ChatGPT Will See You Now, and Silicon Valley Bank Fallout Continues

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Hi, everyone.

This is Pivot from New York Magazine and the Vox Media Podcast Network, or should I say, award-winning Pivot.

I'm Kara Swisher.

And I'm Scott Galloway.

Congratulations, Kara.

First off, congratulations to us.

We won the best tech podcast in the iHeart Podcast Awards.

And I won the Audible Audio Pioneer Vanguard Award.

That's a lot to say, but I won it.

Pioneering Vanguard of podcasting.

You sound like a ETF, Pioneering Vanguard, or kind of financial services.

Vanguard.

Brands.

Vanguard.

That should be my wrestling name.

That's kind of cool, though.

You're a pioneer in Vanguard.

So I did a speech in which we just had to give a one-minute virtual speech in which I said, I bet they didn't play it.

I don't know.

Where I said, you know, thank you so much.

I want to dedicate this to Bob Pittman, who runs iHeart, because when I went into him to ask about doing podcasts, he said it was the stupidest idea I've ever had and I shouldn't do it and I should be on radio.

And I want to thank him for being me not listening to him and stuff.

It was very funny.

But he did.

That actually happened.

He was like.

podcasting seems like

no and now they're big in podcasting and you were early you just you deserve the award it's nice recognition for you yeah it's true i'm a pioneering vanguard i would say mark maron is the most vanguardy of all of them, but there's a bunch.

There's a whole bunch of people who did early stuff.

Anyway, congratulations to us.

Let's focus on us.

We are the best technology podcast.

And I think this is very exciting.

It goes back to, I'm even more at someone in a line, a buffet line in another country,

pointed at me and said, podcast zaddy.

They listened to our, and I was thinking about it, and I wish I'd had a better answer.

I actually think, well, I'm curious what you think, but I do think

that podcasting increases my relative level of attractiveness more than yours.

Wait, no.

Well, hold on.

No, I think I'm more attractive as a podcaster.

Can I finish?

Yes, go on.

Can I finish?

I said relatively speaking, only because, and it's very base, I think men get turned on with their eyes and women get turned on with their ears.

Now, I don't know how this plays out in the gay community, and I don't even go there because I'll say something stupid.

Stupid, yeah.

But you don't need to say that before I say it.

You don't need to say it in unison with me.

It's kind of silent.

I've always said to young men, if you can make a woman laugh, eventually she's going to want to kiss you.

Anyways,

I think podcasting makes me the zaddy.

Zaddy.

It's just going to make you rich.

It's just going to make you a pioneering vanguard.

I was at a party last night for Jen Saki.

She's launching her show and the photographer was like, where's Scott?

I literally, it happens all the time.

The person who's taking pictures, this great woman named Shannon.

We appreciate all our people.

We appreciate all the fans.

And we try to

do better and better.

And we're going to win it every year.

That's our plan to do that.

We're winning all the awards.

That is our plan.

Well, you know what they say about pioneers?

Mud on your face, arrows in your back, but enjoy it.

No, enjoy it while you can.

No, no, there's no arrows in my back.

Anyway, I'm so glad to have beaten all the other people.

I'm kind of the Angela Bassett School of Winning.

Remember when Jamie Kirkett School of Winning.

When she lost the supporting actress at the Oscars, she had a a face, Angela.

She deserved an Oscar, by the way.

She deserves one.

And so she, you know how most when you lose the Oscar or you lose an award, you have that face like, yay for the winner.

She was not having it.

She was, I love Jamie Lee Gerd, so I'm glad she won.

No, she just was like, yeah, fuck that.

Like, she had to fuck that look.

So, you know, I'm so happy to beat all the others.

That's how I feel about these things, including some other tech podcasts who we don't like.

So today, we have so much to talk about.

Like Silicon Valley Bank Rescue, Open AI releases the new version of ChatGPT, ChatGPT-4, that writes better dad jokes than Scott Galloway ever could.

But first, the latest on the government's fight with TikTok, it's sort of heating up, even though it was heated up before.

The Biden administration is telling social apps, Chinese owners, to sell their stakes or face a ban in the U.S.

They're sort of doubling down.

The company responded saying a sale wouldn't address security risks any more than what they've done.

actually, but promises to spend over a billion dollars to safeguard programs for U.S.

data.

However, Bloomberg Bloomberg reports that TikTok is considering separating from ByteDance as a last resort.

If the existing security plan is not approved, I think this is going to be a spin-off.

There was some investment last week, valuing it at slightly less than it was, but tough, tough situation here.

What do you think is going to happen, Scott?

Well, we've been saying this, and so far it's playing out as we had initially speculated.

And that is the only thing you have to remember in a negotiation is one, don't make it a win-lose or get emotional, and two, show a willingness to walk away.

And the willingness to walk away with respect to the government's position is we are serious, we're going to ban you.

And I think it's finally looking like the CCP and ByteDance are like, yeah, this shit's getting real.

They probably are going to ban us.

And

there's bipartisan support for the first time around an issue.

And on the eve of the banning, they're going to figure it out because there's somewhere between 200 billion and a trillion reasons to figure it out.

If TikTok is banned and has to come off of the Google and Apple app stores, I mean, that takes that valuation.

That is an existential decline in value.

And I think the CCP and ByteDance and everyone involved would just love to just keep on trucking the way things are.

But when it becomes clear that's not going to happen, I think they're going to either figure out things that security protocols that satisfy the administration or they're going to spin it.

I think they will.

This is the government's coming to play.

They have to.

I think it's over because I think they thought the U.S.

would back down.

There would be fighting among in between.

And there's very little pushback, actually.

There's some, there's a little bit, but it's not a good, being for China right now in Washington is not a, is not a thing.

And it's very,

when I say bipartisan, is everyone, no one's going to blink here on this thing.

And that's that, that's what the Chinese had counted upon.

The other thing is the inability to put U.S.

products in China, similar products, not being able to be there.

They don't have a whole lot of legs to stand on in that regard.

And the argument that it's going to be just as safe, that might be true with the stuff they're putting in.

It might be just as safe, but it doesn't matter.

They're not going to get away with it without it being a U.S.

company.

And then I just, at the last minute, I don't know if China will do it.

You know, because it looks like, given all our other aggression between the two countries, I don't know if they want to look like they gave up something.

That would be my only.

If they were to let this happen and have it be banned, though, I mean, the chill, yeah the chill around the internet economy in china and

xi jinping still has to bring millions if not tens of millions of people out of poverty otherwise there's there's probably revolution and to take your national champions and literally kneecap them i mean not even kneecap them take them behind the shed and shoot them

what's this going to do when it's like okay you're telling me i can build an unbelievable company and you refuse to you know, for what's going on.

Why would you do anything?

