重启经济、理解企业债务、避免大萧条，兼谈 2020 大选与多尔西捐赠

Jason Calacanis (00:00:00): Alright, everybody. Welcome to episode 2 of the all in podcast with Jason and Chamath, some basic ground rules here. If you're not in speculation. You don't like to debate. You don't like to question authority. And you don't like to get a shit ton of inside information. I'm gonna actually turn the podcast off right now and go, Download the Daily from The New York Times or all things considered some other bullshit. But we're here to do speculating and talking about inside information in the real deal. With me, as always, my co host, Chamath Palihapitiya. If you don't know how to pronounce it, Polly. Hapa Tia. Chamath are you doing? You holding up okay? Chamath Palihapitiya (00:00:34): I am doing fabulously well. We are in week 4 of our lockdown sheltering in place here. Jason Calacanis (00:00:40): you losing your mind? Chamath Palihapitiya (00:00:42): I'm not because I'm fortunate to be in the suburbs. I think if I was cooped up in an in an apartment in the city, I would feel a lot worse than I do right now, but there's a lot of fresh air. The weather's finally turned. It's not raining as much. so we get to see the sun a little bit makes a big difference. Jason Calacanis (00:00:59): Yeah. Can you imagine 15, 20 years ago hold up in an apartment with 3 kids? who are home from school. Like, these people who are in a city, they must be going insane. Chamath Palihapitiya (00:01:08): I mean, there's so much value to visiting New York, but if you're stuck there in a in a quarantine lockdown. I've I don't know what I do. Jason Calacanis (00:01:16): Alright. Well, we got a great guest today. Why don't you introduce our guest, Chamath? Chamath Palihapitiya (00:01:21): Well, we are really lucky here. This is a a person who I've known now for, I don't know, maybe 15, 20 years. What I would call him is one of my best show pony's. I have ridden this motherfucker up and down in everything he's done. He has made me so much money. It's like owning the publishing rights to the YouTube back catalog. This is how prolific this guy is. Jason Calacanis (00:01:46): It's like owning the Beatles' back catalog. Right? You're like Michael Chamath Palihapitiya (00:01:49): Jackson. -- back log. Jason Calacanis (00:01:50): You bought the Chamath Palihapitiya (00:01:52): so David Sachs, though, know all kidding aside. David Sac, is one of the most incredible people that we know, one of our closest friends, big bit of a background on David. He Almost became a lawyer, but dropped out of law school after going to Stanford and worked with Peter Teal at PayPal and was the chief operating officer there, left PayPal, moved to Los Angeles, unsuccessfully kept his virginity found way to not get laid as a movie producer in Hollywood, which seems to be impossible, Jason Calacanis (00:02:28): but he Chamath Palihapitiya (00:02:29): David found a way of doing it. Produce the movie, one of the best known movies of that generation called Thank you for smoking. then move back up here, started Genie, pivoted, started Yammer, sold that for more than a $1,000,000,000 to Microsoft, and became during that time, frankly, one of the most unsung heroes of company founders and was a prolific investor in some of the most well known iconic businesses of this last generation, Airbnb, Uber, Slack, the list goes on and on, and now is the cofounder of Kraft Ventures. which is essentially David's early stage venture business where he helps a lot of really great companies get to the next level and, frankly, the level that he's been playing at for a while. Despite all of that again, I just see him as a show pony. Jason Calacanis (00:03:34): Yep. Some money printing machine. If you if you can get in on that fund, if you can get in on those companies, you're gonna do well. Saks is an operating machine. Welcome to the program. -- Sachs? David Sachs. Chamath Palihapitiya (00:03:44): Welcome to the pod. David Sacks (00:03:45): Thanks for having me. Jason Calacanis (00:03:48): How are you holding up? Sachs, just personally, family, everything companies, just generally psychologically. How is this impacting you? David Sacks (00:03:57): You know, I think we're we're we're all fortunate to be safe. And, you know, we we started paying attention to to to the virus, I guess, on in February because of Twitter Tech. You know, there are a bunch of people on the tech ecosystem who started tweeting very alarming things in in February or even going as far back as, like, January 30th. And I didn't know for sure if they were right, but some of them were friends of mine. And so I we were to get seriously, and we started doing work from home, I think, on March 1st and We've all been kinda self isolated since then, and, fortunately, everyone has been safe and, you know, hold holding it pretty well. Chamath Palihapitiya (00:04:41): Saksiput, tell tell everybody on the pod, our group chat, and basically what it is, what we do on that group Chamath, and what you think about it. David Sacks (00:04:57): Yeah. So, I mean, basically, our our poker group and sort of extended poker group, which is about I don't know. It's probably about 20 players who rotated them out of our poker game. We have a chat group, and we used to just talk about cards and stuff like that. But but very rapidly, became a a place to share information about the virus in response and what was gonna happen. And the remarkable thing is that whatever we talk about ends up becoming like, it's like everyone else's figures it out about a week or 2 later, and I think it has helped to stay about a week or Jason Calacanis (00:05:29): 2 David Sacks (00:05:30): ahead of the curve on this thing. Chamath Palihapitiya (00:05:32): Has it has it generally been mentally reassuring, or has it amplified your anxiety talking about it all the time in that David Sacks (00:05:41): Well, the interesting thing is that we have people in that chat who are very optimistic that people are very pessimistic have people in between, and then we have people who swing around quite a bit. And so I think you get, like, all the perspectives And I think I guess my view of of the future is that very hard to try and figure out what's gonna happen. You have to think about it in terms of scenarios. And so the, you know, the chat group helps, you know, understand, like, what those