Latest / Breaking Points with Krystal and Saagar / 6/15/26: Anthropic Model Banned, AI Crash Incoming, Eric Trump UFC Scandal, WH Panic Over Situation Room Leak

Transcript

6/15/26: Anthropic Model Banned, AI Crash Incoming, Eric Trump UFC Scandal, WH Panic Over Situation Room Leak · Breaking Points with Krystal and Saagar

0:00
Speaker 1: Hey, guys, Saga and Crystal here.
0:01
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0:34
Speaker 2: So turning now to some significant developments with regard to AI,
0:37
Speaker 2: Anthropic had recently released a new very powerful model to
0:42
Speaker 2: the public called Fable five. This was based on Mythos,
0:46
Speaker 2: which had been able to so successfully identify cybersecurity issues
0:51
Speaker 2: that they were fearful of releasing it to the public
0:53
Speaker 2: and did not do so.
0:54
Speaker 4: So.
0:55
Speaker 2: Fable five was supposed to be Mythos with safety guardrails
0:58
Speaker 2: attached that it would be safe or safer for public consumption.
1:03
Speaker 2: That has now been pulled back from the public due
1:05
Speaker 2: to a government directive. Let's go ahead and put this
1:08
Speaker 2: announcement from Anthropic up on the screen where they talk
1:11
Speaker 2: about what happened. They say, the US government, citing national
1:15
Speaker 2: security authorities, has issued an export control directive to suspend
1:19
Speaker 2: all access to Fable five and Mythos five by any
1:24
Speaker 2: foreign national weather inside a outside the United States, including
1:27
Speaker 2: foreign national Anthropic employees. The net effect of this order
1:30
Speaker 2: is that we must abruptly disable Fable five and Mythos
1:33
Speaker 2: five for all our customers to ensure compliance. Access to
1:36
Speaker 2: all other claud models is not affected. We apologize for
1:40
Speaker 2: this disruption to our customers who believe this is a misunderstanding,
1:43
Speaker 2: and are working to restore access as soon as possible.
1:46
Speaker 2: They link here in this tweet to a further explanation,
1:49
Speaker 2: and I want to read a little bit from this
1:51
Speaker 2: blog post. They claim that they had worked very closely
1:55
Speaker 2: with the government to make sure that this release was
1:58
Speaker 2: ready to go and did safety test staying in conjunction
2:01
Speaker 2: with the government. They say they have instituted strong safeguards
2:04
Speaker 2: that are so strong some users had complained about things
2:07
Speaker 2: that they were unable to do, that they were overly broad.
2:10
Speaker 2: They talk about the way that they had internal teams
2:14
Speaker 2: to red team Fable safeguards for thousands of hours in total.
2:17
Speaker 2: They found that those tests revealed that the fable safeguards
2:22
Speaker 2: were substantially more effective than those of any previously deployed
2:26
Speaker 2: Model NO testers. And this is a key point. Have
2:28
Speaker 2: yet been able to find a quote universal jail break
2:32
Speaker 2: that means a jail break method that can vary broadly
2:35
Speaker 2: bypass the models safeguards unblocking a wide range of cyber capabilities.
2:40
Speaker 2: And they go on to say that they do not
2:42
Speaker 2: believe that there is an ability to have a perfect
2:45
Speaker 2: jail break resistance, and that that is not present in
2:48
Speaker 2: any of the other on the market models.
2:51
Speaker 5: So they are sort of pointing.
2:53
Speaker 2: To the fact they see themselves as unfairly singled out
2:56
Speaker 2: here for scrutiny, which I, you know, tend to agree with.
3:00
Speaker 2: I think there is no doubt that Anthropics had a
3:03
Speaker 2: dicey relationship with the President because they have refused to
3:07
Speaker 2: bend the knee in quite the same way as the
3:08
Speaker 2: other frontier AI companies. Let's go ahead and put this
3:12
Speaker 2: reporting up from the Wall Street Journal about sort of
3:14
Speaker 2: the government side of the story and the behind the
3:17
Speaker 2: scenes of what happened here. So, according to The Wall
3:19
Speaker 2: Street Journal, Amazon's CEO actually triggered this crackdown. They say
3:25
Speaker 2: the Trump Administration's decision to hold all foreign use of
3:28
Speaker 2: anthropics most capable AI models was prompted by conversations between
3:32
Speaker 2: Amazon dot Com CEO Andy Jase and US officials. Researchers
3:36
Speaker 2: at Amazon had used a series of prompts to get
3:39
Speaker 2: anthropics fable five model to provide them with information that
3:42
Speaker 2: could be used to aid cyber attacks and was supposed
3:45
Speaker 2: to be off limits.
3:46
Speaker 5: Jase told officials.
3:47
Speaker 2: Tech industry executives have been in regular touch with the
3:50
Speaker 2: administration about the power of cutting AAI tools. Shortly afterward,
3:54
Speaker 2: White House officials held a meeting to discuss how to respond,
3:56
Speaker 2: and security researchers began testing Amazon's claims, asked Anthropic to
4:01
Speaker 2: fix the vulnerabilities or take down the model, according to
4:04
Speaker 2: administration officials, and then finally they decided that the most
4:07
Speaker 2: direct way to address the risk was to sign off
4:10
Speaker 2: on this order that would prevent foreign governments, companies, and
4:13
Speaker 2: individuals from accessing the tool. That basically meant that Anthropic
4:17
Speaker 2: would have to pull the tool because many of their
4:20
Speaker 2: own employees would fall under the restrictions from this government
4:25
Speaker 2: national security order, there would be no way for them
4:28
Speaker 2: to guarantee that their entire user base was you know,
4:32
Speaker 2: was free from foreign nationals or from foreign governments accessing
4:36
Speaker 2: the tool. So that's why they pulled it from the
4:38
Speaker 2: market after having just been out a number of days.
4:41
Speaker 2: You know, we only got to barely see and test
4:44
Speaker 2: out Fable five before it was pulled from the market.
4:47
Speaker 2: I mean, say, there's a lot going on here. Obviously,
4:49
Speaker 2: I want the government to be much more involved in
4:52
Speaker 2: regulating all of these products. I think there needs to be.
4:54
Speaker 2: And by the way, that is Anthropics position as well.
4:57
Speaker 2: They have been pushing for a comperhen sensive safety and
5:01
Speaker 2: testing regime within the federal government that's done in a
5:06
Speaker 2: you know, neutral as neutral as possible sort of way,
5:09
Speaker 2: where there are benchmarks that you're expected to hit. You
5:11
Speaker 2: have to prove that this is safe enough to go
5:14
Speaker 2: out to the public. But it's also really clear here
5:17
Speaker 2: that what is going on is, you know, Dario Amadae,
5:21
Speaker 2: who is the head of Anthropic, is not one of
5:24
Speaker 2: the Trump regimes favored oligarchs. If it was Elon Musk
5:28
Speaker 2: who had a similarly risky product, which I mean it
5:32
Speaker 2: may be similarly risky.
5:33
Speaker 5: I don't really know.
5:35
Speaker 2: Or Sam Altman, who has similarly bent the need to Trump,
5:38
Speaker 2: then I don't think they would have run into this
5:40
Speaker 2: same trouble. But because Dario is on the ounce, you know,
5:44
Speaker 2: this is all filtered through a political lens, and that's
5:47
Speaker 2: why the crackdown happens in this very piecemeal way where
5:50
Speaker 2: it's this one model that is singled out for scrutiny
5:54
Speaker 2: over you know, some sort of blanket testing regime that
5:57
Speaker 2: would apply to everyone.
5:58
Speaker 3: I'm kind of with you. I think all of that
6:00
Speaker 3: be true. I still think it's a good thing. I mean,
6:02
Speaker 3: let's zoom out, like at the end of the day,
6:05
Speaker 3: it did come from Andy Jassey and from Amazon who
6:07
Speaker 3: claimed that they were able to create that jail break
6:10
Speaker 3: which they saw and called the Secretary of the Treasury,
6:13
Speaker 3: and we're genuinely concerned about it. Now, let's be honest.
6:16
Speaker 3: Can Amazon truly be a real interlocutor here around jail
6:21
Speaker 3: break and Anthropic and the recreation which Anthropic itself says
6:25
Speaker 3: has not been able to was the term is a
6:28
Speaker 3: full jail break. However, jail break. But let's think about this,
6:31
Speaker 3: how can we really trust the word of anthropic. Of course,
6:34
Speaker 3: they don't want to admit or to say that there's
6:37
Speaker 3: not some way to create universal jail break. They need
6:40
Speaker 3: to recoup all the costs to justify their one trillion
6:43
Speaker 3: dollar valuation as they go for IPO, which will undoubtedly
6:47
Speaker 3: be one of the biggest IPOs in modern history. So
6:50
Speaker 3: there's a lot of incentive self regulation itself, as even
6:53
Speaker 3: anthropic admits, is not a sustainable method. Now, remember they
6:58
Speaker 3: have also claimed, I believe that we have this c
7:00
Speaker 3: five let's put it up here on the screen. They
7:02
Speaker 3: have urged a global pause on all AI development for
7:06
Speaker 3: quote self improvement risk. This is when the AIS are
7:09
Speaker 3: able to train the other AIS. Now there's a couple
7:13
Speaker 3: of things going on here. Are they doing it because
7:16
Speaker 3: they are genuinely concerned, possibly maybe partially? Are they doing
7:20
Speaker 3: it because they have one of the best flagship models
7:23
Speaker 3: and they want to stop their competitors from being able
7:25
Speaker 3: to compete with them as they go IPO and to
7:27
Speaker 3: become too big to fail and captured by regulatory capture
7:31
Speaker 3: or create some sort of mote by regulatory capture. I
7:33
Speaker 3: think that both are true, and in the same way
7:37
Speaker 3: that a lot of people were concerned about Trump taking
7:39
Speaker 3: steaks in Intel or taking stakes in the Nvidia export deal, or.
7:45
Speaker 1: Any of this. I look at it as the same.
7:46
Speaker 1: I think the precedent is important.
7:47
Speaker 3: I agree Trump tardation is age old for this administration.
7:52
Speaker 3: Are they doing it one hundred percent for good reason?
7:55
Speaker 3: Probably not, although the circumstances, at least so far as
8:00
Speaker 3: if it was somewhat justified, and if anything should be
8:02
Speaker 3: done to all of the different models. However, this is
8:06
Speaker 3: exactly what the AI development should be going through. It
8:10
Speaker 3: should be treated exactly the same way, like how is
8:13
Speaker 3: it that you have to jump through two hundred million
8:16
Speaker 3: dollars of testing FDA approval to release a drug, even
8:20
Speaker 3: for a drug that will apply to a very specialized population,
8:25
Speaker 3: for like a single disease. But you can release what
8:28
Speaker 3: the developers say is a technology akin to a nuclear
8:32
Speaker 3: weapon with zero scrutiny whatsoever. And it's only on the
8:37
Speaker 3: back end whenever somebody discovers like a potential risk to
8:41
Speaker 3: the entire Oh, I don't know global infrastructure and global
8:44
Speaker 3: economy that the government should step in, So if anything,
8:46
Speaker 3: it should be far proceding what is all happening here.
8:50
Speaker 1: And you know, last thing, I've seen all these people.
8:51
Speaker 3: Like, oh, this is gonna stop US competitive edge against China.
8:56
Speaker 3: I'm like, uh, this is literally how China runs its
8:58
Speaker 3: entire economy. Just so people know, if anything, they do
9:00
Speaker 3: it a hell of a lot more competently than what
9:03
Speaker 3: we're watching before all of us. So I don't know
9:06
Speaker 3: this entire theory that this will hamstring US development or
9:11
Speaker 3: USAI edge.
9:12
Speaker 1: I don't believe that for a second.
9:15
Speaker 3: And if anything, I think it needs to be much
9:17
Speaker 3: more like we live in a democracy. These people keep
9:20
Speaker 3: saying this will be the most revolutionary technology literally of
9:23
Speaker 3: all time. It cannot be allowed to just simply be
9:27
Speaker 3: released for everybody, or to be released for everybody with
9:33
Speaker 3: no scrutiny, And if anything, we need to make it
9:36
Speaker 3: much more akin to like drug approval than we.
9:38
Speaker 1: Do with any of the bs that's happening right now. Yeah.
9:41
Speaker 2: Absolutely, but let's also be clear that's not what we're
9:43
Speaker 2: getting here, and I know you're not saying that it is.
