Nvidia launches AI safety platform, adds $150B buyback, jobs report | Market Hang

[music] Welcome to Market Hang. Glad you're all here. We have Pros, we have Sarah, [music] Al, and Kevin. Thank you all for being here. >> Yeah, appreciate it. Thanks for having us. >> Yeah. Uh, [music] curious how how was the weekend? >> Um, it was good. I was just talking to Al. We're both Michigan fans. Uh, kind of just just lamenting this last second loss, which was just a travesty in the Big House. And I my take was that the offense is terrible. Like they deserve to lose. But I know this is this is cutting kind of close. [gasps] >> They deserve to lose, but it's still it still ruined my Saturday. >> It happens. >> Saturday ruined. Yeah. >> Sarah, how was your weekend? >> Well, I went to Michigan State, so I always [laughter] lose. >> Oh my goodness. I need to walk out. >> So So you enjoyed it? >> I I do enjoy the pain. Uh, even though I don't think Michigan State has much much to be proud of this year either. >> Yeah. Sarah, how's your team playing? [laughter] >> I can't hear you. Sorry, I lost audio. >> And Kevin, how was your weekend? >> It was great. It ended on a high note, unlike these guys with the Denver Broncos winning. So, uh, you know, can't complain. Beating the LA Rams, which is always good. You know, it's, uh, it's one of those things. I think the Michigan was retribution for earlier in the year uh, get squeaking out that win, the last second play. The I think that's retribution from the football guys. It >> was a well-deserved extra play, I think. >> I went to bed last night and at halftime it was 16 nothing. >> Yeah, it was it was just >> Yeah, exactly. That's Yeah, you can't. The first half is never good for the Broncos, just so you know. So, anybody that watches football and you have Broncos on, the first half is is never good. Second half is always great. >> Well, I I had a good football weekend, too. The Cleveland Browns won, which was a shock. Um, >> you don't have many good weekends. >> I know, right? and I saw the movie Prime Time and I caught up on a lot of reading. Uh so I've read a lot about the AI safety debate. Um >> and where I kind of land is um it's a proxy for control, right? [snorts] And uh these cries for help seem hollow at best. uh which is which is a shame because I think we really do need some guidance, some guard rails, some governance and so I'm I'm a little nervous that there there's no leadership and I don't know who's going to take us to the next like >> are you falling into the camp of the industry sort of acting self-interested? You know, uh, uh, uh, Nvidia today has their AI agent safety announcement, which seems like it, uh, uh, Adobe Photoshopped or probably AI made a bunch of logos and stuck it on Axe. >> You can put me in that camp. >> Yeah. [laughter] >> Yeah. It pro it is concerning because we probably should have leadership. >> It's not that I don't I think two things can be true, right? We we we're we're in need of of of some regulation and it's self- serving for for the people who are speaking out. >> Yeah. Well, I was just going to say it's it goes back to the age old question. Do you want the uh companies to they can put in their own guardrails and they can actually kind of speed hump their own development and kind of refine and and and all this doomsday stuff is coming from them which is what is their angle in that? But at the same time, do you want the government to do it? because the government tends to be behind and when you think about, you know, what what's gone on from social media, you know, Cambridge Analytica scandal back in the day with Mark Zuckerberg and Facebook at the time and and so and there's never any real repercussions. Facebook did fine after that. So I I I think it's it's who's going to be the leadership and how are we going to derive it? And we can't even get anybody in Washington to agree on balancing a budget, >> which is fundamental for our country, let alone AI safety. So, it's like, who's going to do it, >> right? >> Sarah, what camp are you in? >> I think that you can't deny the self-interest. This is not new news. Um, they've known about these problems for a long time. It suddenly got very urgent when it was time to produce the S1's, right? And when it was time to to show the market what was going on. So, I'm in the camp of self-interest and yeah, probably be nice to not all die. >> But, but turning to your point, self-interest is fine. Two things can be true. You know, we shouldn't be fatalistic like, well, government stinks. I mean, there are many things that, you know, the FDA for drugs, FDA for models. You have uh this nuclear proliferation. Everybody's always talking about that from a cooperation perspective. You could do something like that. I mean, right now it feels like uh we had somebody say that uh it would wipe out there's 10% it would wipe out humanity and then President Trump said, "Forget it. It's a hoax." And that was that was about the end of the debate. We should probably go a little deeper. >> Well, oh, sorry. I was Ally, you mentioned Nvidia today and and Jensen was on was on CNBC talking about just this this the the state of play and you know we talk about how well it's nice to have them do this nice little uh harness safety harness for us for AI but he also mentioned he thinks it's an engineering problem because if it's not it's not solvable. So there was this other element of like oh okay there is a lot of risk here but hopefully it's solvable. Right. >> Right. But two weeks ago, wasn't he saying it was overblown? Like, >> well, he was basically saying that's just a bunch of there's no conscious there. It's just a bunch of zeros and ones. It's just an engineering thing. It's just scripts doing stuff like we don't these aren't real entities. And now he's saying, well, actually, maybe it isn't just an engineering problem and we can't solve that. >> You know, we had, you know, the early AI, we had six finger pictures and we all used to laugh. So hopefully the agent debacle is the six-finger version of the agent and then we engineer it away. >> Wait, what do you what do you mean the debacle? Don't you remember the early pictures, right? You have six fingers and Jesus and it was easy to tell AI. Now it's impossible to tell AI, you know? So these are the first agents that are going out and doing things and oh my goodness, they hacked the Pentagon. So maybe we can engineer it out. >> The the other issue that we're not talking about is if the government if we come out with regulation, they're going to pick winners and losers. And I think that's a situation that is an overarching concern when it comes to these types of scenarios because uh you know they all got big and now they're like regulate regulate regulate us and then they throw up the guard rails and now they're entranced and so I think that's a big concern as well and we know they're not going to they're asking for all this uh you know regulatory oversight or or what have you. But they're not over overseeing themselves. They're like we're going to keep building and being as and develop as fast as we can. you know, their the old motto in in Silicon Valley was move fast and break things, right? Like they ask for forgiveness, not permission. And they're going to continue to do that. And so, you know, is it hollow? I mean, I had mentioned this to you previously, but Sam Bman