Latest / Black Box Theory Podcast / BBT #09 | Iran Attacked Saudi Arabia, AI Is Replacing Your Job, and Your Portfolio Is on Fire
Transcript
- Thomas: Hello? malcolm: What's going on man? What's going on? What it do bro? Thomas: Not much, man. I'm happy to be back with another episode, man. Episode nine. malcolm: Yeah, man, we here, man. Happy Sunday to everybody. Hope y'all went to church this morning. ⁓ Saw a lot of stories, people outside this weekend. I just really hope everybody was at church this morning, online, in person, whatever it may be. Hope you got a word in, You know, we here. Hopefully we ⁓ able to start y'all a week off on a good note. ⁓ Well, you know, we'd like to start our week off on a good note, but know, what y'all bullying in office? You know, it's another week. We're still cooked. know what saying? Still, still a whole lot going on, bro. It's kind of hard to not see, you know, on any platform. You can go, you can turn the news on. You can go on Twitter, go on New York Times. All you're going to see is headlines. You're going going to be war, TSA lines, or, you know, just something getting cooked, bro. But, you know, we still, we still going to find a way to try to uplift, try to still navigate, you know, so still, still kind of see. you know what we can do in during this very ⁓ trying time very very whole lot going on ⁓ Thomas: trying time. I mean, ⁓ you got to be informed about what's going on. I want everybody, I think what people need to know is what we're doing here is being objective for the most part, like just trying to provide the facts, some interpretation, some views. And it's not to say don't be positive, but you do need to know what's going on. If we came on here telling y'all it was all peaches and cream, we'd be sending you up for failure. malcolm: Oh yeah, for sure. Even during this very tumultuous time, we still want to make sure our audience and anybody tapped in, one is aware of everything that's going on and just how you can position yourself to as best you can, protect yourself from sad circumstances or policies. But yeah, we can go ahead and jump right into it, man. Thomas: Welcome to Black Box Theory hosted by Malcolm Doster Jr. and ⁓ Thomas Freeman. You know, we usually leave out the last names, but ⁓ we're not hard to find. But you want to save those names. We're doing something big here. ⁓ But before we really jump into kind of the overview of everything, I'm going to break the order a little bit, just do our disclaimer. So everything here. malcolm: Thanks. Yeah. Thomas: ⁓ own views. It does not represent an employer or any affiliated organizations. ⁓ we're just learning out loud, spreading facts, spreading information. And it's up to you to make the appropriate decisions. We are not financial advisors. We are not career coaches. ⁓ just people learning out loud, like I said, and you need to ⁓ faith to make the trust best decisions and consult qualified professionals before you do anything. ⁓ just a Give an overview of kinda some things we're gonna talk about today. for those who may not know, we are in a war. We're actually day 23 and it just got worse. Iran fired ballistic missiles at Riyadh, which is Saudi Arabia's capital. Three missiles, 10 drones. Saudi Arabia expelled diplomats within hours, which is something new. Iran also hit Demana. and a rod in Israel directly targeting Israel's nuclear research center for the first time, wounding 100 plus people Trump's 48 hour ultimatum to obliterate Iran's power plants expires tomorrow night at 7 44 p.m. Eastern Time. malcolm: Obliterate is OC. I'm like, well, y'all like, yeah. Y'all boy, y'all man's not playing around with dog. Like this is OC, this is crazy. Thomas: That's a quote. That's what he's obliterating. ⁓ Hey, what's that song, that DMV Trump song? He's like, something, we ain't going for nothing. Misses on misses, you know how we coming. Whatever he said. malcolm: But where did you see that at? Thomas: It's a bro, look at the Trump DMV Trump song. It's called DT. It's a people who know it, who seen it's a lot of memes around it. It's just like a DMV comedian slash rapper made a song in the DMV flow talking about Trump in Iran. This was like a few months ago. He did this. But, ⁓ okay. That back to it, right? the that expires tomorrow. So that tomorrow, as in you're probably listening to that today. or whenever you listen to it, that would be Monday, March 23rd at 7 44 p.m. Eastern time. So it'll be on the lookout. Iran's response, if you hit our power plants, we will permanently close the Strait of Hormuz and it won't reopen until you rebuild what you destroyed. ⁓ So they're saying you could do what you want, but we're gonna screw over the world. think carefully. ⁓ Israel says strikes will increase significantly. That's a quote this week. malcolm: Yeah. Thomas: ⁓ Oil is at $112 a gallon. I mean, no, no, a barrel. I'm sorry. $112 a barrel. Gas is $3.93 nationally. The S &P has dropped for the fourth week straight and Iraq shut down its oil fields. And you know what we're doing? We're recording a podcast because the world doesn't stop. You just have to stay informed. malcolm: Yeah, we're so fried. yeah, I ain't gonna lie, it's kind of a... Woo, yeah, nah, that's crazy, man. And just to make this very clear, for that whole... It was actually kind of astonishing, bro. I've actually seen a number of people ⁓ across social media be like, dang, why is gas so high? Like genuinely. And I was like, okay, let me not look at that as ignorance. me use this as an opportunity to try to educate, spread some awareness. ⁓ But with that whole... The straight up for moves that's like basically all oil, hundreds, like millions of barrels of oil has to get through there. is no, you know, say there's no alternative route. It either gets through there to get to us, to China, to European countries. Like without that, it doesn't get to us, right? Like if they permanently close that, what that means is what gas is in most places is around close to $4.00, nationally in some places, higher seen in California. I've seen some insane prices like $7, $8 a gallon, crazy. But if that bad boy permanently closes, what that means is these prices aren't dropping anytime soon. I've been doing it myself. I've been trying to, you know what saying, as often as I can, literally only refuel at either at a wholesale club, at a Costco's, at a BJ's, at a Sam's Club. I went today, man. That gas was near the price of What you see at a normal, a Shell, at an Exxon, at a Royal Farms, a wow wow, I'm like bro, it's getting close to the point where it's not even no difference in the price. You're not even getting a deal anymore. I'm like bro, if that permanently closes, these guys, you're going to need to set I don't know if people are already doing this, but you're first going to need to set aside a portion, depending on how much you drive. You're going to need to set aside a portion just for gas, bro, every month. Obviously, people have their gas budgets, but I don't think it's ever been ... as prominent as now where it's like you need to have a strict actual set aside amount of money for gas. Like I'm talking about half a gallon. I mean, not half a gallon, half a tank fill up is talking about $25, $30 bro. Like it's that crazy. Thomas: Look up 1973. For all the people, 1973 is what we don't want to happen. So everybody, I mentioned it a little bit last week, but just compare it to that. But like Malcolm said, that gas budget, that's real. I don't know if anybody else saw a video. It was some