9:45
Speaker 2: I mean, this is what anthropics said. They said, as
9:47
Speaker 2: we've stated publicly, believe that the government should have the
9:50
Speaker 2: ability to block unsafe deployments as part of a statutory
9:53
Speaker 2: process that is transparent fair, clear and grounded and technical facts.
9:56
Speaker 2: This action does not adhere to those principles. It's hard
9:59
Speaker 2: to just agree with that. I mean again, if you
10:02
Speaker 2: had Sam Altman with a similarly risky release, which I
10:05
Speaker 2: can't honestly say that, you know, chat GPT's latest model
10:08
Speaker 2: isn't similarly risky. Although I think Mythos was the most advanced.
10:12
Speaker 2: I think Anthropic does seem to be sort of leading
10:15
Speaker 2: in terms of where their models are at this point.
10:18
Speaker 2: But there's no way that Trump would have rained them in.
10:20
Speaker 2: It's worth adding to the conversation the fact that he
10:23
Speaker 2: had there was an executive order that was being prepared
10:27
Speaker 2: that would have implemented some sort of across the board
10:32
Speaker 2: broad based safety approach, at least some minimal safeguards, which is,
10:37
Speaker 2: you know, what we had under the Biden administration was
10:39
Speaker 2: some minimal but across the board safeguards. And it got
10:44
Speaker 2: spiked and reportedly it was David Sachs, who we can
10:47
Speaker 2: put his comments here C four up on the screen.
10:50
Speaker 2: It was reportedly David Sachs, Oh, no, no, no, you
10:53
Speaker 2: can't do this. Why because of China competitiveness, blah blah blah. Well,
10:57
Speaker 2: Kerry is justifying the takedown just of fable. He says
11:03
Speaker 2: that you know that effectively this was too dangerous and
11:07
Speaker 2: that you know this was based on some real process
11:10
Speaker 2: and not just based on the politics of the situation,
11:13
Speaker 2: says those trying to misdirect and tie this action to
11:15
Speaker 2: the prior dow Anthropic issues are wrong. The Admin values
11:19
Speaker 2: Anthropics technical capabilities feels that this issue, while series, should
11:23
Speaker 2: be easily resolved the balls in Anthropics court. So in
11:25
Speaker 2: any case, you know, very inconsistent here that sacks when
11:29
Speaker 2: it comes to safety guard rails across the board. Oh no, no, no,
11:32
Speaker 2: we can't have that. But in this one off instance.
11:35
Speaker 2: And then you also have Pete Hegseth, who just came
11:37
Speaker 2: out directly and was celebrating the fact that Anthropic was
11:42
Speaker 2: having its you know, its sales clips. Here he says,
11:46
Speaker 2: three months ago, Department of War kicked Anthropic AI out
11:49
Speaker 2: of our building forever every passing day proves why that
11:53
Speaker 2: was the right move.
11:54
Speaker 5: And a little flag emoji.
11:55
Speaker 2: It also has a community note on it that says
11:57
Speaker 2: the official statement is not accurate or truthful.
11:59
Speaker 5: The dood you didn't kick out Anthropic forever.
12:01
Speaker 2: They invited Anthropic back when they launched them at those
12:03
Speaker 2: model They even continue to use with those in high
12:06
Speaker 2: stakes military ops. But in any case, you know, I
12:09
Speaker 2: think you're right. The precedent of the government being able
12:14
Speaker 2: to come in and say this is too dangerous, we
12:16
Speaker 2: need to not do this is positive. The precedent of
12:19
Speaker 2: the government picking and choosing among their favorite oligarchs who
12:22
Speaker 2: is allowed to, you know, pursue this level of risk
12:27
Speaker 2: is a real problem and a real failing of what
12:30
Speaker 2: we've got going on right now, you know, zooming out.
12:32
Speaker 2: You mentioned the fact that Anthropic called for this global
12:36
Speaker 2: pause in AI development and your right to flag. You know,
12:40
Speaker 2: the potential self interested motives there of Anthropic feeling like
12:44
Speaker 2: they've got a lead and then that would allow them
12:46
Speaker 2: for some time to lock in that lead.
12:48
Speaker 5: I think you have to look at that.
12:50
Speaker 2: But I do also think that they are genuinely on
12:54
Speaker 2: the cusp of what's called recursive self improvement. The reason
12:58
Speaker 2: that matters is because the expectation is that once these
13:04
Speaker 2: models are able to train themselves, so you have the
13:08
Speaker 2: most advanced model training a new more advanced model, and
13:11
Speaker 2: on and on and on, where human beings aren't really
13:15
Speaker 2: required anymore. And this can go for twenty four hours
13:17
Speaker 2: a day and you know, experience exponential explosion of growth
13:23
Speaker 2: and capability that we could really be on the precipice
13:27
Speaker 2: of something that is quite different than the already extraordinary
13:30
Speaker 2: capability that Mythos and Fable five and the other leading
13:34
Speaker 2: frontier models have. You know, the expectation is that once
13:38
Speaker 2: you get to that recursive self improvement, that you can
13:42
Speaker 2: have an intelligence explosion that would lead not only to AGI,
13:46
Speaker 2: which is artificial general intelligence, which means the models can
13:49
Speaker 2: do basically every human cognitive task as well as a
13:52
Speaker 2: human that you could quickly speed run that to super intelligence,
13:56
Speaker 2: where they can do you know, genius level, they can
13:59
Speaker 2: fu or surpass even the smartest human in all cognitive fields.
14:05
Speaker 2: We don't know what it's like to live in a
14:07
Speaker 2: world where we are no longer the you know, peak
14:10
Speaker 2: of cognitive abilities, and there is basically no one who
14:16
Speaker 2: believes we have done the cognitive work required to anticipate
14:20
Speaker 2: all of the dangers and risks of creating such a
14:24
Speaker 2: model you know, could create. So I think that is
14:28
Speaker 2: I think that is should be making people very nervous
14:30
Speaker 2: and sagara. I know you played a little bit with
14:32
Speaker 2: Fable five I did as well before it got pulled.
14:35
Speaker 2: I don't use it nearly as extensively as people who
14:37
Speaker 2: are like coding things with it, you know, you know,
14:39
Speaker 2: I just did some queries with let me get a
14:41
Speaker 2: feel for this thing. Doesn't feel different than the other
14:43
Speaker 2: Claude models, And even just with a few sort of
14:46
Speaker 2: basic analyses and queries, you could tell it was a
14:50
Speaker 2: significant leap forward from you know, the previous Claude model,
14:55
Speaker 2: which already.
14:56
Speaker 5: Was quite advanced.
14:58
Speaker 2: So I do think we may be on the precipice
15:01
Speaker 2: of something here that could be quite transformational. And I
15:05
Speaker 2: don't necessarily say that in a good way.
15:06
Speaker 1: Yeah, I don't know.
15:08
Speaker 3: I genuinely don't know how to separate the hype from
15:11
Speaker 3: the reality, and especially with so much That's part of
15:14
Speaker 3: why I'm celebrating the decision regardless, I understand is that
15:17
Speaker 3: at the end of the day, you cannot be allowed
15:20
Speaker 3: to just do this with multi billions of dollars that
15:23
Speaker 3: are all at stake purely just you know, the free
15:26
Speaker 3: free market engine which is behind it with no overside,
15:31
Speaker 3: Like you know, it's like we have to start genuinely
15:34
Speaker 3: taking control like the economy, the economy, the rules of
15:37
Speaker 3: the economy.
15:38
Speaker 1: Are written by us by law.
15:40
Speaker 3: Now, I know that's extremely naive and reductive, but it is,
15:43
Speaker 3: you know, at some basic level true. So we have
15:46
Speaker 3: to take some level of control over it. From the
15:48
Speaker 3: data center issue here to the models. The Silicon Valley
15:51
Speaker 3: people will hate it. I don't care. They're all saying
15:53
Speaker 3: that it's going to take our edge away from China.
15:55
Speaker 3: And sorry, actually China has proven that the open technological
15:59
Speaker 3: era actually was a disaster I think for the United States,
16:03
Speaker 3: and that their choice to have closed and intentional development
16:06
Speaker 3: has actually propelled their society forward while ours is going down.
16:11
Speaker 3: And so I think that that model is genuinely the
16:13
Speaker 3: only The managerial model, which to some extent the United
16:17
Speaker 3: States has kind of always had, is genuinely the only
16:20
Speaker 3: way that we will come out of this at least
16:22
Speaker 3: somewhat unscathed, or at least with some place of a you,
16:26
Speaker 3: of a human or at least a democratic input into
16:29
Speaker 3: what our society is going to look like like, we
16:31
Speaker 3: get to have a choice. It's not just up to
16:33
Speaker 3: Dario and Sam Almon. So anyway, why don't we bring
16:36
Speaker 3: in ed Zatrone. He has a very differing view on
16:39
Speaker 3: the reality of AI. I'm sure I'll have a very
16:42
Speaker 3: interesting take here on this and on SpaceX.
16:44
Speaker 1: Let's get to it.
16:47
Speaker 2: For more on the entire AI landscape, including his views
16:51
Speaker 2: on Anthropic and the new spacexipo elon must becoming the
16:55
Speaker 2: world's first trillionaire. We're very fortunate to have joining us
16:58
Speaker 2: this morning.
16:59
Speaker 6: Ads A.
16:59
Speaker 2: Trone is a fantastic journalist has been sounding the alarm
17:02
Speaker 2: about what he sees as a massive AI bubble and
17:05
Speaker 2: his host of the Better Offline podcast.
17:08
Speaker 5: Welcome to the show. I'd great to have you.
17:09
Speaker 1: Good as team man.
17:10
Speaker 4: Thanks for having me.
17:11
Speaker 5: Yeah, our pleasure.
17:12
Speaker 2: So we were just discussing the forced basically pulling of
17:16
Speaker 2: Fable five, which is Anthropics latest model based on Mythos,
17:21
Speaker 2: which they themselves saw as of too dangerous to release
17:24
Speaker 2: to the public. Fable five was meant to be Mythos
17:28
Speaker 2: with some guardrails put in place. Apparently the Amazon CEO
17:32
Speaker 2: went to the Trump administration and said, oh, we figured
17:34
Speaker 2: out some ways to jail break this, you should pull
17:35
Speaker 2: it from the public, and through a national security directive
17:39
Speaker 2: they effectuated that outcome. Wonder what you make of this
17:42
Speaker 2: whole chain of events and what it says about where
17:45
Speaker 2: AI development is at this point.
17:47
Speaker 6: So I think the thing to be very clear about
17:50
Speaker 6: is the Fiber five Mythos five. They are still large
17:53
Speaker 6: language models, no matter how much you gloss them up
17:56
Speaker 6: by saying, oh, they're too scary to release. Probably a
17:59
Speaker 6: good signed that they weren't too scary to release is
18:02
Speaker 6: the fact that Anthropic released them. But before Fable five
18:06
Speaker 6: came out, Mythos itself had already been spread to one
18:08
Speaker 6: hundred and fifty organizations in fifteen countries. So let's start there.
18:13
Speaker 6: Any who, it turns out that spending several years selling
18:17
Speaker 6: AI based on fear and saying your stuff is too
18:19
Speaker 6: powerful and you're scared of it, saying it's mysterious and unsettling,
18:24
Speaker 6: someone's going.
18:25
Speaker 4: To believe you.
18:26
Speaker 6: Now, I would argue that this is obviously political. They
18:31
Speaker 6: pissed off Hegzeth, they've pissed off the government. But it
18:34
Speaker 6: also they're refusing to fix the issue. They're refusing to
18:38
Speaker 6: actually fix the part of Fable five that allows you
18:41
Speaker 6: to make it mythos esque. That seems to be the
18:44
Speaker 6: long and short of it. But they're also not kissing
18:46
Speaker 6: up to the trumpadmen, which is bully for them. I guess.
18:50
Speaker 6: But it's funny because this company sells itself as the
18:52
Speaker 6: safety minded organization. They don't fix the safety aspect here,
18:56
Speaker 6: or they claim the guardrails are fire and everyone's having
18:59
Speaker 6: too too big a hissy fit about this. But the
19:02
Speaker 6: other thing is ananthropic keeps trying to pretend it's this
19:06
Speaker 6: anti government or at least pro democracy thing. But they
19:09
Speaker 6: were used in the war in Iran. They've been working
19:11
Speaker 6: with the Pentagon for two years. They've just they tried
19:15
Speaker 6: politicking a little too close to the sun for my reckoning.