Right.

Yeah.

Yeah.

Why would you start a company there?

What?

So I think that they're going to, I think they're going to figure it out.

And that figuring it out, well, as you've said, will either be a spin or some sort of additional certainty or regulatory scrutiny.

I don't think additional certainty will work now.

I think it could have.

And also, they've taken their eye off the ball of the business.

It's all about this and not about anything else.

And so Reels is doing better.

You know, I think a lot of people, I was talking to, I was at this NBC dinner and like they were talking about it.

and nobody wanted to put their stuff on TikTok suddenly, right?

Even though it's super popular.

They're like, oh,

and really just in the last 90 days.

Think about how much it's pivoted, how much the brand and the kind of issues surrounding it have pivoted.

That Chinese, the balloon did not help.

You know, it's, it's kind of the perfect storm of bad things for them.

But I say they're not going to ban, but they will spin.

And then all the rich U.S.

people will get rich.

Chinese will get rich.

And

this is the

covering up the shame part, like that they got made to do this.

That's the part I'm still not figuring it out.

But they'll keep arguing it until the last minute and then they'll do it.

Also, the year of Zuck efficiency continues.

Meta is cutting another 10,000 jobs.

We'll end up spending billions in restructuring costs.

Not a surprise.

That's what it costs when you cut lots of jobs.

Mark Zuckerberg told employees to expect cancellations of lower priority projects and overall flattening of the organization.

He loves the word flattening.

Meta stock, again, is up 6% following the news.

Scott, what a great stock choice you made.

Zuckerberg also noted the company should prepare for this economic reality to continue for many years.

It may or may not.

The economy may get better, but he's decided he wants to flatten things.

You've said layoffs are the beginning.

What about the many years part?

I just think he wants to get back to basics, this guy.

The Valley and growth companies have just discovered Osempic, and it's firing people.

They're literally...

Oh, wait, you're telling me

I can take this pill called layoffs.

I can work with HR.

I can say, okay, identify, have our top managers identify the bottom-performing 15% of their staff, get those lists, and then fire 15% of them.

I mean, think about it.

If you have, call it 30 or 40% operating margins, which is unbelievable, you can either cut a dollar in expense or grow your top line by $2.50.

And over the last 24 months, what's become increasingly clear is it's easier to cut a dollar in expense than it is to create an incremental $2.50 in revenue.

So, this is the strategy that keeps on giving.

And on the announcement of this cut, their stock goes up, what, $25 billion.

So,

and again, we've said this.

The most impactful business strategy of 2023 in terms of actual on the ground, what's happening is in AI, is in supply chain, it's that every CEO of every tech company is like, we've been stuffing calories down the throat of this thing.

There's fat everywhere.

Let's fire 10, 20, 30% of our staff.

I mean, Salesforce announces layoffs.

Boom, record earnings, stock way up.

It's the math here is so clear and present

that everybody,

you know, Vox, we laid off 7% of our staff and the value of the company probably went up.

This is a natural, healthy part of the cycle.

It's not to say it doesn't impact Iraq people's worlds, but when it started,

whenever it started six months ago, we said it's just starting.

It's just starting.

It's literally just starting.

They do have even more so, more than companies like Box, but a lot of these tech companies have people, you don't know what they do, honestly.

They just hire to hire, and then they do sort of projects.

Google's the most famous for this, obviously, you know, and they made fun of it on the show Silicon Valley, you know, up on the roof, resting, investing, essentially.

Well, why are you guys still coming in?

Rest and vest.

Oh,

because in order to fully vest your options, you've got to wait until your contracts are up.

I get it.

You catch on slow, you'll fit right in here.

But there's a lot of projects that you're like, what?

Like, huh?

Like, why?

All the time.

And so I think, you know, I don't, efficiency is really hard.

And if you're someone like Mark Zuckerberg and you look around and now you, you started off at the small place and now you have this ridiculously large, insane headquarters that people aren't going to probably.

They have a kind of a cool headquarters down south.

You're probably going, what do I need this for?

And you want to simplify, simplify, simplify.

I don't know.

It's also a psychic thing, I think, for these people as they realize they've gotten like fat and not happy, actually, fat and unhappy.

Well, it's incentives.

Companies don't operate for profits.

They certainly don't operate for societal good.

They operate to get the stock price and the compensation of senior managers up.

That is the tail that wags the dog across corporate America.

And if it's reporting metrics that show growth and lower profitability, then we will manage to that.

If it's showing pivoting from growth to profitability, like Netflix, we'll do that.

Because at the end of the day, the people who get to make the decisions are focused on their own self-interests, which is a key component of capitalism.

And their self-interests are linked to the stock price.

And so the strategy du jour right now and for a while is going to be: okay, the market believes any announcement around layoffs is going to flow straight to the bottom line.

And the consumer and the end customer isn't going to miss these people at all.

A company I started was acquired by a big company.

And what became clear to me about two days into the earnout out is, you know what they wanted me to do?

Fucking nothing.

Specifically, they didn't want me to compete.

I, all of a sudden, I was out of every strategy meeting, not really doing anything.

And I'm like, I'm not pulling my weight here.

And it's like, it became clear, we're going to pay you a shit ton of money just to not go out and compete with us.

And take that times a million.

That's what's happened in Silicon Valley.

And by the way, it's super expensive and wasteful.

And I think right now they're saying, okay, we were going to let you rest invest, but you're not really doing anything.

We'll take the risk that you might go start a competitor.

You're out.

Here's your two, three-month severance.

It's the

psychology has shifted.

And that's the correct way to go.

Now, listen, the stock is way up.

Let's just say, but its high was $376 in change in September 2021, a little less than two years ago.

Now it's 196.

So it's not back where, you know, it's been it.

That's, that's what his max, I think it's his maximum high was then.

Yeah, yeah, but Kara, it's almost doubled.

It's almost doubled since they started firing people.

It has, no, that's what I'm saying.

I, that's what I'm saying.

Fire people, stock doubles.

I get that, but I'm saying it's not where it was, and it's sort of it actually is where it is.

Oddly enough, it's a little less than 2018.

It's kind of getting back to 2018 numbers

because it really went down to $90 a share.

Crazy in November.

November, four months ago, was it 90 bucks?

Now it's at $197.

Crazy.

What has happened since November and now?

Is it the metaverse has taken off?

No.

The only thing that's happened between November and now is 20,000 people have been fired and the stocks doubled.

Yep.

Is there another stock you'd pick?

Because Tesla Stop seems to be sort of staying in the same arena, things like that.

I've said one of my...

One of my predictions in my 2023 deck is that Amazon,

the big guys, Amazon, Alphabet, Meta,

Apple, see their revenues, their revenue growth slow down and have their most profitable quarters in history towards the back end of this year because they're all going to do something they haven't done in 15 years.