video I saw on IG. A guy was saying, he said, man, check on your people. Some dude put 11 cents of gas in his tank, bro. malcolm: Mm-hmm. Nah, think I seen it TikTok, it was like, it's a difference between broke. It is levels to being broke, but that was like poverty, bro. That's poverty, bro. You put it to the gas tank, you put 11, you put under a dollar into your tank, bro. Where is that? I don't think that'll get you a mile. That can get you from yeah, get you from the parking lot to the next parking lot, but like, bro, like, nah, it's crazy. Thomas: You'd be lucky if you get out the parking lot. We live in the hard times, man. All my people out there, stay strong, stay blessed, stay prayed up and stop buying for comfort, bro. I know that it's hard, especially for the young folk. I know it's hard. You want to buy things to make yourself feel better, like retail therapy. You got to hold on strong, man. You got to hold tight. We're going to talk about it, but S &P 500, I just checked. I think it's down 5 % this year, like year to date. You know what mean? Like you guys, this is a good time. malcolm: Mm-hmm. Thomas: to make a lot of money. It's probably gonna keep going down. I'm not a financial guru, but stay strong. We'll get through this. It's just a matter of when. malcolm: Oh yeah, no, no, no questions. Before this episode, I was actually going through some of my, a bit of my portfolio with Thomas. Right now is a very daunting time and I think that these are one of those times that... These are one of those periods of time kind of similar to 2020 and 2022 where that kind of gap in the wealth transfer is directly kind of related to who holds and who panics it was. It's very easy. understandably, when you're watching your investments, when you're watching, even when you think you have a safe pick in an index fund and an ETF and a mutual fund, whatever, and you still seeing red every day, I understand. Nobody likes to sit and watch themselves lose money day by day. I completely understand it. we have to, and I've said this in a previous episode before, we're not holding for today and tomorrow. are not day traders, we're not swing traders. Well, some people are, but we aren't. Like I said, we're going for generational wealth. We're trying to build something here. We can't panic sell. As tough as it sounds, I understand. ⁓ It's a lot, know, everyone wants to just kind of like hold on to their money, but the same way we're losing money on our investments, that cash isn't going to be of much use either in the same period of time. Like if you genuinely think that, you know, your investment in the S &P 500 over the, it is down this year, cool, but I mean. We've seen this time and time again, you can look at the last 50 years, ⁓ even with a red year, there's almost a guaranteed rebound in the market the next year following. So it's like, this is not the end all be all. There's a ton of turmoil in the world right now and understandably, that's going to affect the market. But we can't let day to day news headlines and economic policies affect our ⁓ kind of discernment and our discipline as investors. I guess your investment strategy should not be so easily swayed by headlines and by a couple of red points because like Thomas said, it's then what, 5 %? Could be a whole lot worse. If we're being real, returns what, 19, 20, 21, 22 % every year. We're looking at a 5 % down in the first three months, almost four months of the year. We're going to be okay. This may very well be a red year, but like I said, we're holding for the long term. We are investors. Our strategy is to not be so easily influenced by these different headlines and seeing a little bit of red. I'm saying my portfolio is bleeding right now. Best believe. I would love to get rid of everything. But I know at the end of the day, my purchasing power with the same amount of money, if I were to take everything out of my portfolio now and I just held onto it tight for the next five years, I know that the money I have now, for one, the US dollar is constantly losing value. So my purchasing power in 10 years. I know what the exact numbers are, but I can assure you it'll be less than whatever it is today. we've seen like history, like you can look at the history, history repeats itself, man. S &P goes down, next year it's going to rebound. We will be back in the green sooner or later. It's not fun now. Stuff is bleeding right now, but this is when you deploy capital. This is when you buy low, right? Don't wait for everything to make a bull run and then you want to get yourself back in because that's how you miss out on building wealth. Now's the time to buy things like, and don't keep trying to wait for the perfect price or perfect drop point. Like, cause at end of the day, if your strategy is to hold long-term, the perfect price, obviously be smart about it. Don't buy it at the all time high. But if you're holding for the long-term, man, I mean, now's the time to deploy capital as uncomfortable as it feels. We'll be back. We're thinking 10 years out. We're going be okay, man. Thomas: Exactly, we'll be fine. Keep up with inflation. That's the only way for your money to grow. ⁓ Money you hold is money you lose. you know, kind of pivoting back to the stuff with the Middle East, China's still getting their oil. know, certain places are still getting their oil. So relationships, timing, all of it matters. You can't be emotional. ⁓ But in relation to all of this, things that will impact the stock market, just want to give you the black box truth, right? malcolm: Yeah. Mm-hmm. Thomas: things that people are not connecting that are happening simultaneously in the Middle East with this situation. So one, the war just expanded beyond Iran. Like I said, the missiles are hitting Saudi Arabia's capital ⁓ is a completely different situation than missiles hitting military targets in Iran. Saudi Arabia wasn't a combatant. Now they're expelling Iranian diplomats. If Saudi oil infrastructure gets hit next, you're looking at a global energy crisis that makes the current one look mild. Saudi Arabia produces 9 million barrels a day. Think about that. If something happens there, that's another 9 million barrels potentially off the market, which means that new Porsche you got or that, you know, let's see for my people who just got their first car, that 2018 ⁓ Camry you just picked up, forget about it. You're not going to be able to put gas in it. ⁓ Two, Trump gave that 48 hour ultimatum. malcolm: Mm-hmm. Thomas: Iran literally cannot comply even if they want it to. The straight is mined. There's active military engagement on both sides and you can't just open a waterway mid-war. Iran's response tells you everything. If you hit our power plants, we'll permanently close Hormuz. This is not a negotiation. That's a promise of mutual destruction. For people who've read the Art of War, 33 Strategies of War, if you're going to lose, mutual destruction. You want to go out with a bang, you don't go out by yourself. Facts. malcolm: Mm-hmm. Thomas: Number three, the third point in all this, or this specific topic, Iraq's force, I hope I'm that correctly for all my Iraqis out there, please correct me in the comments. They removed 2.4 million barrels a day from global supply. The government lifted Iran's oil sanctions mid-war to tame gas prices. Then Iraq shut down too. They're out of easy moves. The people in charge are improvising and your paycheck is absorbing the consequences. ⁓ even though Costco said that they're going to, I believe they