyway,

so he's putting the pressure back on.

And the heat is back on.

And the markets are, again,

much less believing of him as they were before when it was an instant panic.

But there is a little jitteriness today, both in American stocks and then also in the currencies of all these countries that are affected by the tariffs.

Just the idea is the deadline's a little shorter.

Maybe something can happen.

If these actually go through, it will be extremely impactful.

It's a huge, huge tariff.

So,

while you were saying that, Perry was scrolling through the letters and he basically scrolled the entire time you were talking.

Is it 25% for every single country that's getting a letter?

Is it broken down and different depending depending on the place.

It is different depending on the place.

What was really interesting to me is he randomly picked, I don't know if this is because of the beef with Elon, which we should talk a little bit about, but South Africa got hit with a big one, like a 35% or something more, you know, just out of the blue.

And South Africa, I looked it up.

You know, we don't do a ton of trade with them.

My understanding is they buy our oil and cars and we buy platinum and jewelry from them.

And that, it's that, you know, it's all in all 12 billion or something.

It's not.

So the fact that he made it specific, it's just interesting.

You know, the, the, it's so focused on his whims and fancy.

And I do want to say, you know, just we'll continue South Africa thing real quick.

There is a

the tweet he put out about Elon.

You guys know we've talked about the Elon beef, but he said specifically, you know, because Elon's launching a new political party.

Have you guys heard about this?

The America Party.

America Party.

I'm saddened to watch Elon Musk go completely, quote, off the rails, essentially becoming a train wreck over the past five weeks.

He even wants to start a third political party, despite the fact they have never succeeded in the United States.

The system seems not designed for them.

The one thing third parties are good for is the creation of complete and total disruption and chaos, all caps.

And we have enough of that with the radical left Democrats who have lost their confidence and their minds.

Republicans, on the other hand, are a smooth running, quote, machine.

I love the random

random quotes, random caps.

It's just awesome.

It's an awesome way to type.

They just passed the biggest bill of its kind in the history of our country.

It is a great bill, but unfortunately for Elon, it eliminates the ridiculous electric vehicle mandate.

And it goes on forever.

I don't want to read it all, but it basically says Elon's mad about the EV mandate getting rid of no more EV subsidies.

And then also that Elon wanted his friend to run NASA, and that guy was a blue-blooded Democrat.

I want to read one of the sentences from this tweet.

Yeah.

And I quote: Elon probably was, comma, also, period.

That's the, yeah, so a lot to think about here.

A lot to think about.

This does make you think.

Okay.

I kind of like it in a sense of I have confidence it's him writing it.

It's it's not somebody's not middleman between no because actually if you told me to write like Trump, I don't think I could do it.

Keep it.

He dictates it to somebody to write.

There's a video of him watching, I think, Kamala Harris give a political speech or something.

And this is during the election.

And he's in a room.

They're all like, there's like eight people watching.

And then he's dictating to a woman next to him to write.

So I don't even know that he is personally writing this, which is even crazier.

Cause, like, how do you even he would have to manually be like, okay, Elon probably was comma, also, period.

And

like the fact that he's dictating it makes it even crazier.

How does he get these, like,

I kind of like the idea?

There's a staffer who has such a read on the vibe that they know what to capitalize.

Yeah.

Or they're like on a lot of drugs, and it's like his favorite guy is like, yeah, I trust Stan.

Someone looking at this and they're like, space business.

Yeah.

That's capitalized for sure.

Okay, so we've delayed until August 1st to basically renegotiate.

We didn't send letters to literally every country, but we sent them to many with varying tariffs that will be placeholders during that time or will start on the August 1st.

They don't start until August 1st.

So again, nothing is.

directly changing today other than the fact that they're not letting it drift off into nothingness.

It's like

the story's is continuing.

Hey, the deals, we still want this.

You have a small extension again.

Okay.

So as far from what you know, through this time period, through these 90 days, how much progress or lack thereof was there on actually making deals with these countries?

Like, did we get to a position where we were 80% confident we were going to make a deal with Japan?

Do any of these countries, are any of these countries close to making a deal or in the process of making a deal?

How present is that in the next?

I think it's a fire question.

I really want to talk about Japan today, specifically Japan, because that has been priority, I think, under Trump's words, priority number one for the United States negotiation team.

Because Japan is one of our, maybe perhaps our closest ally, realistically, and our kind of our

East Asia partner to.

to have some against China.

You know, it's like a whole thing.

We really, and they buy the most debt of anyone else.

Like they're, they're our partner.

And so what's interesting is I come at this originally from the perspective of like,

you know, Trump is silly.

Trump is goofy.

And Japan's trying their best to make a deal and he's blowing it up.

If I could say it, he's being a total baka.

He's being a sussy baka.

You, your Japanese is getting crazy.

Thank you.

Thank you.

That's what I thought, right?

I want to, and I, so I did some further research on how, because this Japan deal has been priority number one now for 90 days.

And they've sent United States best and brightest and Scott Besson and all these people have been flying to Japan regularly and having these meetings.

And you hear about some of the chaos and the inability to get it done.

And I just assumed it was all on one side.

So I want to give you a more nuanced picture here.

Trump, your ears are high level.

Japan is currently going through a rice crisis, a rises, if you will.

That's good.

I enjoy that a lot.

They had a bad harvest.

And so there is not enough rice to go around.

And also, they have a ton of tourism.

And everyone there wants to eat rice.

So the rice keeps the price.

The price of rice is going to get history.

All right, Dr.

Seuss.

Keeps rising.

Dr.

Seuss economics

keeps rising, and it's becoming a problem.

People are very angry about it in Japan.

And one thing that Trump keeps saying in this deal, and he's not, it comes through, he's not very well informed on exactly what Japan is and isn't doing.

But one thing that he's got stuck in his head is that they have a 700% tariff on American rice.

They won't buy our damn rice, and they need our rice.

And what's interesting is that the current PM of Japan, Ishiba, who Trump called Mr.

Japan because he forgot his name.

Dude, that, oh man, it's it's so unfortunate how awesome that is.

Yeah, it's just rolling it.

It's just crazy to be in power of the wealthiest nation on earth, and you're just like, Mr.

Japan,

that's crazy.

I've come to deals.

I know that isn't the important thing here.

It's just, it's crazy how this, he

really keeps on giving p.m was like oh a medica suma

you know like we just go back to that'd be so sick dude i'm gonna get to that because actually i think i think there's some valuable geopolitical insight to what you're saying actually i'm gonna get to it okay so so anyway so trump thinks there's a 700 tariff now what there actually is is a decently high tariff i don't know the exact number but they have a tariff it's not 700 maybe it's between one and 400.

It's somewhere in there.

They do protect their domestic rice industry.

So what I found is that ishiba who's the current pm of japan uh did not appoint the normal person to do the negotiation from the japanese side he appointed a different guy who's from the district that is there's a picture of this pair by the way of the guy and uh

who is from the district where all the rice growers are

ishiba is very beholden to the rice industry in japan like he is you could even you could say corrupted by or you could say corrupted by big rice by big rice in japan like he that's where a lot of his voting base is that's where he's so he actually

has the opportunity here to just pretend what Trump is saying is true and go, you know what, sir, I'll bring down the 700%.

What I'm saying is, the more you look into this, is that Trump has actually given them a lot of easy outs, but because Ishiba is so wanting to appear tough for the rice people, the rice industry that supports him, that they've reached this stupid impasse where they're both being pretty stupid.

And someone had this tweet that is actually pretty funny to me.

Clusot investments was a bit goofy, but

the problem with Japans are too polite and straightforward and analytical to make a good deal.

They don't get showmanship.

As crass as it sounds, if they pulled up to the White House in a gold-embroidered special 47-edition Yamaha golf gart with gold-plated Mizuno clubs driven by Shinzo Abe's widow and a mannequin of Shinzo wearing the Donald hat, he'd be more than happy to sign a deal.

It's actually true that like,

they're so desperate to close a deal that all they would have to do is lean into the showmanship of it and offer some basic concessions.

But because it's politically unpopular on their side, they can't do it and nothing's getting done.

It's becoming this problem where now I think Trump is pivoting to a different country to find the number one deal because Japan, they can't seem to close it.

Japan was meant to be the number one deal.

Yeah, that was the idea from minute one.

And they were really willing to.

Can we backtrack a little bit to the one deal that did get made with the UK?

I knew that deal got made, but in terms of like fanfare or its position in the news, I feel like I heard relatively little about it and also the contents of it.

My understanding is that deal wasn't very comprehensive and it was something quickly put together.

So why isn't his one win something that we're more locked into or you're presenting as something more important?

I think the UK deal, my understanding, is that it's really just a restatement of the way things already were.

It doesn't change much dramatically.

It isn't like a huge win for American producers or that the UK is going to significantly buy more goods they weren't before.