Freed, remember, was like, "Regulate us." And he was doing nefarious stuff and now he's in the clink. So, I mean, that just goes back to, you know, whenever I see these guys say, "Oh, we need to be regulator. Oh, it's doomsday. Doomsday. Doomsday. It's serving their own purposes, >> of course. But so, where do we where do we come down on Jensen's uh software safety platform? Like, is is that a better way to go? I mean, >> it seems like the kind of the it seems like a way to deal with these agents, these 1.0 agents, right? They're like little kids. They they you tell them to do something and they'll they'll do it, but then they'll say, "Yeah, there's a way to wiggle out of that." You catch them doing something wrong. I didn't do anything wrong. What are you talking about? Or sorry, yeah, you call me. I made up that name or I made I did this one thing I shouldn't have done. Sorry about that. So it's like okay so maybe there's you need a physical physical type of structure that kind of keeps in place and and it sounds like Nvidia they have a solution. They say they have a solution with this new uh sort of I don't know what you call it this new tool uh that might be open sourced and things like that and has some big like said big logos around that on that on that sheet right so I think it's probably a step in the right direction probably what we what the market and people want to hear the doomsdayers the the AI advocates they probably want to hear this so probably the right time for something like that >> I mean I hope >> I think the other side of it though is you know why are we having these problems and like one of you mentioned having a toddler earlier. It's a little bit like having a toddler, right? Your toddler gets into the cabinets that you forget to shut properly. If you put a child safe lock on, you're not going to have them breaking in as much usually. And a lot of the stuff with the agents is the same thing. So, you hear hack and you think, you know, sort of masked men parachuting in on the internet. A lot of times it's that an agent found a database that had all the passwords that nobody else thought to try, right? So some of these solutions and this is less popular to hear. Some of these solutions are that a bunch of these big companies and small companies need to go talk to their IT teams need to go hire cyber security need to say hey guys what are we doing internally so that we don't I don't know expose that all of our passwords are password and and you know sort of let let the horse out of the barn and so there are these basic block and tackle things that we have largely missed from the internet and I think as that shifts uh we will see that the agents have a much harder time breaking Right. Um, would you call Nvidia's uh move this morning like the fox buying the hen house or licensing the hen house? >> Well, so I think it's a great point that we're talking about Jensen because it is going to we are going to need a leader to step up and move it forward, right? So I think Jensen is that guy. If you think about the development of the railroads, right? Uh you think about, you know, Rockefeller, Carnegi, like they led their industries, right? There were a bunch of other titans within there that made tons of money and helped build build it out, but we're going to need someone from the industry to step up and take that mantle. >> To that point, though, did you notice who is not on on his list? >> No. Uh let's see. Open AAI isn't, Google isn't, Meta isn't. That seems a little strange, right? maybe they didn't want to come to the table or they haven't played nicely like we don't know the inner politics behind the scenes right I and there's a lot of competition and what we do know from from AI is that they typically you know they're hacking their partners or not not partners or competitors right like the hugging face hack you you you have all these things where they're setting out all all these bots to go hack their competitors and no one's held responsible but if you and I did it we'd be arrested >> right >> yeah I'm just trying to get my mind around whether we want to model Rockefeller, Carnegie, and Vanderbilt. They're not they're not exactly pristine guys. >> No, they're not pristine guys. But >> aside from gunning down your workers and building rock center. [laughter] >> Well Well, I I would put it like this. America became the world superpower because of what they did and because of the free market enterprise and because they built this country and by you know what it wasn't clean and I'm not saying they were pristine guys but if you see what they did and how how they did it for their industry the reason why we're the number one country in the entire world is because of what they laid down and and I mean you can try to refute that but you know they they built this country. Mhm. >> That's [clears throat] fair. Another interesting dynamic I think is I mean it's almost laughable, right? Uh we've got all these, you know, cries for concern like this is an emergency. This is like a real issue and you know, download this app and give us all of your privacy information, right? Like the house is on fire and they're saying would you like a tour? >> But it'll cancel my Paramount subscription for me. [laughter] >> Right. I mean, >> yeah. Yeah, the acronym everyone should know is to terms of service, but no one knows it because they just click accept, right? It's a 38page document where you give everything else away and then they they own your data. Like you don't own your data anymore. >> So, uh, a former colleague of mine and Al's current colleague Josh Schaefer did a story on on Muse and he basically wrote, I downloaded Muse, I checked it out, here's what here's what I did. Uh, and he was concerned about I don't want to give it all my passwords and a lot of the information that's personal. I just wanted to see if it do some certain tasks for me. and it did some stuff where he would upload a uh and a PDF of a you know credit card statement and said find a stuff that's duplicative and and take take care of it flag me on stuff and it was very helpful but he said I don't want to do this personal data stuff well someone else said I can't remember who it was but basically saying that if the agents can prove that they're not productive more like they will take care of annoying stuff for me that's the real use case and then if you're saying you know what this thing is so helpful maybe I will do that maybe I will give it my Gmail login because it'll allow them to parse through emails and send stuff out and cancel things for me. Uh, so I think that's sort of where we're at. It's the balance of my my my privacy versus how useful are you to taking care of annoying stuff. And I think that from like a consumer I know there's a whole enterprise thing going on, but consumer agent point of view, that makes a lot of sense. I'd be willing to maybe give the password up. Maybe. Maybe. >> What have I Oh, sorry. Go Sarah. >> Sorry. I do think that's where you're going to see Alphabet though really kind of thrive in Meta 2 because the reality is they already know, right? Every email we've sent, every every DM you've ever sent um because they already have that data. I think that it's going to feel less scary than signing on to a new service and and letting it crawl through everything you've ever done. >> Yeah. I mean, I feel like I mean, maybe