19:18
Speaker 3: And you know, that's one of the things we wanted
19:20
Speaker 3: to talk to you about, is we just laid out
19:22
Speaker 3: you know, Crystal and I maybe are a little bit
19:24
Speaker 3: more believers that AI. You know, may it's the promises
19:27
Speaker 3: of the technology might be real, but we want to
19:29
Speaker 3: know let you lay out your baar case. I've listened
19:31
Speaker 3: to quite a bit of your content. You really believe
19:34
Speaker 3: that LMS and AI itself don't develop good code, they
19:38
Speaker 3: don't develop good technology, and that much of this is
19:41
Speaker 3: based on hype. Why don't you just lay out that
19:43
Speaker 3: case and we can interrogate it a little bit.
19:45
Speaker 6: So last few years, lllm's have been framed as something
19:49
Speaker 6: they are not. They are not autonomous technology. Pretty much
19:52
Speaker 6: everything you use with a LLM is if it can
19:55
Speaker 6: do anything, it is having to use some deterministic scripts
19:58
Speaker 6: just to knock it into PLA. But LM's hallucinate, it's
20:02
Speaker 6: mathematically guaranteed. Open AI themselves said this that lms will
20:06
Speaker 6: always hallucinate. Now, when that's a fact based thing, they
20:09
Speaker 6: might authoritatively state something that's wrong. When it's code, they
20:12
Speaker 6: will just coded poorly. They will they will leave security
20:16
Speaker 6: doors wide open. It will not be stable or functional code,
20:19
Speaker 6: or if it functions, it will not be easy to
20:21
Speaker 6: update for someone in the future. Lms are a technology
20:24
Speaker 6: that works in some ways for code, but they have
20:26
Speaker 6: been oversold as this kind of panacea for all that
20:29
Speaker 6: ails the tech industry. They are the new software as
20:32
Speaker 6: a service. They're then you consumer software that in new search, thedy,
20:35
Speaker 6: you this, that, and the other. In reality, llms are
20:38
Speaker 6: inherently limited. They can only do so much. Coding is
20:42
Speaker 6: the thing that they can do to an extent. But
20:44
Speaker 6: when you add what the truth is under the hood
20:47
Speaker 6: is that these services are extremely unprofitable to run, incredibly so,
20:52
Speaker 6: which means that I think when we eventually know the
20:55
Speaker 6: whole cost, when we see the s ones, when someone
20:57
Speaker 6: leaks the financials somewhere I don't know who that would be,
21:00
Speaker 6: you will see that these companies are spending probably the
21:03
Speaker 6: equivalent of just hiring a person to make a mediocre
21:08
Speaker 6: copy and barely functioning copy in many cases, of what
21:12
Speaker 6: a human being could do, specifically in code, because everywhere else,
21:15
Speaker 6: alms don't replace people. They don't even replace some as
21:19
Speaker 6: code as because there's much more software engineering than just code.
21:22
Speaker 6: Oh no, long story, short is that look at the
21:27
Speaker 6: way that these things have been marketed for the last
21:29
Speaker 6: three years and tell me does this sound Does the
21:32
Speaker 6: thing that's been marketed match up with what they can
21:34
Speaker 6: actually do? And the answer is no, because if they
21:36
Speaker 6: actually just talk to what they could do, they would
21:38
Speaker 6: have to admit that AI is relatively normal, boring and
21:42
Speaker 6: extremely unsustainable and unprofitable software.
21:46
Speaker 2: So I think what they would say is that AI
21:48
Speaker 2: cannot do all the things that have been promised yet,
21:53
Speaker 2: but we do see. I mean, this is a genuine
21:55
Speaker 2: progression in terms of technological capability and far from you know,
22:00
Speaker 2: the people who have used this to like code extensively
22:03
Speaker 2: to be deep in the details of what it can
22:04
Speaker 2: do and what it can't do. Certainly it hallucinates. All
22:07
Speaker 2: those of the hallucinations have been diminished. But it's very
22:10
Speaker 2: able to go in and do a lot of what is,
22:13
Speaker 2: you know, entry level type work, spreadsheet jockeying type work,
22:17
Speaker 2: take a big data set, analyze it, put it in
22:21
Speaker 2: some sort of comprehensible format. It does that relatively well.
22:24
Speaker 2: It obviously does the coding relatively well. We're now getting
22:27
Speaker 2: into the era of agentic AI that can actually go
22:30
Speaker 2: out and do stuff in the world.
22:32
Speaker 6: You know.
22:32
Speaker 2: The proponents argue that that is a significant development forward.
22:36
Speaker 2: And then in terms of just sort of regurgitating pre
22:38
Speaker 2: existing human knowledge, you did recently have AI solve, for example,
22:43
Speaker 2: a mathematical problem that humans had been unable to solve
22:46
Speaker 2: and trying to solve for eighty years. So I do
22:50
Speaker 2: think that there is some significant technological progress here that
22:53
Speaker 2: may not live up to all the hype of We're
22:55
Speaker 2: going to replace every human you know, all human endeavors
22:57
Speaker 2: in all human labor within the next five years, but
23:00
Speaker 2: certainly seems that it will be disruptive, and as already
23:04
Speaker 2: being disruptive in some significant ways.
23:06
Speaker 6: I'm going to start the beginning of that. The spreadsheet
23:09
Speaker 6: jockeying doesn't always work. It's actually quite unreliable with financial
23:13
Speaker 6: models regularly. I have tried this because I wanted to
23:17
Speaker 6: make sure that that was the case. They will hallucinate
23:19
Speaker 6: cells that are not there. They will spit out stuff
23:21
Speaker 6: that just involves data you didn't enter. Sure it might
23:24
Speaker 6: work at some point in some way, but what use
23:28
Speaker 6: is that if you end up building a financial model
23:30
Speaker 6: that you rely upon with coding as well, it can
23:32
Speaker 6: do that very well. Meaning what because across all of
23:37
Speaker 6: these organizations right now, everyone in the large enterprise space
23:41
Speaker 6: is having to pay token based billings. So the actual
23:43
Speaker 6: cost of AI, and so with all of those AI
23:46
Speaker 6: services written by LLN code all this time, no one
23:52
Speaker 6: has been able to actually measure whether that's good or not,
23:55
Speaker 6: whether that's I don't know, actually resulting in better software
23:59
Speaker 6: shipping of Uber. Andrew McDonald said that they could it
24:03
Speaker 6: was getting harder to justify the costs because of the
24:06
Speaker 6: actual outputs not resulting in better software, faster shipped software,
24:10
Speaker 6: and so on and so forth, and also agentic coding
24:13
Speaker 6: going out and doing stuff. I'm this is not an
24:16
Speaker 6: attack I'm just saying, what does that actually mean? What
24:19
Speaker 6: do they go out and do? Because while there might
24:21
Speaker 6: be some software engineering task that they might be able
24:24
Speaker 6: to do, and that is a load bearing mate there
24:26
Speaker 6: that hallucination within that process would break a lot of things.
24:31
Speaker 6: And also code written without intention is increasingly harder to
24:34
Speaker 6: work on as organizations work on this. Now, these big jumps,
24:40
Speaker 6: the ERDOS problem you're discussing as well. I'm not super
24:45
Speaker 6: read up on mathematics and I can do them myself,
24:48
Speaker 6: but my general sense there is no one has been
24:52
Speaker 6: able to explain why that is a big breakthrough, indeed
24:55
Speaker 6: what the outcome is from that, which is the larger
24:57
Speaker 6: problem with LMS. The very bench these things are trained
25:01
Speaker 6: on are specifically made for LMS because MS can't really
25:05
Speaker 6: do human stuff. They can't do jobs, So we have to,
25:09
Speaker 6: like a gifted child, coddl them and find a way
25:12
Speaker 6: to measure them that matches their skill set. The thing is,
25:16
Speaker 6: three years in, we still can't measure the are a
25:19
Speaker 6: wi of our AI. We still can't point and say wow,
25:22
Speaker 6: it's done all this stuff and the outcome is this.
25:26
Speaker 6: So again people are saying, oh it's dark outputs. Oh
25:29
Speaker 6: there are other measurements we can use. Why And it's
25:32
Speaker 6: because like our society at the moment, we must coddle
25:36
Speaker 6: the mediocre and the expensive to pray at the foot
25:39
Speaker 6: of capitalism.
25:40
Speaker 5: Yeah, so whant me ask you?
25:42
Speaker 2: I just want to ask you on the financial piece
25:44
Speaker 2: of this because I just interviewed another journalist has a
25:47
Speaker 2: different view of this, of the economic aspect, Garrison Lovely
25:51
Speaker 2: last week, and his contention is that the actually each
25:55
Speaker 2: individual model, if taken on its own, is profitable. That
26:01
Speaker 2: the revenue of for example, open Ai and Anthropic has
26:05
Speaker 2: skyrocket in a very short period of time. Now they
26:08
Speaker 2: are not net profitable because of the amount of money
26:11
Speaker 2: that they plow into training new models, and that when
26:15
Speaker 2: you take that into account, that they are not profitable.
26:17
Speaker 2: But if you just look at any individual model to
26:20
Speaker 2: run and the user base they've been able to acquire
26:23
Speaker 2: that they actually are quite profitable and do have an
26:25
Speaker 2: economic business model that makes sense, at least in the
26:28
Speaker 2: near term.
26:29
Speaker 5: So what is your response to that view?
26:32
Speaker 6: If my grandmother had wheel should be a bicycle. Yeah,
26:35
Speaker 6: if you remove the costs, they're profitable. That's that's not
26:40
Speaker 6: generally how businesses work. Also, we're moving.
26:42
Speaker 2: The cost of training. The next model is the IDA here.
26:46
Speaker 1: So if you're just if you never.
26:48
Speaker 2: Stopped it the existing model and had the user base
26:52
Speaker 2: you have, that they would actually be profitable today.
26:54
Speaker 5: But it's that investment in.
26:56
Speaker 2: The research for the future that leads to that picture
27:00
Speaker 2: that you're presenting.
27:01
Speaker 6: So let's start at the beginning, which is no, I
27:04
Speaker 6: actually don't think they're profitable when you remove training. I
27:07
Speaker 6: think when you have sales and marketing, when you have
27:09
Speaker 6: all the other costs, I think you'll find the open
27:12
Speaker 6: AI and Anthropic are not profitable with training at removed. Also,
27:16
Speaker 6: and they.
27:17
Speaker 5: Sink they're not public.
27:18
Speaker 2: We don't have a total complete financial picture, which I
27:21
Speaker 2: think is important that to this conversation.
27:23
Speaker 6: Yeah, sure, but really key point here though, training is
27:29
Speaker 6: not just pre training. Training is not just feeding stuff
27:32
Speaker 6: into it. They have to constantly train these models, even
27:34
Speaker 6: the ones that are out must be post trained. Because
27:37
Speaker 6: there's something called model drift, which sounds kind of sinister,
27:40
Speaker 6: but what it means is any machine learning model that
27:42
Speaker 6: is left in a vacuum will stop being able to
27:46
Speaker 6: respond to human inputs because human inputs are based on
27:49
Speaker 6: experience in the real world that is constantly changing, but
27:52
Speaker 6: AI models stay the same, so they have to continually
27:56
Speaker 6: post train them. On top of that, when they post
27:59
Speaker 6: train them, they have to specialize get specialized data, which
28:02
Speaker 6: in it also has a cost, So you're actually continually
28:06
Speaker 6: updating these models. You can't just stop training because if
28:10
Speaker 6: you do that, well, everyone will go to the one
28:12
Speaker 6: that isn't. It's kind of red Queen's race here. Everyone
28:16
Speaker 6: must keep training to keep up with each other so
28:18
Speaker 6: they can all do basically the same thing. So in
28:21
Speaker 6: the end, training is an inherent cost. Training is probably
28:25
Speaker 6: the greatest con. That word training is the greatest con
28:29
Speaker 6: because it's a word that's meant to make you. When
28:31
Speaker 6: you hear that, your brain's meant to go, oh, yeah,
28:34
Speaker 6: that's going to go away one day. Oh. They don't
28:36
Speaker 6: need to do that. No, training is essential a cost
28:40
Speaker 6: as inference, which is the creation of the outputs. So
28:44
Speaker 6: I think that the AI industry wants to have this
28:48
Speaker 6: kind of fanciful thing of just don't worry about the training.