Listen, the reason I brought up that Japan goofy tweet of that guy exaggerating is because like some countries, and including the previous PM of Japan, Shinzo Abe, who had his own faults, but really knew how to deal with Trump, is they've understood the

showmanship.

Like Qatar promised Trump 20x their GDP in investments.

It's not real.

They promised him multi-trillion, but like they did a big show.

They had people with swords come out.

They They did a parade.

They gave him a point.

Yeah, they gave him, you know, they did, they did the things that like work and they got the deal they wanted.

And it's just funny that

the playbook to winning these trade deals is actually pretty obvious now.

And people that aren't doing it are now like caught, like, it's just causing problems for Japan's car industry because they can't get a deal done here.

They do sell a lot of cars in America.

And it's...

It's just funny.

They're being so hung up on this right single thing.

Can we dig deep for a second?

Let's use our lemonade stand powers to dig here.

And is there, if I'm a part of his administration or other people that are responsible for making these deals or setting the tariff amount, people like Scott Besson, what is the argument, the pro argument for why these things are going well?

Like, what is the excuse for not having anything done in 90 days?

Why have we actually been productive this whole time?

If I want to be the strongest steelman,

do you guys know of anything to dig in the opposite direction?

100%.

What they they would say is

basically, sorry, what I'm asking is, is there anything to talk about here other than outright failure?

Because the presentation of it feels like that.

And I'm wondering, it's like, it feels like there must be something they could say.

If I had Scott Best.

No, what I would say, yeah, I could totally steal my mess.

From their side, what they would say is the onus is on everybody else.

Like, they don't care if a deal doesn't get made.

Like,

what they're saying is like,

if you want to sell your goods here in America, you know, then better figure out a play by our book.

Like, we don't care if there's no deal.

We will just tariff you.

We'll write it.

We'll just write up a tariff, and that's fine by us.

That's the idea.

However, what I'm questioning is that

because of the delays the first time, it seems like they actually do care about what the impact it'll have on stock markets and bond markets if we actually have the tariffs.

I think they would rather have a nice deal inside it and be done.

But they have to pretend to be in a position of total strength.

We don't care.

And that's

a position we can pretend to be in because as a market, we have so much buying power and we're not so much an exporter where we're relying all these countries to buy our things.

We're at a deficit in the first place.

We're a gigantic market that presumably these people need.

Yeah, I think they all need it individually.

The hard part is whether they start to collectively, if they all collaborate,

how much do you need us?

How much do you need the American market if you can literally sell to everywhere else?

That's the big question.

And so, I don't know, but I do want to say this.

So China is the only country that's had above 10% tariffs.

They've had like the 40% or whatever from the

bring up that article.

The one with the graph where you scroll down.

So what actually has been happening is I think we predicted this on the show straight up is like

they're just shipping through other countries, which is like 100% what you'd expect to happen because the demand for the Chinese goods is still there and China still has the only place to make them.

So let me give you a little window into this.

As someone who

has experience working on a business that has sourced things from China,

I might have friends who operate businesses of similar scales

that are making similar decisions around this problem who are also just doing this.

They're just doing this.

They just, it just goes to a different country and gets something added or repackaged, and then it comes to the U.S.

That's all that happens.

This is the most predictable outcome.

And I think we said it from minute one.

And if you scroll down to the graph, so like the second these tariffs started to come into play, a huge spike in Vietnam and Indonesia imports happened because that's where they're just going to Vietnam or South Korea or Indonesia.

Something's being slightly tweaked and it's being reclassified so the tariffs don't apply.

So what this becomes is, what the lesson of this is like, hey, either we spend gazillions more to try and constantly whack them all and put all this down, or we tariff every country on the world at once.

Questionable if that'll work, or

we got to find a way to make a deal that both sides agree.

Like the idea that

these tariffs will just work with no workarounds, no black market, no, I think is a little silly.

That's where I'm at.

So that's where we find ourselves in this trade war with this update.

I don't know if you have any further questions.

I think it's pretty fascinating how, sorry,

my microphone discipline.

I'm going to import a second microphone.

Just two on either side of your face.

One full three six.

One of those three

podiums.

Here's a voice acting booth where you're like yelling through it.

I think maybe let's, I think this cleanly connects into something we wanted to briefly touch on, which we were saving for later, but I think is the big, beautiful bill passing.

And

I'll let you take on the lead.

with this mostly.

Sure.

But the way I see this connecting is the pro argument for this bill passing.

And if you're listening to this right now, we've talked about the bill an endless amount.

And we've always been pro every aspect of the business.

And we've been a pro the entire time.

And so please don't try to dissuade us from that position.

Is that

in the bill, the deficit spending?

is being offset by things like the revenue from the tariffs, which are not accounted for in the accounting of this bill.

Like the tariffs are a source of revenue to the country.

And that is something that we haven't seen all the benefit of yet.

That's supposed to come in and be something that helps with the financial math of this bill.

Right.

And my skepticism to that

when I heard it was this, seeing the degree to which people will go to dodge these tariffs to begin with, whether it be a small business or a big business, everybody is looking for a way to circumvent it.

Yeah.

And I think just leading into that, I think there's a bit more teeth to that argument as well that I thought was interesting to cover

that you might want to touch on or get into.

Yeah, we can hit up.

I mean, I think what's what's so the bill, we've talked about a bunch of times, it did pass completely.

I,

you know, this time I was like, surely politicians will do what they say they're going to do and not vote for it.

And that didn't happen.

So that's been a fun.

That's wild.

At some point, I'll stop.

My naive, childlike whimsy will be stamped into the ground.

But there was a lot of politicians who were like, I will absolutely not vote for this.

They've changed my critical things.

And

it's just wild for me to someone to get on like five different news networks and speak directly to Cameron and be like, this bill's a disaster.

And unless it's changed, I.

The recency bias, I feel like

I can't even believe I convinced myself a little bit.

I think it's just the audacity to run the media circuit

and then still vote for it.

Not even like a quiet quote of like, yeah, I don't know if I really agree with this or like, I don't know if this is the right direction.

Then you vote for it.

It's like wildly doing the media circuit to like rile up your constituents against it.

And then being like, yeah, I said yes, though.

Dude, Ron Johnson was a, was a senator.

And like, I played his clip, maybe on here and also on my stream.

And I was like, this guy's spitting.

This guy.

And he was like really going after it.

And then I checked and he voted for it.

It's like, it's just crazy.

Unchanged.

The bill did not change.

He just voted.

That to me is wild.

They might be like lizards in a human skin.

I just don't.

I genuinely like, what's going on?

Like, what do you, what do you think is the point of your life if just like what you say has no bearing in any of your actions?

Like, what, what drives a person like that?

I don't understand.

Uh, maybe, like, really nice dinners paid for by Comcast.

Probably, man.

I, I am just baffled.

Well, some of it's fear, right?

So, my understanding is that, yeah, you know, uh,

Trump definitely has the power to get a Republican primaries.

You would lose your job.

Like, he, if he really gets the true social machine working on you, he can make you out to be affected to the America Party.

Yeah, which Elon Musk's new third party.

Yeah, what I wanted to briefly touch on about

just the argument for why it could be good.

Because I streamed on 4th of July last week, and there are a few comments of people being like, This is a sad day to celebrate America.

We are, our country's going towards ruin.

And I think there's a legitimate argument towards that.

For me, not only is there the kind of moral ethical side of cutting a bunch of Medicaid, which is just not cool, the main concern that we've talked about a bunch is just the debt going up by trillions and trillions of dollars.

And as we've discussed, that it could send us like towards ruin as a country.

So I think that

you can dislike this bill from so many different angles.

Yeah, there's just a lot of angles.

You can pick so many different things.

A lot of angles.

As the reason why this sucks.

Yeah.

So the debt and the deficit, that is the really concerning part to me amongst many.

And so I was listening to an argument basically, again, from the, let's say, Scott Besson, Treasury Secretary, of what is the goal here?

Like, why are they doing this?

So part of it is, like you said, tariffs.

So, when they talk about the amount of deficit, that doesn't include tariffs.

But even numbers on that could be wrong.

And obviously, please double check me if you're.

But okay, Vietnam, I believe, is about $120 billion

in trade, like trade with the United States.

So, even if we did a 20% tariff on them, that is like $20 billion.

That's not that much money.

So, even if we, you know, get, let's say, $100 billion in tariffs every year, a couple hundred billion, that is helpful.

Like, I didn't know you were doing that well.

20 billion, not that much.

Not that much.

That YouTube.

That's because you got five channels.

His second channel goes crazy, dude.

You haven't seen the revenue on that second channel.

Them, like, the Vietnam tariff money is like having a VOD channel.

It's not going to resuscitate the U.S.

government.

Come on.

It's a slight stream of income.

Right.

It's not.

Right.

And so between that.