this is the wrong word, but they've been grooming us for the last two decades, >> right? making our lives easier and easier and >> and we're we're just giving them everything that they want. >> Well, it's not about us. It's it's about the future generations where they've grown up and all they've known is a screen in front of their face and how they interact with that and their brains are actually interacting differently than when I grew up where we had to read and even just learning where it's like I couldn't cheat because chat GPT or Claude didn't exist, right? like like I actually had to learn things. And so now they're learning how to use AI to learn. And so it's not about us. I mean, we're we're we're going to be dust in the wind uh when when this all plays out. I I mean, it's it's unbelievable, you know, because like I had to pick up a [snorts] phone call to ask a girl out, right? Like I had to like dial a phone number and pick up Did >> she say yes? Uh well well it well it was a numbers game so uh so um yeah the one that >> so you were learning sales. >> Yeah. Yeah you were learning sales and how to interact right and and I think we could be losing a lot of that with this new age of AI. >> I think on some level we already have lost some of it. Like I have I have a a Gen Z daughter and like using the phone is like scary for them [laughter] >> and Yeah. >> Yeah. And AI is not not not making it any better. The one thing about uh I won't, you know, keep my Gen Z child, they uh don't know how to use the phone. They don't they don't hold it to their head. [laughter] It's either always on speaker or it's always out here. I like I never thought I would have to tell my child, "No, no. What you do is you hold it to your head and you turn the volume down so we can't all hear." >> Yeah. It's kind of the phenomen Oh, sorry. Go ahead. Go ahead. >> Are these AI failings or parental failings or >> uh Oh, definitely a parental failing. >> It's a Well, yeah. No, it's probably a little bit of everything. Yeah. >> But I mean, there's a serious point that I I forget who flagged it, but basically there's some people that are hiring and there the young people are so reliant on AI tools that they can't actually read and process and sort of analyze things on their own. It's becoming a a problem from a hiring point of view. And I think that's a real issue, right? Is that's is that is that true? Is that really are we seeing that across the board in all various industries or is this sort of a one-off thing that we might read about online? I I I tend to see that, you know, I've been hearing that as well with interns and things. You know, >> I want like how do you make money off that? Like what's, you know, what's the market play if >> reading comprehension uh schools, I guess, >> or were you short those? >> Yeah. [laughter] >> We don't need Yeah. >> Yeah. I mean, I I think this goes back to, you know, is it a parental thing? Is it is it a societal thing? I think what we need to focus on is going back to basics and that reading comprehension, mathematics, it's it's actually teaching core analytical and and basic skills. I mean like I if you go out and you try to have students do just basic algebra, can they do it on their own? and they're not and they don't necessarily need to know basic algebra for, you know, being an intern or whatever, but it does unlock wiring in the brain, right? Left hand, right hand, you know, you've got you've got these different things and and and on top of that, it it'll help them because these dopamine hits that we're getting from social media, from AI, from all these the different feedback loops, it's shorting our attention spans, right? Like, we're not watching three-hour movies anymore. We're watching 45inut like you know movies now that used to be seconds. >> Right. Right. Everything's condensed now. And and and and I don't think that's great uh for just overall society when we're trying to further and grow uh you know basically our GDP if we can't understand basic reading comprehension. >> Right. >> And there's hallucinizations. We we haven't talked about that too. I mean AI isn't always right. I get things back from AI and I'm just like that's not right. >> Yeah. >> Mhm. >> Um you know so I woke up this morning and you know looked at futures and uh a lot of these stocks um were down and and they're down now. Nvidia is the only uh green one uh with a buyback and you know privacy concerns the um debate on um I'm drawing a blank. Oh, on safety, you know, probably has these stocks down, but I'm programmed to to to buy every every selloff, right? And I'm going to be wrong at some point, but I I just think you just keep buying this the the sell-offs. >> Yeah. I mean, I think I came out as like anti AI, but I mean, Baron, we we we like a rising stock market. We buy dips, >> right? >> And if and if you're wrong at some point because of AI, then it doesn't really matter because none of us are here. Well, I think you're touching based on something completely different, which is asset inflation, and you need to buy assets to keep up with uh what's going on, right? Like the Fed uh is, you know, probably one and done, you know, given where we are, uh at least I think. Uh and you need to own assets and and that's just it. So, if we see a dip, people go in and buy. And we've seen the valuations on some of these companies aren't absurd. Namely, when you bring up Nvidia, Nvidia is super cheap compared to its historical growth and its historical pricing and they're saying we think we're super cheap. We're doing this huge buyback, right? Like we, you know, now there are concerns about circular financing, but we don't know how this is going to play out. We are in the beginning of an intelligence revolution that we haven't even scratched the surface yet. Yeah, not even close. So, buying the dip if you're if you're a long-term investor over 3, 5, 10, 15 years. I mean, it's proven since even, you know, the la the last blow up, you know, 2000. Some of those companies that blew up in 2000 are now past those those, you know, their previous prices, but the market's always changing. It's fast. I mean, think about Meta, for example. Uh Mark Zuckerberg did a huge miss in building out the metaverse, right? He he spent billions and billions and billions of dollars. Look at Meta today, the stock price, and look, they completely pivoted. They're now trying to go into this whole enterprise when it comes to AI. >> You could buy it at 100, I think, at the end of 23. >> Yeah, exactly. So, getting back to So, you're saying, I'm I'm sort of programmed to buy this dip. Of course, you are because you need to own inflationary assets in this type of market environment. >> Right. Sarah, are you are you playing any of the names? not >> I think that they really depend. I I don't think it's a monolith. I think I mean obviously if you want to buy the dip across the market that's one thing in an index, but I don't love putting all of the AI names into one basket. Um SpaceX is a very different company than Nvidia or Taiwan Semiconductor, which is, you know, in the chips business versus an Alphabet or Meta. And so the the names I like have been the names I've liked. Um, I think Nvidia, uh, even if things go poorly, will still be a very good company. I think Taiwan Semiconductor is is finally kind of getting the love it deserves. But I've been a big fan of that