They're going to cut costs.

Yeah.

Well, we'll see.

Amazon's still bumping along the bottom, but go ahead.

But they're going to, they're just going to find entire departments, entire business lines, entire regional offices that when they close them and they let those people go, no one notices.

I think every company, and I hate to acknowledge it, but I think every company in the world,

every tech company at least is like, wait, check this?

Wait, you're kidding me.

Musk laid off 80% of the workforce in about four months.

And granted,

he did it poorly, but the company's still there.

The product's still there.

I would put that off to the side because in this case, Facebook is still operating well.

Yeah.

They're still growing.

We don't know what the cost of what he's done at Twitter is until we know what the cost of what he's done at Twitter is.

But they're still making great products.

They're not screwing up.

It's not breaking down.

We'll see.

I don't know about it for years, but I think he's just putting that in their heads to get them acclimated to the new reality.

Anyway, let's get on to our first big story.

Scott, the government took your advice and also Bill Cohen's.

All the depositors with Silicon Valley Bank are safe.

Now the question, who's to blame?

There are accusations that panicked all caps tweets from VCs helped cause the bank run.

Those are my accusations, and others too, by the way.

And critics are zeroing in on a 2018 law that weakened oversight of miss-sized banks, although that might be a little overstated too.

In that story, Dodd-Frank passed in response to the global financial crisis.

The act forced many banks with more than $50 billion in assets to pass an annual stress test.

In 2018, Congress upped that number to $250 billion,

had bipartisan approval,

and then that's what some people are blaming.

Meanwhile, a Wall Street Journal columnist wrote that the bank was distracted by diversity demands, which was an inane woke bank thing, while Fox News pushed a bogus claim that the bank donated tens of millions of dollars to Black Lives Matters.

It didn't, but that's not really the point.

And let me just say, I have to say, it's Andy Gessler who wrote this insane

idea.

I like some of his stuff, but boy, was this stupid.

He popped it in at the bottom of just a sort of basic article about what happened.

You have diversity efforts, one, because it's the right thing to do for society.

When you wake up and everyone on your board and every senior manager is one demographic, that's just not good for society.

All right.

But

in addition,

the shareholder-driven reason to do it, not the societal reason, which is enough on its own, is that the key to risk management, the key to innovation is diversification of thought.

And when you have people from the same background all saying, no, interest rates would never go up this fast.

No, we should take these kind of risks.

You all end up barking up the same tree and you all end up stupid.

So diversity not only matters from a demographic standpoint, the reason why companies benefit from people with different backgrounds is they're likely going to have a different set of experiences and a different viewpoint that will result in better decisions.

So diversity is not only the right thing to do, it's the smart thing to do.

You don't want, as a CEO, it is your job to make sure not everyone is telling you the same fucking thing every day.

But you know what?

They just like that.

Let me just, they just like it.

But nonetheless, that article was fucking nonsense.

Fucking nonsense.

He stepped in it.

He stepped in it.

That was.

Whatever.

It was a big talking point all over the place.

It's ridiculous.

It's just fucking ridiculous.

But also, quite frankly, on the far left, they were publishing pictures of like the chief risk officer and demonizing these people.

And they shouldn't have done that either.

Agreed.

Although I think the right did distinguish itself for nonsense on this one more than others.

So after our emergency pod, what do you think?

What do you think of the situation?

I'm fascinated by this and I have a lot to say about it.

All right, go for it.

Well, the first is people's narrative is often shaped by their own personal incentives.

So I want to be transparent.

I'm either the founder of, a director, or an investor in four companies that had low tens of millions of deposits at Silicon Valley Bank.

And none of us got our money out.

And

the majority of us didn't even try.

And by the way, that might have been the wrong thing to do.

It did look for a certain amount of time on Friday, according to the Washington Post, that Janet Yellen and some of the regulators in D.C.

were saying, we're not sure we're comfortable with bailing out depositors, supposedly.

But when I heard from the CEOs and the venture capitalists, I mean, this is what just...

I am a bit in the mix here.

And what I saw going on or my experience was the following, distinct of what you're reading about or what you would think if you just were on Twitter.

Every VC of my companies that I'm involved in, ranging from General Catalyst to Andreessen Horowitz, immediately called the CEO and said, you're covered, you're fine.

If there's a problem with liquidity, which may or may not happen, we'll do what's required.

Don't worry about payroll.

There wasn't a sense of hair on fire panic.

I mean,

it just wasn't there.

In addition, and I tweeted about this, I wasn't worried.

And maybe I should have been, but all

I did, and I think what you needed to do to realize that all pasts led to them backstopping depositors is the following.

In the last 10 years, there have been 73 bank failures.

72 have had their depositors guaranteed.

And the 73rd was such a small bank that if you lost more than $250,000, it gives you an 800 number to call where I think they figure out a way to get your money back.

In sum, I looked at this and I'm like, every bank, the depositors get bailed out, whatever you want to call it, backstopped, bailed out, guaranteed.

They get bailed out because they own the treasuries.

Bailed out would mean they don't get anything in return, but go ahead.

Well, my point is, whatever the nomenclature is, the shareholders got wiped out, the unsecured debtors get wiped out.

In every bank failure for the last 10 years, the depositors get 100 cents on the dollar.

So I was, my attitude is keep calm and carry on.

But what I would also say is to the VCs who pulled their money out, that's their right.

You have the right to pull your money money out.

You are allocating risk and capital for fiduciaries.

So if you believe there's a chance that this company is going to be impaired for whatever reason, it is your right to pull it out.

I think there's going to be investigations in how they pulled it out.

I think that government's got to look into it.

Was it coordinated in any way?

Were there any kind of anything?

And I think that's, they should be investigating this entire thing, even if it may be just a regular bank run and the money wasn't, you know, and a fire sale of treasuries and simple as that.

But they definitely should be looking about the mechanics of how it ran because this was unusual in that people had so much online ability to create both the run itself very quickly and also to create fear-mongering.

And so they have to look at this thing in a new fresh, this is the first time I've ever seen so much fear-mongering going on that created a problem.

And I agree with you.

We on Saturday, we were like, calm the fuck down because everybody, because this, the government is working at it.

And I was talking to some government officials

recently, some high-ranking ones.

And the only question is, what is wrong with them?

What do they think?

We were playing pickleball all weekend.

Like, of course, they were moving on this.

And, you know, I think even if Janet Yell and the others that initially didn't know what to do, I think they were trying to figure out what to do over the weekend and what was the best thing.

And they were bringing in all kinds of opinions.

And quieter Silicon Valley people like Reed Hoffman and others contributed in that way.

They helped them figure it out.

Like not just not the Silicon Valley people, but all kinds of people.