I wouldn't understand because he has an upload on YouTube.

He's a

China.

That's our Twitch Primes, okay?

Like, we can really squeeze them.

Yeah.

So,

you know, arguably there's going to be some tariff money, but, you know, there's so much flux of tariffs.

We don't really know.

The more compelling argument that I heard is, why is it acceptable to put us $5 trillion in debt by cutting everybody's taxes?

And again, it is everybody.

It's not just rich people.

But if you cut everybody's taxes, way less money for the government, that's what sends us more into debt.

What is the possible value of that?

Well, the pitch is we want to get GDP growth up.

And one way to deal with a debt is to pay it back, which is stupid.

Cringe.

Or we outgrow it.

Because if the idea is in 10, 20, 30 years, our GDP is so incredibly massive, our economy is just fucking cruising that our dollars worth more and the 36 trillion that we owe right now is comparatively not that hard for us to pay back.

So, if we just stop the debt from getting worse and we grow a lot as a country, we can outgrow the debt being problematic.

And there's no,

I mean,

the statement, if we just stop the debt from getting worse, discussing a bill that makes the debt significantly worse.

Yes.

So that's my first point.

Can I synthesize?

And from my understanding, it is the tax cuts and the bill in general are going to incentivize so much economic growth that it outpaces the debt that this bill adds.

Yes.

So that's the hope.

The hope is because we are putting so much money into people's pockets that it will stimulate an amount of growth.

And hopefully with AI and automation, all the other stuff going on, we will actually outpace this.

It would also require us to stop making the debt bigger.

But theoretically, if we stop making the debt bigger every year and we just keep it at 36 trillion dollars just a little bit of money

just a small amount

that we could outgrow so a crucial part of the equation is missing which is to stop making it bigger every year if we've ever tried this cool idea where we cut taxes for wealthy people so that it'll sort of

fall what was the word for that like it'll get down and then the growth will

i wonder if we've maybe trickle maybe trickle tricks cereal like trick

I don't know.

I don't know.

I don't think it's ever been tried before.

That's why I'm so excited about it.

Yes.

Because it's so brand new.

So, yeah,

I'm also skeptical to be clear.

But

I just want to point out for people who are like, this bill is a complete and total disaster.

What the fuck are people on the right thinking?

This is at least the argument.

Probably for a majority of politicians, it's just like, hey, short-term, let's get more money to people.

That's most likely what's going on.

But that is at least the pitch.

Is

that more money into people's pockets?

Let's grow more.

To steel man it.

But I just

disagree.

I understand.

I'm with you.

I, I, I, I, and I think it's fair to do that.

And I, and I, but I just want to say, like, um,

it's funny because so much of the tax cuts are just continuations of the tax cuts that exist right now.

Like, they're supposed to expire.

Right.

So, the idea that keeping the, like, we're not getting the growth right now, but we're still going to keep this going.

And then the growth's going to 10x, like trillions of dollars to do the same taxes we currently have is going to give us the growth that we're not getting currently is

stupid.

I'm sorry.

Like,

I think the Occam's razor here is that they want to throw money to the people that support them.

Like,

the idea that it's this brilliant 90 chess plan that is going to grow us out of our debt is a nice thing to say as you blow out the debt.

But it feels like you're not treating the problem seriously, but you keep telling me that, like, this is, don't worry, this is the web.

Okay, so this is the other argument I've heard from a couple people.

And I think this has been copy-pasted across a couple things that Trump has done.

But this idea that through,

in a similar way, to Trump started talking about, even before he was running for president, he was talking about China and our relationship with China, what getting rid of our manufacturing means.

Like,

if you look at old footage of him, he's been talking about China for a long, long time.

And that's energy he carried into his first campaign.

And

now, our relationship with China, or our trade relationship at least, is something that is top of of mind in politics, right?

It's something that gets brought up all the time.

And I think you could credit him for its place in

popular politics talk, like regular people bringing that up as a talking point, right?

And I'm not necessarily arguing.

Mission accomplished.

So I think the argument that I've heard with this is that through

this bill getting passed and through

other

things that his campaign has been about this time or his presidency has been about this time, the conversation of the national debt has reached a point that is inseparable from the public conversation of politics.

It has set us on a trajectory where we have no choice but to confront and address it really aggressively.

And I'm not saying I agree with this argument.

I would rather this have not passed, but this is the other argument I have heard.

It's like the benefit of this, whether he intends it or not is that now we have a problem that is so dramatic that we have no choice but to address it.

That person is a baka.

That's that's an insane all right.

Sorry dad

a baka to his credit he's not the only person

he's the first person to find an easy mode for dark souls I he plays politics on such an

the amount you can bend over backwards to well he's not fixing the problem but he's bringing awareness to it so that eventually i don't think no no no no i think the discrepancy between that is the people i have talked to one of them happens to be my dad but they there are other people that have brought this up is not people who are like trump the genius who is making sure that we confront this down the line they're like through his recklessness at least the country will be forced to address this very important issue that they have refused to let enter the public sphere up until right now we're like sick with the flu or something but not enough to go to the hospital And then Trump is coming in with a bucket of flu virus and injecting it into the body to incentivize us to go to the hospital.

I like it.

I'm just saying, and are these same people?

Are these same people being like, God bless Hunter Biden.

Through his recklessness, he's bringing awareness to cocaine abuse and that is going to finally make America conflict.

It's just absurd.

It's just an absurd line of thought, bro.

It's like, it's such a, a desperate play.

No.

It's also funny because it implies that it's like a one-time fix that we're putting off.

No, it's only there because we're moving towards the cliff.

Like, you don't have to move towards the cliff.

It's not like we've got to, it's not like spring cleaning.

You've got to do it at some point.

We don't have to have a $40 trillion deficit.

Yeah.

You're taking a spring cleaning approach to an episode of Horrors.

But, but here's what I'll say.

To give credit,

one thing I've never said Trump is bad at.

He is actually one of the goats at this, is he can read

the room, I guess, on what

real

things that people are actually, you can find a kernel of truth that people are actually upset or angry about.

He's good at reading his base.

He's very, very good at reading his base.

Yeah, he can understand.

Like, I think, for example, 30 years of jobs disappearing to China is something that like.

Americans were broadly,

a big swath of Americans were broadly upset about.

And he can harness that.

I just never like his solutions never seem to make sense.

They never seem to be coherent.

But

he can definitely read the room.

I'm like, these are problems that everyone's kind of sleeping under the rub.

No one's discussing.

I'm going to make a big deal about it.

But,

you know, that doesn't mean you get automatic credit for fixing it.

You have to fix it.

You have to, that's, that's a fine thing for a pundit, but it's not a fine thing for a president.

Like, a president has to have policy that fixes it.

No.

No,

you're wrong.

You know what?

Another interesting thing, an element of this that I haven't heard anybody talk about.

So Medicaid, there's always Medicaid cuts.

That's one of the most criticized parts of this bill.

And I've seen a lot of people criticize and basically say,

you are going to be taking away health care from a ton of your constituents.

How does anybody on the right justify this?

Well, part of the reason they do is because most of the people, basically all the people who are going to be cut from Medicaid,

this would be under the expansion program of Medicaid.

So quick recap, in 2012, Obama passed the Affordable Care Act and that expanded Medicaid.

And basically states could opt in and say, hey, we're going to expand Medicaid so it covers more people with higher income and it can include people who are able-bodied and don't have dependents.

So if you were able-bodied and didn't have dependents before the Obamacare Act, you could not get Medicaid.

It was expanded under the Affordable Care Act in 2012.

But not every state took it.

It was literally Obama said, okay, the federal government, any state who wants it will now cover like millions more people.

All us, we'll pay 100% of it at first,

90% later.

We'll pay all the costs for this and you can expand your Medicaid dramatically and just way more people in your state get coverage.

40 out of 50 states did that, but 10 didn't, including Florida and Texas.

So there are 10 states right now who don't have the expanded Medicaid.

It is instead incredibly small and restricted compared to these other states.

So if you're wondering why there seems to be certain groups of the country that are adamantly, let's say, even kind of like this moral crusade, it seems like to say Medicaid shouldn't be given to people who can't work.

To their credit, they haven't been taking the federal dollars for this for over a decade, even though they could have.

And from what I read, there's people saying, like, you know, this doesn't make sense.

It's not financially responsible.

And people who are, you know, it takes away the dignity of work or whatever, you know, lines like that.

So.

Dude, this is a weird thing.

Alfred does take away the dignity of work.

I've been saying that.

Yeah, I've been saying that.

It's all your employees.

Hold up there.

Was that the union word I heard?

Hey there, champ.

You're at Mogul.

We don't talk like that.

Why'd you quiet on now?

Yeah, so it's an interesting thing.

If you're wondering why a bunch of states are so on board with removing Medicaid, it's because from their perspective, they haven't benefited from this for 13 years.