said with the tariffs, they're going to implement automatically kind of like put those discounts back so that when they get the tariff refund, because that was illegal, they're going to pass that on to customers to help, you know, kind of show support back to us. Costco has been one of the best businesses in the world in all of this, in far as how they treat their customers. malcolm: sure. Thomas: They can only taper the cost so much when it comes to gas, man. They're not, they're not God. That's just food for thought. malcolm: Yeah. Yeah, nah, nah, nah, no cap, man. And like I said, I think what this all does is ⁓ just one, just to reiterate the importance of being acutely aware of what's going on in the world. I'm not saying you have to be a news or history buff, but at a bare minimum, at a foundational level, think that you should have a understanding of why gas is this high, for one. Two, ⁓ just like being proactive and understanding what type of adjustments can I make as an investor, as someone who has a steady income with whatever money I have left, what type of proactive steps can I take to one, protect myself against inflation, to best budget for rising costs with gas, most notably, but also everything is rising when I grow. got groceries going up, cost of insurance and premiums going up. Everything's going up, So there's no question about that. the question now is, one, how do you adjust your personal budget? What type of investment strategy changes do you make, if any at all? Also, another thing to think about is, as these gas numbers continue to go up, how does that affect my allocation towards my personal investments? How does that affect my portfolio allocation? Now that we have these high numbers and these other things to worry about, Now we have to do some rebalancing and readjusting because we can't keep putting towards the same money unless you magically are just going to stop driving for X amount of time until the war ends. We have to be proactive about this stuff and so we also need to understand like, okay, what do things look like if Trump actually does strike these power plants? If they talk about really shutting down the whole straight up for moves, mean, gas might. I don't even want to imagine what that price is going to be now. I know one thing, I'm not going to be driving. As much as I any opportunity, anybody that asks me to come out, yo push up here, push out here, if it's saying more than 15 minutes, it's clipped my boy. I hate to break it to you man. If you actually pull up somewhere, push up, you know what saying, come hang out, more than 15 minutes, it's quiet. I ain't gonna lie to you. Until these bad boys get down, you know, back to a reasonable price. If guys talk about $4 a gallon, best believe my car will not be touching no type of asphalt. Thomas: You malcolm: So yeah, yeah, yeah. Couple things. Yeah, I don't know, man. We, you know, I don't want to be a doomer and make everybody feel like this is end of the world. There's no way out. We're cooked. We're absolutely, you know, like our portfolios are cooked. Everything is cooked. It's not the end of the world. We're going to get through this. I think completely side note from our whole, I really hope. I really really hope that if you haven't already had enough reason to by now, are taking this as whatever, if you needed any more motivation to go vote during these midterms, to go make some type of change in your community, actually, I hope people understand now that voting does matter. This is not a, like I cannot stand the ignorance when I say, when people hear people say, bruh, it's just my one vote wasn't gonna change nothing bruh. Thomas: Please. malcolm: D, I hope people understand that that type of thinking spreads and it bleeds across our community and our population. It's not about your one specific vote, it's about the way that you think and about how it spreads to other people. And when that accumulates and spreads across several people, it becomes entire communities, it becomes entire neighborhoods, it becomes entire areas and cities that don't vote because everyone thinks that their one vote doesn't matter, which you're not accounting for. It's everyone else that thinks that their one vote doesn't matter. Your one vote does matter. It can be literally the tide changing kind of pivotal moment that we need to get new leadership in the house. If you like war, if you like paying $4 a gallon, $8 a gallon in some places, if you enjoy rising costs of everything, if you enjoy seeing federal programs get cut, enjoy seeing HBCUs and minority serving institutions get there, federal programs and scholarships and funding get cut. If you enjoy seeing healthcare, actual important research for vaccinations for children get cut. If you just enjoy seeing these policies and this message isn't for you, but if you're someone with any type of moral compass, some type of human decency and just a fundamental, just if you're just not an ignorant person, I hope this is a reason for you to go out and vote, bro. Like said, I'm not a poli-sci guy, but I have enough common sense to see this is not right. This is not how the people that lead our that lead our country are supposed to be handling themselves and leading. We're in a war for no reason and we're doing Israel's bidding. Yo, and I'm not sitting here saying I'm not going to be the guy that says, Kamala would have been perfect, she wouldn't have messed. I'm sure she would have made her own mistakes. But I know for a fact under her leadership, we would not be in wars for no reason. We ⁓ wouldn't be in half of the mess that we're in now. And sure, it's a hypothetical, but this is literally the worst of the worst. Thomas: Thanks. malcolm: And we're not going to make this into a political, into a Joe Rogan, we're not doing that. But, we got to get this across at some point. I hope people that are listening to this really resonate with what I'm saying because I'm not saying this for clicks or for like, dude, please go vote. I'm banging you. I'm genuinely banging you, bro. Thomas: Yeah. Get out and vote, especially our minority people, as we saw, ⁓ that swung the election last time, unfortunately, in the wrong direction. ⁓ But hey, we got to get out there. We got to go vote. I've met too many black people that say, ⁓ it don't matter. Bro, if you don't have trust in the system, bro, go move to Cuba, bro, like the place that's probably the most anti-system place that you can go to. ⁓ America. malcolm: Yeah. another piece, it's also like, you also have to understand, I'm not saying still go vote, but you also do have to understand where you live. If you know you're in a swing state, you know that your vote matters more. Now, if you know, like me, I live in Maryland, I know we're going to be blue every year. If you live in Massachusetts, you know you're going to be blue. If you live in California, you know you're going to be blue. If you're in a state like Pennsylvania, like Georgia, you know states that can... Thomas: Vote, bro. malcolm: North Carolina that can really swing either way, you really need to take this seriously because I'm not talking about the states that are all blue 100 % of the time, I'm talking about the states that can swing either way depending on what communities more closely align with what are policies the person running is presenting, right? So let's just kind of keep that in the back of our mind and just understand that location does play a huge part. ⁓ first of all, all the... Thomas: Yeah. And they're cooking