28:51
Speaker 6: Don't worry about the training. Training is not a big deal.
28:53
Speaker 6: Training is as much part of it as any other
28:56
Speaker 6: cost of good soul. It should not be. We need
28:59
Speaker 6: financial regulation of AI companies, not for the models, but
29:03
Speaker 6: for the way that they refer to their businesses. And
29:06
Speaker 6: I think when these s ones come out, people are
29:08
Speaker 6: going to realize I'm right here. But also very simple point,
29:11
Speaker 6: when does training stop? Exactly when does that stop happening?
29:15
Speaker 6: Because until it does, until they can say with clarity,
29:18
Speaker 6: we're done training for a bit, training costs are coming down.
29:22
Speaker 6: It may as well be a cost of good soul.
29:24
Speaker 6: They want you to They want you to remove that
29:26
Speaker 6: cost because when that cost is there, they are so unprofitable.
29:30
Speaker 6: They are basically insolvent when you continue training at this scale.
29:36
Speaker 6: But they want everyone to ignore that because that's the
29:38
Speaker 6: only way for these companies to be profitable is to
29:41
Speaker 6: literally remove costs.
29:43
Speaker 3: So ed, this is where we have to loop in
29:45
Speaker 3: SpaceX because a lot of what you just laid out
29:48
Speaker 3: would apply to SpaceX. I believe that their market valuation
29:52
Speaker 3: is based on sales, not on earnings, very un traditional
29:55
Speaker 3: ways of valuing. We have D two that we can
29:58
Speaker 3: put up here on the screen. Space is now literally
30:01
Speaker 3: sixth largest US public company at its current valuation, or
30:04
Speaker 3: at least it was at market clothes. On Friday, their
30:06
Speaker 3: S one came out. We saw we saw how much
30:09
Speaker 3: money they make versus their sales. But you know, they
30:12
Speaker 3: had twenty two pages I believe, of pictures of rockets
30:15
Speaker 3: and so promises of AI and they got a two
30:17
Speaker 3: trillion dollar valuation. Why will that not apply to Anthropic
30:21
Speaker 3: and Open AI with very similar promise if anything, honestly,
30:25
Speaker 3: maybe even a better product, you know, in terms of
30:27
Speaker 3: what they're actually selling here. So does that challenge you know,
30:30
Speaker 3: their forthcoming IPOs of when we see their s ones,
30:33
Speaker 3: that it's all going to fall apart.
30:34
Speaker 1: That didn't happen to SpaceX.
30:36
Speaker 6: So not a big fan of Ela Musk personally don't
30:40
Speaker 6: like him, but he is a better salesperson than Dario
30:43
Speaker 6: amade or Sam Altman. He is also dependent on Anthropic,
30:47
Speaker 6: who is a customized they built open I'm sorry, SpaceX
30:50
Speaker 6: built this massive, massive data center with all these turbine,
30:55
Speaker 6: these horrible gas turbines, gassing local neighborhoods. But nevertheless, they
31:00
Speaker 6: all these data centers, claim they'd use them for grock
31:02
Speaker 6: AI then sold access to them for to Anthropic, turning
31:06
Speaker 6: them into one of the larger AI compute providers. Except
31:10
Speaker 6: that deal has a ninety day out and Anthropic could
31:13
Speaker 6: leave it at any time. Putting all that aside, SpaceX
31:16
Speaker 6: is like several companies stabled together. You've got Starlink Internet,
31:19
Speaker 6: You've got the rocket business, You've got the CSAM generator
31:23
Speaker 6: XAI like you've got all of these different business is
31:26
Speaker 6: hammered together. And then you have, of course, the fact
31:29
Speaker 6: that it's Musk. It's the Elon Musk industrial complex where
31:33
Speaker 6: Goldman Sachs, JP Morgan is so inherently corrupt that they
31:37
Speaker 6: just that. I think I saw one of them claiming
31:39
Speaker 6: the AI revenue would increase by three hundred x. Elon
31:43
Speaker 6: Musk is a better marketer than any of these companies.
31:45
Speaker 6: And on top of that, I think that SpaceX's losses
31:49
Speaker 6: are going to be much low, well are much lower
31:51
Speaker 6: than anything we'll see out of Open AI and Anthropic
31:54
Speaker 6: because their AI business is extremely small. Rock does not
31:58
Speaker 6: have that many customs. The biggest costs are buying these gepus.
32:02
Speaker 6: The biggest costs are the former training runs of Grok,
32:06
Speaker 6: the model. I don't even know how long they're going
32:08
Speaker 6: to stick around with Grok at this point. A lot
32:11
Speaker 6: of the people have left there. There are stories about it. Nevertheless,
32:14
Speaker 6: very different company. Don't know if you could say better
32:17
Speaker 6: or worse. We don't have the s ones yet, but
32:20
Speaker 6: I will say that it's going to be a very
32:23
Speaker 6: different story for anthropic and open AI, especially given this
32:26
Speaker 6: story around the export controls.
32:29
Speaker 2: So the other thing Elon has going for him, as
32:32
Speaker 2: you mentioned the Elon industrial complex, is how tightly tied
32:37
Speaker 2: in he is with the government, and especially this government.
32:40
Speaker 2: I mean, you know, SpaceX relies on government contracts. He
32:43
Speaker 2: obviously put quarter of a billion dollars into Trump's re
32:46
Speaker 2: election campaign. They had a falling out, but they're back
32:48
Speaker 2: together now. Unlike Dario Amide, who's clearly on the ounce
32:52
Speaker 2: as a disfavored oligarch in the economy, Elon Musk and
32:55
Speaker 2: I think Sam Altman are both favored oligarchs in Altman
32:59
Speaker 2: in particular seems to be betting explicitly on the idea
33:03
Speaker 2: that already his company and the gigantic bet this country
33:08
Speaker 2: has placed on AI development makes it too big to fail.
33:12
Speaker 2: And so I wonder if that also is a challenge
33:15
Speaker 2: for your theory that there's a bubble that'll crash at
33:17
Speaker 2: some point, simply because even if you're right about the
33:20
Speaker 2: underlying economics, the governor will say, if we allow this
33:24
Speaker 2: all to come crashing down, like this is all we've got.
33:27
Speaker 2: The rest of the economy doesn't look so great. This
33:30
Speaker 2: is where we've plowed all this cash. You know, some
33:32
Speaker 2: of our own fortunes and net worth are tied up
33:35
Speaker 2: in this thing.
33:36
Speaker 5: We got to keep it going no matter what.
33:38
Speaker 2: And then you throw on top of that the geopolitical
33:40
Speaker 2: considerations of, oh my god, we got to keep up
33:42
Speaker 2: with China, and it does create a reality where they
33:46
Speaker 2: are too big to fail and will be propped up
33:48
Speaker 2: and built out no matter what. Even if you're the
33:51
Speaker 2: rest of your economic analysis.
33:52
Speaker 6: Is correct, okay, so they're not too big to fail.
33:56
Speaker 6: Too big to fail refers to a vastly different system.
34:00
Speaker 6: Great financial crisis. People like, oh, it was the government
34:02
Speaker 6: bailouts that actually kept things together. No, it wasn't it
34:04
Speaker 6: was the repo window. It was the fact that the
34:07
Speaker 6: government basically sat there with a firehose of cash and
34:10
Speaker 6: put it into the mouths of all the finance companies
34:12
Speaker 6: of the Golden Sexes and the banks of the world.
34:14
Speaker 6: Looked like hundreds of billions of dollars, Like I think
34:17
Speaker 6: trillions of dollars just got funneled straight into the banks,
34:20
Speaker 6: even if and I don't think this would happen, open
34:23
Speaker 6: ai somehow got bailed out. Open ai is on course
34:26
Speaker 6: to burn tens of billions of dollars a year. This
34:28
Speaker 6: is already reported. Anthropic think they're probably going to be
34:32
Speaker 6: in the similar situation. Let's say you actually bailed out
34:34
Speaker 6: these companies. That won't change the fact that we need
34:38
Speaker 6: four hundred five hundred billion dollars within the neck I
34:41
Speaker 6: think by twenty thirty worth of AI compute revenue, so
34:45
Speaker 6: people renting GPUs we need in Nvidia to keep selling well,
34:50
Speaker 6: they claim that they're going to sell a trillion dollars
34:53
Speaker 6: worth of GPUs by the end of twenty twenty seven.
34:55
Speaker 6: We need those data centers to keep being built. We
34:58
Speaker 6: need all of this stuff to keep happening, whether or
35:00
Speaker 6: not open Ai and Anthropic exist, whether or not they
35:02
Speaker 6: continue to exist, but whether or not they keep alive,
35:05
Speaker 6: we need way more AI compute revenue to keep the
35:08
Speaker 6: markets going. Put aside anything I feel about open Ai
35:12
Speaker 6: and Anthropic, the markets themselves are based on the fact
35:15
Speaker 6: that in Video always sells more GPUs, that Marvel sells
35:18
Speaker 6: more memory, Sand sells more storage, the Skhyenex and Samsung
35:23
Speaker 6: continue selling RAM. These things can only happen with a
35:26
Speaker 6: near unlimited amount of money that is unrelated to open
35:30
Speaker 6: AI and ananthropic open aion aanthropic as well. They don't
35:34
Speaker 6: buy enough compute, and they buy more than anyone else
35:36
Speaker 6: in the world to sustain the semiconductor rally that is
35:40
Speaker 6: actually holding up the markets. The markets are not held
35:43
Speaker 6: up on AI revenues. None of this is. It's held
35:46
Speaker 6: up on hype, specious hype, but also the largest infrastructural
35:51
Speaker 6: build out in history that they're claiming they're going to
35:54
Speaker 6: keep doing for years. They're going at this rate, they're
35:57
Speaker 6: going to spend five trillion dollars by the end of
35:59
Speaker 6: twenty third. No too big to fail situation changes that
36:03
Speaker 6: at all. And the thing is, here's a fun one
36:06
Speaker 6: for you. You'll like this one. Let's say open ai dies,
36:10
Speaker 6: or even open AI just has trouble and can't get
36:12
Speaker 6: seventy billion dollars a year, they will be unable to
36:15
Speaker 6: pay Oracle for the compute that mad Larry Ellison has
36:18
Speaker 6: been building. Larry Ellison needs seventy billion dollars or more
36:22
Speaker 6: for all of those Stargate data centers to actually be
36:25
Speaker 6: worth it. If that doesn't happen. The value of Oracle
36:28
Speaker 6: stock crashes and he gets margin called, and suddenly Larry
36:31
Speaker 6: Ellison isn't a billionaire anymore. Well, you might bail out Oracle,
36:34
Speaker 6: you can't bail out the price of a stock. There
36:37
Speaker 6: are so many different bits here that are not just
36:40
Speaker 6: it's too big to fail doesn't even apply because too
36:43
Speaker 6: big to fail isn't relevant here. The whole too big
36:46
Speaker 6: to fail situation in two thousand and eight was that
36:48
Speaker 6: the modern banking system was built on commercial paper loans.
36:52
Speaker 6: We don't have that here. We just have a bunch
36:54
Speaker 6: of messy people burning the most money ever on something
36:58
Speaker 6: that does not rent can sile with reality, and building
37:02
Speaker 6: hundreds of billions of dollars worth of data centers for
37:04
Speaker 6: AI compute demand that does not exist. It doesn't matter
37:09
Speaker 6: if open AI or Anthropic survives. We need two or
37:12
Speaker 6: three more anthropic and open AI sized companies on top
37:16
Speaker 6: of everything right now to substantiate the data center's being built. Okay,
37:21
Speaker 6: I also don't think they'll bail out anyone, but that's
37:23
Speaker 6: just my personal belief.
37:24
Speaker 3: Last question, then, D, So what's the logical conclusion of
37:27
Speaker 3: what you're saying? Are you short, is this going to
37:29
Speaker 3: be the greatest bust in history?
37:31
Speaker 1: What do you think?
37:33
Speaker 6: I'm not sure anything. I'm long humans and I think
37:36
Speaker 6: the I think. The thing to remember here is that
37:40
Speaker 6: this is all of a symptom of a greater problem,
37:43
Speaker 6: which is that the tech industry is out of hypergrowth ideas.