They've adamantly been opposed to it.

And now they're basically trying to say everybody should be closer to what we're doing.

We've been the only financially responsible ones this whole time.

It's like 20% of the country never expanded it.

It's a a lot of people.

So that's really interesting.

I didn't really not know that.

That is interesting.

I mean, right?

If you're, if you're a Texan and you're a poor Texan on Medicaid, you, I mean, I wouldn't agree with this, but you could be like, everybody else should have the same standards as me.

And it makes more sense why people in these countries, in these states would be receptive to this.

Do you know how that was decided at the time?

Was that state votes or constituent votes deciding whether or not they would accept it?

Or was it just a governor or their state?

I'm not sure.

I believe state legislator.

Maybe you can look up Perry of like how states decided to join Medicaid expansion.

But yeah, this was, you know, it's been happening over the last 10 years, but that was, you know, a major part of the pitch of the Affordable Care Act is we as the federal government are going to cover the cost to massively expand Medicaid.

And 10 of the states just didn't,

which is crazy for them to just refuse the money, frankly.

Yeah, so they had to, it looks like pass law.

So it would have been state legislation.

So in 10 of these states, they were just like, nope, we don't want it.

We don't want your dirty

Obamacare money.

You know, like uh

i got mine type voting like if you're in texas and you're

you don't want other states to have stuff you don't have like just simply

it's so like interesting

thing to vote to cut yeah because it doesn't benefit you at all is it someone else getting the fact that they've voted for 12 years to never take the money either is strange like that is is strange to me that

follows some strings or something or like it comes out of the state budget in some way eventually on a lot like well you said it was eventually it becomes a 10% cost to the state.

You said the federal government would cover a hundred years ago.

It started 100%.

If the federal government went to you and was like, hey, we're, as the federal government, we will pay for 90% of Medicaid if you expand it to like 5 million new people.

Almost every single, anybody on earth would be like, yeah, sure, we'll take that.

And they just, and they just didn't.

This strikes me as something,

this is without me looking into this at all, right?

But I think about the fervor around Obamacare at the time, right?

Right.

And you tell it was political.

It's like, we don't want, we hate Obamacare, therefore we won't even be a part of this movement.

It's like the, have you ever looked at the polling of you poll reception to Obamacare versus reception to the Affordable Care Act versus reception to the line items of the Affordable Care Act?

And each one is just an insane jump in percentage of people who are like, yeah, this is good.

And Obamacare, you know, polled pretty low at the time.

And then you just give the actual name of the bill, and then people are like, yeah, it's pretty good.

All right.

Pretty good.

Much better than all of you.

And then you show them what it actually does.

And they're like, this is great, dude.

So

it's just, it's just how politics works, I guess.

Yeah.

In Texas, they're probably like, do you want Obama coming into your house and treating your grandmother with free care?

That's

unironically what the rhetoric was at the time.

If you go back and watch pundits talk about Obamacare at the time, it's crazy.

It is that.

And they were right.

And they were right.

I want my country back.

All right.

And mission accomplished.

So why don't we?

I want us to slide over because I think you had an interesting story about

social media that you wanted to dig into.

Yeah, let's just dish, dudes.

Let's just get into it.

All right.

So

article to kick this off.

Perry, if you could pull this up.

So do you guys remember this crazy thing?

I don't know if you've, if like this happened a while ago and it's wild.

Threads.

Remember threads on Instagram and how that existed briefly?

I remember.

Remember that?

Remember how everybody was like, yeah, we're going to go here instead of Twitter?

Cause I'm pretty sure.

Yeah, that launched after Elon bought it.

And remember, everybody's like, we're going to threads.

And then nobody ever talked about it ever again.

Remember that?

I remember everybody getting their handles and then never doing anything after that.

Just in one thing, and then

just like Google Plus, just like Blue Sky, just like Mastodon.

Yep.

So this is one of those things.

And then it, you know, kind of died off by the wayside.

Except it didn't.

It has gotten really big.

So there's this graph that came out about the daily active users on, and and this is mobile, which is an important distinction, on Twitter, Threads, and Blue Sky.

Twitter has like about 150 million people who tune in every day on their phones.

Now, Threads is almost at 150 million.

Like it is almost there.

In terms of the impact that these apps are having, Threads is nearly as big, at least when it comes to mobile devices.

On PC, there's basically no presence by Threads.

Blue Sky, there are like a million.

Blue Sky is not having a good time.

Shout out to Blue Sky.

So

this is an interesting opportunity to talk about kind of what is the landscape as I looked across it of like what is even going like I assume you guys have a similar take as me, which is that I have not heard a single mention of threads once in the past two years.

My take is that people are opening Instagram, a very popular app, and misclicking the threads button 100 million times.

I legitimately do not believe that it is close to the daily active users of Twitter.

Wait,

is it not its own app?

You access it directly through Instagram.

It's connected to Instagram now.

You have the same handle.

You have a cross.

Dude, if you're connected, you still open the app.

The number of people.

Wait, Wait, is threads a separate app or not?

Yes.

Yes, but in Instagram, there's now a threads button that can like

click over to it, but you still have to open it up.

Out of the like billion people using Instagram, it's just a bunch of them misclicking

on Instagram.

No, no, no, no.

So, so this is what I want to talk about.

This is what I was thinking.

So, you know, again, threads users are going way up.

If you look at this chart right here, it's just been growing like crazy.

The monthly active users is like double that.

It's like 300 million people a month.

They're opening up threads.

So I was looking into that.

How in the fuck is this app getting insanely huge?

300 million people a month looking at it.

Every day, 150 million.

None of us hear about it ever.

It's not in the cultural zeitgeist in any way.

And the answer is not the entire world is America.

So it turns out social media users in

2025, there's like a billion social media users in China.

India, almost, I should say, almost 460 million.

Now, the United States, we got a lot.

We got 240 million social media users, but then Brazil with 144 million.

One of the countries that I feel like we never talk about is Indonesia.

It's one of the biggest countries in the world.

I never hear anybody talk about Indonesia ever.

They have 140 million people on social media.

Mexico, 90 million.

Philippines, 90 million.

Vietnam, 70 million.

Pakistan, 70 million.

These are massive, massive numbers.

And so looking into where is Facebook, as a specific example, getting all of their people.

Well, so found this breakdown.

It's mostly from Asia and South America.

There we go.

Out of the, so Facebook is still absolutely gigantic, by the way.

It has almost 3 billion monthly active users.

Like, it just, it's like, you know,

two-fifths of the

world's population is still on Facebook, which even though, again, for Gen Z and millennial Americans, like nobody goes on Facebook anymore, right?

And so looking at this, of, of those 3 billion, India has 400 million active Facebook users.

Indonesia, 100 million.

Brazil, 100 million.

Mexico.

So.

400 million is more than the entire population of the United States all using Facebook.

Just using Facebook from one country.

So, I think what is interesting to kind of to step out and remember here is that America, relative to the entire population of the world, we are tiny.

And even though we don't really use Facebook anymore and we don't use threads, Meta as a company across Instagram, WhatsApp, and Threads is really, really, really successful at capturing broad audiences across the world, particularly ones that are rapidly developing, like Southeast Asia, South America.

You know, Brazil has a massive social media presence and all this.

So I thought this is really interesting that threads is actually doing fantastically well for them, just not really in a way that we care about, which is an interesting just like way to think about social media, you know?

I mean, that is interesting.

Something I will say, though, is

my understanding is the value per user because these platforms run on ad dollars.

Oh, you think they're less valuable?

I don't think they're less valuable as people, but I think there's an ad dollar thing where it's like one user in the United States is worth like,

I don't remember the exact numbers from marketing days, but it's like 20 plus dollars per person in terms of amount they can sell ads for it.

Yeah.

And it's like eight cents if it's from an

they don't buy enough on ads.

Yeah.

So from a profitability stand, I mean, it's number of users and impact, I guess, is valuable.

And this is very interesting.

But like from a health of the business, it's just a lot easier to get 100 million people from somewhere where you can't sell any ads than it is to get somewhere where it's like there's a high.

Yeah, that's my that would be my one counter, but that this makes sense to me.

I mean, I

guess you do not think of it that way.

Yeah, it's it's just like fascinating, and I think it's it's again like what you're talking.

There's two, there's two angles.

One is you objectively make way, way, way more money when you have an American audience, right?

Yeah, or European or European, whatever, rich countries, right?

That's you just objectively can squeeze us for a lot more of our precious, precious goo.

I mean, even compared to Europe, right?

Isn't the the the ad rates in the us yeah the us like

canada australia we just consume like crazy we consume like we love ads and we buy and we make and we have a lot of money we're we're rich people who want to buy stuff and that's that's our vibe dumb tick tock ads

well i a question i have for you guys are you residual facebook users like do you guys engage or check it at all now like the facebook the site and then if not facebook i'm wondering if you guys touch messenger at all anymore.

