How Meta Could Quietly Win The AI Race

0:00Your heart can tell you a lot about your health. Apple Watch Series 12 measures your heart rate every five seconds with the most accurate heart rate sensing and awareable. So your vitals app now with heart rate variability can tell you when something is off. And your readiness score can let you know when to rest and when to push. Here are the story in every heartbeat with Apple Watch Series 12. The features described are for wellness purposes only and not for medical use. iPhone 11 or later require based on Apple conducted study of heart rate accuracy August 2026. Visit Apple.com slash Apple Watch Series 12. I'm Anna Garden. I have a new podcast called Happy Hour with Anna. Each week I'm inviting a

1:07really interesting guest to join me for a drink and a fun conversation at my kitchen table in New York City. I'll be getting personal with actors, chefs, comedians, musicians and writers I admire. So grab a snack, pull up a chair and join us. You can watch by searching for Happy Hour with Anna on YouTube or listen wherever you get your podcasts. Don't we only need to have more fun? Today's number 28,700. That's how many trades Trump made in the 17 months after his inauguration more than all of Congress combined. True story that I was raised as you know as an only child. Drill my sister nuts. How are you Ed? I'm doing very well. Here in New York, when to a wedding last weekend,

2:09now this weekend I've got an engagement party. It just keeps coming. Never ends. Any good destination weddings? One in Greece next year. Actually, that's the engagement party that I've got this weekend, which is preceding the Greece wedding, which will be cool. I went to a wedding in Germany over the summer, which was fun. Any of these close friends? Are you in any weddings? No, not in these weddings. These are friends, but not my best friends, but good friends. Yeah, still waiting to be in a wedding. Still waiting to get the call up. Were you in weddings? I was. Yeah, I've given three best man speeches. I told you my best man speech, right? This is the advice I believe to taking care of your wife, right? I think it's great advice. So why not? Why not share it? Don't keep score. It was expressed physical and sexual desire and never let your spouse be cold or hungry, page meaners and power bars all the time and dual climate control. Upgrade. It's worth it. I

3:10look back. I'm not exactly. I look back. I'm most of major blowups, so much significant others, and I think they were either cold or hungry. I think it's exactly right. How are you doing? How am I doing? I did the 92nd Street Y thing last night. Yeah, just Tarlov, which I didn't like, because everyone likes her much more than me. They like in SkyCallow, and everyone sort of rolls their eyes and apply the clouds, and then they literally like treat her like she's fucking Mick Jagger. It's a book. I love her. Oh my gosh. But that was good. We were sold out. And then, yeah, things that I'm in New York, I'm really excited to be here. I love it here. And yeah, I just start in the last seven days. I've been in LASF, Mexico City, London, L.A. and then back to here. So I'm a little bit a little bit manic from traveling. But yeah, and all everything's good. I feel really good about it. And your show is killing it. You keep getting good guests and huge, huge video views. So as I said, if you keep working this hard, I will

4:13get my second Ferrari, which I'm super excited about. By the way, I don't know the car, just for those you out there eventually, you're going to have to actually get the Ferrari. Eventually, we're going to need to time this bit into a reality. I can't get in and out of a Ferrari. It's too low for me. It is very low. Yeah, I can't pull off a Ferrari. You need to be. So what are we going to do instead? Maybe like a Lamborghini Urus or maybe like a Brabus? I mean, you need like a massive vehicle, but it still needs to be a luxury sports car. That's sort of the line that you're struggling here. No, I go with the mid-life crisis, Range Rover. Range Rover. The best car on the road is the Mercedes-Wagon truck. It feels like a sports car. It's a great car. But I like the British high. I'm rich and classy Range Rover thing. But I have an undercar in five years and I love not owning a car. Do you own a car? My girlfriend does. What is it again? The Outback, our favorite vehicle in the world. This is super outback. Right. Okay. So has she told you she's a lesbian yet?

5:16Sure we can't. Oh, stories. A lot's to talk about. Let's get into it. Now at the time to buy, I hope you have 20 of the wherewithal. The Federal Reserve unanimously voted to raise interest rates last week for the first time since 2023. The quarter point rate hike was largely expected on Cal State. The odds of a rate hike had climbed to 88% ahead of the announcement. Still stock sold off after the press conference and Treasury yields rose. I was later, President Trump somewhat lashed out at the Federal Reserve while notably leaving chair Kevin Warsh out of his criticism. You know, very tough board. He's got a board that was put there by a lot of other people and the interest rates are too high. They're not appropriate. And I told I talked to Kevin and I said, you might as well vote with the board because it's not going to matter. The board is very hostile. They're very political. They're doing the wrong thing. They're bunch of politicians or people put

6:20on by politicians and it's a shame. Essentially implying that Kevin Warsh didn't want to raise rates, but he sort of had to because he had to just go with whatever the rest of the board of the Federal Reserve wanted to do, which was to raise, which is quite an interesting statement. Not sure I agree with him or believe that it is even remotely true either way. We have raised rates. 25 basis points first increased since 2023. You and I had both predicted that this would happen. So, pounding it back to us, what do you make of this? Institutions are discovering that independence only matters when someone powerful wants you to surrender. That's the whole point of independence. His wants someone powerful asks you to do something that's not in the best interest of the country. That is why you're supposed to be independent. So, what do you have? Can it is diversifying away from Washington, AI companies are being asked whether they can govern themselves. And the Fed is resisting the president who appointed its chair. Everybody suddenly wants a