37:46
Speaker 6: There is no smartphone. There's new app, no new app store,
37:49
Speaker 6: no new cloud computing. Generative. AI was meant to be
37:53
Speaker 6: the next thing, the thing that brought Google to a
37:55
Speaker 6: ten trillion dollar market cap, the thing that was meant
37:58
Speaker 6: to replace Google Search for them or add on to
38:00
Speaker 6: Google Search. Everyone has been looking for the next big thing,
38:04
Speaker 6: the next new startup that could be worth a trillion
38:06
Speaker 6: or two trillion, or three trillion, the next generation of those.
38:10
Speaker 6: Because the tech industry has no more big ideas. Because
38:14
Speaker 6: the tech industry does not have the next smartphone, they
38:18
Speaker 6: have sunk more money than anything into this. So everything
38:21
Speaker 6: we're seeing is not coming from a place of innovation
38:24
Speaker 6: or building the future. It's a sign that the rot economy,
38:27
Speaker 6: the growth of all costs capitalist system, has finally reached
38:31
Speaker 6: kind of its end. And the way this falls apart
38:33
Speaker 6: will be gruesome because it's not just the AI bubble bursting.
38:36
Speaker 4: That's the problem.
38:37
Speaker 6: It's the fact that there's nothing left for them to sell,
38:40
Speaker 6: no new business line that could enhance their businesses. The Microsoft, Googles, Amazons,
38:45
Speaker 6: Metas of the world. They don't have a next step.
38:48
Speaker 6: And when the markets realize that, I think there will
38:50
Speaker 6: be a fundamental revaluation of the tech industry writ large,
38:53
Speaker 6: and I think venture capital may break, probably permanently.
38:57
Speaker 2: Wow, do you have a sense of do you have
38:59
Speaker 2: a guess on timing or what could trigger that that
39:03
Speaker 2: bubble pop?
39:04
Speaker 5: I know it's a very difficult question.
39:05
Speaker 6: Oh, it's gonna be It's gonna be difficult. I think
39:08
Speaker 6: that if anything comes out about say open AI or
39:11
Speaker 6: Anthropics finances in the next few months, I think that
39:13
Speaker 6: could really spook people. I think that by the end
39:16
Speaker 6: of the year is possible. It's just that their wacky
39:19
Speaker 6: stuff keeps happening. So it's hard to say. But it's
39:23
Speaker 6: hard to see this going on another year. It's just
39:26
Speaker 6: hard to see we are reaching the most ridiculous heights
39:29
Speaker 6: of this story. And I mean, it's gonna be horrible
39:32
Speaker 6: for everyone involved.
39:33
Speaker 3: Well, yeah, what's saying It's like markets can stay irrational
39:36
Speaker 3: longer than you can be solved.
39:37
Speaker 6: You could say.
39:38
Speaker 3: So let's all, let's all remember that for the retail
39:42
Speaker 3: day traders who are watching this, Ed really enjoy your perspective. Man.
39:46
Speaker 3: Just appreciate everybody goes subscribe to as YouTube channel as well.
39:50
Speaker 3: Thank you, and the newsletter and the newsletter do it all.
39:54
Speaker 5: Thank you, ED.
39:58
Speaker 2: So President Trump's big birthday party America two fifty UFC
40:03
Speaker 2: bash on the White House lawn after a rain delay,
40:06
Speaker 2: happened last night, and there's a lot to get into
40:10
Speaker 2: around it, surrounding the events, some potential attempted insider trading,
40:15
Speaker 2: the imagery of all of this, and what it means
40:18
Speaker 2: for the country. Joining us now to break down all
40:21
Speaker 2: of that is Luke Thomas, who is a combat sports
40:24
Speaker 2: analyst and also one half of the Morning Combat podcast
40:28
Speaker 2: and was up very late last night watching all of
40:31
Speaker 2: this so that we didn't have to. Luke, it's great
40:33
Speaker 2: to see you, Halud, it's great to be here, real honor.
40:35
Speaker 4: Thank you for having me of course, yeah.
40:37
Speaker 5: It's our pleasure.
40:38
Speaker 2: So I wanted to get your reaction off the top,
40:40
Speaker 2: just to sort of like the spectacle of all of this,
40:43
Speaker 2: you know, what you as someone who's a fan of
40:45
Speaker 2: these events, what you think of it, and we can
40:48
Speaker 2: throw into the mix. Put E three up on the screen.
40:50
Speaker 2: This was some of the biggest news that came out
40:52
Speaker 2: of it. The winner apparently shouted out Michelle Obama is
40:56
Speaker 2: a man in an interview with Joe Rogan right out
41:00
Speaker 2: after his victory. So tell us about that and your
41:04
Speaker 2: overall thoughts here.
41:05
Speaker 7: Well, the guy who did that is a dude by
41:07
Speaker 7: the name of Josh Hokit. He wrestled collegiately and briefly
41:10
Speaker 7: admitted to the NFL before washing out. He's a very
41:13
Speaker 7: good athlete and he's a good fighter. What's so interesting
41:16
Speaker 7: about this is I have to test tell you this
41:18
Speaker 7: is just what MMA is now. Josh Hokit had to
41:21
Speaker 7: try out, like a lot of fighters do, to be
41:22
Speaker 7: on the UFC, through this show called the Contender Series,
41:25
Speaker 7: where they essentially an audition, but you fight through the audition,
41:28
Speaker 7: and he won it, and in his post fight question
41:32
Speaker 7: and answer period he did the exact same thing. He
41:35
Speaker 7: actually said, Michelle Obama is a man. This was the
41:37
Speaker 7: whole time, and he's done several different versions of this
41:40
Speaker 7: throughout his short but I would say somewhat memorable tenure
41:44
Speaker 7: in the UFC, and what the UFC will simply say is, well,
41:46
Speaker 7: this is free speech. But this is such a nonsensical argument.
41:49
Speaker 7: It's just so crazy to me that fight promoters can
41:52
Speaker 7: tell the media this is what we believe and the
41:55
Speaker 7: media will just never question it. For example, if a
41:58
Speaker 7: fighter who is destitute wins about and you hear them
42:01
Speaker 7: afterwards say it'd be really great if I got a
42:04
Speaker 7: post fight bonus, the UFC has an informal policy that
42:07
Speaker 7: if you do that on TV, they're never going to give.
42:09
Speaker 4: You the bonus.
42:10
Speaker 7: It's actually a mistake that fighters make all the time.
42:12
Speaker 7: But isn't that supposed to be a function of free speech.
42:15
Speaker 7: It just sort of goes to show that, like the
42:17
Speaker 7: the operating way in which they treat speech is like
42:21
Speaker 7: almost I mean, it's not intentionally this way, but ends
42:24
Speaker 7: up being like de facto pro slur because they don't
42:27
Speaker 7: allow a questioning of the kinds of things that free
42:30
Speaker 7: speech would normally allow for In terms of the event itself,
42:33
Speaker 7: I'm just going to give you two perspectives and you
42:35
Speaker 7: can decide which one is the most valuable or important one.
42:38
Speaker 7: With inside the MMA bubble, I'm going to describe what
42:41
Speaker 7: we saw last night within the bubble as something approximating
42:45
Speaker 7: a home run. I think most fight fans and the
42:47
Speaker 7: fight world generally really liked what they saw, in part
42:50
Speaker 7: because the UFC put an enormous amount of effort into it.
42:53
Speaker 7: You'll recall last year when they tried this with that
42:56
Speaker 7: military parade. It fizzled and they even had a fan
43:00
Speaker 7: at the Ellipse and I was told that was a disaster.
43:02
Speaker 7: But this fan fest was super well run. So I
43:05
Speaker 7: think that inside the bubble there's just a lot of
43:07
Speaker 7: positive things to say. But I mean, naturally, as somebody
43:09
Speaker 7: who's lived in DC a long time, as somebody who
43:12
Speaker 7: cares about the ominous nature of the Trump administration. Any
43:16
Speaker 7: blending of the UFC brand with the Trump administration, and
43:20
Speaker 7: essentially as they serve now as something of like the
43:23
Speaker 7: like the propaganda sports arm of the Trump administration, these
43:27
Speaker 7: things give me a great degree of pause, to say
43:29
Speaker 7: nothing of using you know, important architecture in our Nason's
43:33
Speaker 7: history as set pieces for these kinds of events.
43:36
Speaker 3: Yeah, So, Lukele, I think that's an interesting point and
43:39
Speaker 3: one that I think you in particular have been trying
43:41
Speaker 3: to focus on ahead of this is like, this is
43:43
Speaker 3: like the apotheosis of Dana White and Donald Trump's relationship.
43:47
Speaker 3: Do you want to go into that a little bit
43:48
Speaker 3: about what this event kind of signifies to you about
43:51
Speaker 3: the two of them, about the blending of the White
43:53
Speaker 3: House and the UFC and how the two of them
43:55
Speaker 3: came together.
43:56
Speaker 4: I mean, you know what, It's kind of funny.
43:57
Speaker 7: Heading into last night, I would have said to you,
43:59
Speaker 7: I think that the UFC is the most important mainstream
44:02
Speaker 7: actor in essentially rehabilitating Donald Trump's image and more generally
44:06
Speaker 7: just conferring something of a positive spotlight on him. Honestly,
44:09
Speaker 7: after last night, I might say it in terms of
44:11
Speaker 7: general conservative world. More broadly, I mean Mark Zuckerberg, who
44:16
Speaker 7: I interviewed Lena Khan and she described the business of
44:18
Speaker 7: Metat to me as you know, serial rule violators, and
44:22
Speaker 7: they're out here giving these these glasses to blind veterans,
44:25
Speaker 7: and of course this is a nice thing, but they're
44:27
Speaker 7: being sued for basically ignoring warning signs about how their
44:30
Speaker 7: products made it easier for predators to find kids. I mean,
44:33
Speaker 7: let's just sort of be real about this. But the generesis,
44:36
Speaker 7: I mean, everyone goes back to twenty sixteen at the
44:38
Speaker 7: Republican National Convention for Dana White.
44:40
Speaker 4: That's really not it.
44:41
Speaker 7: It's really after January sixth, because your recall, he leaves office.
44:44
Speaker 7: He has low polling, and he goes to two Sea
44:47
Speaker 7: Pack events in that February and in that July. But
44:49
Speaker 7: in that same second week in July, he actually attended
44:52
Speaker 7: a UFC event. It was the Connor mcgregord Dustin Poorie
44:54
Speaker 7: A trilogy. And again for folks who've never seen this,
44:57
Speaker 7: you just don't understand what this is. Gets a walk
45:00
Speaker 7: out on TV by himself with Dana White. There is
45:04
Speaker 7: often you know, Mike Johnson, Elon Musk, you know somebody
45:07
Speaker 7: else there in tow he gets walk out music, The
45:10
Speaker 7: commentators glad hand him, they talk him up, they seat him.
45:13
Speaker 4: By the cage.
45:13
Speaker 7: They don't do it like the NBA did where they
45:15
Speaker 7: put him in the box and he kind of falls asleep.
45:17
Speaker 7: They put him right there and then the fighters get
45:19
Speaker 7: in on the act where they're in the postfight. This
45:21
Speaker 7: is the greatest president of all time. You got to
45:23
Speaker 7: go vote for this guy. And I'm referring to prior
45:26
Speaker 7: to the election. You know he's gonna save America. So
45:29
Speaker 7: ask yourself if you're a campaign, if you're running a campaign,
45:32
Speaker 7: and remember at this time he is not a president,
45:35
Speaker 7: he is a candidate. Where can you go to buy
45:39
Speaker 7: that kind of mainstream third party validation it does, It's
45:43
Speaker 7: literally not even for sale. And to say nothing of
45:46
Speaker 7: how hard it is to reach the you know, the
45:48
Speaker 7: young men as a portion of the electorate, and how
45:50
Speaker 7: good they are at facilitating that. He and Rogan or you,
45:53
Speaker 7: I should say, UFCN Rogan, they are the entity that
45:57
Speaker 7: it's simplistic to say that they got Trump elected normal
45:59
Speaker 7: suggesting as much. However, what I would say is people
46:03
Speaker 7: vastly underestimate how important this relationship is and what it's
46:07
Speaker 7: done for him. And especially last thing I'll say on
46:10
Speaker 7: this recall that like when all of this is happening
46:14
Speaker 7: twenty twenty four, this is when the long arm of
46:17
Speaker 7: the law is descending on Trump, and that is the
46:20
Speaker 7: point at which the UFC goes to the matt the
46:22
Speaker 7: hardest for him. They helped to an extent keep this
46:26
Speaker 7: dude out of prison. This is why they got a
46:29
Speaker 7: gigantic spectacle on the White.