I, it got me, like, I kept using it for Messenger specifically for about five years after college.

And now I am locked out of my account.

I don't even have my password anymore.

And I tried to reset it and it wouldn't let me.

And I was like, hey, I don't care.

I just truly don't care.

Yeah, I'm a Messenger user.

Because there's like, there's that period in time where Facebook was big enough.

Yeah.

And you have some friends that you just talk through that.

Exactly.

And it just sticks.

So that's what I was going to say: is the U.S.

having a number that's even as high as 200 million is pretty shocking to me.

But I think about the way that I I use Facebook, which is basically I check Messenger once a week.

And I think that's a lot of people.

Like you just have a residual use for Facebook that you continue to engage with occasionally or things like Marketplace, like Facebook Marketplace has become crazy popular.

Things that let you hang on to the site in a way that is very different from the way that you were probably using it 10 years ago.

So that was the first thing that I thought of when I saw this.

Another interesting thing is, I think for young people, especially, the way you get into social media or end up picking a platform or signing up for is social pressure around you or social trends around you, right?

A way to engage with the, you know, friends you have at school, you know, whether it be college or high school or

something you might use for work, right?

And the trend of one site being big at a certain time hits different languages and countries at different times, right?

So even if Facebook has maybe a lot of the same issues that it did 10 years ago, and it's not a very good or very fun site to use, or people have phased out of it in American life.

Different countries are experiencing the wave of Facebook just being popular at different times.

So I'm really curious, like if you give another 20 years after this, what are the ways that all the people in all these other countries are still interacting with that site?

The other thing I was thinking about with this was the segmented nature of language or culture on social media.

And this is why China has always been so fascinating to me, even growing up, was that their internet wasn't even on the same sites that I use.

And I was kind of excited by that.

It felt, it's so

secretive and cool.

But with stuff like this, like Japan or Japanese gaming scenes, like I came up playing competitive Mario Kart and the Japanese scene is a huge part of that.

But the world scene on the whole communicated to each other pretty much in English.

Even if you were French, even if you were German, the community was a linked thing that communicated in English as the medium of exchange, right?

And then Japan was pretty separate

because they only spoke Japanese and they didn't mind playing with just their own community in a lot of ways.

And they had their own forums, their own websites.

And then eventually with Twitter, they had their own kind of sections of Twitter, right?

Like people, like there's a whole world world of Japanese Twitter to interact with that you can find if you follow enough Japanese people and speak Japanese.

But if you have a normal English-centered algorithm, right, you're never interacting with that.

And the same goes for like Portuguese, like Brazil has its own memes and own things, right, that are totally separate from the way that the English internet has developed.

Yeah.

It's funny you mentioned China and their entirely separate apps and the Great Firewall and everything.

I saw someone said something recently that was funny to me, which is that like, you know, you mentioned there's like a billion internet users there, right?

Was there no one?

No, no, no, no, no.

Social media, yeah, exactly.

That's not even internet.

That's people who are on these apps, which is crazy.

You just have an absurd, absurd number of people online.

It's got to be because of WeChat, though, too.

I put an asterisk on that is like everything is on WeChat and you need WeChat to like live basically.

So I, but, you know, even if it's 800, it's a lot of people online and they are all completely isolated from the rest of the world, really through their apps.

Like they don't, they don't use the same apps.

They don't use anything.

And, you know, it's funny that

the way someone phrased it was like, we think of it as they are being

blocked from us.

But in a way, we're almost being saved from a deluge of what, 800 million Chinese people overrunning every...

They would outnumber almost every other country on every platform that we use.

They would be.

Oh, yeah, the English audience would be secondary.

Yeah, right now the Americans or Western is is the central you know like you said I get what you mean like if you go to the Morocco community was through English the examples that I would give if you like you go to Twitch if you go to YouTube even when you account for all these languages and different types of videos right the biggest creators on all of these platforms are still English speakers

in general.

There's like a few exceptions depending on how you measure it.

Like for example on Twitch eBay

Super big figure, right?

Very, I mean you have access to there's more first people with spanish as their first language than english yeah like that's a an enormous audience across so many countries but on the whole the largest consistent figures across all these platforms are english speakers if you go look into the data like you can go take a look that doesn't mean that doesn't mean it's always the case in every like subcategory and thing you measure but on youtube it's mr beast right and then on twitch it's kai well like the idea would be if the firewall was down it would be chinese the number one based on the number of people and you can you can go do this something i do think is interesting about Chinese websites is that they block people from going to websites that they don't approve of.

But most of these Chinese platforms are things that you can access as an American.

So that's the thing I would do growing up: is I found out, like, what are the big Chinese, like, YouTube-esque and like streaming sites?

I would go, like, browse YY and Dou Yu and like see what, what the fuck do they stream?

Yeah, there was a phase for a bit where everyone was going on Zhao Hong Shu, which is like their Instagram Pinterest hybrid.

It was like a a trend.

Everyone was going there.

And then like I remember I made a QQ account growing up because that's how you could make a Chinese League of Legends account.

And then I used a fake Chinese passport number to make my Chinese League account and then played three.

We're trying to go to China, not get banned from it.

I played

300 ping Chinese league.

And that's what it means and not you.

Your fucking support.

You are terrible.

They're going to look at your KD ratio and we are banned if it's not yours.

Follow your toxic chat messages.

You were raising yourself.

They see you inting a single time.

Woman Busha upon y'all.

What's up?

Oh.

He's been practicing.

One more thing.

We're on social media.

So, China, TikTok, let's bring this together.

You know, it's supposed to be banned.

Yeah, yeah.

Yeah, yeah, yeah.

There's a follow-up here, which is very interesting.

If you want to say anything, but you keep delaying it.

Big news is that I think by the end of August, the international version of the app is supposed to be banned.

And TikTok is launching a new US-only version of TikTok called

M2 or something.

Yeah, do you have the DJ?

Yeah, yeah, yeah.

Yeah, yeah, slightly different than that.

So TikTok is supposed to be banned.

There's a law that we talked about this last week, law that it's supposed to be banned.

Trump's just stalling it just because of pure vibes.

Supposedly, there might be a buyer.

The reason a buyer is really unlikely for TikTok is because the core app is developed in China.

So there's a, you know, it's owned by a Chinese company.

The idea that they are going to like give up the algorithm to TikTok, this wildly successful thing, they won't want to do it.

Not only is that just a stupid business decision, it also, there's a degree of like national pride that China has created this international phenomenon that's extremely rare and uncommon.

And it would be a big hit to the idea of China wanting to export culture.

It's like giving up laboo boo dolls.

You just couldn't.

Yeah, yeah, yeah.

You know what I'm saying?

And so this is, you know, most people would agree untenable.

There is like no way that, and actually here, I have this article here as well.

You can pull up on the,

there's like no way that the Chinese company is going to be willing to sell the algorithm, which again is developed by Chinese engineers by ByteDance in China.

So TikTok is technically a separate company than Daiyin or Doyin, which is the Chinese version, but it's still Chinese engineers, right?

And that's the challenge.

So this new one they're going to do is called M2.

And the idea is it's going to be an app in a company that is entirely made within the U.S.

And that way they can tell the U.S.

regulators, hey, this has nothing to do with China.

So it means moving the tech stack

from China to an American company.

And from a technical perspective, probably it means forking the code in some way, but it's not clear what this means because again, ByteDance does not want to give up the code that allowed them to make TikTok.

They don't want to give that away.

And so the whole weirdness around selling TikTok is there's no way they'll sell the core thing that makes TikTok run.

At most, they would sell basically the name, the name TikTok and a bunch of data, which is not valuable.

And so there's this inherent disconnect between the idea of selling TikTok and what ByteDance might actually do.

This is their attempt to get around it, seemingly.

And so the specific dates, they're going to launch this in September 5th, and then they're going to shut down TikTok on March 26th.

So their idea is we will force everybody on TikTok to migrate to an app, which is legitimately centralized and developed in the United States.

And then it'll be a kind of separate thing.

And if that pans out, then maybe they don't need to be banned.

So interesting, though, because that's like us.

soft creating our own great firewall.

Do you know what I'm saying?

The idea that it has to be a US-based app that is for other U.S.

users only.

Well, I think, so we don't have a lot of details about it.

The idea would be the algorithm and what powers it and the data are all US-based, but it would still be able to interact with international people.

Right.

But I assume someone in, you know, France is down, is keeping the same version of TikTok and you are on M2.

So unless they cross-share videos.

Yes, they would.

They would.

Yeah, yeah.

So the idea is like you still, because, you know, if we get, I think TikTok is aware that if the United States gets removed from from the TikTok ecosystem, it all fails, right?

Like we are too much of a cultural center, right?

You can't, you can't just pull away the U.S.

and have, and not have everybody else flood.