And so calm the fuck down was really, and they didn't even understand what the screaming was about.

They understood that they needed to act, but it was kind of ridiculous.

And I think they should look into that.

I do think they should look into that.

Well, I'm writing about it for this week's No Mercy, No Malice.

And there's two kind of, I'm trying to find what's original or is there any insight here?

And I have two major themes.

One is brand and one is bifurcation.

And the reason why this has gotten so much attention and the reason why this has been kind of a societal polemic with a lot of people thinking, all right, I'm uncomfortable with what's happened here, is that if this bank had been called First Agricultural of Iowa, it would have been no problem.

We're here to shore up.

We're here to

deposits are backed by 100 cents on the dollar.

But what you have is the brand that has fallen furthest fastest in the last six months is Elon Musk's brand.

The brand that has fallen the second furthest is the brand Silicon Valley.

And there's a general sense that, all right, you have a group of very fortunate and very talented people who take a lot of risk with their own capital and other people's capital, and they capture all of the upside or the majority of the upside.

And they weaponize government to ensure that,

oh, if you're a founder or a VC of a company, your first 10 million or 10 times your investment is tax-free.

That's literally a law, right?

That they capture so much and more of the upside relative to other entrepreneurs that capture upside.

In addition, and this is what angers people, is that the downside risks, specifically the externalities, are borne by other people.

That when you create a social media platform and you capture hundreds of billions of upside, and there's externalities, that it's, that it's parents, teenage daughters that pay the price.

That when you gamify with VC money, you gamify investing, that young men become addicted.

And again, parents and young men pay the price.

When you finance a ride-hailing company that is not profitable, but you capture tens of billions of dollars in upside, it's union workers and contractors who no longer get worker benefits because of a $120 million

proposition that's passed by the industry that they pay the price, that other people are constantly paying the price for the downside risk here.

And then when you have this bank called Silicon Valley Bank, and

some of this is unfair and lacks nuance, but the way I think America, the American public sees it is, all right, you guys created your own bank.

What do you know?

It was super risky to your benefit.

You got venture debt, you got low mortgages.

And then when shit gets real, and by the way, many of you have been saying the government should just get out of the way, that we know best, that you're the great regulator, you're the great handicapper, you hamstring us, just get out of the way and let us run.

And then when shit gets real and all the risk you've been taking starts to cost a lot of money, you start sounding the alarm that the government, who you've been saying should get the fuck out of the way, needs to show up right now.

And that they're negligent, they're probably stupid.

To me, it reminds me of election deniers.

Like, you've been tammering with the government for a long time, and you're still doing it when they're actually probably doing just what you want, right?

That's the, that was the part that was particularly irritating.

So, the first is brand, the second is bifurcation, and that is there are now two tiers of banking being formed.

One, in one, if the depositors had not been bailed out, that that march towards two two tiers would be a stampede.

Specifically, there's going to be smaller regional banks that service people, 250,000 or lefts, FDIC insured.

And then there's going to be the big banks that are bulletproof and are just more, much bigger balance sheets.

There's just going to be a massive leaking of capital to those banks.

We have created a two-tier banking system.

It's going to happen more slowly now, but it's definitely going to happen.

We've also in Silicon Valley created two tiers of venture capitalists.

And that is there are venture capitalists like Reid Hoffman, who you mentioned, Herman Taneja, who tried to get a group of VCs together, Kleiner, Lightspeed, General Catalyst to say, we support the bank, we're here, we're not panicking.

They were trying to facilitate an acquisition by making the asset more attractive to make the government's

expenditures here lower.

They were trying to be good citizens.

Reed Hoffman was working with Nancy Pelosi and Governor Newsom to keep the White House informed.

There were people behind the scenes who are venture capitalists, who see that we play a larger role in society.

And then there's another group of people that I call venture catastrophists.

And what they see is that there's a large element of our society in the media, which subscribes to catastrophism.

And catastrophism is a belief that the world is shaped by a series of unpredictable, short, and violent global events that reshape the world.

And that it's 9-11 and Pearl Harbor and FTX that shaped the world.

In addition, these venture catastrophists recognize that in an attention economy, you can be famous for being famous and you can monetize your fame.

So the temptation to catastrophize is huge.

And they go on Twitter and say, these are exact quotes.

You should be terrified.

All caps.

Chaos will ensue.

All caps.

On Monday, there are lines around banks.

Some people get their money out.

Most do not.

That does not help.

No, it does not.

They did.

They thought they helped and they took a lap.

You know, the real hero here is a Reid Hoffman, not these people.

And let me just, we had Bill Cohen on, and I thought he characterized it correctly.

He talked about the idea that betting on this zero interest rate policy was stupid, colossally stupid, as you said, that this bank did.

And so he talked about that.

And he goes, and that would have been stupid enough, but probably not fatal unless another thing happened.

And that was something nobody could anticipate or imagine, largely because people aren't wired to imagine the unimaginable.

This is the asshole theory.

For whatever reasons, rumors started circulating Silicon Valley ecosystem and the Silicon Valley Bank was in financial trouble and some depositors decided to take their money out immediately.

There was a total meltdown in confidence.

We'll see why that happened, right?

But I think the assholes theory, you're correct.

And you're calling it the catastrophe.

Natural catastrophes.

Yeah, but I think they're just assholes and they do not care what they break as long as they can get theirs and that's what they're like and they also like to shoot at anybody on the way down you know whatever they're doing it's always someone else's fault they're the ultimate victims and everybody's stupid everybody's stupid but them and you know i had a back and forth with these people you're quoting from this this week and i'm like you know i don't agree with you and they had they called me vitriolic i was like are you kidding me like you're the like winners of the vitriolic olympics here people But they don't, they have to insult and demean and then get theirs.

And that, and there's a very, you're right.

There's two different kinds of venture capitalists now.

There's two different kinds of people, those who want to constantly rag on people and act like victims and talk about catastrophe, you're right.

And some that are just, let's fix this.

Let's let's have some solutions going here.

Well, it comes down to.

Like, what kind of leader do you want to be?

What kind of business person do you want to be?

What kind of citizen do you want to be?

And I think there's a lack of citizenship and more of a survivalist mentality.

And that is I'm going to build a bunker.

Yeah, they have bunkers.

All these people.

Yeah, most of these people, there's a thick vein of this survivalist mentality.

And the government are suckers.

I'm going to sell my analytics into the CIA and NSA, or I'm going to get you, I'm going to gamify you to get as many subsidies as possible.

Or I'm going to give money to

a ton of congresspeople to lower my taxes.

Government is there to kind of be abused and used, but they're idiots and I have no respect for them.

And then I'm going to start mixing potions in my backyard that might result in amazing things.

I take risk, I innovate, I come up with all sorts of cool stuff.