46:31
Speaker 4: House last night.
46:33
Speaker 2: Another thing this was was a giant cash grab for
46:37
Speaker 2: a lot of Trump friends Dana White, obviously being a
46:40
Speaker 2: close Trump friend. Trump's crypto company was advertising here the
46:45
Speaker 2: fighters friction getting paid in Trump Crypto. I naively thought
46:52
Speaker 2: this would be free for people, because this is supposed
46:55
Speaker 2: to be a celebration of the country.
46:56
Speaker 5: Blah blah blah. It wasn't free.
46:57
Speaker 2: You had to sign up for a paramount plus and
46:59
Speaker 2: pay for that streaming service. Of course, David Ellison running Paramount,
47:03
Speaker 2: he was also there, and so he's getting in on.
47:06
Speaker 5: The cash grab here.
47:07
Speaker 2: But we also have this is a very strange thing
47:11
Speaker 2: that happened in advance of the event. So Daniel Cormier,
47:15
Speaker 2: which you can tell me, Luke, he's like one of
47:17
Speaker 2: the top UFC announcers, correct, sort of alongside Rogan.
47:21
Speaker 5: Is that the idea of who he is?
47:23
Speaker 7: Former two time member of the Olympic team, former captain
47:25
Speaker 7: of the Olympic team in wrestling, and yeah he is
47:29
Speaker 7: MMA royalty something like that.
47:31
Speaker 4: Got it?
47:31
Speaker 2: Okay, So let's put this first elevant up on the screen.
47:34
Speaker 2: He posts, I'm probably going to get a lot of
47:38
Speaker 2: flack for bringing this to light. However, I refuse to
47:41
Speaker 2: stay silent. The UFC is a sport. I'm deeply passionate
47:43
Speaker 2: about I will not tolerate this type of insider behavior.
47:47
Speaker 2: Shame on anyone trying to ruin this beautiful event. And
47:51
Speaker 2: attached to that are screenshots of what appear to be
47:55
Speaker 2: a conversation with the president's son, Eric Trump, where he says, Hey, Daniel,
48:01
Speaker 2: I'm going to be attending UFC two fifty tomorrow. Saw
48:04
Speaker 2: you were casting. Hope to see you there. He responds, Yo, Eric,
48:09
Speaker 2: didn't expect a DM from you. Excited to meet you
48:12
Speaker 2: in the family. Much love, brother, Eric replies, anything you
48:15
Speaker 2: can tell me about the fighters tomorrow?
48:17
Speaker 5: Who you got winning?
48:19
Speaker 2: Daniel replies, haha, I like to stay unbiased, but I
48:23
Speaker 2: love to watch Nickel fight.
48:25
Speaker 5: Let's go on to the next ones.
48:27
Speaker 2: Here, he says, not you placing any bets now, I'm
48:31
Speaker 2: actually not allowed to bet on any cards or anything.
48:34
Speaker 2: Makes sense? Are any of the fighters injured that you
48:37
Speaker 2: know of? Eric Trump, according to these screenshots, wants to
48:40
Speaker 2: know I'm not quite sure why you're asking me this,
48:42
Speaker 2: but I think they're all in good shape. Then, Eric
48:45
Speaker 2: Trump says, I'll just cut to the chase. Are any
48:47
Speaker 2: of the fights tomorrow rigged? I've been eyeing the Lopez
48:51
Speaker 2: fight and I think an upset wouldn't be too unrealistic.
48:54
Speaker 2: Dollar Sign, Dollar Sign, And then Daniel replies, no, none
48:58
Speaker 2: of our fights are rigged. And honestly, I appalled that
49:01
Speaker 2: you would even ask me something like that. So after this,
49:05
Speaker 2: Daniel posts something to the effect of, you know, a
49:09
Speaker 2: lot of people are really stupid out there. He deleted
49:11
Speaker 2: this very quickly, but I think we pretty much confirmed
49:14
Speaker 2: at this point that he did post this and the screenshots.
49:17
Speaker 5: Eric Trump put up this denial.
49:19
Speaker 2: He says, we are aware of the fake AI generated
49:22
Speaker 2: screenshots being circulated online. I have never spoken to Daniel.
49:26
Speaker 2: He has since deleted his post, which confirms it was
49:28
Speaker 2: clearly fabricated. That also inadvertently confirms that he did post
49:32
Speaker 2: this thing, so it wasn't just something that was completely
49:35
Speaker 2: created on of thin air. So, Luke, what is going
49:39
Speaker 2: on here? What do you make of this? What can
49:41
Speaker 2: we say about what likely transpired here?
49:44
Speaker 7: Just one is strange. I mean this whole event, as
49:47
Speaker 7: this whole event. I've been covering this sport for two decades.
49:50
Speaker 7: I don't think I've ever seen anything like this event
49:51
Speaker 7: in all myriad different ways, and this is just another
49:54
Speaker 7: example of this. I like you someone at tagged me
49:57
Speaker 7: in this and I looked at it and I was like, oh,
49:58
Speaker 7: this is obviously I mean, this does nothing to this.
50:01
Speaker 7: And then I saw a reporter who I know and trust,
50:05
Speaker 7: being like, uh, I saw it, he deleted it.
50:07
Speaker 4: I'm like, how can that possibly be?
50:10
Speaker 7: And so I ended up talking to a bunch of
50:11
Speaker 7: other reporters last night like what they thought about and
50:13
Speaker 7: what was going on, and they all seemed equally bewildered.
50:16
Speaker 7: It is true he tweeted it out to the point
50:18
Speaker 7: that you raise, they can see the replies, even to
50:21
Speaker 7: the deleted tweets, so like it emanated from his account,
50:25
Speaker 7: and so then it's like, okay, well how did that happen?
50:27
Speaker 7: And then you see, as you indicated, Cormia kind of
50:29
Speaker 7: insinuating everyone's pretty stupid. I saw later he kind of
50:33
Speaker 7: suggested to a bunch of people who are outside in Washington,
50:35
Speaker 7: DC that he was hacked.
50:37
Speaker 4: I mean, maybe that is the case.
50:39
Speaker 7: I mean, to me, Daniel has been something of maybe
50:42
Speaker 7: a company man more recently, but an honest guy in general,
50:45
Speaker 7: especially as it relates to things like this.
50:47
Speaker 4: So this would be you know, did you.
50:50
Speaker 7: Get hacked and then you immediately recovered your account. I
50:53
Speaker 7: suppose that can happen. I don't really know if that
50:56
Speaker 7: is the case. Certainly, I don't think reputationally it would
51:00
Speaker 7: be a great surprise to know that, or to learn
51:02
Speaker 7: in maybe any way that the Trumps would want to
51:05
Speaker 7: engage in something like this That does not seem to
51:07
Speaker 7: be necessarily out of character, because, as you mentioned, the
51:10
Speaker 7: bonuses paid to some of the fighters last night came
51:12
Speaker 7: from World Liberty Financial. Word Liberty Financial for folks who
51:16
Speaker 7: don't know, and I know your audience is smart about this,
51:17
Speaker 7: but just to say it out loud, this is one
51:19
Speaker 7: of the center pieces of Trump's financial corruption and self dealing.
51:24
Speaker 7: I mean it's literally like, if you're making taxonomy a
51:27
Speaker 7: chart of a taxonomy chart of how it's done, you
51:30
Speaker 7: couldn't make one without World Liberty Financial.
51:33
Speaker 4: So it just remained. I mean, combat sports.
51:35
Speaker 7: This is what happens when you bring combat sports to
51:38
Speaker 7: the mainstream world. This is a very very bizarre place
51:41
Speaker 7: where unusual things happened in unexplained ways, no one really knows,
51:46
Speaker 7: and it just kind of keeps going this way. I
51:48
Speaker 7: would chalk it up to something like that.
51:50
Speaker 1: Okay, all right, let's put E five up here. On
51:52
Speaker 1: the screen.
51:52
Speaker 6: I do.
51:53
Speaker 1: I'm curious for your reaction.
51:55
Speaker 3: Last night was also an incredible event for sports betting.
51:59
Speaker 3: We had in many cases polymarket ads here on the
52:04
Speaker 3: South Lawn. My personal favorite and advertisement for Stake, which
52:09
Speaker 3: is a crypto casino I literally illegal in the United States,
52:14
Speaker 3: which is offshore.
52:15
Speaker 1: I believe it's a.
52:15
Speaker 3: Caribbean based one crypto dot com and multiple other gambling
52:21
Speaker 3: like multiple other gambling, you know, advertisements that were not
52:25
Speaker 3: only just present, you know, on the arena itself, but
52:28
Speaker 3: ever present around the entire UFC. What you know, I'm curious.
52:33
Speaker 3: You know, you've covered the sport now for two decades.
52:35
Speaker 3: I'm not naive. I know betting has always kind of
52:37
Speaker 3: been part of it, but this does seem particularly extraordinary
52:41
Speaker 3: to see illegal offshore betting sites have their advertisements there
52:46
Speaker 3: as part of the UFC at the White House. Does
52:48
Speaker 3: that just show us the power of Dana White that
52:50
Speaker 3: he can just openly flaunt this, you know, on the
52:53
Speaker 3: White House lawn?
52:54
Speaker 1: What does it? You know?
52:55
Speaker 3: What do you make of it? As a combat sports analyst? Like,
52:57
Speaker 3: do you worry about it? I'm curious for your areus
53:00
Speaker 3: for your thoughts.
53:01
Speaker 7: Well, let me have a matter of disclosure here so
53:04
Speaker 7: you and your audience can make up your mind about
53:05
Speaker 7: what I'm about to say. I do have a show
53:08
Speaker 7: on the Draft Kings Network. Now, I personally don't ever gamble.
53:11
Speaker 7: It's not a thing that I It's not a thing
53:14
Speaker 7: that I necessarily engage in. And I will say that
53:16
Speaker 7: I have followed your coverage on this sager very closely,
53:19
Speaker 7: and I've learned a lot from it, and I pay
53:20
Speaker 7: close attention to it. So I'm glad that you are
53:23
Speaker 7: covering in the way that you are. It's helped me
53:25
Speaker 7: to understand a lot of this as well. I will
53:27
Speaker 7: say that I am not against sensible reform of online gambling,
53:32
Speaker 7: and I think it's important to say that out loud.
53:34
Speaker 7: I will say one thing you have to understand, and
53:37
Speaker 7: this is a thing that I will go to the
53:39
Speaker 7: mat on. This is that you know, the relationship between
53:42
Speaker 7: combat sports embedding and the rest of the sports world
53:45
Speaker 7: is completely different.
53:46
Speaker 4: It's an important point that's like combat sports.
53:49
Speaker 7: I looked this up, like, when did the New York
53:51
Speaker 7: State Athletic Commission get going in this country. It was
53:54
Speaker 7: in the early part of the twentieth century, and it
53:55
Speaker 7: was created specifically if you look up articles at the
53:57
Speaker 7: time that were written about it. It was to combat
54:00
Speaker 7: you know, promoters who were like, you know, hiring guys
54:02
Speaker 7: and then leaving town before paying them, and then also
54:04
Speaker 7: illegal gambling. Like I've been to many many sporting events
54:08
Speaker 7: in casinos, they've only ever been combat sports events. There
54:11
Speaker 7: is a unique tie in, and I think it comes
54:14
Speaker 7: from being both kind of associated to vice culture. These
54:17
Speaker 7: are related enterprises in a way that for example, hey,
54:21
Speaker 7: what's the parlay on the NHL game or something like
54:23
Speaker 7: that is very new right now as it relates to
54:27
Speaker 7: this kind of a thing.
54:28
Speaker 4: I'm as blown away by this as you.
54:30
Speaker 7: I mean, there were early kind of indications from Mark Shapiro,
54:34
Speaker 7: one of the leaders of TKO, the parent company of UFC,
54:37
Speaker 7: that they were going to be very kind of judicious
54:39
Speaker 7: in how they did advertising when this was kind of announced.
54:42
Speaker 7: I didn't see any evidence of that. But I think
54:44
Speaker 7: the way to kind of understand it to me is
54:46
Speaker 7: like us, is this the power of Dana White to
54:48
Speaker 7: an extent, maybe, But I think the other way to
54:50
Speaker 7: look at it is this is kind of the power
54:51
Speaker 7: of combat sports. Like one thing you really got to
54:54
Speaker 7: understand is combat sports does not act as quality control
54:57
Speaker 7: for things like this. Combat sports is going to say
55:00
Speaker 7: yes to everything. They're gonna say yes to absolutely everything.