the books too. North Carolina, they just took away like 50,000 some registered Democratic voters. they didn't take them away, but they moved the stuff around, even ANT. malcolm: Yeah. They take away the polling sites from places, like they literally make it as hard as possible for underserved, you know, minority kind of communities. ⁓ They really just try to make it as hard as possible to vote. They'll take away polling sites. They will make it hard. They'll do gerrymandering to carve up more seats for whoever they want to get in place. And what I'm really appreciative of now is that, you know, the blue side, now it's like before we've always just tried to be... And one thing that always kind of pissed me off because it's like, we always try to be the good guys. And it's like, we always try to do the right thing, the moral thing, but you have to understand the people that we're dealing with, being nice doesn't work anymore. have to fight fire with fire now. And so I'm glad to see that people like Gavin Newsom are like trying to implement the same things you're trying to do in Texas. out in California, right? okay, y'all want to do this instead of trying to be, hey, that's not right. Now we like, nah, you know what? Now we going to double up what y'all doing and run it right back. see now when you hit them back, when you get spacked in the mouth on the same thing you're trying to do to somebody else, that's going to hurt a lot more. So I'm excited to see that. ⁓ And like I said, man, hey, just do your due diligence, man. Do your civic duty, please. ⁓ And yeah, let's actually make some change. this upcoming cycle man because there's no way that you're satisfied with the state of our country now. We're supposed to be the most powerful military, the land of the free, the most economically well-positioned country. It don't seem like it, brother. Thomas: you Yeah. Cook, bro, people in other countries, look at us, I talk to people from other countries, they're like, yeah, I don't know what you guys are doing. We look like idiots to people across the world. We look like we're stupid. Please expand your horizons. Going to Texas is not the same as going to another country. Going to Mexico is not the same as going to Europe. I mean, that goes without saying, that's not even a political thing. malcolm: Mm-hmm. Thomas: It's just like expand your horizons, bro. The world is bigger than North America. ⁓ But yeah, no, that was tough. was smooth. like that. ⁓ But go vote, like seriously. But I guess another area where you should be informed, because this is also super heavily mixed into voting and where money comes from and all this sort of things, ⁓ OpenAI super app and the AI job paradox. So OpenAI is building an app that replaces your browser. your code editor, and possibly your job. ⁓ While Meta is reportedly cutting 20 % of its workforce to fund $135 billion in AI spending message, the same technology is creating and destroying jobs simultaneously. malcolm: Nice, more A.I. slop headlines, man. Just what I wanted to hear, bro. And it's like, I'm sorry to people that listen to this, they're like, bruh, homies are... Thomas: You life. malcolm: everything is AI. There is no, you're not going to go a day without hearing about AI anymore unless every data center on the planet just vanishes. Those days are gone, brother. So you do need to understand, and this isn't even about... I hope you don't think that this is only a tech thing now. This is white collar work everywhere, and it's going to be blue collar work in some time as well too. It's not a... We're not here sitting here trying to discuss... who's gonna get displaced first, hopefully it's no one. In an ideal world, we would be using AI to supplement workers instead of trying to use it as a lever to kind of cut costs and to cut people. ⁓ I think that if people were really worried about productivity gains and efficiency gains, more money would be going towards actually training people to how to leverage these tools and how to leverage these ⁓ kind of like. automated systems to handle more mundane tasks and allow the humans to focus on more creatively demanding work, work that requires more of human touch and understanding, instead of just using AIs, all right, bet, you can go now. And that should tell you a lot about the state of tech executives now and what their priorities are. And you should also understand that these corporations, they view you as now. corporations just view you as more money they can put towards your compute capex spending. And that's a really unfortunate way to kind of think about it. This is across tech everywhere. This isn't even just hyperscalers. This is across consulting. This is across healthcare. This is across federal government. This is everywhere, bro. Like, this isn't just software engineers anymore. It's everyone, right? So, like I said, like we've kind of been reiterating this entire episode. It's one thing to be acutely aware of. what's going on in the world, saying a breast of news and what's kind of coming out. But it's also just as important to continuously improve and refine your skills. Now, this is through certifications, through watching different courses. Like I say, everything else, you do not have to be an AI demigod. But you should understand how AI works. You should understand its capabilities. You should understand how tokenization works. You should try to get some type of certification so that you can demonstrate. Thomas: do. malcolm: fundamental capabilities to understand AI and how it can actually be implemented into workflows. How it can be used to automate things. these, like I said, it sounds like a hassle, but when stuff like this comes out, you're a fool if you think you're just going to sit back, lean back in your chair, put your arms up. Yeah, bro. They're never going to lay me off. My brother, you're next, right? Like, so that you're capable of learning these skills. I'm not saying that you have to... Thomas: you malcolm: use like and understand like understand how to actually implement it because the difference between knowing what AI is but how do you use it in your own workflows? How do you speed up and create more productivity games for yourself and for your team? That's where it kind of matters right like sitting back and just looking at AI looking at the headlines or you just look like a sheep grazing grass before it's getting ready to get freaking sheathed and slaughtered bro like learn something teach yourself a new skill bro like These headlines as crazy as they sound, all these different workforce reductions, compute, these of billions of dollars going towards compute capacity and data center infrastructure, this should just be nothing but motivation and it's like an alert in your head going off like, A, I need to lock in. Like, I need to get, like, I need to get with the program. Like, I need to be like, I need to learn this stuff. I need to learn, teach myself a new skill. I need to like understand like which way the market is heading because this is such a rapidly expanding. sector and technology, by the time you learn one cert, it's going to be a whole nother certain path that you have to expand now. You're going to make your job a lot harder, and you're going to make your learning path a lot harder if you continue to push it back and push it back and push it back. Because when you're starting at ground zero, when we're three or four years into the AI race, you're going to be so behind as compared to someone who's been trying to at least, at