If I'm not dancing on there, it's not going to last.

Right, right.

That's what draws the people in.

Some of this is like how the app stays afloat.

If my 20,000 viewer TikTok clips of my stream don't keep going up, the site will crumble.

You would have squeaks on there.

But what makes that, what makes TikTok work culturally is the international spread, right?

So you need to keep that fabric going.

The challenge is that you you need to have the algorithm of the app not developed by China.

So the idea here is that Americans will use an app that can still connect with the international version of TikTok, but it would be two different recommendations algorithms.

One is developed by the United States, one is developed by ByteDance.

So you would never really know if you're going to have that different experience.

Yeah, yeah.

It'd be this very strange thing.

So there's a lot of unknown about this because we don't know exactly what they're doing, but this is what they're, you know, these are the reports coming out.

It's like, we're going to make this version that technically is developed by America, and then there's this weird fracturing while maybe still keeping it all together it's weird do you think it'll have any impact on the number of people who are actively using the app i feel like it will be negligible at best because the platforms that are sort of competing with tick tock that have worse algorithms like i think even functionally from

it's clear to me that youtube shorts has a worse algorithm than tick tock does like the way it just serves me content right but i still click the shorts like i'm still i still have the monkey in my brain.

Yeah, our brains are.

So I feel like you downgrade the algorithm, but I don't feel like it's going to change the way people use it, which was the only benefit that I saw from banning it.

But yeah,

probably besides, I mean, I don't know if I necessarily believe in like the security concerns in this specific case, but yeah.

Yeah, I don't know.

I don't think habits will change too much.

But I also don't know that this is even, you know, this, this could be like

stalling.

We don't know if this is.

I think both sides are just stalling in this.

It just feels like everyone wants to kind of like

keep things.

Like March 2026, we'll get rid of it.

But by March 2026, they'll be like, all right, we need six.

This is going to be like real ID, bro.

This is going to be like real ID at the airport.

The TikTok ban is actually going to come to fruition in 2032.

And they're like, all right, we got to do it.

For non-Americans, for the last five years, every time you go to the airport, that's a sign that says, you have to get a new updated ID or you can't fly coming in March of this year.

And then every single year, every single year,

they're just like, look, we'll give you a little bit more time.

And this has been going on for what, seven years?

It has to be at least six years, right?

I think I saw the first signs for a real ID at the airport.

I think in

2018.

And I still lived in Washington when I saw them for the first time.

That's everything.

We just keep extending.

We just

bail.

Yeah, dude.

You just bail.

I mean, the thing is, what they would do is they release this.

So the reason I think it's interesting is because they're saying September 5th.

That's soon.

That's in two months so in two months they release dick talk and inside the of current app there's a button that says you must migrate to dick talk by next march and you press a button and you download the new app and it's exactly the same in almost every single way they might pull it off that'd be like a kind of that'd be a kind of funny way to get around the whole thing

yeah well they should get around the law that's supposed to ban it we're just still that they're going to be well i so well wasn't that it was never a ban right it wasn't the whole idea this was the goal of the law was it not to get it under it was to give this to an American-controlled company warranted under American control.

This is what the goal of the law was.

This is an app developed in America, correct?

But it's still owned by ByteDance, which is still a Chinese company.

The whole point of the law specifies that like

you have to get the Chinese ownership out of the app that is controlled.

Hey, hold on.

Run this back.

Sorry, I actually skipped over this part then.

Does the Chinese company still owns this as like a subsidiary, but it's just the data is being stored in the U.S.

and that's adequate?

All right.

Currently with TikTok.

Yes.

ByteDance owns it and develops it.

TikTok is a Chinese company.

However, they store, at least for the U.S., their data in the United States.

So that's their argument is like the Chinese don't have control over it.

The data is all in the U.S.

That is how it currently works.

However, the United States Congress and lawmakers said that's not enough.

There's a whole bunch of evidence that shows Chinese engineers and software developers still have access to the data.

The Chinese Communist Party is still pretty clearly able to tell ByteDance what to do.

So clearly, there is influence.

The core code running the app is Chinese, even though the data is stored here.

The idea with this is they will move that actual development code to the United States.

So the whole thing is here.

And then they might be able to get around it and say, yes, we have Chinese overlords who are technically in control of the company, but the engineers are no longer in China.

Are you a Chinese tech company that's been forced to move your tech stack to the United States?

Well, you can sign up for NordVPN.

and you can also watch Vietnam you can also watch some like crazy shows on Netflix and that's

that's gonna be our fifth that's our first

let's only take sponsors whenever we start taking sponsors that are just catered to TikTok getting around American censors okay speaking to China let's do a sponsor where we can get money out of China for money laundering yeah

okay because that's your final topic I want to hear from you this was a cool so this isn't really like, it's not breaking news or recent news in the sense that this has been going on for a while, but it's something that still exists now.

And this

interesting world of Chinese capital flight and money laundering, how it ties into the drug trade around the world, but specifically in the United States as well.

And I started looking into this, I think,

almost two years ago

when some stories were breaking out about it.

I remember watching.

I started looking into this.

He he means starting to do drugs,

yeah.

When I was buying the drugs, and uh, I started to,

I was like, I met a guy in San Diego, and he was speaking Chinese, and I was like,

that's crazy.

I just noticed my plug kept getting more and more Chinese as I was buying throughout the years.

No, but there's some really cool, uh, there's some like cool reading you can do about this.

There's some good videos, uh, out by both the FT and Vice.

Uh, I think Patroc, I think, had a good one.

The Vice one is particularly interesting if you want to go watch it after this, this, because they actually go undercover and meet some of these Chinese brokers that I'll tell you about.

And it's really, really interesting.

But basically,

so if you are a rich person in China, you might want a way to get your money out of the country.

Well, why is that the case at a basic level?

They have really strict capital controls.

So if you're a Chinese citizen, you can only move 50K USD worth of currency per year per person out of the country.

So whether that, and if you want to make larger investments in, say, foreign companies of any kind or buy things like real estate or make really large purchases for like a foreign good, you would need to get that approved somehow.

So

when you couple that with general restrictions or issues in China

around

maybe you're just not confident or in your assets in China for the foreseeable future and you just want a way to get the money out of the country.

How can you get it out?

Well, you could use something called an underground bank that functions on the basis of these things called mirror transfers.

And the basic idea of a mirror transfer is that on one end, I deposit money with like an illicit bank or group.

Like I give you a bunch of so you're a rich Chinese guy.

I'm a rich Chinese guy.

You have a hundred trillion yuan.

100 trillion.

Oh, you have a lot.

Yeah, 500 billion yuan.

That is what, like $6?

That's still a lot.

That's a lot.

That's still a lot.

Okay.

And so you go to him, and what are you doing?

I'm going to Doug.

He's actually, Doug is also Chinese in this city.

And

I give Doug a bunch of my Chinese yuan, R and B.

And on the other end, I have a contact in the United States that I'm comfortable holding assets for me.

My little, my homie over there.

My little guy over there.

And the Chinese

organized crime has a representative in the United States that gives you the person I trust, the equivalent amount in USD minus like a commission, right?

Right.

So, what we've done is there's no record of this transaction, there's no actual international transfer of money, and so it's just done through this crime syndicate that basically has the cash to do it and has signed off on the transaction on there.

And the issue with this is that it's really hard to track, right?

But this is a way that uh Chinese people buy

money outside of China in order to get,

in order to get like foreign money or foreign assets.

You know, you always hear

about

particularly Chinese nationals, but just international people buying housing in North America.

You know, like in Canada, that's a complaint that's often said by people.

It's like, you know, foreign people are coming in and buying all the houses and that's why we can't afford any.

How are Chinese nationals able to buy so many homes if they can only spend 50K a year?

I actually had this question too, and I have two loose answers to this.

And if anybody can weigh in, I'd appreciate it as well.

But from my understanding, there's actually restrictions on the Chinese end that came to place into place in 2016 and 2017 that actually makes it harder for Chinese citizens to do this.

So that's one thing that limits it.

And then I also know in places like Australia and Canada, they've instated laws at local levels that also makes it harder for foreign citizens to just buy up real estate and hold it.

So those are two things that have changed in like the last eight years that do affect this.

But how did they even buy a house in the first place if they can only spend 50K?

So now,

one of the ways you could do it is through a system like this.

Or perhaps you just have a family member abroad that you could do it through.

But this whole process represents a way that you can move money around in order to make purchases like that.

Gotcha.

I do want to stress that prior to like 2016 and prior, there wasn't as strict controls from the Chinese end on what you could be spending your money on.

So there's some laws that have changed from China's perspective that also also have like made it

more of a reason to do this at all.

So the way that this ties in

is into the drug trade, a massive,

you know, Mexican drug cartels make massive amounts of money selling drugs in the United States and around the world, and they need a way to launder the money that they bring in, right?