7:23prenup, so to speak. But look, I think this was, I think Warsh has established himself. This is a great move for him. It was the right thing to do. I believe the business schools should be 15 months. I think we should take kids in September one, have them go through the summer, or take them in August, charge them a lot less money. We invent the second year of business school, mostly for networking, and so we can charge them double tuition. And then we let them take these ridiculous classes from Thips, what I call formerly important people. And where they bring in their friends, and it should be just lunch and speakers, and we charge them $7,000 for classes, including leadership, sustainability, ethics, my favorite ethics. I can't get my 16 year old to make his bed, but I'm going to teach a 27 year old how to be more ethical. Let me summarize every leadership and every ethics course offered at every great institution in America. Oftentimes, the hard thing and the right thing are the same thing. How? I just saved you $7,000. And all these

8:30leadership courses do is bring in some former CEO who's bored and to talk about how everyone was against them, but he did this and it ended up being the right thing. Meanwhile, he's probably in the Epstein files too. Yeah, he's, yeah, he's that's right. But teaching about ethics and leadership. But I'm waiting to hear how this relates to the Federal Reserve. Well, okay. Leadership, Kevin Worch demonstrated leadership and independence here. What economist, what anyone who doesn't have their head up their ass and is taking Econ one, who's come out and said, this is the wrong thing to do. So the whole discussion is whether a guy who doesn't understand economics and now has brought us tariffs and what seems to be a never ending war and exploding diarrhea and so much, so much incompetence around a lack of regulation of guardrails around AI that were all really anxious. This guy understands economics. I mean, this guy is the, this guy is the one to decide what

9:31interest rates should be. So to Worch's credit did the right thing. And this is going to be a footnote. And 48 hours Trump's going to take that. He knows he can. This is losing battle. He knows he can ship postwarsh. I think there is actually a not stupid argument against Iking rates in this situation to be, to be clear, I agree with you. I think it was the right move. But I think the economist, the sensible economist who had argued that this wasn't the right decision would say that this is a supply shock that is related to one thing and one thing only. And that is the war in Iran. That is the reason why inflation is running so hot because we cannot get oil out of the straight. And we're dealing with an energy crisis. And raising rates won't do anything to solve that problem. It'll slow down the economy overall. And it will start to sort of bring down some growth and hopefully bring down prices at large. But the real problem, which is the fact that we can't get oil out of the straight. And the fact that oil is now above $100 per barrel for

10:35Brent crude, that problem is not going away with any movement of the monetary policy. So I think the argument, that argument actually is reasonable. And I will be interested to see if this actually works because it could be a real problem. If we decide to raise rates, we increase borrowing costs, which will slow down the economy a little bit. But more importantly, it's going to increase mortgage rates for regular Americans around the country. And we're already seeing that mortgage rates, study and mortgage rates are above 7% highest in over a year. And if prices also don't come down because this is so tied to the war and so tied to the energy crisis, then we're running into more of a problem. And I think you could begin to fashion an argument as to why this was not the right decision. Having said that, I think it is the right decision because this is the only tool that the federal reserves disposal. They can't talk to the president out of his head asseree when

11:38it comes to foreign policy and when it comes to the tariffs and when it comes to any of his economic policies, when it comes to any fiscal decisions. But this is the tool that they have and they recognize correctly that inflation is getting out of control that it has been sustained for so much longer than any of us would have wanted. Many of us expected it, including myself, but we didn't want it. And so they're using their only tool to get us out of this situation. But I do think the jury is out on if it will actually work. And if it doesn't work, then we're in for even larger problems. Yeah, but the Fed's mandate is the kind of two things that are supposed to be have their eye on our job growth and inflation. And that's in reverse priority or order of priority. If you have unemployment, that's bad. Inflation, if it ever hits kind of runaway inflation, where people start panicking, that's how economies and even societies fail. And if you look at the

12:41numbers, job growth is still, you know, the job numbers keep getting revised. It's hard to even look at them anymore. But unemployment isn't that unemployment is sort of a historical average. It's maybe a little bit below average. The economy has been surprisingly robust in terms of growth. Some people would argue that's deficit fueled, but the reality is we're growing faster than most G7 nations still, I believe. It's inflation. It's really, really the scary thing here. So it just feels like on a balanced scorecard, this was the right thing to do. It also just sets the right tone for an independent Fed. What I also think in this isn't as true. I don't know if you saw Senator Cassidy giving director Patel a hard time around this particular conversation about beastieality. I used to be addicted to beastieality with wolves, but fortunately I'm down to just a pack a day. That's good. That's good, Ed. That's good. Just last night I was trying to count how many

13:51sheep I fucked, but I fell asleep. So much better at the dirty stuff. So much better. If the shoe fits, why why use a condom? I mean, why just where anyway? So why won't we bring them back? This was the right move. This was the right move. And I think the markets are going to like it. The markets, the AI insecurity right now seems to be have a bigger impact on on the markets than than inflation or in interest rates. In addition, I think the world is desperate to see America reflect some sort of rational discipline, if you will. And I was really heartened to see this. I think it's the right, you know, check, check, I'm a fan of this. Yeah, I think the market's reaction will be a very interesting and open question over the next few months because I mean, we can just look at the market's immediate reaction, which the stocks fell slightly, S and B closed down half percentage point, Dow fell 1.2%. I don't think that that is