best they can, constantly keep up with the way it's expanding and the way these new technologies are coming up. The way that Claude and Anthropic and OpenAI are consistently shipping out new features and products, a lot of the time, cowork comes out, there's a codex, and there's gonna be codex V2, codex V3, and there's gonna be a new product out that you haven't even heard of that can do what the last two products can do 10 times better. like I said, so it's like, the more you wait, the harder it's gonna be to catch up, bro. And that's just what it is. Thomas: And realistically, you got to get in the room. That's why we're here. You got to get in the room to understand and see things. A lot of these people in tech, especially the ones that are super heavily investing on AIs because someone's telling them to be investing on AI because it's starting from the top. And they try to say that they're keeping human centered, human focus, blah, blah, blah. They might believe that they're doing that, but we all know how things are going. We all know that it's all data. We all know exactly where things are moving towards because they want to automate. So you can have Europeans. malcolm: Yeah. Thomas: Be informed, be aware. A lot of people say, ⁓ this is impossible. That's not possible. Yes, it is. It is on the way. It might be ⁓ framed as something that helps you now. But if you're using Frontier in your code or your Excel, you're using all these Frontier things, ⁓ why is your company going to continue paying you when you've worked with the AI agent to work on this Excel sheet? Think about the long-term impacts. ⁓ But that's whatever, right? I'm just a crazy guy. I'm AI slot. My brain is AGP T two stories that are actually one story on March 19th Open AI announced plans to merge chat CPT the Atlas web browser and codecs into a single desktop super app Codecs gets autonomous agent features first. It'll write code browse the web analyze data on your computer without you ⁓ number two meta is reportedly allegedly planning to lay off 20 % of its workforce, about 16,000 people, allegedly. Like I said, to fund that $135 billion in AI spending. Crazy. Then, very good. And then they also allegedly denied the reports. But that's still debated. ⁓ But here's the thing. Meta stock rose 3 % on the layoff rumor. allegedly the Trump play. Wall Street. malcolm: So cool. Thomas: literally rewarded the idea of firing companies, or no, no, I'm sorry, firing 16,000 people. Meanwhile, OpenAI CEO Sam Altman called the tech layoffs AI washing quotations, saying companies are using AI as a cover for the pandemic over hiring cuts across the industry. Across the industry, 56,000 workers have been laid off in 2026 so far, we're only in March. with AI cited in 12,000 plus US job cuts according to the challenger, or to challenger gray and Christmas. So people are getting laid off because AI, right? And we're overly cooked. So kind of like with our inside perspective, the black box truth, it's a paradox and nobody wants to say out loud. are building AI, or companies building AI are also the ones firing people because of AI. Message. or at least saying they are. Sam Altman just called it AI washing, but companies are blaming AI for layoffs that are really about correcting pandemic error over hiring. That was a thing, a lot of hiring in the pandemic. And then AI came about big shifts. And then the OpenAI CEO admitting that AI isn't actually replacing as many jobs as headline success is just a convenient excuse. But Meta stock going up 3 % on the layoff rumor should tell you that malcolm: Mm-hmm. Thomas: what Wall Street actually values. Fewer humans, more machines, higher margins. So whether the AI office are real AI replacement or AI washing, it doesn't matter to the 16,000 people who just lost their job or the 16,000 who might lose their jobs and the thousands, tens of thousands, hundreds of thousands that have lost their jobs before. An open AI building an autonomous coding agent while calling other companies layoffs fake. ⁓ That's a contradiction of the entire moment. If you're early career, this is actually a window. You're cheap and AI literate, but you need to understand the game. So that all ties together. If your early career is good, if you're a middle manager, you might be cooked. If you've been around super long time, you should be stacked and ready to go. But yeah, it's a scary world outside. It's a cold world. malcolm: Yeah, man. I find Sam Altman's comments particularly interesting just because I actually read an article recently. OpenAXE plans to almost double its headcount this year. And this is primarily to fend off competition from Anthropic, ⁓ their biggest competitor in the startup space, but also from companies like Google, Alphabet, I'm sorry, Meta. ⁓ But yeah, so. They're planning to almost double its headcount by the end of 2026. They said they want to increase the headcount to about 8,000 from about 4,500, which is their approximate headcount. And so the new hires that they plan to hire across OpenAI, they'll work largely across product development, engineering, research, and sales. And they've also taken a new office space in San Francisco, which is like the startup capital of the country. ⁓ To accommodate his growing staff count. So they're taking their footprint in the city to more than 1 million square feet ⁓ So yeah, it's like I said, that's why I kind of find his comments interesting About the AI washing stuff because I Don't know man, it's just gonna be very And that I can say like Thomas like Thomas just said and I also said earlier like this is just kind of why I reiterate the importance of staying on top of the game know, as AI literate as possible, ⁓ understanding what type of news and developments are coming out. ⁓ And just like, it's, these are one of those periods of time, and it's like, it's crazy that our kind of generation and graduating class is coming out, like I said, one of the craziest, just kind like, like I said, tumultuous times ever across housing, across, you know, new college ⁓ barrier to entry for new hires. ⁓ You know, this, our current president and all these things going on at once, it just seems very unfair and kind of like a, just an unfortunate series of events for us to kind of come out at a time where it's like all of this uncertainty in the world. But like I said, at end of the day, nobody's gonna come save us and pick us up and protect us. So we have to do our job to, as best as we can, protect ourselves ⁓ from all this going on in the world. And a lot of that takes a lot of just productivity and just being like. committed to consistently improving your findings. The days of making a resume and not touching it again until you get laid off are over or get fired or moved to a new role is over. Like we are in a space now where you are constantly being scrutinized for your knowledge and understanding of AI. Your kind of contribution and impact are just being more closely monitored and scrutinized now because everything now is a justification to not get rid of you to spend more on compute, to spend more on infrastructure. Right? So as an employee, as a contributor, as a manager, whatever your position is across the company, at any of these hyperscalers or anywhere, you know, across tech or white collar work, you are constantly on the spot to prove yourself. So what that means, like I said before, now is the time to learn, to apply, to consistently show that you are more than capable and that you're not just a sheep, right? Like