Occasionally, there's a fire from the shit I'm mixing in the backyard.

And I immediately start saying the whole state is going to burn alive.

And I get angry and start shitposting the government when the Coast Guard doesn't show up on time with the fire department dumping flame retardants at cost to taxpayers when i need government government are idiots and i want to be a survivalist until unless i can either sell into them or i need them right now and it comes down to i was thinking i was talking to a class they want to use a case and i'm like what kind of leader do you want to be and quite frankly to be blunt what kind of man do you want to be do you want to be the guy in the foxhole that when shit gets real, assesses the situation, calms everyone down.

The person with the biggest sack here, who was the biggest man around all of this, his name is Janet Yellen.

She wasn't panicking anybody.

She was talking to people.

When I was at business school, Professor Yellen was a professor there.

I can't think of more capable hands for the economy to be in than hers.

And she's like, who do you want to be?

Do you want to calm everybody down, assess the situation?

make thoughtful, purposeful decisions and get to the right decision by talking to a lot of people?

Or when the first bullet flies over your head, do you want to start screaming, we're all dead?

We're all, the world is ending.

That just

doesn't help.

When they do that, it's part of their game.

That's, it's also, they're in the background, they're playing another game that you don't even know

to advantage themselves.

They're really loathsome people.

They're just loathsome.

Let me, I'm going to speaking of government, this Dodd-Frank Act,

I do think a little bit blaming on this too is early.

It's not clear it would have helped.

And

I think if it was at the same levels, could this have been avoided?

Maybe, maybe not.

You know, and of course, not just Elizabeth Warren.

Josh Hawley tweeted that it's time to bring back Glass Steagall, the law that puts limitations on banks investing depositors' funds.

I mean, it is not a time to over-regulate, and it's also not a time to under-regulate.

Let's listen to this Warren idea about banking.

Banking should be boring.

And anybody who wants to take a lot of risks and make a lot of money should not be in banking.

I can't agree with her, Tom.

I don't think that's true.

I don't think that's true either.

The base is one of the pillars of our society is a banking system that loans out money and invests more than it has to grow the economy.

It's kind of how you create money and how you create growth.

And you put in place certain standards so there isn't meltdowns everywhere.

Poor recklessness with loans.

That's happened.

This bank was brought down for two reasons.

An unprecedented increase in interest rates and poor risk management at the bank.

And a bank run.

Yeah, and a bank run.

100%.

That some people arguably contributed to unnecessarily for fame and for so they can.

Who was the guy?

And there was a cop in 1984 that planted a bomb under the

credit for it.

You got the feeling on Twitter that these people were actually hoping for a bank run, that they were taking some pride.

It was like Schadenfreude times a million here.

But the government did exactly what it was supposed to do.

It came in, it backed the depositors, it it said, sorry, investors, you lost all of your money.

It may not even cost them that much money.

And we're going to see in the banking system, you know, essentially, in, I mean, this has been a giant kind of stress test for the U.S.

The problem is the stress test is going to start to wave across the world.

And I don't think, I think a lot of banks aren't going to shore up as well.

Yeah, Credit Suisse.

The Saudi National Bank said it wouldn't shore up the finances of Credit Suisse, where it's its largest shareholder.

The Swiss National Bank did offer.

So things calm down again internationally.

You have to calm and get confidence back.

The shares of all the banking sector are down.

That doesn't really matter what the shares cost at all, but it still creates havoc.

What's really interesting is what's going to happen to this bank.

And I just, from what I've been told, they tried to sell it, but they didn't quite get what they wanted.

I thought that was smart not to sell it over the weekend.

You don't want to do like a too quick a sale if you're not getting what you want and have to take a lot of things.

There's an auction happening right now for this bank, and we'll see who gets it.

100%.

There's real value there.

Yes.

Yeah.

And so

there will be an auction to sell the bank and carefully.

And the question is who gets it?

Who gets the bank, whether they bring, they trade it, as you guys talked about, to a big important bank like Goldman Sachs or J.P.

Morgan.

But there's a lot of other candidates or someone else.

And that would be interesting to see if

they're able to sell this bank.

Another just brief point that was, I thought, illuminating.

So a group of venture capitalists, I'll call kind of old school venture capitalists, the Kleiner Perkins, the General Callus, put out a statement saying we support the bank and they were trying to be helpful.

It was that statement was more interesting or was more illuminated in terms of who was not, who was clearly called and said, we're not putting our name on that.

And the question is, do certain venture capitalists have an incentive to see the banking system and the U.S.

dollar unravel because of their investments in crypto?

They want to bank themselves.

Guess who needs a bank?

Well, I'm not even saying banking themselves.

I'm saying, okay, we have raised and invested tens of billions of dollars in Web3 token and Bitcoin-related assets.

Do we really not want banks to fail?

Do we not want to see the U.S.

banking system and the U.S.

dollar really take a hit?

Because what would happen to the value of our crypto-based investments?

Bitcoin's up.

Bitcoin is up about, I think, 20 plus percent.

And so it comes down to incentives.

And that is,

is this community consistently figuring out ways to capture all of the upside of risk while, again, socializing the downside?

And are there incentives to really be good citizens?

Are they kind of hoping that things unravel?

Are they agents of chaos?

No, of course.

They want to see it all burn.

I'm telling you.

I have said this over and over again.

Let me read finally from Edward Ungueso Jr., who's been on pivot before.

He's in one of our quarterly review episodes.

He wrote the following on Slate.

It's not obvious to me why venture capitalists should be so in control of what tech gets funded, who designs it, how it gets developed, why it gets deployed, and where the returns go.

We can and should explore alternatives to the privately run VC system prioritizing tech that degrades and commodifies more of our life, gambles on these developments with other people's money, and in the blink of an eye, causes regular panics that threaten to upend life for countless people.

I got to say, he has a point.

The house burners really are not good citizens.

They're just not.

Well, everybody got to the same place, that they needed to back the depositors, but they did it holding their nose because they're like, these are the first people who shit post government.

These are the first people that say government should stay out of the way, and then the first to scream, the government needs to be here.

I mean, when shit gets real, it's just sort of it's really kind of, I don't know, unseemly.

They should be ashamed of themselves, they really should.

Anyway, we have to move along, but we'll go on a quick break.

When we come back, Chat GPT gains the power, speaking of a very powerful technology that, once again, the government's not in charge of, but these guys are.

The power of sight.

We'll take a listener question.

We'll be right back.

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Scott, we're back with our second big story.

AI is getting smarter.

At least that's what the AI says.

Open AI released Chat GPT-4 this week.

The upgrade adds a few new bells and whistles.

The reviews are mixed, but better, better.

Users can now ask the chatbot to analyze images.

That's kind of cool.