for quite a while. Um, I think that Alphabet's the the ultimate AI winner, and you can fight me on that because I know that is not the streets consensus, but I am increasingly right about that. Um, and then I think some of the other names are just too hot and and I wouldn't buy those dips. Um, that's now would you ever say that I' I've heard rumblings that Micron might take over Nvidia as the darling of AI. What do you think? >> Well, I'm less interested in sort of what's currently popular and more what are they actually making? Right. And and I think when you sort of look at the hey, what's the revenue? What are the margins? What are they actually making? There isn't another Nvidia for at least a few more years. Um, we might see that eventually, but we're nowhere near that. I think that to me the bigger question is, will the demand keep up? And I know that no one else on the street is concerned about that, but I'm not sure that people are going to keep spending on tokens the way they have been. >> Um, >> but Tony, the the the like the Nvidia versus Micron debate, right? You you know from your history that if the stock is up on is outperforming on a 12 trailing month basis, we just assume that their strategy is genius, right? Right. Like Micron is memory, which is great. We need memory, but all of this is built on a foundation of GPUs and we have ASKI chips from Amazon and and and Alphabet and they're all very good, but all of this is built on a foundation of of Nvidia chips, right? So to the extent that any of this works, Nvidia will be fine. And like and Micron is a darling because it's like four times earnings, >> right? >> So >> and they report what? Wednesday, I think. >> I don't know. >> I think so. >> Well, and there's a bottleneck. So the the whole thing about Micron is there's not many Microns out there and you're not going to there's no one's going to start up sort of these memory chip companies, right, which tended to become commoditized and they have their boom bus cycles that we've seen and you know I mean Micron is a key component and they've demonstrated that through the entire AI you know uh vertical right like so there's many different things that happen you know to to actually achieve AI Right. So, Nvidia is part of it. Micron's part of it. >> Physical copper is part of it. Data centers are part of it. Cooling systems are part of it. Right. So, and that goes back to what we talked about with Nvidia earlier and everyone the market's concerns about this circular financing because it's like I give you this, you give me your stock, you get you I mean it's it's complex, right? And we've even seen as you started off the show that >> uh Jensen even left out Open AI. He left out, you know, Google. left out these these other companies in this. So, um it's going to take a while to figure out, but there's no replacement for Micron, right? And then we've seen that with SKH Highix, we've seen it with other, you know, uh high high, you know, memory memory names that are actually out of Korea, which goes back to the whole geopolitical aspect in AI because a lot of chips are coming out of Korea. We've talked about Taiwan Semiconductor. There's ASML which does EUV chips which is primarily could be the reason why uh China goes takes Taiwan because they need that to make more sophisticated chips. They need the ASML machines out there. Now there's been reports that they've actually gotten some key components and can do it themselves. So I mean it it's vast and complicated. So saying Micron's going to overtake Nvidia or you know it's just way too complex and convoluted. >> I want to add one more thing. Allan and I have been talking about this before, but it's in the auto sector. What they've been hounding pounding the table on. We need more memory. This could be a bottleneck for us to produce. You know, you can't have heated seats and stuff like that. Like just weird things like not but like just weird things like that that >> quite the luxury we're complaining about. >> I mean, I >> I need my heated seats. >> I I don't even look at a car if it doesn't have a heated steering wheel. >> Yeah. Not buying a car without heat. [laughter] I'm telling you, even even in the warm environments, I like that heated seat to kind of give me a nice little not like a massage, but it's a nice little sort of easing into the day. >> Every once in a while, I like to say, "Why am I hot?" "Oh, I left the seat [laughter] heater on." >> Always feels great. But yeah, anyway, that's >> I mean, it's interesting or fascinating all of your answers. Um there's one thing I didn't hear, which I I haven't heard really from anyone, and I believe one of our biggest concerns is the lack of data, right? like you need to feed AI something and if it doesn't have something to feed you end up with slop upon slop upon slop. So I think I think one of the best plays would be to figure out how or who's going to benefit from the giving it data. >> Well I I the interesting thing is that it's giving itself data. That's why we're getting the slop like it like AI is feeding AI other AI. So that's the interesting aspect and and there's been reports out that actually AI companies have gone out and bought rare books and they're now destroying those books because they're feeding it into the AI and so a lot of you know vintage book collectors are worried about that because now these precious artifacts of actual human creation h are being destroyed and and going back to the hallucinization effect that happens. Um, this goes, you know, we just need to once again not rely on AI and use it as a tool. But yeah, I don't know where this data is going to be coming from. It's >> I mean, I I get made fun of, but you know, I talk about Reddit almost every episode. I I think I think >> you you should have let me say it. I was going to say the repository of information that is Reddit. >> Yes, >> I'm with you. >> Yes, I 100%. And I made this comment I think last episode. I think companies with either large workforces or uh large customer base is is basically um uh a feeding ground of data, right? So I I threw out McDonald's potentially being a great place uh to be able to collect data and I got made fun of. But let's let's [laughter] let's transition to Meta. Uh you you mentioned, you know, they're they're out with news this morning. uh you know when you're in the lead you you keep your foot on the gas pedal. What are your what are your thoughts on the news? >> Yeah, I mean it's uh it's sort of the next they've been had they had a big week last week. This is the next hit. Zuckerberg is sort of, you know, just kind of going all out here. I mean hiring the MongoDB CEO, right, to come on and run this business. >> You see what happened to that stock, >> right? Right. Right. So basically we're bringing Muse to the enterprise and to different companies want to who want to sort of I imagine will pay for this service and have them assist their employees or do other things for for their for their clients. uh big enterprise play here but you know I've seen other sort of commenters talking about you know enterprise is a very competitive market you're going to be going against Microsoft and Alphabet and all these guys you know this is a tough anthrop this is a tough >> place to enter but you know Meta's got the firepower and they clearly have Muse which is gaining some popularity >> what I mean can