14:56that meaningful in the grand scheme of things. And we shouldn't really interpret that too much. Interestingly, the 10 year yield rose again above 5%. And I think that is going to be the really important thing to keep track of because you would hope if you're rooting for America, you would hope that if we raise interest rates, then inflation expectations over the long term will be reduced because you're expecting, yes, you might see a short term rise in short term yields because people start to price in the fact that we're going to have higher interest rates in the near future. But you might then also expect that we're going to have lower inflation further down the line 10 years out. And so you might hope that yields the 10 year comes down same with the 30 year as well. So that hasn't happened yet. The 10 year yield rose again. So I think the jury is still out in terms of what inflation expectations will be later down the line. And also the extent to which this is all a function of perhaps just our unsustainable deficits and our incredible eye-watersing levels of

16:01debt, which we've talked about a lot and which we talked about last week. So that'll be a big question. But in terms of the stock market, I mean, one thing that we should just acknowledge is that a higher interest rate environment is generally bad for stocks. And the reason it's bad is just because of basically the risk-free rate. If you're getting a higher risk-free return from your bonds, from your treasuries, then that means that you must now demand a higher return from your stocks, which of course are a riskier investment. And in order to get a higher return, you're going to want to pay lower price for your stocks. And so as a result, generally speaking, when interest rates go up, the price of stocks go down. So the S&P 500 over the past several decades, this was a study from Goldman Sachs. They have seen an average three-month return of negative 2% at the start of a fed-hiking cycle. They also expand this over the course of 12 months and they find that this market usually bounces back in a very significant way. But that is something to keep an eye on. And I

17:03think it would be reasonable to assume that in the near term of the next few months, it's possible that stocks will continue to go lower. And we have seen that over the past month, it's down one and a half percent in the past month. But do we care that much? I don't know because the S&P is also up more than 11% yet today. And it's been a pretty good year. My prediction at the beginning of the year was that we would see positive growth in the stock market. But I thought that it would be very lackluster. I thought we'd see single digit, maybe low single digit growth in the stock market. So I think we could eventually arrive at that place due to the interest rates. But I think the thing that is interesting for investors, we went into the year thinking that interest rates were going to be reduced. That was one of the big tailwinds of the stock market. Now here we are in September. Interest rates are going up. They have just been raised in the expectation. If we look at the dot plot from the FOMC is that we will probably see another hike before the end of the year.

18:06That is just fundamentally a different environment for investors. The UID suggested a couple of things happen. Things get more expensive. So it puts pressure on earnings. You do see a transfer of capital from the equity markets and the bond markets because the bond markets or credit is now offering investors more. So if I can get 5 or 6% on what feels like mostly risk-free, maybe I'll consider that. But what's interesting if you look at economic history is that while initially a hike takes the S&P down over the following 12 months or typically on average a 9% gain in the S&P. So my sense is the market responds well to fiscal discipline in a general sense that the atmosphere is here or that there is an adult in the room. So we talk so much about what we feel are fairly irrational, bad decisions. The Fed is independent for a reason. They exercise that independence. All of the numbers

19:06suggest that this was the right thing to do. So this is a good, good government. We'll be right back after the break. And if you're enjoying the show so fast, send it to a friend and please follow us on YouTube, Spotify or wherever you get your podcasts. Support for the show comes from HIMS. Weight loss can be frustrating, but with weight loss by HIMS, you can take the gastric out of the process. Weight loss by HIMS gives you access to a range of affordable FDA-approved GLP1 medications, including the Wigovie pill and Wigovie pen, along with support to help you stay on track. Wigovie at HIMS can help you regulate your appetite to E-Less and keep the weight off. And with the Wigovie pill, the first-ever GLP1 pill for weight loss, you can get treatment without needles. The process through HIMS happens entirely online. You'll connect with a licensed provider who can determine whether treatment is right for you and have prescribed your medication shipped directly to your door, no insurance necessary. You'll also have access to 24-7 messaging with your care team, plus in-app lifestyle and nutrition support,

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22:14someone to tackle marketing or graphic design. They're all on Upwork. You can browse profiles, review past work, and get help scoping the role so you can hire with confidence and get started quickly. Upwork even handles the operational hassles, including contracts and payments, so you can spend more time actually running the business you're trying to grow. Thousands of growing businesses already trust Upwork to hire highly skilled freelance professionals for everything from one off projects to ongoing support. Visit Upwork.com right now and post your job for free. That's Upwork.com to connect with top talent ready to help your business grow spelled UPWORK.com. Upwork.com. We're back with Prof. Malkis. While the race between Anthropic and OpenAI is capturing most of the headlines, another company has been quietly building a serious AI product and that company is Meta. Meta's new app is called Meta Muse. It is designed to handle everyday tasks for you

23:16from making dinner reservations and scheduling doctors appointments to filling out forms and more. And it is gaining traction. The app is already getting more daily downloads in the US than threads, WhatsApp, and Facebook. So while Meta has largely stayed out of the spotlight in the debate over the potential risks of AI, the company is making plenty of progress in another part of the AI race. So Scott, let's talk about this new AI product, Meta Muse. Mox Zuckerberg described the product he posted this all over social media the other day, here's what he said. Muse doesn't just answer questions, it gets things done for you. I use mine to organize projects with my kids, like ordering ingredients so I can bake with my youngest daughter or getting permits so I can climb mountains with my oldest daughter. I use it to monitor my MMA training and health and to help me find talented researchers and people that I want to meet. So it's a pretty consumer facing AI app. We have been playing around with it. It can do all of the kind of the grunt work in your day to day life and the stock jumped over