In one example, the bot created a recipe from a photo of possible ingredients.

The new bot also performs better on academic tests, passing several AP exams, but not English lit.

And of course, it can be used for gimmicks and gags.

One user told the bot to make as much money as possible on a budget of $100.

At ChatGPT pitch and affiliate marketing sites themed around eco-friendly products.

One of them, of course, told jokes, which I thought was funny.

I don't know if you saw that, making dad jokes.

It was one Madonna joke.

But many people report they're still flawed.

It can generate text that's wrong.

It has hallucinations.

It can't do much in the future.

It's not good at the future.

So anyway, this is just ups the game and the sort of arms race between OpenAI/slash Microsoft, DeepMind owned by Alphabet, and what Meta is doing and Amazon also and Apple.

So

there's also been an enormous amount of funding into AI for startups.

So there is going to be a lot of startups happening.

And it'll benefit lots of people here as the computing goes up.

So what do you think of this latest situation?

I think this technology is incredibly exciting.

I think it's going to result in a lot of short-term anxiety, but medium- and long-term

prosperity.

I'm even thinking somebody might is probably working on now some sort of large language model or some sort of AI that takes numbers instead of words and does mock stress tests on each of the 8,000 U.S.

banks and then sells them back that research and says to the model,

look at every number here, look at every word before the number, categorize the risk of the word before the number.

Is it mortgage-backed security?

Is it treasury?

What is the duration?

And train

this model and feed in data sets from publicly disclosed documents and start doing private stress tests.

And then go to each of these banks and go, we've done a private stress test and we've identified your 11 points of weakness.

Would you like that report?

the number of businesses that could be started using this technology can make you giddy if you really start thinking about it.

So I'm just super excited.

I think it's really,

I'm glad America's in front here.

Yeah, it is.

It's like the early internet.

I think there's reason to worry about where it goes and in whose hands it is.

And one of the things that the complaints, OpenAI had shared plenty of benchmark and test results for GPT-4, as well as some intriguing demos, but offered essentially no information on the data used to train the system, its energy costs, or specific hardware.

It's not really open.

And so some people thought that, you know, it's essentially a for-profit experience going on here.

But OpenAI's chief scientist, this is from The Verge, expanded saying OpenAI's reasons for not sharing more information about chat GPT-4, fear of competition and fears over safety were self-evident on a competitive front.

It's competitive out there.

GPT-4 is not easy to develop.

It's pretty much all of OpenAI working together for a very long time produced this thing.

And there are many companies who would want to do the same thing.

So from a competitive side, you can see it is a maturation of the field.

Well, I'm not surprised.

Another example: take every press release issued by every publicly traded company, correlate it with stock movements, and figure out what terms, what phrases, what

messaging results in the greatest stock increases.

I mean,

and

start advising people.

If you're Edelman, incorporate AI into your

messaging.

Huh, that's interesting.

Are you starting like a lot of companies right now, Scott Galloway?

I'm investing in a lot of companies that are.

The way I think of this is processing power came along.

And if you didn't figure out a way to incorporate processing power into whatever business you were in, you didn't keep up with the competition.

When the web came along, or it's e-commerce, people don't remember.

Williams Fonoma wasn't selling anything online for a while.

Hermes and Shamel refused to sell things online.

So with these technologies, whoever adopts them fastest and really leverages them and puts them to work outperform the rest.

So every company needs to be thinking about, whether you're a communications firm, whether you're health services, whether you're a consulting firm, how do I use this unbelievable technology to inform my product and my service delivery?

I think the services business, my God, if I was Edelman, I know Richard,

I'd have some sort of AI model that says, in general, we find that this type of phrasing and language around this type of situation results in the lowest hit to your stock price, right?

I mean, you know, they're not even thinking about this.

You know that they're not.

All the regular people aren't for sure.

But it's going to be super exciting, and some will, and it'll inspire others to start thinking about it.

I think it's really, really cool.

All right.

So, what do you think the worries are?

Microsoft just laid off an entire team of AI ethicists.

Is it that kind of stuff?

The inappropriate conversations are there.

The opportunity to cheat and to trick is much higher.

How do you balance that against, you know, I think one of the things that we didn't do at the beginning of the internet was think about the bad things.

And I know you think the media is negative, negative, but it was such a cheerleader for the internet at the beginning and a cheerleader for social media until far too late.

So is there, how do you incorporate this, these worries, these, and they're legitimate worries into being excited about the companies?

Well, one, I mean, just some basics.

I'm really hoping that AI is more subscription-based than attention-based, because I find that attention-based models just lead to terrible places.

It could have gone that way many years ago.

I'm just talking to someone about that.

The other thing is I hope that there are regulatory bodies formed that have real teeth and early hit somebody really hard that produces propaganda about mRNA vaccines that ends up creating misinformation.

And

I don't know how it impacts 230.

I don't think they're protected.

Which is awesome.

Which is awesome.

Because if you think about it,

all of these technologies have been a net good for the world.

But the problem is with the the word net, if we'd had better regulation and held them accountable, we just wouldn't have as much self-harm.

I think you're 100% right on the advertising part.

If we at the beginning had been able to have subscription or a payment system, micropayment system, totally different ballgame.

In terms of climate change, there's been three big puffs into the atmosphere.

One is the suburbanization of America.

The second is the industrialization of China.

And I would argue that the bigger puff into the atmosphere is coming out of Palo Alto.

And that is an attention-based economy, a lack of appreciation for what it means to be citizen in terms of who could potentially incur the downside of these enormous risks we're taking.

We don't pay attention to that, and we've created

these attention-based monsters that create depression, division, and that is...

inhibited and basically totally hamstrung our capability to deal with everything from carbon emissions to every other thing.

The biggest coal-fire plants in the world aren't in Kentucky or Shenzhen.

They're in Palo Alto.

Right.

No, I I would agree.

But I want to address the most important issue of all, which is dad jokes.

GPT-3.5 had, this is, tell me a novel joke about singer Madonna.

The answer was, why did Madonna go to the bank to get a material loan?

That's not very funny.

Tell me a novel joke about singer Madonna for GPT-4.

Why did Madonna study geometry?

Because she wanted to learn how to strike a pose in every angle.

Scott, they are still funnier than you.

But see, you're still, you're not clearly not a pro at AI yet.

What you have to do is say, tell me a dad joke in the voice of Richard Pryor, in the voice of, and it'll give you, you can ask them to tell you a dad joke in the voice of Scott Galloway.

I have enough content out there now that it'll make slightly.

slightly off-color, like inappropriate dad jokes if you ask it to do it in my voice.

But you can do it in the voice of George Carlin, in the voice of a lawyer, in the voice of a Vice President Harris.

This is not a good development.

We need a law to stop this.

It is

intoxicating how exciting this is.