you explain just just for for my brain so explain how they go after the enterprise business >> I mean I I Imagine that they would approach companies that need agents to do both internal work, let's say, with amongst employees figuring out different systems or maybe going after their like a CRM type thing going after clients. It's hard to kind of say how to envision how this could work. I mean, it could go >> and that and that's why they did this move today. Um, they just hired a C3PO or I mean a COO is actually his new title. Excuse Excuse of course. How could you not love Star Wars? Um so but they didn't really have a plan before and the market was looking for that. That's why they were unloved for a long time even though they were pivoting to AI and now this says hey we are now a software company we are not a we are not a social media company anymore the social media data will feed our software company and they are going against big enterprise companies like Microsoft which would would have been kind of the pure play kind of AI in that vertical of software and so um you know hide your kids hide your CEO because Mark Zuckerberg's coming for him >> but it's like co-pilot it's It's coding assistance, right? It's things like agents like that. >> Yeah. Or we have agents, you know, we have agents at work. I have not figured out how to work them yet, but you know, read all the research and tell me what's important, right? >> Yeah. Just productivity tool. >> Have you used any agent? >> I tried and failed. >> How about you Sarah? Any agents? >> No. But I mean, I think the bigger problem is there are few things that Zuckerberg has failed at as consistently as getting into enterprise. This is not the first time they have tried. Um I think they are very good at being a social media company. They're very good at being a communication app. Um they're not good at being enterprise and and well where they are good at being enterprise is advertising and small businesses, right? Where they're not good is going to people who currently spend millions a year on Salesforce or or Microsoft and saying, "Hey, shift that budget over to uh the same platform that your crazy aunt is posting bad memes on." So, do do you think this today was more of just like a headline and and not not to be concerned if you're a competitor? >> Zuck Zuck loves flashy hires. He loves buying a brand new friend for a billion dollars or so. So, that is not new to us. We know that what's been going on Exactly. >> Exactly [laughter] with Alexander W. That's been a disaster, right? So, so this isn't shocking that he needs the next new thing. he's been on a press push. like none of this is surprising when you're kind of a zuckologist and you know the waves that tend to come and go and maybe it'll work a little bit but it doesn't really matter because they have still a red-hot ad business >> right c can I bring up one aspect when we talk about agents that we didn't touch on and and the it's it's actually cryptocurrency and blockchain right so agents actually do need to use some form of currency and so I think the important aspect that when people hear about agents um they need to understand the spend behind it. And so you've actually seen sort of a bounce back come back off of a lot of these digital assets. And so if you we talked about football, right? So what was on the field at one of the biggest games, it was Old Miss versus Florida. You saw XRP's logo on the field, right? And XRP is actually more of a contained uh environment than more decentralized. And so you're seeing actually a lot of, you know, uh, stable coins uh, be based off of and agents using whether it's XRP, whether it's, you know, different layer 2s for Ethereum, uh, even blockchain. So, you know, when we're talking about Muse and you want to you want Muse to buy stuff for you across the internet, it's going to be using cryptocurrency, >> right? >> Um, you you bring up an interesting point. I saw a headline uh this morning which actually did concern me a little bit. Uh the Apollo chief economist was saying basically that Meta agents or other agents can now go out and sweep your your cash into some type of money market to gain 3 to 5%. >> Correct. >> Where the traditional banks are dependent on on that. That's why the banks went after the Clarity Act because Yeah. So that that was the whole juxiposition of >> Is that a real issue? I mean I mean that sounds concerning. >> Well, would you rather how would you rather earn money on your cash deposits? If it's tokenized and if it's if it's on a blockchain that can't be hacked that it's that it's um that you feel comfortable with then why not earn three four 5% as opposed to you know practically 0% in a traditional bank and that's why you even saw Jamie Diamond he cursed on TV and uh and was saying Brian Armstrong is full of kaka is is a different way of putting it right. And you know what I mean? He was like, "That guy is so full of crap." So, um, why? Because he's defending his position. They're cheap deposits and the net interest margin. I mean, tell me where I'm wrong on this. I mean, you I mean, at Barrens, I'm sure you guys have covered, you know, uh, banks and crypto. You know, >> it's like uh it's like the Blockbuster principle, right? They had a business model that was effective before Netflix that was effectively built on late fees. >> Yeah. >> Right. And it was, you know, nobody really, it was, it actually turned out to be like a big problem when late fees went away when they tried to do that as they were battling. >> So like how much would the total cost of finance rise if everybody got their appropriate rate on their deposits? Is it a big deal? Is it a little deal? I think it's probably a big deal. >> Yeah. >> But so now we'll get into like >> you can get a lot of those. You can get a lot of that already, right? You can get sweep. Every blockchain is hackable. Don't trust the blockchain, right? You want something FDIC insured, but all of my cash goes to sweep every night that sits across my various bank accounts, and I don't have an AI agent doing that because most people don't have an AI agent doing anything. Um, and and so I don't think that it's a nearterm problem. Um, the adoption rates just do not signal that. I think to some extent there is a existential anxiety about AI that is looking for reasons to be afraid. >> Yeah. Uh say say that last part again. I missed the the last thing you said. >> I think that there's there's an existential anxiety about AI that's looking for reasons to be afraid, right? Is it is it the paper click problem or whatever else it is? >> Um so AI, you know, is not in a vacuum and we're getting a jobs number this week. Uh, so a lot of people are are, you know, on high alert. I personally think, you know, may maybe it's a one day selloff or concern. I just think the AI machine is holding everything up. And so I I'm not I'm not really concerned with the jobs number. >> Yeah, I'm not concerned with the jobs number. Um, what I'm more focused on is wage inflation and and wages rising. And you want to see that cuz that leads to healthy inflation which we want to see because people are worried and concerned about actual inflation hitting the real world costs whether it's education whether it's healthcare food. I mean think about this remember when we go back to when the Fed was like inflation is transitory and people are like