24:206% when it was released. People aren't really talking about it that much right now. I think because the conversation has been so dominated by this idea that civilization is going to end as a result of AI. But I'm actually quite bullish on this product, but let's get your reactions. So first off, you know the difference between Marx Zuckerberg and my neighbor Steve. That's right. Steve's not a f***. Too much? I saw it coming. Too much, Ed. I'm sure Claire will edit that out. I have never met or never observed more of a so-so path. I don't think Marx Zuckerberg is evil. I don't think there's a psychopath. I think he's arguably the most brilliant businessman of your generation, actually, so other than you, he's not my generation. I just think the guy understands his asset and that is he sits on first party data, more first party data of any organization in the world. And I predicted in 2025 that Meta would be the most

25:22important AI company of 2025. And as I often am I'm directly correct, but I got the timing wrong. 9 out of 10 internet users, excluding China are active on metal platforms. They have a massive user base, which means, I mean, the primary inputs here are compute and training data. They can buy the compute, but they have a monstrous lead in training data. And I've been looking at Aura and further upcoming IPO. There are a handful of companies that have tens or hundreds of millions of first party data consumer interface with consumer. There's always someone in between, right? Who is controlling or in between you and the data set. The largest first party data minor in history, some people would say a strip minor is Meta. It just makes sense that they would be in this. You know, they have four billion monthly active users. And since the release of this September

26:24of the 8th, they've added 150 billion in market cab and the stock's up more than 10% or the S&P is down 2%. You just any time Mark Zuckerberg does something you have to take it seriously. And he had, he didn't stub his toe. He kind of fell flat on his face with mixed reality headset. But on the whole, you know, everybody strikes out. So you would argue the Meta Muse, would I, well, it's ever a long time, is you want to build a trillion dollar company? You have to do one thing. You have to build a time machine. And that is you have to give people time back. And when you download Muse, you're like, you log in using your Instagram or Facebook or WhatsApp. So it immediately knows you. So it's already benefiting from the first party data that another company would take years to build. It knows where you like to eat, who your friends are, where you live. And it doesn't, it's also taking AI from defense to offense in the sense that it doesn't wait for you to tell what to do.

27:25It takes about basically three clicks from the download to the ideas tab where it begins telling you how it can help. So for example, it will proactively find and cancel random subscriptions. You forgot about it will turn your inbox into a daily schedule. It will track travel fares. It can even make calls on your behalf. So when you think about all the drama and the AI doomers coming out of our topic, it's kind of open to pretty big void for these guys. And we all see that a lot of people are actually souring on Anthropic right now. Ramp had data. They showed that Astra is taking 13% of Enterprise AI spend versus Fable, which is obviously Anthropic's product at 8%. So it's interesting to see that that Anthropic might actually be falling behind right now. It would just be so scary and ironic in such a business case. If meta ended up being the frontier LLM that figures out a way to capture shareholder, the most shareholder value. Anyway, it feels like, I mean, just to his credit that Mark Zuckerberg is a just a brilliant

28:28business person. And more first party data, I think, than any organization in history. I don't think it's significant because remember several months ago when it was revealed that meta was considering selling its compute versus using it to build its own AI products. And we were wondering if that basically meant that they were just giving up on any form of consumer facing AI because it was too difficult, which by the way, given the information that we had, I think was a reasonable assumption. But this is now our evidence. Actually, no, they haven't given up. They are actually investing quite heavily into a consumer facing AI product. And to your point about how people are kind of getting annoyed with Anthropic and they're getting annoyed by open AI and with good reason because of all of this doom orism and all of these constant posts and all this public drama over whether these products are going to destroy civilization. And this matters when you're dealing with a consumer facing product. Consumers need to like you. It actually is important. I'm not saying everyone loves meta. I think meta still has significant PR issues.

29:31But to Zuckerberg's credit, this was a pretty non-annoying release. And I'll just read you what he said when he shipped muse. He said, quote, we didn't call for everyone else to do this before we would. We just did it as part of our day-to-day work because it was clearly the right thing for people and for us. They basically delayed shipping this thing for several months because they wanted to make sure that it was safe and that it was secure and then it worked. And then once they had done all of that homework and they'd figured out their product, then they released it. As opposed to the alternative, which is before you release your product, you go out to the world and you go on all of these news platforms and you say, this product is going to shake the world as we know it. This is going to be the worst thing that happens if we don't figure out how to get things under control. And then they release these products and it's like, okay, now the product is out there. They said this about so many iterations of chat GPT. Every time there's all of this sort of scary doom risn about what it might do. And then suddenly they release the product and it's like,

30:31we're fine. So that I can respect about how they are handling the release of this product. And then I think it's honestly just a really good product. I've been playing around with it a little bit and I want to point out something that a test that our research isn't done Shalon conducted. And this is what we're calling the dinner test. Basically, Dan submitted a prompt to four of the main AI agents. So Muse, Claude, Chat GPT and Google Gemini. And the prompt was the following. I'll read the quote, find and book a dinner reservation for two people this Saturday between 613 and 813 Williamsburg. It should be a sit down restaurant with a rating of at least 4.3 stars. That was the prompt same across every single platform. So with Claude, he also, he also Claude to do this. Claude then asks to connect to open table, which then Dan had to go and set up. Then it picked a restaurant, then it presented some options. And then eventually it said, actually, I couldn't make the final reservation. So Claude failed at doing this dinner test.