So this created an interesting opportunity.

And I want to walk you guys through the process.

So can I be the cartel?

You can be the cartel.

Yeah, absolutely.

So you could be the cartel in Mexico.

Okay.

And your name's Doug.

Okay, cool.

And you send a fentanyl shipment to our friend over here.

I have the fentanyl.

I know you have to act on this one.

And

Atrioch operates a

drug gang in New York that distributes and sells the fentanyl, right?

I thought we were doing something fictional here.

And this is fictionalized events.

So the drug gang, Atriok, sells the fentanyl in New York.

Say they earned a million dollars in cash that now needs to be laundered.

And they tell the cartel back home that, hey, we have a million dollars.

We've successfully done this.

And now you approach a Chinese triad member in Mexico that's your broker for this amount of money.

And he's like, you're like, I need to get my money now.

That guy hits up his Chinese contact in New York and he's like, there's a million dollars for you to go pick up.

And then they communicate.

And then the guy in New York goes and picks up the money, tells the Chinese contact in Mexico, and let's say that's me.

I'm the Chinese broker in Mexico.

I pay you out the million dollar USD equivalent in pesos and I just give that to the cartel, right?

You've been paid out and made whole for this whole transaction.

And the reason this is so good for you is this is way quicker and way safer than trying to smuggle cash across the border, which would take much longer periods of time, get seized.

There's all these associated risks with that, right?

But instead, all I did was my team in New York handed a million dollars to a Chinese guy, and then we received a million dollars and pesos in Mexico.

And apparently, this was they're like Chinese zell.

Kind of drug dealers.

What's mind-blowing about this is this regularly happens.

The turnaround time for you as the drug dealer regularly happens within a 24-hour period.

It is extremely fast.

So, compared to the weeks or months that it might have used to take in you, you know, back in your early drug dealing days.

Yeah.

And then,

so the way this continues is like the Chinese contacts have picked up the million dollars, right?

And the Chinese broker in America now put up the US dollars for sale to any Chinese citizens that might want those US dollars, right?

And then

Chinese citizens who want to purchase that US dollars to get their RMB out of the country,

they meet with a

agent of the triad, like a Chinese person in China, and then make a legal money transfer of RMB to their bank just within China.

And now that representative of the triad in China, you know, texts the guy in the U.S.

and confirms that the transaction has been made.

And then the U.S.

guy pays out the million or you know, whatever amount in USD that they wanted to their friend in New York.

And now your trusted contact, like if I'm a rich Chinese person, I just have a homie in New York or wherever in the U.S.

It doesn't matter in this scenario.

And my friend now has the money in his hands and I've successfully acquired the USD that I want.

Yeah, what's fascinating about this is like, it's so, so much more difficult to track under all normal like FBI money tracing methods because the USD has never left New York.

The RMB has never left China.

The Pesos have never left Mexico.

It's just, it's just circling in each one, but everyone gets what they want.

Damn.

Which is.

And so drug trafficking is like a very natural fit with this because there's a ton of cash that needs to be laundered, right?

But it isn't just the Mexican to U.S.

drug trade that is taking advantage of this.

There's crime, organized crime around the world that needs money to be laundered.

And so, anywhere in the world where there's pockets of like

Chinese diaspora that have popped up for whatever reason, like in Africa, because of the infrastructure projects that have been built, or like Chinese mining companies that are working in Africa, there's little, there's like groups of Chinese people that now live in that place that can operate potentially as like as part of this, part of this money laundering trade, right?

Or a huge thing, crazy stat that I saw was how remittance, remittance is when a foreign, like a foreign national is sending money back home to family, right?

Legal remittance from Italy has fallen off to like near zero in the past decade and a half because they've all gone to the black market because of the system now.

And there's, so there's, there's all of this like illegal, you know, black market trade that exists all over the world that wherever a Chinese broker can provide this service, because there's a need from Chinese citizens to get their money out of the country, they can provide a really

quick and clean service, basically.

I mean, my understanding, and you can correct me if I'm wrong, let me rush to similar things, is that over the past 10, 15 years,

Chinese triads have taken over the global money laundering industry completely.

Almost everywhere.

It is complete.

It used to be a million different ways for a million different people.

It is now almost all global money laundering is done through Chinese triads because the demand from regular non-crime affiliated citizens in China to get money out of China is so big that it can support everything else.

Everything else can run off of that need.

Yeah, and it's going, it's going up.

And

I asked myself, like, why the specific rise in this, in this happening now, right?

And it was the, you know, the capital restrictions, like I said, but also other things in China that have been happening that pressure people economically to do this.

Like if you want to invest in foreign assets, you don't want to, the Chinese stock market just hasn't been, it sucks.

Flat performance.

So if you just want to put a bunch of your money in assets that exist outside of China in order to safely keep it,

you want to get your money out.

Chinese real estate struggled a bunch in recent years because of the giant bubble that started that did pop, started to pop.

You don't want to hold Chinese real estate anymore.

You put your money,

get your money out of the country.

And then general confidence in whether or not the government is going to like impede or seize the assets that you own, right?

Because they have a history of doing that.

So,

or, or a really basic reason, sometimes you just want to buy something super sick that isn't sold in China and costs a lot of money.

Some people just want to use a service like this for the sake of doing that.

If you don't mind me spoiling it, at the bottom of your notes, I see in all caps, CS Go skins.

okay this was a thought that i hadn't fully completed it's just that's all it says with two question marks cs2 oh excuse me cs2 skins well this reminded me a little bit of the way that like the chinese cs skin market interacts with the rest of the market because there's a giant trading site called buff uh buff163 that is chinese only and is really difficult to get money into and out of as a foreigner and you need to go through like all these steps to do it and china is the largest section of the skin market for CS.

And I was noticing like weird parallels between like what I was watching and reading and the way that the skin market works in Counter-Strike, but I hadn't completed the thought, which is why it was like a weird thing.

Well, I got a weird note at the bottom.

Then the same thing apparently, this is again, this is also a limit of misinformation, but I was reading this recently.

is happening in the early stages with the labooboo dolls.

The demand is real from Western countries.

Like we think it's really cool.

There's like celebrities wearing them and they want to buy them.

They have huge value, but they're made in giant.

Hold on, before we talk about boobadols, let's start with like some objective facts.

They are ugly as sin.

Thank you.

Rihanna doesn't think so because she wore one around.

No, I think let's just start with the facts.

No rational person thinks these look good.

I'm sorry, but Riri thinks they're cool.

And so other people think they're cool.

And you can gamble on them and open blind box.

That's really my line.

I'm going to steel man it.

I hate them.

Ooh, good steel man.

Steelmanning is just saying my own opinion.

Anyway, they're popular and they're worth quite a bit, especially some of the rarer ones.

And so recently, this did happen.

Again, I don't know if it's part of this larger thing, but they've begun to become seized at Chinese customs leaving the country because they're made in China.

And so people are getting access to them much cheaper than they would get them overseas.

And then they are smuggling lots of them out of the country, then selling them for a huge inflated profit to get money out of the country.

It's like a way of not carrying cash out, but carrying Bubba dolls worth hundreds of money.

So it's just funny because I do think in a similar way to how I'm kind of like making fun of Trump for trying to whack-a-mole tariffs.

Like there's no way to, yeah.

The similar thing is happening with Chinese capital controls where the demand is so great.

There's so many porous holes open.

People find a way.

People find a way.

You can't clamp it down.

If they don't, you know, if you're like you said this, but if you're rich in China, you put your money in the stock market, it goes nowhere.

You put your money in real estate, it goes nowhere.

You have to get the money out of China, even if you're not like afraid of it getting seized.

You just have to find a way to get it to grow or you're shrinking.

So you want to put it in Vancouver real estate because that's mooning.

You want to put it in NVIDIA stock.

You want to put it in, you have to get it out.

And so they will find a way, whether it's through drug dealers, whether it's through Luba Dolls, whether it's through CS Go skins.

They're going to find a way.

Yeah, and I think it's almost assuredly happening with CS skins to some degree because through the larger skins, like they're ridiculously expensive at the high end.

The one we didn't mention that is the elephant in the room is crypto.

Crypto is a crypto vehicle for this.

And so it's happening all over, or it's gold.

People are finding a million different ways.

But it well, okay, let me steel man that.

NFTs look really cool.

Guy who hates Labu Doll, but loves monkey JPEG Twitter profiles.

Yes, sir.

Let's just start with the objective facts, sir.

Okay.

I'm sorry.

I don't like these steel man.

Okay, wait.

I want to ask you guys something, though, because I and I,

does any question pop in your head when I, when I give you this scenario?

Think about the whole process we had outlined with the drug trade and like Mexican cartels.

Like when they're selling drugs in the United States, they sell it for USD.

Yeah.

When does money actually change countries?