55:03
Speaker 7: All the time, UFC was airing ice ads up until
55:06
Speaker 7: the renee Good got murdered. Then they took them off
55:08
Speaker 7: the air. They never aired him again after that. Like,
55:10
Speaker 7: they're just part of saying yes to money in ways
55:14
Speaker 7: without much interrogation. And so what they'll do is they'll
55:17
Speaker 7: just kind of mainstream it. They'll just kind of make
55:19
Speaker 7: it normal. They're just introduce it. You were asking earlier
55:22
Speaker 7: Crystal about for example, hok it, this is the thing
55:24
Speaker 7: that's happened already, and then there was no repercussions. I've
55:27
Speaker 7: seen people be like, oh, is the UFC gonna come
55:29
Speaker 7: down on this guy. No, they will never ever do that.
55:32
Speaker 7: That's not what they do. They lead with a certain
55:35
Speaker 7: kind of just having a permissive structure about matters generally,
55:39
Speaker 7: and then the rest of the world kind of uses
55:40
Speaker 7: that as well.
55:41
Speaker 4: If they're doing it, I suppose we should do it too.
55:44
Speaker 5: Got well.
55:45
Speaker 2: That also fits very well with Trumpian philosophy. Anything for
55:48
Speaker 2: cash is justified. It's a good fit for him there
55:51
Speaker 2: as well. Look, if you could put on your political
55:55
Speaker 2: hat here. Harry anton Over at CNN did an analysis
55:58
Speaker 2: of how Americans are viewing the idea of this event
56:02
Speaker 2: in general and didn't find a lot of broad based
56:05
Speaker 2: public support for it.
56:06
Speaker 5: Let's go ahead and play e seven.
56:08
Speaker 6: Let's just say this much. They do not like it.
56:12
Speaker 1: They don't like it.
56:13
Speaker 8: I like you, omar, but Americans don't find this thing
56:15
Speaker 8: to be appropriate to take it here. Take a look here,
56:17
Speaker 8: you havec white House fights are appropriate just sixteen percent,
56:21
Speaker 8: just sixteen percent overall, and among Republicans, even among Republicans,
56:26
Speaker 8: you know, the diehard based Republican party with Trump threw
56:29
Speaker 8: thick and thin, just thirty one percent of Republicans. Is
56:32
Speaker 8: approval rating amongst Republicans overall, as you know, usually hovers
56:36
Speaker 8: a little bit north of eighty percent. So we're talking
56:38
Speaker 8: fifty points slower here. And you know this overall, you know,
56:41
Speaker 8: being sixteen percent. You know, what is it like twenty
56:43
Speaker 8: eight percent of Americans you know believe in telepathy, so
56:47
Speaker 8: this is even below that.
56:48
Speaker 5: So not a lot of support there.
56:49
Speaker 2: And then I'm also curious for your view on you know,
56:52
Speaker 2: you've made the case probably better than anyone. How central
56:55
Speaker 2: UFC was to Trump's re election appealing to young men,
57:00
Speaker 2: young men who aren't particularly political, you know, the Hope
57:02
Speaker 2: podcast bris Fear very important with that, and also tied
57:06
Speaker 2: in directly with UFC, with Dana White and Joe Rogan
57:09
Speaker 2: being sort of the entree point there.
57:11
Speaker 6: Well.
57:11
Speaker 2: His approval writing with young men, as it has with
57:13
Speaker 2: virtually everyone, has really fallen off a cliff. He won
57:16
Speaker 2: young men by a single point, which was an extraordinary
57:19
Speaker 2: accomplishment because usually young people in recent years have voted
57:23
Speaker 2: for Democrats. Now he is underwater some thirty plus points
57:28
Speaker 2: among that same demographic. So I'm wondering if you think
57:32
Speaker 2: that this type of event will hit the same with
57:34
Speaker 2: that group that was so central to his reelection.
57:38
Speaker 4: I think it will.
57:39
Speaker 7: I would actually be interested to see what the polling
57:42
Speaker 7: would look like now for the Dems. I don't think
57:44
Speaker 7: that the broader one would change all that much. The
57:46
Speaker 7: sixteen percent, maybe that comes up a little bit, but
57:48
Speaker 7: I think that thirty one percent would climb. I mean,
57:50
Speaker 7: you know, Jack Posoviec tweets a lot of not super
57:54
Speaker 7: awesome or intelligent things, but it's kind of like a
57:57
Speaker 7: proxy to see what the enthusiasm is from that side
58:00
Speaker 7: of the aisle, and there was just a lot of it.
58:02
Speaker 7: I saw a lot of people saying, you know what, Trump,
58:04
Speaker 7: I actually saw this. Trump delivered this for us. I
58:07
Speaker 7: actually saw that word used last night, and it's like,
58:10
Speaker 7: you know, he can't deliver on these other policy objectives.
58:12
Speaker 7: We're in the shadow of the humiliation of the Iran war.
58:15
Speaker 7: But but we got this, and we really enjoyed it.
58:19
Speaker 7: It's something to give back to them.
58:20
Speaker 4: Now.
58:20
Speaker 7: The question is how long will that last? How long
58:22
Speaker 7: will this bump last. I suspect it will be fleeting.
58:25
Speaker 7: I think that there's going to be high water mark,
58:27
Speaker 7: maybe today, this week, this month, something like that. But
58:29
Speaker 7: once Trump gets sort of back to the natural, you know,
58:31
Speaker 7: rhythm of his what do you want to call it governing,
58:34
Speaker 7: I think that this number will probably probably decline. And
58:37
Speaker 7: I want to say this too, which is kind of
58:39
Speaker 7: funny because I've talked to some like, you know, sort
58:41
Speaker 7: of more mainstream, you know, liberal kind of outlets, and
58:44
Speaker 7: they're like, oh, young men are really abandoning Trump, and
58:47
Speaker 7: I'm like, yeah, but not for you, right, They're not
58:51
Speaker 7: walking away. They might be mad at Trump because of
58:54
Speaker 7: high gas prices, then no more foreign wars, all the
58:56
Speaker 7: stuff that you know, all the stuff that your audiences
58:58
Speaker 7: know that does not in any way, shape or form
59:02
Speaker 7: mean that they're like, we should really reconsider the ideas
59:05
Speaker 7: of the Democratic Party. They have just the same level
59:08
Speaker 7: of distrust and antipathy of them as they always did.
59:12
Speaker 7: So I think that these numbers will get a temporary boost.
59:15
Speaker 7: I don't think it will last, but I do think
59:17
Speaker 7: that if the UFC and Trump have a more robust,
59:20
Speaker 7: continuous pace at maybe doing events, I guess we'll see
59:24
Speaker 7: how that works.
59:25
Speaker 3: Yeah, it's quite a gamble there. For Dana White, Luke,
59:28
Speaker 3: You're so awesome to talk to you, man. I'd love
59:30
Speaker 3: to have you back on the show and talk more.
59:32
Speaker 3: Thank you for coming anytime. Thank you, guys. Turning now,
59:37
Speaker 3: two leaks an extraordinary new concern from the White House
59:41
Speaker 3: to go put f one up here on the screen.
59:43
Speaker 3: Trump aids fear that Maggie Haberman and Jonathan Swan have
59:47
Speaker 3: obtained situation room tapes for their new book called Regime
59:51
Speaker 3: Change Inside the Imperial Presidency of Donald Trump. So we
59:55
Speaker 3: have actually shown you two of the excerpts from their
59:58
Speaker 3: book here on the show. One of them was how
1:00:01
Speaker 3: the US was taken to war with Iran. It famously
1:00:05
Speaker 3: included the exact quotes out of the Situation Room what
1:00:09
Speaker 3: the various leaders said about going to war with Iran,
1:00:12
Speaker 3: who exactly said what. It even included Situation Room basically
1:00:16
Speaker 3: exact quotes from Marco Rubio talking about Israeli intelligence being
1:00:21
Speaker 3: quote bullshit.
1:00:22
Speaker 1: It included you know, JD.
1:00:23
Speaker 3: Vance saying that he opposed the war but then said
1:00:26
Speaker 3: he would back Donald Trump. It included Trump, you know,
1:00:28
Speaker 3: and many of the reasoning for why he decided to
1:00:31
Speaker 3: push the US forward. It included the Chairman of the
1:00:33
Speaker 3: Joint Jesus Staff, very typically warning the President about what
1:00:37
Speaker 3: was going to happen if the US were to be
1:00:39
Speaker 3: taken to war with Iran. It was an extraordinary revelation.
1:00:42
Speaker 3: Now the assumption, Chris, I'm curious what you think. My
1:00:46
Speaker 3: assumption is this was a Bob Woodward style, like a reckoning,
1:00:51
Speaker 3: as in he interviews like fifteen people who are all
1:00:53
Speaker 3: in the room. You reconstruct the dialogue. You put in
1:00:56
Speaker 3: a note to say these are based on the recall
1:01:00
Speaker 3: elections of those who were involved. However, what they note
1:01:04
Speaker 3: here is that in many cases the words are so
1:01:07
Speaker 3: exact and so on point that they fear that it's
1:01:11
Speaker 3: impossible for it to be anything but a direct recording,
1:01:15
Speaker 3: which I should note is an extraordinary breach. The situation
1:01:20
Speaker 3: room is a skiff. You're not allowed to bring in
1:01:22
Speaker 3: your phone. Traditionally, they're all checked right before you even
1:01:25
Speaker 3: enter the secure area. I mean, it's just long standing policy,
1:01:29
Speaker 3: going back twenty five years or so the Pentagon. However,
1:01:33
Speaker 3: we do know that between Signal Gate and a lot
1:01:36
Speaker 3: of these other things, the administration has played very fast
1:01:39
Speaker 3: and loose I think with classified information and others. And
1:01:42
Speaker 3: it's possible that somebody did bring in a phone and
1:01:45
Speaker 3: taped it. What makes it even more extraordinary is it's
1:01:47
Speaker 3: already brought their phone in, taped it, and then leaked
1:01:49
Speaker 3: it to a New York Times reporter for these exact,
1:01:53
Speaker 3: you know, comments that are there in the situation room.
1:01:55
Speaker 3: What they point to is that not a single piece,
1:01:58
Speaker 3: not one piece of exact dialogue which has been quoted
1:02:01
Speaker 3: by the authors, has been disputed yet by the White House,
1:02:04
Speaker 3: out of fear that if they were to dispute it,
1:02:07
Speaker 3: they could say and point to direct tapes that they
1:02:11
Speaker 3: are in possession of from the situation room. Around the
1:02:14
Speaker 3: most sensitive things that are being discussed in the White
1:02:17
Speaker 3: House at the very, very highest level.
1:02:19
Speaker 2: I mean, it's some extraordinary reporting either way. It's so
1:02:24
Speaker 2: accurate that the White House is afraid that they literally
1:02:27
Speaker 2: have the verbatim tapes. I mean, that's pretty incredible, and
1:02:31
Speaker 2: I think provides a lot of credibility to these accounts,
1:02:34
Speaker 2: which you always have to take with the grain of salt,
1:02:36
Speaker 2: because it all depends on who is leaking to you
1:02:39
Speaker 2: and the way they want themselves to be portrayed. I
1:02:42
Speaker 2: still suspect that it wasn't recorded. I still suspect that
1:02:45
Speaker 2: it was that they just had good sources in the
1:02:47
Speaker 2: room who were able to provide them with quotes that
1:02:50
Speaker 2: they were able to cross check and get very close
1:02:52
Speaker 2: to how it actually unfolded.
1:02:54
Speaker 5: Is still my assumption.
1:02:56
Speaker 2: But the very fact that the White House fears they
1:02:59
Speaker 2: have tape sort of is a direct validation of what
1:03:03
Speaker 2: they reported out here.
1:03:04
Speaker 6: You know.
1:03:04
Speaker 2: The other thing that's really interesting though, is I think
1:03:07
Speaker 2: most people assume it was Jade Vance or somebody in
1:03:09
Speaker 2: the jd Vance world that has been leaking to them
1:03:12
Speaker 2: most extensively. But it's not like an either the Epstein
1:03:17
Speaker 2: cover up piece or the Iran war piece makes him
1:03:21
Speaker 2: or literally anyone else look good. Normally, that's the way
1:03:24
Speaker 2: you have to look at these accounts is like, Okay, well,
1:03:26
Speaker 2: who is this trying to paint in a favorable light?