31:33Chat GPT, similar thing, asked to connect to open table, picked a restaurant, offered some times, and then after a back and forth said, actually, I can't complete the reservation. It failed. Gemini presented down with some restaurants, asked if Dan wanted to make the reservation Dan confirmed. Then it asked to confirm that reservation Dan confirmed again. Then it asked to confirm again. There was another confirmation. And then finally it made the reservation. It paused the test, but with a lot of extra steps and a lot of annoying confirmations. Finally, Meta's Muse. Meta finds the restaurant, asks for an email and a phone number, confirms the information is correct. And then immediately Dan gets a message that the reservation is booked at a restaurant that he actually likes. So the whole thing was done in less than a minute and it paused with flying colors. So I think what we're dealing with here is an AI product that is actually relevant to everyday problems that isn't trying to create poetry or trying to solve mathematics equations.

32:34Something that basically does the boring stuff, books are dinner reservation, books are doctors appointment, sends emails. Does the thing that you don't want to be doing with your time and it is purpose built for specifically that function? And for that reason, I think it's probably going to be a pretty popular product as much as Mark Zuckerberg sucks as a person. I think what he's done here is actually kind of on the money when it comes to AI. Yeah, the most powerful practical use of AI that I've encountered is I gave it permission to look at my Gmail and with co-work, with cloud co-work, I can say, I hear about a company in the go, I invest in that company in 2019 and I'll say how many shares do I own and what are they worth? And it will go into my email, find, find the document, say you own this many shares, then it will go out to the web and say the most recent secondary trade was at this valuation. Scott, you've lost 70% of your capital. Should we or your 70% down literally to this last night, but then it'll say should we

33:39reach out to, you know, name my tax advisor, should we reach out to them about taking loss? And that's really powerful. So it's the biggest unlock for me with Anthropic was enabling it to understand more about me by giving a permission to go into my email. This starts at letter V because it already knows your relation. It's turning chicken chin into chicken salad and that is meta has been molesting your privacy for 10 years, but it has all this information. It knows where you like to go and knows where you like to stay and those who your friends are and knows what you do all day. And it can start saying, oh, Scott, we see that you like to travel to London on a Thursday night. And this is typically according to your patterns when usually go, should we start looking at airfare? I mean, just you can start playing offense with a level of certainty. And also the AI models are just so I think their management teams are so freaked out and trying to feel around the room for what types of privacy they can violate. No one violates privacy like meta.

34:45And as much of a fight as we all put up about it, we don't actually fight. This is the thing. Like you might say, oh, like trust meta down to your privacy. No one's going to go for that. It's like four billion people do it every single day because literally, as you said, nine out of 10 internet users across the world are using meta products. So you're letting them invade your privacy already. And the question is, if you want to use an AI product, are you down to continue to let them invade your privacy? And I think the answer for most people is yes. It's that versus giving up your data to a new company who you don't know. And then taking a leap of faith and hoping that they will use your data responsibly. But ultimately, I just don't think consumers are going to care that much because they use Instagram, they use Facebook, they use threads, they use WhatsApp, they use all of these apps, all of the time. We love to say that meta sucks and it does suck for a lot of reasons. We've seen that in the lawsuits, but we still use their products because their products are quite frankly useful and entertaining in a lot of different dimensions. I think this

35:48will probably be the same. There's attention between privacy and utility, right? Yeah. And Washington claims that we're all in Brussels and young people on social media, you know, complain we're really concerned with our privacy. And then everybody tells Uber where they're going at all times. And then people publicly say, this is where I am and who I'm with and what I'm doing 10 times a day on on meta. But oh, we need privacy regulation. What about your actions, communicate that you're interested in privacy? I'm watching a 30 second movie of you and your bedroom trying on your clothes and you telling me what mouthwash you use. And what what you did or did not like about your second date last night and his name and when I mean, oh, but you're concerned about your privacy. So a meta just said, meta is just sort of nodded and said, yeah, yeah, yeah, no, you're concerned about your privacy. Yeah. Now we're going to now we're going to serve you the exact

36:52right, you know, add for a trip to Mika noose because you went this time last year. It's the mother of all consumer dissonance, which is a fancy term for people are full of shit and say one thing in their behavior can note something entirely differently. And meta figured it this out a long time ago. They're like, okay, until we get sued and then and not only that, we can delay and obfuscate and even if they find it, okay, us using data about a 16 year olds insecurities and then using those insecurities to start feeding her content that keeps her glued to her phone about normalizing being 5, 8, 90 pounds. Okay, that's wrong. But as long as we can can can can some more Nissan ads will continue to do it. Finally, somewhere regulator will get outraged and then maybe we pay a few million dollars. They're just like honey badger don't give a shit. So they just could be this could be Apple in the iPod or Apple and the iPhone. They're never first, but they come in

37:53they enhance something and they give it with a trusted organization where they already have interface and they capture the majority of the shareholder value. I would be very I have never seen to trillion dollar plus companies andthropic and open AI more fragile right now. I think there's a fairly people hate them. Well, I think they could be down 70% in value within 12 months. If all of a sudden traffic lights start going crazy and it ends up that this ant-infant infestation of bots from open AI started coordinating and speaking to each other and someone and someone instructed them to to start fucking with the traffic lights and figure out and talk to each other and figure out a way to start misaligning the lights that brought way in Houston. And there was some car crashes and someone got killed or run over. I think Nate I think I think you might see some nation states just say sorry no frontier labs from America allowed. Yeah, who are they going