what are you talking about? This bag of chips that I used to get 16 ounces is now 8 ounces. We had shrinkflation and they're telling us it it's transitory. Now, they got off of that, but I think that's the biggest concern. We need to see real wages rise. Um, especially to real inflationary costs that we have that permeates through our system, not this this real CPI or this core CPI number that we see come through. And guess what? Energy is one of the biggest costs. Cost of capital, cost of energy is rising across the board, whether it's for retail, whether it's for corporate. And I think that's one of the biggest concerns. So when you look at the jobs number uh you you know the the more important thing is is the wages number and actually real and when we go back to jobs too we think about uh labor force participation rate. We're already so low especially in in uh um men between ages like you know 20 and 40 which is which is not good for us in in society. So when we see headline numbers, I never really take them at their face value because that's what they are. They're just headline numbers. You need to look underneath the hood to see what is actually important. And I think it's, you know, labor force participation rate. I think it's uh uh wages. >> Yeah. I mean, it's it's interesting. We have a Fed meeting at the end of October. Uh yeah, jobs numbers. It's you might have a little bit you have a shocker one way or the other, but I think we're all sort of seeing potentially another rate rate hike. He said one and done. >> I think Yeah, I think they'll be I I'll think they'll I think they're one and done. >> I I'm with you. >> I mean, like higher rates, but to to square the circle on the jobs number, the impact. I mean, the the current AI buildout is not dependent on uh short-term debt financing, >> right? >> So, it's an explanation of why the market doesn't necessarily sell off. On the other hand, I would love to refi someday and I don't want to refi at seven. >> So, please God. Yeah, for the love of God. [laughter] >> But you know, there's also you see a lot of people talking about you with bonds for instance, like it's horrible. It's the steel is spiking, but it's also maybe it's a good time to get into bonds, right? Because you have an attractive entry point, right? I mean, >> spenders versus savers is what you're bringing up and that's the the core thing, right? Like we were p like the consumer was powering the economy this whole time, right? It's like spend, spend, spend, spend, spend. And now savers were getting crushed. They were getting crushed for forever. And now at five and and a quarter on a 10-year, um that's looking pretty tasty and that builds the economy because savers are then, you know, investing in the real economy. >> You could make the argument that higher rates are better for boomers and they're they're the ones with all the money right now, right? I mean, >> boomers win again. We're done. Boomers won. >> Unfortunately, they're going to pass it down to millennials and so Gen X gets screwed. >> Yeah. Well, >> no, they're they're going to pass it on to uh private equity care homes that they'll they'll benefit from that. [laughter] >> That's that's brilliant. I actually um someone once pitched me an idea and I was like that is so brilliant to to make college campuses coincide with um >> senior living >> senior living and it kind of gives them the energy. It gives young people access to older people and and you know colleges are struggling right now. Was this after you left the theater for Old School with, you know, where My Boy Blue, you know, was in there and was Was that the Was that the genesis of that? >> It it might have been. >> Okay. Yeah. I I I don't know. I mean, um, think about Thanksgiving where the younger generation and then the grandparents, they can get along for for a meal, you know, and maybe for a holiday, but I don't know, you know, over a full semester or over a full term how how that that would play out, >> right? Um, but like I was saying earlier this week, you know, 5% isn't high historically. I mean, it's it's high, you know, recent history, but it's it's I don't know. It doesn't 5% doesn't scare me. >> No, but we all got used to free money. >> I True. >> So, it's like and and it's like almost a generation of free money, right? Because whenever Baki >> I mean, we're 18 years when 20 years in 2028, right? from the initial crash when we had good old 0% interest rates. >> I think that's maybe one of the unforeseen drawbacks potentially of that low rate era was that people get used to it. They don't ever want to go back and now it's it's happening now. It's causing a lot of consternation. You see we see Scott Besson talking about hey maybe AI productivity gains will mean that we don't actually have to keep hiking you know we'll be okay. >> Yeah. He said that over the weekend right part two. >> Yeah. Uh the the thing that I think is hardest to predict is is oil and geopolitical risk, right? And that to me can cause a lot of pain. Uh especially maybe I would say maybe the market less but the economy more. And so I have friends who are just like basically got their eyes glued to the price of oil and and like that's how they're making all their decisions. Well, I'll just getting in into that. Um, oil like many commodities that are out there are priced in dollars. So it is a huge geopolitical risk and that's why the whole yen uh situation is happening with Secretary Bessant because the Japanese need to buy more oil uh but it's priced in dollars settled in yen and so it takes them a lot more yen to buy you it's it's just a mess right so the geopolitical aspect especially because so not only is it a currency problem but it's also an input cost problem and so you know the cost of energy rises everything and that goes back to what's happening with diesel right now it's going it's going to reverberate into more inflation into, you know, like we talked about cuz everything's transported, right? So, every time you pick something off the shelf, it's gone through five different distribution centers to hit that actual shelf. And so, through those distribution centers, you know, it's it's had to be on, you know, trains, planes, automobiles. So, the cost is going up um at least right now while we have it. >> So, you mentioned diesel. Like, can can you explain how a diesel short-term ban would work? uh you know we make refined products and you you stick crude oil at the top of the tower and diesel and jet fuel and gasoline and asphalt come out the bottom of the tower. This is very technical by the way. Uh and you know if we if the problem is if you ban diesel then what ends up happening is you just uh get more gas you get more different refined products. So diesel goes down gasoline goes up. I mean it it's difficult problem to solve. Basically what would be better is to not be fighting a war in the Middle East. Where do you stand on the war, Sarah? [laughter] >> I mean, you would think with all these young men of fighting age out of work, uh, a war that needs a lot of warm bodies could be good, but we don't seem to be deploying enough people to move the needle there. You know, I I think that we're going to find out that this is going to be a tough economic reality for the K-shaped economy. Um, more people will spend more of their money on oil, uh, on gas, but that means that they're not going to