But whether it's globalization or outsourcing or the web, you have to have regulators thinking really hard around, okay,

how could this go really bad and put in place early some guardrails.

Yeah.

It's interesting.

There was one person who was showing me, I've been looking at a lot of the studies, that you can have someone call your phone and you speak, like your kid answers and says, hello, who's there?

They can take that and make a voice of it using this stuff and then call you and say, mom, dad, I need my social security number.

And it's sound.

Or I've been kidnapped.

This is the kind of stuff they can do quick.

And hopefully what we've learned, hopefully the immunities are, when Open AI's lobbyists are in Washington saying this would hamstring the community that the senators and congresspeople say, you know what, that dog's not going to hunt again.

Anybody who's producing misinformation that reduces or damages national security, health-related issues results in the prosecution and persecution and violence against vulnerable communities, you are liable.

And we're coming for your help.

Lawyers.

Lawyers.

I do think 230 does not apply to these people.

And that's a good thing.

I've always talked about liability and privacy legislation can do a lot of good things.

And for this, and it's good for them too, to have some structure around that.

It's better rather than them making their own decisions because you know what the decisions they make will be because they're rather self-interested, as are most people.

I'm going to go on it today and ask a dad joke in Scott Galloway's voice and I shall bring it back for us our next show.

Okay, Scott, let's pivot to a listener question.

You've got, you've got, I can't believe I'm going to be a mailman.

You, you, you've got mail.

This question comes from Alec in New York City.

He writes, Hi, Karen Scott.

What are your thoughts on the rise of the new gambling and betting industry?

It seems like it's impossible to escape news and advertisements from this industry with all new casinos opening in city centers like New York.

Isn't it just another another ticking bomb that will disproportionately affect young men?

Everything with young men is so interesting.

They come to Scott to ask this question.

So, Scott?

I'm really torn on this, Kira.

I don't, I think as the bottom line is, I don't know how you outlaw gambling, and does it make sense when it's just sequestered to certain geographies or certain communities?

It's not.

30 states have legalized in Washington, D.C.

Right, 30 of the 50.

I can see the arguments both ways.

I think what we have to do is,

I almost, I don't want to say be more thoughtful parents or incorporate into,

I think it would help to have certain, what I'll call non-STEM-based classes in high school.

I think people should be taught mating dynamics.

What's it called?

Like the behave yourself course?

Well, okay.

How do you approach a person that you're romantically interested in while making them feel safe?

This is how relationships form.

This is what it means to be a good partner.

I think this would be helpful for kids in their teenage and their formative years.

I think it's important to say, this is what's happening in your prefrontal cortex.

And by the way, as a young man, you are more vulnerable to gamification that results in gambling, that results in addiction.

And by the way, gambling more than any other addiction has a greater suicide rate.

And the reason why is because you can go down a rabbit hole and no one knows.

If you're addicted to meth, people figure it out pretty fast and they intervene or they try to intervene.

You can lose your house,

your parents' money, and be hundreds of thousands in debt with gambling and nobody knows.

And so you decide there's no way out.

There needs to be education.

But I don't, and I know that's a pad answer.

I think parents have to be very aware of these dangers, especially with young men.

Yeah, no, and they don't do well.

They don't do well.

There's interesting statistics.

According to debt.org, more than 20% of compulsive gamblers end up filing for bankruptcy and over $7 billion in legal bets on Super Bowl 2022, according to the American Gaming.

I mean, people love it.

It's an addiction.

It's just like all of them.

It's a huge thrill.

I mean, to a certain extent, in the stock market, you get a little bit of that thrill.

And I don't know.

I don't understand how you suppress it or age gate it.

And also, I think the best regulation in the world is mistakes and doing stupid things.

So I don't think you want to infantilize people.

Do you gamble a lot?

I don't gamble at all.

Oh, I love.

This is exactly what I do.

I go to Vegas.

I take a kilt.

I get super fucked up.

What?

I take $5,000.

I go down to the casino.

I play craps, which I don't even understand.

I just start yelling out shit like baby needs new shoes and there's a gambler in the house.

I get ridiculously fucked up and I lose it all and it's worth it.

And there's a lesson there.

It's interesting.

It's consumption.

Gambling is consumption.

The moment you start thinking you need to leave Vegas with as much or more money than you came with, you're going to be heartbroken and depressed because it's not going to happen.

There's a reason they can afford white tigers and cirque de Soleil in the rainbow room.

It's consumption.

Take money.

Craps is actually where you can make money, but go ahead from what I understand.

Well, no, no, craps is the place you lose the least.

There isn't a game in Vegas over time you will make money.

And so I think part of education, you know, my, I can tell my 12-year-old's totally into Vegas and wants to go to Vegas.

I'm like, gambling is fun.

Dad loves to gamble.

And this is what dad does.

What do you love about it?

It bores us.

Oh, living days.

Vegas is so awesome.

Oh, my God.

It's hilarious.

People are friendly.

It's fun.

I have no addictive tendencies.

It's so interesting, except for maybe Twitter use.

Yeah, but it's not an addiction.

If you look at it like, I love to drink, it's consumption.

I love to buy.

I love to buy cool tennis shoes.

That's consumption.

I don't love that.

So you just have to think of gambling as consumption, but assume, start from a position of the following, like buying, like buying a cool pair of tennis shoes, like going to Disneyland, like going to a strip club, however you consume, expect to leave with no money, and then you're fine.

But don't talk yourself into believing you have some strategy or insight into this thing.

Yeah, I see.

So, a little decompression, and you have the number that you're going to spend.

I think it's when people

spend $500.

It's a ton of fun.

Yeah, I get it.

But they're going to say there's been $500 and then they keep going.

And that's where it gets dangerous: when they keep going.

All right.

That's what it means to be an adult, right?

So if we went to Vegas, I would be at like the shows and you would be in the kilt spending the money, correct?

Oh, my God.

I have so much fun in Vegas.

I am a good drunk.

I love love to gamble.

I know the best places there.

It is a ton of fun.

I would go to Cirque du Soleil.

I like Vegas.

I like Vegas.

It's a ton of fun.

I love Vegas.

I don't mind a strip club.

Some of them are okay, but I like a show.

I like a show.

That's what I like.

So I would do that.

That's it.

But the problem is when you push out gambling to every device and it's constantly in your face.

And you gamify it and maybe you prey on people who are in a weak moment thinking, I could get back to paying my rent or I could,

it just, I got to be honest, it makes me uncomfortable, but I don't know how to address it.

It's Heddy, do you really wear a kilt?

Oh, 100%.

It's a ton of fun.

It's a great conversation starter.

Do you wear underwear with that kilt?

Yeah, Big Edna twins need a little support at my age.

Okay.

It's like a set

care without underwear.