38:53to blame if that happens? Are they going to blame Mark Zuckerberg and Metta who have made it their goal not to advance the frontier of AI but to help people make dinner reservations and doctor's appointments and he's literally said this like he's not trying to level up humanity and turn us into some transhuman AI digital race. So whatever it is that these guys are arguing for and it's getting increasingly insane. I mean, he's literally just trying to sell more ads and he's laid out the plan now how they're going to make money off of this and the plan is to basically just take a small cut of all the transactions that take place on Muse. Like that's the plan. He's kind of going after in a lot of ways a smaller fish which I think ultimately will be a bigger fish because these guys keep talking about how they want to merge with AI merge with robots and I just don't think that it's something that anyone is actually interested in and I think if anything goes wrong I think the person that I think the first person people blame is Sam Altman in Open AI

39:58and at this point the second person people blame would be Daria Amade. I think that a lot of people are upset with them but Zuckerberg's just kind of he's perceived to be on the sidelines here. And then you look at the product actually he's building exactly what I think people want from AI and more importantly he's doing it cheaply because he's leveraging open source and that's why he's offering this thing for free. That's also why the model itself is the cheapest of any of the American LLMs. So I just I think he's going about this the right way when I look at everything that he's doing. I predicted that the market would be disrupted by cheap open-weight models from China. And I may have gotten wrong it might be the cheap open-weight model from Meta and what's weird is what benefits Meta right now is Zuckerberg is the devil we know. It's just strange but people are sort of used to bad behavior from Mark Zuckerberg. They're used to they're used to the sociopathy

40:58but for but people said well we figured out a way to mostly live with it for the last 20 years whereas it just feels like Dario Amade might he be might he be the nice guy you know that ends up being a very you know congenial after the fact goring I mean we just don't know this again Meta and Zuckerberg feel like the devil we know here and it's weird but that is somewhat that is a huge advantage. It's actually a different shita just as we wrap up here just checking in on the market so Meta has been the top performer in the Mag 7 over the past month up 14% as you mentioned they've added 170 billion dollars in market gap since Meta Muse was released but it is still cheap compared to the rest of Big Tech so just looking at the PE multiples across Big Tech Microsoft when you adjust for their private investments which we have to keep on making a stupid adjustment so we did that the PE is around 28 for alphabet similar thing we had to

42:02adjust for their private investments we've talked about that before 32 Amazon adjusted 32 Apple 38 times earnings I'm just still blown away by the by how expensive Apple stock is right now I still don't think it's anywhere close to a buy I think it's a sale actually compared to Meta trading at 25 times earnings below the S&P average as I said earlier on I bought in June 564 dollars a share I'm up around 20% and I'm pretty sick of people saying that I am a permabare I think it's pretty clear that I've had multiple bullish picks including Meta and Microsoft and Salesforce and ServiceNow which are up all up more than 20% at this point but I still think it has room to run because it's cheap and I think that this I mean we'll see with this with this product but I think it's actually quite comparing as much as I dislike Mark Zuckerberg as a person

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45:13unbelievable and now NFL network is on the ESPN app more football more coverage more ways to watch footballs on all season long on ESPN and streaming on the ESPN app we're back with profty markets the european union just invited Canada to become its first associate member the proposal came from european commission president Ursula von der Läen during her state of the union address it's still unclear exactly what associate membership would mean for Canada but president trump said the move is a quote hostile act and threatened the EU with additional tariffs so Scott let's first take a look at fondet lands comments this union between Canada and the european union Canada might be the first associate member never happened before here's what she said we want to bring the relationship with Canada to the highest level possible

46:17and dear mark i said we must urgently reimagine our partnerships so i would like to work with you on opening the door for Canada to being the first associate member of the european union i just love the fact that trump might be taken down by someone in Ursula von der Läen it's like a cs Lewis novel and then Ursula von der Läen stabbed the devil i am like the most powerful person in the world right now is Donald trump number two might be Mark Carney and if you see a kid being abused it you hear a lot about a lot of wonderful families in this case the EU have adopted the kid and this is so i've been thinking a lot about how we have elegantly figured out a way to do attempts snipers called super power suicide

47:18given the lead we had given the institutions the human capital the capital formation on a financial level our academic institutions and what Donald trump fails to realize and the real flaw that is going to set our nation back generation decades of not generations is that chroma going to be neanderthals with cooperation neanderthals with stronger smarter faster meaner and the key whether you you've all know hurry on sapiens the key to our progress is cooperation and if you look at the modern economy our treaties our settlement our free navigation enforcement by the world's largest military our trading agreements rule of law respect for each other's borders that cooperation moving from conquest to cooperation the last 80 years has resulted in infant mortality being cut by 90 percent and GDP up you know 17 fold nothing

48:25has created more prosperity than a recognition by the by the chroma magnum man the cooperation is the ultimate gangster move Donald trump has decided to regress the species known as the united states and just to go and again in my next life i'm coming back as a navy seal of broadway dancer and anthropologist but let's assume i come back as an anthropologist i'm not kidding i actually think i really good for them i actually believe you that's why i find a hilarious i think it's probably true i'm fascinated with adjusting people anyways so if you have any pain come over i think i can get rid like all right so there's a wonderful anthropologist named robin dumbbell who famously estimated that humans can maintain roughly a hundred and fifteen meaningful social relationships but the wonder of the modern world is that we coordinate millions of relationships via money corporations laws markets religion nations norms norms are essentially technologies for getting