be spending on Christmas presents, back to school, vacations. I was looking at flight prices recently, and it's kind of shocking, um, how cheap a lot of the international flights still are given the cost of jet fuel. And so, you know, I I do think that the consumer, most consumers, middle class on down, and we've been hearing this from a lot of consumer CEOs now for quite a while, it's really hard on them and it's not going to get better. They don't feel better about it. They don't feel like they have job security. And so, I think that the real economy is hurting and I think we're going to see that in the midterms and the midterm results are probably going to spur lots of interesting externalities on in DC. And so I think it's just a volatile situation. >> Don't Don't you think that we would have I I would have thought that we would have seen some positioning or posturing for the midterms already with with I Iran? I mean, I don't know. Like >> best we can do is maybe no more attacks until post midterms. So we've got about five five weeks, 45 days to to enjoy the the mini ceasefire. It sounds like >> quickly Oh, sorry. Go ahead. Mhm. >> Quickly add about airline price. I saw a headline that shows that airline prices for Thanksgiving in Christmas are at the highest they've ever been. And I was looking for prices to go to Thanksgiving Austin, Texas. My preferred carrier, Delta, $1,000 round trip for Thanksgiving this year. Thousand. >> Did Did you buy it? >> No. I'm looking at other airlines. >> Yeah. Well, the the energy situation that you're talking about with with midterms is that with oil going up and gas going up, everything that's a regressive tax. Okay. So, so it really reverberates and I think it is going to lead to a huge, you know, blue wave that's going to come across because it's what have you done for me lately? Especially when it comes to politics. And as people are driving to the polls and then they're paying their gas bill, they're going to remember how it how we got to this situation. And so I think that is going to have huge implications for 2028 and you know the potential presidency and then the regulatory environment the tax environment you know I mean like and AI you know tax the rich you know Bernie Sanders this you know we are seeing you know whether it was from Donald Trump or it's from AOC and Bernie Sand there's a populist wave happening right and we're we're and so and it and that's what's been moving the needle on elections. recently. >> The the the hard part with with the midterms and elections these days, I remember back in 2000, um we we had a Bush portfolio when I was at the Gallion Group and and we had a Gore portfolio. Like literally, there were two different portfolios and you could tell me who was going to win and I don't know if I could tell you exactly how how the market's going to play out, right? Um big week for Elon Musk. He's got a lot of things going on. We were joking. When is it not >> Alan and I are gonna be Alan and I are gonna be very busy this week. It's going to be not fun, but [laughter] All right. It's interesting. It's interesting. It is. >> So, we have what? >> So, we had the launch today. We had Starship 14 launch. Uh seemed to have gone off successfully. There was a a thing a rocket engine issue, but they were able to get to low Earth orbit with the Starship and deploy those 26 uh Starlink satellites. And I think uh the the Starship is going to land soon somewhere. I think the Pacific Ocean and I believe the booster has already probably landed already on its on its Mechazilla arms or something like that. So great week for for for SpaceX with their launch business. >> We got a little bit >> and also the Starlink which is their which is their top money maker. >> Yep. Yeah. I mean we got uh so we had Starship test 14 which is very big right. This is the secret weapon. AI data centers in space, low cost to reach orbit, a million satellites, hourly launches. Elon is [laughter] given to hyperbole. Uh so Starship, very big. And then on uh Thursday, we get the Roadster uh which is this long delayed uh now we've never talked about the Roadster. We talked about Tesla, but you know, I have this thing like it's a $250,000 car and it'll have like SpaceX technology on it. I mean these a $250,000 car does not move stocks. It's just like cool. Yeah. It's like buying GM for a Corvette. It's just you buy GM for the buybacks. >> Um, so then we get and then we get deliveries on Friday >> and we're lapping the end of the $7,500 federal tax credit from last year. So there's no more tax credit. So deliveries are down. But the bigger discussion is like, do do these deliveries even matter anymore? We don't care about EVs anymore. We care about AI, darn it. >> We care about robo taxis and robots. >> Yeah. Humanoid robots. He's refurbing an entire production line for humanoid robots, right? So Elon is going to build for, you know, what technology he thinks is good over the next near to immediate term and then he's going to completely pivot and go to what's going to be good for longer term, right? And that's the whole genesis of SpaceX. He's like, why aren't why aren't we reusing rockets? Why, you know, why is NASA not good at putting stuff into space? I mean, Elon Musk actually had to go up to the International Space Station and bring back our astronauts. I mean, think about that. Like, we sent him up there and we couldn't bring them down. >> Yeah, that wasn't a NASA problem. That was a Boeing problem. >> Yeah, it was a Boeing problem. But but who who hired them? >> Well, NASA contracted with Boeing and correct SpaceX. Two private contractors because they wanted to morph into a a builder of systems to a a manager of systems and uh Boeing spit the bit as they say. >> Yeah. Yeah, you know, I want to quickly really touch back on Tesla deliveries real quick because, you know, I think we saw sort of maybe a plateau after that tax uh tax re um the tax incentive went away, the the credit went away. Um and then maybe now we might see a little bit of normaly and you know, we've been hearing a lot about people who are using FSD and saying this thing has changed my life, older people, people with possible disabilities. I wonder if we might see some not maybe enthusiasm or some lift because of that FSD effect. And that's that's why people buy the stock, right? Is the is FS. >> Sarah, where do you where do you stand on Elon? >> He tends to uh overpromise, underdel. A lot of the cars blow up and people die in horrific ways. But other than that, I think it's great. You know, I don't think we're going to see great deliveries, especially when people start to dig in and say, "Wait, uh, wait, how many Cyber Trucks did did SpaceX buy again?" Right? And you start to look at that. is everybody who knows Elon getting a roadster for Christmas Oprah style and and know once you know the tricks the the magic like anytime you're watching a magician just doesn't quite hit the same >> brass you know like I feel always I don't want to be the Elon apologist I am a happy FSD user Mel Whitner from the Baron's round table value investor she says it's unbelievable you know Starlink has 12 million subscribers and billions in Eb so he was going to sell 10 million EVs is Is he going to sell 10 million EVs in a calendar year? Probably never. He might never get to two. >> Yeah. >> Um, is he going to sell a billion robots by 