1:03:29
Speaker 2: Who is leaking to them so that they can get
1:03:31
Speaker 2: their story on the record and help to establish for
1:03:34
Speaker 2: the historical record, like, oh, well, I was the one
1:03:36
Speaker 2: who knew what was going on. I was the one
1:03:38
Speaker 2: who had the right decisions. I was the one who
1:03:40
Speaker 2: was opposed to Iran. I was the one who wanted
1:03:43
Speaker 2: had the correct strategy with regard to Epstein. But it
1:03:46
Speaker 2: is a little bit hard to tell because everybody looks
1:03:49
Speaker 2: pretty bad based.
1:03:51
Speaker 5: On how this went down.
1:03:52
Speaker 2: The other thing is just to point out the fact
1:03:55
Speaker 2: that the Epstein cover up was being hatched in the
1:03:57
Speaker 2: situation room is really kind of crazy. I mean, it
1:04:01
Speaker 2: makes sense because it is genuinely like a massive national
1:04:05
Speaker 2: security issue given all of the entanglements and you know,
1:04:09
Speaker 2: Israeli connections and all of those sorts of things, but
1:04:12
Speaker 2: it still is incredibly crazy that that's where they were
1:04:16
Speaker 2: doing some of their most significant brainstorming about how do
1:04:19
Speaker 2: we keep the truth that Donald Trump is all over
1:04:21
Speaker 2: these files out of the view of the public. Or
1:04:24
Speaker 2: at the very least sort of like throw enough in
1:04:26
Speaker 2: their face so that they can't grab on to, you know,
1:04:29
Speaker 2: one single allegation and then move on.
1:04:32
Speaker 1: The whole thing is nuts.
1:04:33
Speaker 3: As I said, it's not uncommon for Woodward style recreation books.
1:04:38
Speaker 1: I've read a lot of them.
1:04:39
Speaker 3: Obama's War, by the way, probably one of my favorite
1:04:41
Speaker 3: Woodward books literally ever written. I do I think you
1:04:44
Speaker 3: should be recommended reading for a lot of people about
1:04:46
Speaker 3: how exactly the war machine in the Pentagon can roll you,
1:04:49
Speaker 3: even whenever you are the most powerful person in the
1:04:52
Speaker 3: White House. This type of reporting was extremely common in
1:04:55
Speaker 3: the first Trump term. I will say, you know, this
1:04:58
Speaker 3: one has been a lot less leak than the original one,
1:05:01
Speaker 3: where you would get, you know, live texts from Steve
1:05:04
Speaker 3: Bannon and other people about Jared and Ivanka to these
1:05:07
Speaker 3: various types of reporters and exactly what was going on
1:05:10
Speaker 3: in terms of the drama. But this is very much
1:05:12
Speaker 3: akin to how the first term of the White House
1:05:15
Speaker 3: really went down. And I think that's really what's surprising
1:05:18
Speaker 3: and shocking a lot of people in the room. From
1:05:20
Speaker 3: what I've been told, a lot of them feel that
1:05:23
Speaker 3: they were battle tested. They were very committed through the
1:05:25
Speaker 3: campaign and through the administration. They were like, look, we
1:05:29
Speaker 3: went through this together, we survived. You know this onslought,
1:05:31
Speaker 3: we won the popular vote, like we're a team. But
1:05:33
Speaker 3: it does appear that now that the political fortunes are
1:05:36
Speaker 3: going down, that a lot of people are trying to
1:05:39
Speaker 3: save their legacy. Now, as you said, I don't think
1:05:41
Speaker 3: it really makes anybody look particularly good in this. There's
1:05:44
Speaker 3: a lot of missteps. There's a lot of problems. I mean,
1:05:46
Speaker 3: for example, let's take the vice president. You have somebody
1:05:50
Speaker 3: who internally opposed the war, and as we just heard
1:05:53
Speaker 3: just this morning, whenever we're playing the defense, he's like, oh,
1:05:55
Speaker 3: thank you to the president for I mean, obviously he's
1:05:57
Speaker 3: going to say that. But to say on the record
1:06:00
Speaker 3: or to basically say, you know, to have a tape
1:06:02
Speaker 3: or a recollection of saying you oppose something and then
1:06:04
Speaker 3: come out publicly and support it, that doesn't look good,
1:06:07
Speaker 3: right whenever you're the vice president.
1:06:09
Speaker 1: But then let's take people like Dan Bongino.
1:06:11
Speaker 3: Dan Bongino, some people were like, oh, he must have
1:06:13
Speaker 3: leaked the Epstein coverages. But f two, just so people
1:06:16
Speaker 3: know what we're referencing, where Bongino screamed at the you know,
1:06:19
Speaker 3: at the White House Chief of Staff and all of that. Well, yeah,
1:06:22
Speaker 3: he might have screamed at that and said, oh, you
1:06:24
Speaker 3: guys are screwing all this stuff up. Well, he came
1:06:27
Speaker 3: out afterwards and he supported it, and he said he
1:06:29
Speaker 3: stood by all of the work he did while he.
1:06:31
Speaker 1: Was in the administration.
1:06:32
Speaker 3: Same with cash Ptel, who publicly or at least privately,
1:06:35
Speaker 3: had said a few things and acquiesced to the infamous
1:06:38
Speaker 3: Epstein memo of nearly one year ago.
1:06:40
Speaker 1: I mean, I could go down the list.
1:06:42
Speaker 3: I can't think of a single really public official in
1:06:45
Speaker 3: any of these deliberations who actually comes out looking better.
1:06:49
Speaker 3: You can give some credit to some of those who said, hey,
1:06:51
Speaker 3: this is going to be a big problem, but in
1:06:54
Speaker 3: basically every case, I'm like, this is a real problem.
1:06:57
Speaker 3: I would say F three in particular about how Trump
1:07:00
Speaker 3: took the US to war with Iran, there is not
1:07:03
Speaker 3: one person that comes out of that looking good.
1:07:05
Speaker 1: The Chairman of the Joint Chiefs looks like.
1:07:07
Speaker 3: Shit, because, as I flagged to everyone earlier, they did
1:07:11
Speaker 3: not talk to Trump in the way that they're supposed
1:07:13
Speaker 3: to from their congressionally mandated role. They did not tell
1:07:15
Speaker 3: him the truth. I'm not absolving Trump at all. It
1:07:18
Speaker 3: also showed clearly how bab manipulated Trump and the Secretary
1:07:22
Speaker 3: of State in the entire CIA intelligence and how even
1:07:25
Speaker 3: the Secretary of State and others were like, hey, quote,
1:07:27
Speaker 3: literally this is bullshit in terms of the Israeli assessments.
1:07:30
Speaker 3: So what does it say about Trump that he believed it.
1:07:33
Speaker 3: It shows how there was very little pushback inside of
1:07:35
Speaker 3: the NSC and others once Trump had made up his
1:07:38
Speaker 3: mind about how to take the war, take the US
1:07:41
Speaker 3: to war with Iran. I mean, really, it's a breakdown
1:07:44
Speaker 3: in the entire US chain of command and the way
1:07:47
Speaker 3: that any of this type of decision making is supposed
1:07:49
Speaker 3: to work. So that's part of the reason why I'm
1:07:52
Speaker 3: kind of mystified, genuinely as to why anybody would have
1:07:56
Speaker 3: leaked any of these conversations in the first place.
1:07:57
Speaker 1: It really doesn't make them look good.
1:07:59
Speaker 3: But I'm glad it did if it did, because look,
1:08:02
Speaker 3: the historical record matters. This is the first draft of history.
1:08:05
Speaker 3: It will be the Obama's War of its era. It
1:08:07
Speaker 3: really will. We will refer to it really extensively in
1:08:11
Speaker 3: the future. And the good thing is is that all
1:08:13
Speaker 3: of these public officials will have to be asked about
1:08:16
Speaker 3: it when the book comes out and say did you
1:08:18
Speaker 3: say this? And if they don't say no, it tells
1:08:21
Speaker 3: you a little bit about what went down in that room.
1:08:23
Speaker 5: Yeah, and JD.
1:08:24
Speaker 2: Vance on the Iran War piece, he said something like,
1:08:27
Speaker 2: you know, I have my reservations, but if you do it,
1:08:30
Speaker 2: I'll support you.
1:08:31
Speaker 5: It was basically his decision.
1:08:32
Speaker 2: I mean, I guess if you had to say, of anybody,
1:08:34
Speaker 2: he does kind I mean, like you said, nobody comes
1:08:37
Speaker 2: out looking good. But he's on the record of being like, ah,
1:08:40
Speaker 2: this isn't a great idea with.
1:08:41
Speaker 5: The Iran War.
1:08:43
Speaker 2: He's one of the aids in the Epstein piece who's
1:08:47
Speaker 2: at least in touch with the fact that this is
1:08:49
Speaker 2: a problem for Trump, whereas others who are quoted in
1:08:55
Speaker 2: that excerpt just don't have any understanding of the way
1:08:59
Speaker 2: that this is a big issue for the base and
1:09:01
Speaker 2: why it's going to be a problem for him. But
1:09:03
Speaker 2: you know, the other possibility is sager that you've got
1:09:06
Speaker 2: some people in the White House who just like to talk.
1:09:10
Speaker 2: I mean, there is like a human instinct to gossip.
1:09:13
Speaker 2: You're on the inside, you know some things you get
1:09:16
Speaker 2: to lead. You get to talk to some New York
1:09:18
Speaker 2: Times reporter and feel like you're giving them this into power.
1:09:22
Speaker 5: Like that's a very intoxicating feeling.
1:09:24
Speaker 2: And again there is this just sort of human instinct
1:09:27
Speaker 2: that when you have a piece of juicy information, you
1:09:30
Speaker 2: want to be able to share it. So you could
1:09:32
Speaker 2: just have someone like that. And we know, you know,
1:09:34
Speaker 2: I'm not saying that it is her, but we do
1:09:36
Speaker 2: know that Susie Wilds like talk to your reporters extensively
1:09:40
Speaker 2: for that piece on.
1:09:43
Speaker 1: Yeah, it was ridiculous, right, and.
1:09:44
Speaker 2: It was over months where she said all kinds of
1:09:47
Speaker 2: things that she should not have been saying. So you've
1:09:50
Speaker 2: got at least one who has that tendency to you know, okay, well,
1:09:55
Speaker 2: whether it makes me be look good or you know,
1:09:57
Speaker 2: Marko look good or Jadvans look good, or make everybody
1:09:59
Speaker 2: look bad, I just want to be able to share
1:10:02
Speaker 2: what I know from the inside. So that is also
1:10:04
Speaker 2: a possibility here too.
1:10:06
Speaker 3: But nobody knows orders they're excellent at their job. Part
1:10:09
Speaker 3: of your job is making them feel import I used
1:10:11
Speaker 3: to do this. I mean it's not fun, but yet
1:10:14
Speaker 3: you got to make them feel important, you know, buy
1:10:16
Speaker 3: them a few drinks. You'd be amazed way you can
1:10:18
Speaker 3: get out of people.
1:10:19
Speaker 1: Yeah.
1:10:20
Speaker 2: No, that's absolutely right, and especially because you do have
1:10:23
Speaker 2: I think one thing that's telling is obviously the wheels
1:10:26
Speaker 2: have come off of this administration. The approval rating is
1:10:29
Speaker 2: in the toilet, The midterms are going to be a
1:10:30
Speaker 2: total blowout for Republicans. The writing is on the wall
1:10:33
Speaker 2: with I think all of that. And so you do
1:10:36
Speaker 2: have people who are going to be rats on a
1:10:38
Speaker 2: sinking ship, who are like, Okay, how do I position
1:10:41
Speaker 2: myself for what comes after? Because it's increasingly clear that
1:10:46
Speaker 2: there is going to be an after, and that after
1:10:49
Speaker 2: maybe coming sooner rather than later. So I think we'll
1:10:52
Speaker 2: probably see more leaks, not less as the regime days
1:10:56
Speaker 2: we're on.
1:10:57
Speaker 3: Keep it coming, Keep it coming, all right, Thanks for
1:10:59
Speaker 3: everybody watching, appreciate it.
1:11:00
Speaker 1: We'll see you all tomorrow.