00:00I would kind of love to combine these ideas because on one hand you have the spending we're
00:04already doing. War has been incredibly expensive. That's more spending from the U.S.
00:09And then there's AI and the desire for AI sovereignty. Debt markets are being flooded
00:14with AI. Alphabet raising their debt, their equity offering to $85 billion. Are you concerned
00:21that there's a crowding out happening in this market? Can we handle that amount that's coming?
00:27All great technology changes produce bubbles. And the reason they produce bubbles is because
00:37nobody can get it exactly right. You have to either spend a ton of money to capture your
00:45market share and so on. And don't worry about whether it's too much or not. Or you don't
00:52spend enough money and you lose your market share. And it's very imprecise with a lot of
00:57competition. Okay. And then when people bet on the technology, which I'll bet on the technology,
01:05but they think that buying the stocks is betting on the technologies, which is a different thing
01:10because the stocks can be expensive and so on. That's a problem. And what happens is when
01:17wealth grows a lot relative to incomes, I want to distinguish wealth from incomes. Okay. Wealth
01:24is, you can create wealth very easily in the following way. You say, I'm going to have a raise
01:30$50 million, $50 million on a billion dollar valuation. Okay. That's counted as a billion dollars
01:37of money. And now you're a billionaire, but you only put up 50 million. Okay. And so wealth,
01:43you cannot spend wealth. Wealth is, you have to sell wealth to get money because you can only spend
01:50money. So when there's a lot of wealth relative to the amount of money there is, there is a
01:56vulnerability and bubbles burst when money, when wealth needs to be converted into money.
02:02Well, what is the trigger for that? Often that's because of debt, but it could be for anything. It could
02:07be for wealth taxes, for example. Supposing you put in wealth taxes, then those people who have wealth,
02:13are going to have to sell some of that wealth to pay taxes. That dynamic that I'm talking about
02:20accompanies the miracle technologies that over a period of time have wonderful implications for
02:26productivity. So I don't think it has a problem with productivity. I do think that productivity,
02:33it has a big wealth gap implication. A very small percentage of the population is going to do
02:40unbelievably. And a lot of people won't. So what do we do? Can we work together politically
02:45to deal with those issues? And how do you do it? I do not believe, I'm not optimistic on us
02:51working
02:51together to solve. So what's the end? Is it a bubble that bursts eventually? So I think it is. Yes.
02:58And then that moment, there's always the issue of a bubble and we can measure a bubble. I have
03:03indicators and that there's how many people are over owned. What's the sentiment? A lot of indicators
03:09for bubble. And we are right now rising close to, closer to, not at the same level in 2000 and
03:17same
03:17level in 1929. Is there a specific level where you say, oh no, here's the one that we really need
03:21to
03:22worry about? The thing about it is there's two parts to it. There's quote, a bubble. And then there's
03:28the pricking of the bubble. And the pricking of the bubble happens when there's a need for wealth
03:34to be sold to get the money. Like normally in a dynamic of a debt problem. Okay. If you take
03:42Japanese bubble, take the 29 bubble, take the 2000 bubble, all of them have an element of, you know,
03:50tightening money to, because it can't go on forever. It'll find its bubble. The question is how long you
03:56let the bubble go before there's the pricking. So in order to do the market timing, to know how to
04:01market time, it requires both the understanding of the bubble and the looking for the pricking.
04:07And the pricking is the converting of wealth into money because I need money in order, but I have
04:13wealth, but so I have to sell some of the wealth in order to get the money. That's how it
04:17works.
04:18That dynamic is following that kind of path, even though it's a wonderful technology that'll have
04:24great. Great. We could talk about this all day.
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