you have to show like why you belong here and like how you can consistently adapt. Someone The person that's gonna, know, the new hire that shows that they can continuously learn and implement AI in the workflow is continuously get better and learn at it and adopt it versus the, you know, guy of 10, 15 years of experience who thinks that AI is a fluke. It'll kind of, you know, go over in a few months or whatnot. They're gonna take the cheaper guy that's more ambitious about the AI learning over the guy who has a ton of experience ⁓ but refuses to. accommodate to one of our most rapidly kind of like changing market shifts that we've ever seen, right? So ⁓ yeah, man, like Thomas said, man, you have to understand the game. You have to understand what's going on. And when you're in the space now, you have to be constantly improving, bro. ⁓ It's unfortunate, but you can only control what you can control, man. So try to control the things that you can and push the best foot forward, bro. Thomas: Always. No, absolutely. And we also like for people out there with the stuff, man, like you got to balance AI skills and also doing your job or like improving in other ways. Like I know I'm hearing a lot like some people are going too far on AI. Like they're they're literally forgetting their tasks. I'm hearing people saying like they're working over weekends now because AI like you got to balance this stuff out. Like I changing constantly. But like Malcolm said, What you know about AI today is going to be different tomorrow. This stuff changes faster than the human brain can even understand. We've seen technology grow so much in the past 26 years. And AI is changing at a rate that's crazy fast. mean, that's why it's unprecedented. Like, bro, that's why they have all these NPUs, TPUs, and all these GPUs, like special GPUs for this stuff, because it's malcolm: Mm-hmm. It's unprecedented, bro. Thomas: constantly has to be updated. That's why Nvidia can put out a new chip every single year. And it is super critical because things are changing so fast. The human brain took forever to get to this point. And all these changes in tech can happen much faster. So we need a little grace on the people. But the money doesn't have grace. So. malcolm: and ⁓ like in the video as a company like they are literally the ⁓ They're literally a direct application of Moore's law and Moore's law for context. This was originally an observation, but it was coined by the co-founder of Intel, Gordon Moore, back in 1965. And this was that the number of transistors on a microchip doubles approximately every two years. So what this means that this leads, this kind of leads to exponential computing power and reduced cost, but it's not a physical law, but it's kind of acted as a general guide. for the semiconductor industry for over 50 years. And while we're saying all these crazy advancements in AI and smartphones and supercomputing, it's pretty much remained true. what, like the key aspects of it, one, transistor density. So the core concept is packing literally more transistors into a smaller chip ⁓ every two years, increasing compute power. And then as density increases, computational speed increases while the cost per transistor decreases. And so this, exponential growth has led to this chat gbt and an llm and a video boom that we've seen over the last three years this consistent doubling has led to thousands thousands times greater computing power over decades right so The or trade-offs, so the pace of advancement is slowing down as transistors shrink to atomic scales. I'm talking to the point where you cannot make these transistors any smaller. So it's going to get harder to maintain cost effectiveness. And the reaching sizes of quantum mechanics and heat dissipation create significant manufacturing challenges. So what we're saying now is like, NVIDIA, as their constant innovation creating these new chips, That's direct application of Moore's law, but what's not kind of being said is that the additional components that come along with it, there is no law that says that they double in performance or they double in advance every two years. That's why we see this memory shortage going on now. There's a reason that it can't keep up with the cost or kind of like the, you know, same technological requirements as the chips because memory does not advance as quickly back in or kind of like ethernet connections, internet networking does not advance as quickly. as chips do, ⁓ power, liquid cooling, energy, data center infrastructure does not advance as quickly as computational power and these kind of like more chips on these transistors, right? So ⁓ we're getting to a point now of a bottleneck where it's just strictly compute power and everything else just lags behind. But between memory bandwidth, between interconnect networking speed, like all these things are just lagging behind. And it's going to get to a point where it's like, You have to be aware of all the components of the AI kind of landscape and understand how they all tie together and understand like, okay, if the chips are going to keep going up, where else can I, you know, plug and play as an investor to understand what else isn't doubling or kind of being advanced as fast, but it's still a requirement to make these computational advancements possible. So that's a bit of a deviation from our original statement, but. That's just another thing to be aware of as an investor if you are still bullish on the AI, future of AI, which I think I am as well. I don't think it's going away anytime soon. ⁓ So that's just another thing to think about. Yeah, man. Thomas: And for all my people who might not be following everything, the quarterback is 20 yards or moving 20 yards every play and the rest of the line and team are moving about 12 and a half yards every play. So that just puts into perspective. But like, if that doesn't make sense, please watch it again, rewind that part, know, look up the words and things that you don't understand because it's better that you understand everything going on. But speaking of quarterbacks, man, it's March Madness. malcolm: Mm-hmm. Thomas: know that has nothing to do with basketball, but it's sports. ⁓ So ⁓ personally... malcolm: Yeah, bro. My bracket is so busted, dog. Can I lie? Thomas: Bro, bracket is fried. mean, my women's brackets were doing a little bit better because women's is a little bit easier to predict. Usually it falls like the top seeds usually win. It's a little bit less balanced in the women's brackets. ⁓ man, ⁓ Audie Crooks, for all my people who know who Audie Crooks is on Iowa State, she's a dog on offense. But defensively, you got to lock in. malcolm: . So I'm looking, right? And this is as of Sunday, March 22nd. In the women's tournament, 185 perfect brackets remain and 3,477,348 brackets have fallen. Oh, I'm sorry. That number actually just updated. 