It never does.

That's the whole appeal of the...

But like at no point, at no point ever.

No, that's, and that's what protects these transactions.

But I think you're getting at the question that I had, because if you think about how this works, right?

The drugs are sold for USD, and

the brokers are paying you out in pesos.

Precursor.

Is that what you're getting to?

No.

I mean, they're selling fentanyl.

That's the drug.

In the analogy, is Aatrox stolen fentanyl?

I've always been this whole time.

I couldn't do this problem with you guys if I wasn't on a little fentanyl.

He's not on fentanyl this time.

Right.

It's not important in the analogy.

There's no analogy, actually.

I'm just explaining it.

I thought you were trying to get at the point that, like, well,

the pesos have to come from somewhere, right?

Exactly.

Exactly.

I was wondering the exact same thing yeah when i was thinking about this i was like where do the brokers get the pesos because if you follow this system as it's been laid out to me right you have a finite supply of pesos to pay out the cartel right where do the pesos come from so this was one of the there's a whole we got to close the loop here this was wild to me the uh chinese like crime organizations import, they use the yuan that they get in China and then use it to buy cheap Chinese goods that they then transport and import to Mexico and then sell at stores and markets that

the triad still owns in Mexico.

And they only sell them for cash.

And they run massive like market businesses of like shoes, clothes, masks, anything you can think of that could be produced in China.

And the trade relationship, if you look at the amount of goods that have come into Mexico from China in like the past decade, has spiked dramatically.

And that's how they get the pesos.

There's a whole like closed loop to this where they continue to bring in Chinese goods back into Mexico, sell them locally there, get the pesos in cash to use for these payments.

That makes total sense.

I did hear the way I heard it, and that makes, I 100% believe you, I think that's probably makes more sense than what I'm about to say.

That's the amount of pesos you need to be staggering, right?

So you have to do all that.

But the way I heard it was,

you know, to close the loop, the real thing they need pesos, they can get pesos for is from the drug cartels that are making fentanyl in Mexico to export it to the United States need fentanyl precursor.

They need like the raw chemicals and materials to make fentanyl.

And they buy that from China with pesos.

So they, they trade the pesos, but never leaving the country.

So I think you're probably right here because when I was looking at the,

I think it was the, the Vice report where they're going through the stores that the brokers are showing in that they own, I was like,

this seems crazy to me.

Like, how could you be pushing enough volume of these goods in order to make up the gap of like how large these payments are expected to be?

Right.

So, it's probably just both things, right?

It's like you need every

avenue you can get to bring in as much pesos as possible in order to operate the business, the illegal business at the scale that you need to operate it at.

Because in the

interview where they're using the body cameras and stuff, they're talking about like like the reporter is pretending to be a fake, you know, fake Chinese party interested in laundering a bunch of money, right?

And the people they're talking to are like bragging about how much money they can launder or pay out at a time through the system that they have.

And they're like, well, 200 million would be like way too much.

Like, we can't do that all at once.

It would like take a long time.

But like 10 to 20 million, no problem.

You give me a day's heads up, like I can move that for you instantly.

And I was blown away by that.

I was.

It's so funny to think that like something as seemingly irrelevant as like China changing their capital controls could cripple the drug industry temporarily.

You know what I'm saying?

Like every one of these pieces, including just rich Chinese people that don't care about drugs at all, that want to get their money out, has to exist for this all to work.

Otherwise,

do you think that there is a group, a whole section of people in the United States who lost their job as drug dealers and money launderers and are now upset at the Chinese for taking their jobs.

We need to get the money, you know, it's funny.

The money launderer part, genuinely, yeah, because that's what has been replaced here.

Presumably, in this whole scenario that we outlined, it's like

the local gangs, and like whether it be like in the European example, they were talking about the Italian mob.

And in New York case, in New York's case, it could be a local drug gang.

Like, you know, we haven't lost those jobs yet.

Thank God.

But the money laundering is the thing that's been replaced.

Yeah.

Every individual gang across the world is kind of like a McDonald's franchise where they get the drugs from someone else and they do the money laundering.

They just operate their local flavor of crime, of like

violence, but they're not making the drug and they're not handling the money laundering.

Everyone else, it's all decent.

That's really funny.

It's funny that it has become so.

American who can only view things through lens of McDonald's.

Oh, you're saying it's like burger.

It's like burger.

It's like doing burger friends.

I see.

Yeah.

That makes total sense.

I think this story is, you know, I recognize that this whole process,

you know, has pretty dire consequences at corners of it.

But holistically, I found it incredibly fascinating.

Wait, we're coming up on time.

You had a correction you wanted to make.

Yeah, I did want to make a correction from last week.

A quick,

quick thing.

Did you do that correction song where you say, I'm a little baby, I'm sorry for being wrong, I'm not very good at my job, and I don't do my research.

I didn't do the song, by the way, when I lied about cancer two weeks ago.

Last week, I talked about birthright citizenship, and a few people were correcting me, and rightfully so.

So, I want to clarify one thing first: I'm not against birthright citizenship.

I don't know how that came across.

I'm going to hear from the comments.

Nope, not against birthright citizenship.

But one thing I was wrong about, I meant to clarify, or what I meant to say was unrestricted birthright citizenship is not common in a global context.

However, there are way more countries than the US and Canada that have it.

And those include like Mexico, Cuba, Costa Rica, Guatemala, Jamaica, Chile, Ecuador.

So a bunch of countries do have it, like way more than even I thought, but still a minority of countries.

And then a bunch of people pointed out that like birthright citizenship is way, way way more than that and it's like yeah but that's restricted birthright citizenship that has a bunch of like rules and addendums to it which is not what i was talking about uh so i just want to make that correction because i was wrong uh about the number of countries that have it and just keep that in mind that is why next week we're replacing him with gavin newsom who puts so many things wrong newsom doesn't lie about

birthright citizenship he tells a lie he does his research before the show he checks his sources

speaking of checking sources you want to hear something funny so i was looking uh into all this social media stuff, right?

And I was looking at numbers for threads, and I was cross-checking a bunch of things just to make sure the numbers were actually right.

And one of the websites I was using to primarily talk about threads, not this one, but another one,

was basically talking about how threads has grown.

And so, again, the whole point of the story was like, wow, threads is gigantic and we just kind of don't realize it.

They have 150 million people that are being, that are using this like every month or whatever.

And,

and what's crazy as a stat is of that 150 million, 50% are from Armenia.

That's not true, right?

Armenia has 3 million people.

I was like, that just can't be.

According to this website, very confidently is just stating, yep.

And we know looking at the data that Armenians are about half of them, half of the 150 million people.

So each, so either threads is growing, kind of spread around the world, or every single Armenian person has multiple has 30 threads accounts that they are personally running, which is just like, it's a cool cultural place to be.

You really get to feel like you're immersed.

This is my account for work, my account for friends my account for my second wife

for every hour of the day impression of cheating

i don't know

so i as i say to know dude obviously

i don't know what i learned from this is that it is very hard to get accurate numbers on social media and it's it's mostly estimates so it's happened to me when i worked in marketing all the time you you dude so much of this stuff is fluff or empty or and you'd have to give these pitches on like the growth of platforms to your executive and it would just be you're just like just fudget it.

You just, there's no, there's no numbers.

They don't publish it.

Nobody knows.

Nobody knows.

Apparently, it's all Armenia.

Dude, this is a symptom, though.

I've been talking to my stream about this.

No matter what your position is, if you Google hard enough, there'll be a website that confidently agrees with you with a stat that doesn't make sense.

And people, you know, like you have to have some kind of trusted source.

There has to be some kind of barrier.

Because otherwise, there will be a website.

I promise you, I agree that someone's going to find a website.

Dude, of the eight or nine half of them linked to each other as the source it's just like dude what it's like bot farms forming yeah it was bot farms that are referencing each other all with different numbers like what what is even going on here yeah i feel like they add a little bit of noise to the data just the channel right just to just so their website's a little bit different it's crazy the internet i want my country back internet used to be a good honest source of news that i can trust yeah it's i mean it used to be better it used to be better for sure forum days you have a little signature did you ever do do that?

Yeah.

Oh, yeah.

I used to make them for money.

Oh, yeah.

I was on the Yu-Gi-Oh!

card maker forum.

Yeah, I would make you one that says like Yu-Gi-Oh!

lover.

Yeah.

Like Yu-Gi-Oh!

and add a little Photoshop sheen to it.

I used to crank those out.

That was easy money.

Yeah, you're making them in GIMP because you couldn't get Photoshop.

No, I'd cry.

I pirated Photoshop.

Oh, shit.

Never mind.

Well, I think that about wraps it up.

We do have 45 more seconds.

So what I would like to pitch is Atriach just counts down from 45.

30.

29.

This is good.

28.

I can't do that.

Now you're watching Limited Stands Exercise.