49:28people who will never meet to cooperate right you don't bump into people you don't take their shit you sit you if someone older than you comes into the subway you sit up and you let them sit down a pencil the the simplest thing 20 cents no one person can make a pencil it it it takes cedar graphite metal rubber mining shipping machinery finance retail it your breakfast this morning ed was a multinational joint venture coffee was from columbia the machine was from Italy wheat and fertilizer from the midwest and cattar respectively you know before 9 a.m. you've depended and had relationships with more strangers than a medieval king encountered in his lifetime and the fact that we decide to alienate so many relationships and abuse our largest consumer they've said i have an idea i'm not giving up on cooperation i'm just going to start

50:30cooperating with a 300 million second largest regional economy in the world that is the EU what happened yesterday wasn't the EU letting carnian it was them crowning carney president of the EU and right now essentially europe has found the leader it needed and that is mark carney and this should send shivers down the spine of america because we've gone from a 60 or 70 percent control of shareholder value globally to 30 percent and the other 40 percent now has the crisis they needed for cloud cover around things like what i call back sit i think the uk is going to figure out a way to go back to the EU and the you will forgive like bi-gons be god bi-gons i advise a hedge fund you came to me had a lunch with them in la he said give me alpha give me ideas and i said the only real idea i have right now is a hundred and thirty billion dollars is the amount of goods and services candidate buys me you they buy eight hundred and seventy billion dollars of us goods that

51:37seven hundred and forty billion dollars in business is looking for a new supplier i think any finished company that calls a canadian company that's getting its supplies from a miniapolis company has a really good shot at getting that business right now so this is geopolitically continues to provide evidence of the greatest leakage of power and prosperity in history and that is from america to the to the other democracies but specifically to china longer conversation and how and how we could give up this much power and prosperity comes back to a very basic flaw in one member of our species and that is an inability to recognize that the reason our species has been so successful is because we cooperate where he takes this weird business aggressive conquer intimidate coerc but this is a big moment this is a big moment for Canada and more specifically it's a really big moment for what i call the great the great you know pivot and that is a

52:40incredible transfer of power from the biggest democracy to other democracies and unfortunately most specifically to china and i think that that's something that malk conny is actively addressing that he acted actively addressed in his speech uh to the european union is that difference between conquest versus cooperation or some would say positive some thinking versus zero some thinking and this goes back to it is a fundamental aspect of our economy and of markets you talked about the pencil which i think is a perfect analogy milton freedman talk about this a lot of the time the markets are a positive some game that the more that we reach out to other nations and the more that we trade with other nations the more as possible within our own i was very interesting because malk conny used exactly that language in his address here is what he said we are not fair weather allies we do not pursue zero some deals our commitment to the rule of law and are unyielding

53:47defense of human dignity individual freedom and democracies share the same deep roots the same unwavering dedication so i think this is really coming down to a dispute over what actually is the the driver of prosperity and i mean the the economists even the old school economists were just they'd say it planned the dawn trump has it completely wrong this is not the way that you build wealth for a nation and to your point about Canada looking to other countries and looking for other trade partners i totally agree that that is going to continue but i would also point out it's already started we look at counters trade with other countries so far this year it's already increased 17 percent so you have huge amounts of trade that is certainly going to be rerouted away from the u.s and towards other nations things like critical minerals which actually america does depend on Canada for in a lot of ways uranium nickel all of these minerals and

54:49materials that are required for technology infrastructure for military equipment and which of course we also rely on china for and look where that got us in our trade war with china so suddenly this means that america is going to have less diversification available to them for some of the most important materials in the world and then also crude oil Canada makes up more than half of america's crude oil imports and usually i'd say no big deal but here we are in the middle of an energy crisis and we're depleting our emergency oil reserves by the day and so yeah we are in a situation where Canada actually does have some leverage here and i think that the most important thing i mean Canada isn't that much of a threat on its own but when you combine it with europe and when you treat them as the same entity suddenly you're talking about a 25 and a half trillion dollar economy which is actually larger than the economy of china and it is creeping up on the economy of the united states which is roughly 32 trillion dollar economy so suddenly there's there's real leverage

55:51here and i think that this is something that mark carney understands he seems to really understand it especially in his targeting of swing states in america where he is specifically putting tariffs on materials that are going to affect various swing states throughout the u.s. like wisconsin like pennsylvania and he sees how leverage actually works and how he can use it to get what he wants and i i could not agree with you more on this i do think that this is a very important shift in the way the global order and the global economy is actually set up yeah i was come back to Churchill the only thing worse than fighting with your allies is fighting without them and timothy's not snider summarized it perfectly we're in the midst of superpower suicide you know imagine having wonderful wonderful friends that did everything from hid your kids from people looking for your kids to planning to do harm to them that's what canada did when they hit our diplomats and then they returned to the embassy putting themselves a huge huge risk you do with

56:56a lot of trade 70 percent they're totally economically dependent upon us and we've decided okay you couldn't have been a better friend we couldn't have had a better relationship you've followed us into Afghanistan no questions asked i know let's talk with you for it's just i it's just so you wouldn't you wouldn't ever be friends with this person you would think this person had lost their their shit and when i say this person i mean the united states and the silver lining here is i think this might be the crisis that helps the you get it shit together and says all right we need to have one we have to have a multilateral technology investment regulation policy that creates capital formation the hole is greater than some of its parts i do think i had a conversation yesterday with the presidential candidate i said there's a big opportunity to talk about going the other way if you're elected and having the mother of all multilateral trade agreements and get basically take nafta and the eo and the uk and massively lower tariffs and say we're