185. Did I say 185 first? Yeah, okay. So 185 brackets remain. Over close to three and a half million brackets have fallen. In the men's tournament. Thomas: I so. malcolm: zero perfect brackets remain 26,567,887 brackets have fallen. Have we even played a sweet 16 game yet? Yeah, so this is March Madness Bro and some people argue it is the best like sporting event. Thomas: Nah. Nope. It's cooked malcolm: Like period, over like, like Oregon's playoff atmosphere ⁓ sporting event, I guess better than NBA playoffs, better than NFL playoffs, ⁓ better than MLB playoffs. I mean, hey, I'm not going to lie. It's a valid argument. Marsh Madness is like, like the number of games I've just been watching, bro, and it comes coming down to these buzzwords, like the high point Wisconsin game, the the Nebraska game from last night. I'm just like, bro, like these are real, these are real. kind of crazy upsets, but what's kind of been the what's been the biggest upset to you that you've kind of seen so far? Thomas: biggest upset is that we don't have a black box theory podcast bracket. We're going to have to implement that next year. Men's and women's good interaction with you guys. We're going to have to do that next year. So remind us if we don't. But upset to me, man, I don't know. I'm going to be honest. I haven't like sat and watched a full game. Like I really haven't watched it, but I'm just trying to think the ones that I have seen. I'm a Carolina fan, so I kind of been tuned out. I knew that we were cooked. malcolm: ⁓ yeah, there actually will be a... yeah, we said that, yeah. Thomas: when Buddy went down with the broken hand earlier. Yeah, we suck, bro. We suck. Like, I'm not gonna lie. I'm a Bulls fan and a Carolina fan, so like, I don't fall for the tricks bamboozling every year. Like, every time people say, ⁓ you're gonna, no, no, no. ⁓ You serious? To who? malcolm: Well, but y'all were up by like 20 at one point. Yo, Florida just lost. Yo, Florida lost to Iowa, bro. Not Iowa, has a ninth seed Iowa. Yeah, Florida was a number one seed. Thomas: Who? Iowa or Iowa State? And Florida was number one, right? like two? Shout out, shout out Iowa. malcolm: That's crazy to me, man. I ain't gonna lie, from what I've seen, and Kansas lost today too to St. John's. ⁓ Thomas: Shout out to St. John's, first time to the Sweet 16 since I believe it was 1992 or something like that. malcolm: But I'm not going to fake that ⁓ Wisconsin high point. Probably the craziest upset I've seen, Thomas: Because High Point won, Yeah, High Point, Greensboro, shout out Greensboro, or they're not at Greensboro, they're in High Point, but close to Greensboro, shout out the area. malcolm: Mm-hmm. Yeah, man, it's yeah bro. It's only gonna get crazier. I think Kentucky also got blown out today by Iowa State, they rolling. ⁓ Thomas: Who you got winning it all though, man? I'm not going to lie. I'm sticking with Duke. ⁓ You can't, okay. ⁓ Carolina, I gotta say Duke. malcolm: I had UConn winning everything. I think if UConn don't win. I I don't think, I don't think Duke folds in Elite 8 or Mim. Thomas: They're hitting at least Final Four, if not Championship Game. malcolm: i'll see it i'll see the they may make the file sin capacity to not be ⁓ they got the other place and on the next Thomas: you tend to lose. Who ain't running into him? I'm to pull the bracket up. malcolm: Planet St. John's next. Thomas: They play in St. John's. You think they're gonna lose at St. John's? malcolm: I'm putting, seeding doesn't matter to me for Mars Madness no more. It hasn't for a long time, but seeding. Thomas: No, I mean, I'm not worried about seating, like, think St. John's is like, the... malcolm: I think that, think, think, think, I think, I I think, Thomas: ⁓ okay, okay, look, look, look. I'm looking at it right now, I'm gonna just make some predictions. All right, I say. malcolm: or Houston. If you got to know, I got Houston going. If you got to know, get this. Thomas: I'm saying Duke. Duke's going to win. think, ⁓ well, Arizona, they trolling. Well, no, they should win that. I feel like Michigan State. I think it's going be Duke, Michigan State, Elite Eight. I think it's going to be Nebraska. It might be Nebraska. I don't know. I'm going say Nebraska, Houston, Elite Eight. I actually got Illinois winning it all in like one of my brackets, to keep it real. malcolm: I like, yeah, I do like, yeah, I can see, I can see. I see, I think Iowa State, yeah, Iowa State and Michigan. Well, I see Iowa State and Michigan and I also see Purdue, Purdue, Arkansas would be a great game. But. Thomas: I will stay in Michigan. And ever since Purdue lost, ⁓ didn't they lose to a 16C one year? They lost to UMBC. No, no, UVA lost to UMBC. Who did Purdue lose to? malcolm: Yeah, yeah, yeah. No, you UVA. yeah, yeah. They lost to somebody else. was sorry. I forgot. But yeah, they blew us in one scene as well. Arkansas has a really they were really fun team to watch, bro. Darius Cuff is so nice to me, bro. He's ⁓ actually like a sports bar with my boys. Last night we was watching him, bro. He's really like, just a killer, bro. Like he reminds me of Alan Iverson so much. He a killer, bro. Thomas: Hey, bro, I wish I could tap in, bro. mean, hey, ⁓ I just, from all people out there listening, you you notice how he said he was at a sports bar with his boys. These are things you want to think about when you go into your full-time employment. I don't have that option. ⁓ To me, right, sports, television, all those are social activities. Don't have the option. Interpret that how you will. Those options were stripped from me. ⁓ taking away from me like Timothy Turner's Fairly Odd parents when he lied. So, you know, he made a wish, right? Let's just put it like, Timmy Turner made a wish that his Fairly Odd parents would be there forever, that he would be young forever. And he got found out, he got his wish, but he found out, ⁓ he got found out and they were taken from him. Trade off. I'm Timmy Turner. What are my Fairly Odd parents? malcolm: Amen. It's out the mud with Rasaad McCance, man. We do appreciate y'all boys tuning in for sure. ⁓ Amen. know what saying? It's out the mud, baby, for sure. Thomas: You If But hey, we keep it going. So, anyway, man, prior to our prior to our stings of life dog. ⁓ but let's talk about the S and P 500 a little bit. 500 a little bit. ⁓ the S and P just dropped for the fourth week straight. The Russell 2000 has entered correction territory, $5.7 trillion in option options expired on Friday and The Fed said they're not cutting rates. Here's exactly what you need to know. For those who might not be invested or might not be watching, Friday was extremely ugly. I know I opened my portfolio and it looked like it was my time of the month. The S &P fell 1.51 % to 6,506. The NASDAQ dropped 2.01 % to 21,648. Dow shed 444 points. Russell 2,000. Like I said, entered that ⁓ correction territory down 10 % from its highs. This was the S &P's fourth consecutive week in a decline. ⁓ All the options expiring, adding massive volatility. ⁓ The damage underneath the index is worse. 