It's like a sad anteater.

It's nobody needs to see my junk.

It's really, it's not a good look.

All right, Vegas, you're safe.

Don't worry about it if Scott shows up in a kill.

It's not speaking of which, I need to manscape and hit up my testosterone.

I don't want to hear this.

I don't want to hear this.

Now we've moved on to things I don't have any interest in.

Anyway, you've got a question of your own that was a great one and you'd like answered, and send it our way so you can hear about Scott's various and sundry hijinks.

Go to nymag.com/slash pivot to submit a question for the show or call 8-5551-PIVOT.

All right, Scott, one more quick break.

We'll be back for predictions.

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Okay, Scott, let's hear a prediction.

Well, I'll make an obvious one.

So JP Morgan's about to have their best quarter in history.

The torrent,

the torrent, the tidal wave, the tsunami.

What happens in a tsunami is the water, that's how you know tsunami is going out.

The water level goes dramatically lower.

Like all of a sudden you go to the beach and like, where's the water?

And that is a disturbance.

That's a pre, that's pretty.

That disturbance is sucking all the water out and it's about to come back with a vengeance.

Well, the water level has gone down.

People are withdrawing their money from regional banks and the tsunami is going to be the wave of capital that goes into JP Morgan and is going in.

Just JP Morgan or Goldman or what?

Oh, all of them will benefit, but no one's going to benefit like J.P.

Morgan.

I had a board meeting this morning for Ledger, which is this cold storage hardware wallet.

We had a, guess what?

Best day ever?

Sunday.

Right?

Oh, because everyone's putting everyone wants out of USD and banks and wants custodian,

wants cold storage and wants to know for certain they have, you know, my coins, my keys.

I get 100 cents on the dollar here.

There's volatility risk in the asset, but nobody can fuck with it.

No one can invest it in security.

Did gold go up?

Did gold go up?

I didn't even look.

I don't know, but whenever there's a flight to safety, the dollar usually goes up and treasuries usually go up.

And we're finding the same thing at Ledger, but the biggest beneficiary in banks, oh my God, wait till the earnings call, the next earnings call, when Jamie Dimon says, we took in more capital that we can now loan out at a higher interest rate than we pay than we were expecting for the next three to five years.

And we did it in three to five days.

Yeah, gold is way up up to highs, up to high, five-year highs.

So

the next few articles are going to be on knock-on effects.

There's going to be a lot of scapegoating.

I actually think those guys who are the venture catastrophists are going to get probably more than their fair share of criticism,

but they're going to get a lot of criticism.

There's going to be an enormous analysis of which other banks are slowly but surely going to leak capital, who benefits here.

I'll be honest, I think the American government benefits here.

I think the U.S.

government were the adults in the room.

I think this was a great day to be, I mean, it sounds, it sounds passe.

I think it was a really good slash great day to be an American.

The government did.

Yeah.

Hey, stupid venture capitalists.

They weren't playing pickleball.

They were doing their jobs.

Super smart people.

Super smart people.

We're calm.

They're super doing their jobs.

They are.

If you spend time with them, you're like, and came in with the full faith in Grub.

And one of my portfolio company CEOs went to Silicon Valley Bank Monday morning, waited in line to figure out if they had money and if he could get it out and transfer it.

We decided, we didn't, couldn't decide what to do.

So we've decided we're leaving half with SVB and moving half elsewhere just as like smart risk management.

Okay, maybe there's some truth that you shouldn't have all your money with one bank.

So we're putting half somewhere else, but we want to be good citizens and invest in the ecosystem.

And we think SVB is actually

does a good job.

But when he was in line, this guy pulled up in a black sedan 10.

10 minutes before, true story, 10 minutes before the bank doors open, this big, handsome guy in a black suit wearing black sunglasses with a big name tag that said, you know, Bob something, FDIC.

And he went down the line and he said, My name's Bob from the FDIC.

I'm a special officer at the FDIC.

Your deposits are safe here.

And went down the line and shook everybody's hand.

And I'm like,

that's the U.S.

fucking government.

The government is at a specific state.

There's always problems.

But what is it supposed to do?

The U.S.

government is supposed to do things that the private sector can't do.

Generally speaking, the private sector, if you don't want, you don't want the government, and this is a fundamental difference between capitalism, socialism, the means of production you primarily want to put in private hands when you can now occasionally

as in china as in china i think they're going to suffer now occasionally and and occasionally we can do the government can do something better than private sector they do a better job running the navy than a probably a private company would because there's no profit motive there or when profit when there is no profit incentive it's better for the government but also they want to do things that no one else can do and they were able to come in and essentially calm the waters in zero time flat because only they can do it and you know what's going to happen we're going to find out It's not going to cost them that much.

When the waters calm here and already interest rates have come down and those bonds have increased in value, you're going to find when the dust settles, it really didn't cost taxpayers very much.

Didn't cost at all.

Didn't cost, you know, it was just their, it's their job.

That's what, that's why we have the government.

Yeah, it's a great day to be, I mean, it sounds, it's a great day to be an American.

And by the way, all of you who keep telling America to get out of the way, and then, you know, all these arsonists who complain that the fire department is underfunded and late when you have a problem,

that you're not being a citizen, you're being a survivalist.

But circling back, the prediction, JP Morgan.

Oh my God.

All right.

J.P.

Morgan.

Good to be Jamie Dimon.

And we'll see what happens with Bitcoin.

It was at, of course, $61,000 and $500 in November of 2021.

Now it's a 24, but that's certainly up quite a bit from the lows that it has suffered

down in 11, you know, they had lows.

So it's up.

People feel like that.

They want to diversify.

Diversity.

Diversity banks.

Diverse banks.

Woke.

Wokeness in your diversity of spending.

That's how I look at it.

Anyway, Scott, that's the show.

We'll be back on Tuesday with more pivot and more.

Pioneering Vanguard.

You Vanguarding Pioneer.

That's what you are.

You kilt-wearing gambler.

Daddy's a good time in Vegas.

Got you.

And congratulations to us for winning.

We deserve it completely.

That's how I feel.

I'm just saying we're a good pair.

Can you just, you never invest in our relationship.

I'm in this to win it.

Until the kids are out of the house, I'm here.

Okay, great.

Read us out.

Okay, today's show was produced by Larry Neyman, Evan Engel, and Taylor Griffin.

Ernie Endertot engineered this episode.

Thanks also to Drew Burroughs and Mia Silverio.

Make sure you subscribe to the show wherever you listen to podcasts.

Thank you for listening to Pivot from New York Magazine and Box Media.

We'll be back next week for another breakdown of all things tech in business.

Who do you want in your foxhole?

Janet Yellen, or a bunch of venture catastrophists?

Jesus Christ, what bitches?