58:01gonna unlock massive growth through what is the largest world's largest trading block in history because we're going the wrong way we're going back to being the andertals i think it there's a real political value there i agree with you because i mean we obviously know how the Canadians feel about americans right now and that is america and that is they hate us and we're seeing that in the polling day to 41% of Canadians now consider the united states an enemy to the country 56% say Canada has more in common with the EU than with the us and we can look at more colonies approval rating which was 55% at the beginning of the summer which was already pretty high and then after this whole tariff thing blows up it's now at 70% so he's at an all time high so this is like the best thing to happen to morkani and Canadians are pretty much unanimously rallying behind him but what's really interesting to me is the way americans feel about this americans are really upset about this on behalf of the Canadians they oppose these tariffs against Canada more than

59:06two to one nearly four times more americans say the trade war with Canada is america's fault not Canada's and so it is a really interesting situation where you have our own nation is turning against itself and arguing yeah we are the bad guys we are the bully we do not condone the actions that we ourselves have taken and you have to wonder what what how much that's going to matter in terms of actual economic policy here will it be a case where trump realises okay the majority of the population thinks that what i'm doing is bad ridiculous unproductive aggressive hostile you name it and then decides to walk it back all will he just continue going down the path because of his pride and because of his ego and because he just can't get enough of this i'm actually not sure what the outcome would be what do you think i think everything comes back to high school and that is we used to be the cool kids at the cool table but we were nice and

1:00:07sitting at our table meant you had you did better at school you got help with your homework you were more economically prosperous you got the hottest dates you got to do the coolest things and slowly but surely we're now alone at that table and it just and also again with the metaphor of high school they did that study on who are the most popular kids in high school and you think well it's it's the most handsome it's best looking no it's not oh it's the most intelligent or it's the best app nope the kids who are the most popular in high school are the ones that are the nicest the ones that have the confidence to say hey leesa you did amazing at the game on Friday night hey bob i love your shirt the kids who like the most other people are the most popular kids and what are we right now i what and using high schools of metaphor what do we're a kid who's had a growth spur and has you know underarm hair and is big and and we're decided to start beating up

1:01:10everybody at some point the kids right the other kids rise up so i don't i mean who's at our lunch table right now in the high school cafeteria north korea russian argentina how's that gonna work yeah that that's the kids we wanted prom i mean i don't know tango and vodka i probably make for a pretty good party the i didn't what what we have here is on a fundamental level the the poorest decisions um and let me just move to it like this is a market show we're not supposed to be political if you're like me in two things one you've benefited the way i would describe my economic life in america's of following unprecedented prosperity unfair advantage that let me leverage my formidable talents to live a life that few people will ever experience or before me but i had to pay the lowest taxes in history right never drafted never really in arms way

1:02:17crimes consistently gone down i mean oh let's give him free education at the world's greatest institutions they got four of the five Nobel prizes last year university california were 53 percent of the kids don't pay tuition and 67 percent graduate with no debt right all of this unbelievable prosperity standing on the shoulders of great americans and great leaders before me so easy to bitch into the microphone i hope all of these tick tockers and all of these virtue signals complaining about fucking sydney swiney i hope that a third of the bitching and virtue signaling from the left from people like me who have registered a lot more than we put back into the system get out and canvas and vote and remove the stain that is the trump administration or at least start to remove this stain and this is a market show but there is no way to ignore that the worst thing for the markets and prosperity of americans in a century is a narcissist

1:03:20a psychopath and a criminal so i'm kind of and i'm going to be announcing i'm going to be doing a bit of a tour where i'm going to be canvassing with some candidates if you're out there and you're like me and you're thinking i'm you know any honest assessment as i my generation and i have benefited more from america than i'm given this is our moment i really do believe that it is time for americans to match their actions to their bitching into a mic or on social media about how outrage they are okay there's a lot of that let's see how many of us turn out because this is a big opportunity coming up in a few weeks not only for america uh uh but but for the markets yeah i believe the markets will soar you have similar to what quite frankly what fed share washed it i think the markets in the world really need to see a step step up and go okay we got a little out of control we make mistakes the arc of america is jagged

1:04:26but it bends toward the righteous let's take a look at the weekend there are no major earnings or economic dates releases next week but one thing we'll be watching as a result of the nasdaq 100s costly rebalancing which will more than double space x is waiting in the index that will take effect when the market opens on monday morning could trigger significant passive buying we will see Scott do you have any predictions for this week or in general easy times man of the year is marcarney i think you're probably right i think i would agree my prediction i think the metamuse will see significant adoption i think it'll be rivaling charge ebt and clawed in the next six months specifically on the consumer side i think this product is pretty powerful i'll make another one um in the next 90 to a hundred day 80 days a country or trading block is going to ban us frontier models this episode was produced by klamila and allyson was and engineered by benjamin spencer our video

1:05:28editor is hall hay kasi our research team is dan shalon christanodona hew and msl verio jake mcpherson is our social producer drew burrows is our technical director gatherin dillin is our executive producer thank you for listening to profitey markets from profitey media if you liked what you heard give us a follow and tune in tomorrow for a fresh take on the markets and Doesn't, Looks Good