40 % of S &P 500 stocks are in individual bear markets, which means down 20 plus percent. ⁓ 97 % of software stocks are below their 52 week highs. The Fed rates at 3.5 to 3.75 % Wednesday and the market now prices in zero rate cuts for 2026. Some analysts at Macquarie think the next Fed move might be a hike, not a cut. We are sizzling. malcolm: Yeah, dawg. I don't know, bro. It's scary, bro. I know I said earlier, like... capital because prices may not Understandably, we don't know, it's one of them situations like buying the dip could be buying the high because we don't know when this dip gonna stop. like I said before, bro, like I know it's hard to hear it and visualize it because, you know, we thinking about the end of the day, folks got bills to pay, folks got rent, folks got kids to feed, folks got it. You have to keep a roof over your head, closing your back, food on the table to get it to the point where you can think about long-term investing. So I 100 % understand and I empathize with those who understandably cannot make those type of deployments as far as capital goes into all of these investments right here at this moment, because you've got to take care of yourself today. However... portion of that, you know. said and you can rebalance or kind of adjust your portfolio or your allocations as needed but I will say that a part of us does have to always think about our future selves like everything cannot go towards today and tomorrow or next week we have to think about ourselves five years from now so like I said like I said I know things are bleeding right now like a down year like I said you have to remember it's only March we're also in a very high ⁓ Thomas: Mm-hmm. malcolm: very high stress, you know, kind of economic state right now, ⁓ globally. So understandably, like it makes sense why the market is reacting the way it is. ⁓ So like I say, you just kind of got to just keep, you know, stay abreast of the news, you know, and just try to invest where you can, make the right strategy for yourself. But I hope that investors who are Thomas: Mm-hmm. malcolm: maybe just now breaking, I feel for investors who may be kind of like just now breaking in for the first time this year and they feel like, bro, I'm just losing all my money. This is a waste of time. Time in the market always beats market timing, no matter what. People that make the most money, it's not from quick trades, not from boom, boom, boom, know, quick swing trades, quick day trades. It's for people that hold for five, 10, 15, 20 years, consistently reinvesting their dividends and then living off of that, right? So that's kind of how you got to think. If you don't believe me, you can go ask Warren Buffett, just like this small guy, know, very minimal net worth. you can double check with him and his strategies if you don't believe ⁓ guy on ⁓ ⁓ But yeah, man, like I said, bro, just try your best to not be discouraged. ⁓ Stay abreast of the news, ⁓ what's going on everywhere, and ⁓ take control of portfolio as proactively as possible. We're get through this together, for sure. Thomas: you Thanks. Now we get we figuring it out got to. I'm not blaming not blaming him, but man, watch out for Agent 47 and not the hit man. I'm not talking about the hit man. Man, we gotta we gotta stay smart, stay stay sharp, stay up to date. ⁓ And if you're in your 20s from my people who were born too late, I'm sorry. ⁓ Your mom and dad should have had teen pregnancies. malcolm: I am. Yeah. Thomas: ⁓ But do not panic sell, like Malcolm has said multiple times. Don't panic sell. Be a non-emotional investor. your horizon is 20 plus years, corrections are statistically where the best buying happens. So you have to think long term. I know it's easy to get caught up looking day to day, checking your stuff day to day. Brother, you just got to hold for the long run. And if it's cooked in the long run, we're all cooked in the long run because the world relies heavily on the US dollar still, even though Agent 47, not the hitman, malcolm: Mm-hmm. Thomas: is pushing countries away from that, the US dollar is kind of backing a lot of things. But we are now making enemies out of friends. We are destroying ourselves. But if that happens, everything's cooked. So unless you have multiple passports, just keep holding on. If your entire portfolio is tech stocks and S &P indexes, you're correlated to the worst performing sectors at the moment. ⁓ At a minimum, check your energy and commodity exposure. I mean, me personally. Gold is absolutely tanking for me right now, but it should go back up, hopefully. I'm just going to hold on. And if you have cash sitting in a high-yield savings account at 4 % plus, that's not a bad place to be right now considering the S &P 500 is down about 5 % on a year, year to date. And cash is a position. Don't let anyone shame you for holding it during a genuine uncertainty. If someone's shaming you for holding cash, I hope. I hope that person has some sort of bread because if they don't, probably, yeah, you can figure the rest out. But I feel like most people who actually have a little bit of change to their name are not going to shame you for being intelligent. Don't just go spend $300 on Facebook Marketplace because you saw a P5 available. Don't do it. You can live. malcolm: Yeah, man, do not make... To be honest, I don't even know how you're saving the account. still do have a 4 % rate. Oh, they may. I'm not sure. Yeah, I don't know. I don't even check as often as I should, but... But alright. Thomas: So far, they don't have the 4 % anymore? Let me see, I'll just check. says as of March, 2026, mind you, this is from the Google AI overview since I'm not allowed to do a Google search without seeing AI. Best rates around 4 % to 5 % APY with Pi Bank, that's P-I-B-A-N-K, 4.6%, Vero Bank, V-A-R-O, that's 5%, and Open Bank, 4.09%. They are the top three leading the market. But the best choice is generally have no monthly fees, low minimum deposits and FDIC insurance, maximizing earnings for savings. I mean, me personally, I try to go with stuff that makes sense. Like a lot of people, try to chase those, like, you know, those offers and things like that, but you got to make sure you pick somebody, you know, a good choice. Because, I mean, this is your money we're talking about here and you want that insurance. If you go find something that says, hey, we got 10 % APY. malcolm: Mm-hmm. Thomas: But they're not FDIC insured. Hey, you could retire yourself early if you want to. Retire yourself early in homelessness, that's where you might end up if you put all your money in there. Be smart. malcolm: Yeah man, but hey, that's all I got for y'all man. We ⁓ dude you wanna touch on anything else? You all good? Thomas: I think we covered a lot this week, Just, I guess, announcements. ⁓ Man, please, please like, share, subscribe, ⁓ continue to interact. Let us know what y'all want, man. If y'all want us to introduce us to show every episode at the beginning, let us know. If you listen this long, thank you, first and foremost. We appreciate you. ⁓ And we have some things on the way, man. Let us know. what type of perspectives you want, some people you might be interested to hearing from, know, people in industries. Like we're working on a lot, man. We're expanding, so I'm not going to speak on it too much, but we got a lot coming for you guys. ⁓ And also anybody out there who has suggestions, you know, meaningful criticism, you want to see us partner with your favorite brand, you know, you got some connects. ⁓ Let us know and I gotta say this one. out my boy Xavier, Xavier Odom. ⁓ If you guys don't know, look him up on IG, ⁓ tap in. He's gonna be on Netflix show next month. Temptation Island ⁓ for all my people out there who like reality TV. All them things, look, tune in man. Good dude. Excuse me, also your plug for Wild Chips. I'm cutting that out. Also your plug for Wild Chips, ⁓ Chomps, Protein. Tap in. This is not a paid promotion. malcolm: Yeah. Yeah, man. Appreciate y'all. out Xavier, bro. Cool dude, man. Really smart guy. Like I said, we appreciate everybody that tap in, tune in. Yeah, like I said, we got some stuff cooking up, Hopefully, you can announce soon. We still kind of work through some of the kinks and logistics. But as always, we appreciate y'all tuning in. Appreciate y'all, anybody that's supporting us, spreading the word, sharing our content, our platform, anybody. We appreciate it in a long way, for sure. Pause. Yeah, OD pause. But yeah, love y'all man. And we will catch y'all next week on the next episode of Black Box Theory podcast. South of the mud man. Love y'all for sure. Okay.