2027? Like, no. But, you know, >> uh, one thing >> he seems to he he gets and and and then like it just never seems to impact the valuation. So, >> Mars Mars colonies >> Mars miss it. >> Tesla. The thing we're missing here though real quick is the data that it's collecting, right? And so the d like because what is Tesla? Is Tesla a car company? Is it a robotics company? >> Definitely not a car company. >> Right. So it it it goes out and it can drive. People like FSD. What is FSD doing? It's got all this data that it's continuously collecting and refining and that is what is so valuable. And so this goes back to something we had previously discussed where is Tesla eventually going to get looped into SpaceX, right, with all of its data with with what it has as a company. And you own Tesla stock because you believe in Elon Musk, right? Like people aren't owning Tesla stock because they're competing against GM and their buybacks. >> No. >> So, you know, I think Tesla is not a car company. It is an Elon Musk company. And so, it's the people that believe in Elon Musk and the FSD and what and they just want exposure to it. >> I forget what analyst said this, maybe you remember, Al, but uh someone said that, you know, Elon wanted to white label FSD so you can license for me. We we'll sell it to other people. We have no problem with that. And the analyst said that in a year or two they might not want to do that because that's the competitive advantage that they have. And actually this is only a Tesla only technology. We're not going to give it to anyone else. I'm not sure if Elon would do that. But >> is it is it that different though? Like I had a I spent some time uh with Ford Lightning when that was out and it was it was impressive uh the self-driving that that could do. And this was on highways in Michigan and and that's kind of you know their bread and butter where they're trained. But it I don't know having spent a lot of time in BYDs and and you know the sort of world of these electric smart cars that are available particularly outside of the US. I don't know how much of an advantage Tesla has right spending time in Whimos versus robo taxis. I I Tesla has Elon and that is a huge advantage in storytelling as long as he's focused on Tesla and not SpaceX. I don't know uh what the science is saying about how much better FSD is than the mini competitors. >> Well, this is the ultimate question. Is self-driving like uh uh just a car feature and all of the uh uh economic benefits get sort of competed away because everybody has it or is AI and self-driving features are they like a competitively defensible moat that can build a robo taxi business? >> Right. That's like, you know, we have limited time left. What I would say, and I'm sure PR pros has been in a gazillion of these, FSD is way different than every other driver system. Like, not close. It just isn't. Just go do it. >> Yeah. You can you can do point to point. I mean, you can try to work from your from your house. Right. >> And also, when you hit a 100 miles on a road trip, you get like confetti [laughter] after you've let the car drive you 100 miles. >> Does it automatic? Listen, for the record, when I'm getting to 98 mi on my little uh road trips, nobody touching that wheel cuz I want the confetti. >> Does it reward you by turning on the seat warmer for you? >> No. >> No. But you can tell Grock to turn the seat warmer on, but I don't know. I don't talk to Grock because I'm too paranoid. [laughter] >> Does Rivian Does Rivian have a seat at the table? >> Uh, yeah. I mean, they do. They're working on autonomy. They're not They're not anywhere near where Tesla's at. They want to. They're doing their own in-house product, which is which is commendable. building their own chips which is or designing which is very commendable. So, they're they're a company to watch, but Tesla just seems to be far and away more advanced from that point of view, the neural network, the self-driving, everything like that. Plus, >> can can I throw in uh BlackBerry? How Blackberry is stock has done exceptionally well over the last year because it does the endtoend encryption for all these autonomous driving vehicles and it really protects it and nobody really talks about it. And it actually there was a uh on the weekend edition of the Wall Street Journal uh there was a front page, you know, full-on article about how it's rebounded, how it's it's their Q&X technology. It's and so that is a sleeper stock if you want to play autonomous driving vehicles. Uh Blackberry, it is uh ticker symbol BB for anybody that wants to have the sleeper pick. >> So there was >> what's old is new again, right? >> And you know, I'm Canadian so I'm I'm I'm for this. >> That's a great movie, by the way. see the movie, Blackberry movie. Amazing. >> So, there was there was um a Bloomberg article this morning saying that minivans have now overtaken SUVs. Would you buy a minivan? >> Minivan mega fun. Okay. Minivans are fantastic. By the way, go to a drive-in movie theater in a minivan and uh tell me otherwise, Al, >> I Well, I've just got to pause on that. Go to a drive-in in a minivan and think [laughter] about the possibilities. >> Uh uh I've owned a Toyota Sienna. >> All right. Right on. >> But I graduated out after the kids could open their own doors. >> Perfect. Sarah minivan. >> I hate them, but I don't have kids yet. So, call me in five years. >> If I had kids, it'd be a no-brainer. I mean, the My brother has two two kids. Rented a Kia Carnival when he went to Florida, and he said it blew his mind. He said it was unbelievable. The sliding doors, the low entry, the the the the entertainment that the kids have. He said it was fantastic. >> The amount of cubic feet you have in one of those. And think about the one car on the road that never gets into road rage accidents. Minivans >> and and and the affordability issue like or not issue that's that's a big draw for for the minivan. People can afford them. >> Yeah. >> You're talking like souped up like crazy vans. >> No, I'm talking about bare bones vans. I'm like, you know, uh you you don't need the souped-up version. It is just so nice and comfortable and spacious in there. I took one from I took actually a taxi that was a minivan from the airport to my hotel and it it felt way better than a Toyota Camry. [laughter] >> It was also the Tesla robo van is supposedly a thing. So >> Oh, really? >> Yeah. Well, it's rumored for some. >> This is another one of those. The roadster was teased in 17. >> Yeah. Yeah. you or you see the little the white sheet over the van thing and the presentations [music] and stuff >> like I think I remember seeing like robots working 10 years [music] ago like >> where where are those? >> Well, they're kung fu fighting now. Haven't you seen the [music] viral videos? >> Yeah, >> actually [laughter] follow follow Unitry on YouTube. It's it's something. >> Well, I'd love to thank all of you for coming to Market Hang. It's been [music] been phenomenal. Market hang. >> I'm I'm trying to make it happen. No, no, no one, no one's gone on with me with the market. >> I'm trying to make fetch happen. >> Yeah, [laughter] >> thank you all. It's great, great hang. >> Thanks, guys. [music] Heat. Heat. [music] [music] >> [music] [music] >> Heat [music] [music] up [music] here. >> [music] [music] [music] >> Heat. Heat. [music] [music] Heat. Heat. [music] [music] >> [music]