scenarios, you know, might look like. Jason Calacanis (00:06:11): So where would you describe each of us then on the positive, negative, and then swingy? You're you're in which camp. Are you swinging? David Sacks (00:06:20): So so I think the three basic scenarios are v, u, and and l. And Jason, I would describe you as as as a v. I think Chamath is closer to the u, which is the the most pessimistic Sorry. The the l is the most pessimistic, and then the u is sort of somewhere in between. And I I sort of swing between the u and the l, but but I also understand the case for the v. And and and and those initials really refer to the shape of the recovery to common. how quickly will will come out of this. Chamath Palihapitiya (00:06:58): So, David, before we drill down into your beliefs on the future, let's talk about the past What do you think this entire episode has shown us whether it's from a public health perspective or an economic perspective, but how would you summarize your view of the world as it's been revealed to you in the past 2 months. David Sacks (00:07:26): Yeah. I mean, I think that what what what it really should you know, we live most our lives during, you know, the these relatively calm periods, and then our lives get redefined by these, you know, apocal events and and, you know, we're not really wired for this this rate of change. I think it was Lennon who said something like there there's some decades when nothing happens, and there's some weeks where decades happen. And And I think that that's basically what what's happening here, and it feels like I mean, a little bit the last thing that was like this was was 911 where, you know, you woke up that morning. saw the the twin towers coming down on TV, and you realized that we were down in a different era. And something like that's happening here as well just in in slower motion. Chamath Palihapitiya (00:08:18): What do you think the government did right, and what do you think that the government did wrong? David Sacks (00:08:25): Well, I mean, you know, limiting the flights in from from Wuhan or China was a good initial step. But after that, it seemed like the response was very slow and and and sort of disbelieving and kind of incredulous. and and and we've seen this basically everywhere. The initial response of just about every country with a few notable exceptions in in Asia that had previous experience with SARS. But but what we've seen in just about every country is that nobody believes it's gonna happen to them. until it happens to them. And then even in the United States, you know, it's It's it's it's like no one believes it's gonna happen in their city until someone in their social network gets gets the virus, and then all of a sudden they take it seriously. And so there's always been this, like it's like this slow moving train wreck where you see it coming and people are just a little bit too slow to react. And, you know, the problem is It's all about the doubling time. So if the virus doubles, you know, every 2 or 3 days in the absence of any action at all, maybe even doubles every day in a in a very density like New York City. Just waiting 2 or 3 weeks can make a 1000 x difference in you know, it's somewhere between, I guess, 10 x to the 1000 x difference depending on the doubling time, whether if you wait 2 weeks or 3 weeks, I saw an article on there's a bunch of articles now talking about why has New York been hit so hard in California has been relatively mild. And and the articles were saying, you know, California only declared shelter in place 1 week ahead of New York. can it be doing so much better, and they're looking for all these different causes and explanations. And, you know, even 1 week makes a huge difference if in New York, New York's been hit about twelve times harder than California. But if the doubling time is just 2 days, Jason Calacanis (00:10:26): 1 David Sacks (00:10:26): week is a 12 x difference. That's how the exponential exponentiality works. And so, like, being a a week you know, or 2 weeks or 3 behind the curve is incredibly costly. Jason Calacanis (00:10:37): How do you break down local government versus federal government and the action there? and is America's architecture with states' rights and powers a benefit in this case or Is it a negative? because we did see the blue states take it very seriously. The red states take it less seriously. The red states have a lot more distance between individuals, the blue states tend to be coastal cities. They're more dense. Maybe you could handicap for us. The the spread of the virus with the layer on top of it of local governments and the political climate we're in? David Sacks (00:11:13): Yeah. I think, you know, the the the decentralized nature of the American system is both a blessing curse in this in this type of situation. The the curse is that it's been very hard to create a unified national strategy. We're we're doing lockdown's piecemeal, and and so the the lockdowns get forwarded as people move around between areas that are not locked down and start new outbreaks. Very hard to control a virus that way. You know, we're also you know, we're we're also not able to act in in the in the authoritarian way that that we saw China act and move on to control the virus very early on. But the blessing of decentralization is that it's allowed you know, the the governors of states to react, and it's allowed private companies to react, and it's allowed entrepreneurs to react. And you see a lot of people helping in different ways. And and and and and that can be that can make up for having kind of a a a more ineffectual centralized response, which isn't likely to to to work completely in a country the size anyway. Chamath Palihapitiya (00:12:22): Do you think that the health apparatus of the United States did its job? And where do you think the areas of opportunity are to improve? David Sacks (00:12:34): Well, the if if you're talking about the health system, it seems like the the health system has done a great job in reacting to the virus in terms of hospitalizations, you know, hospital adding hospital beds, adding ICU capacity. Even in New York, it looks like I think Cuomo just said today that they've got you know, ICU capacity. They've got hospital beds. I think the hospital system's done a a great job rapidly creating more capacity. We haven't seen a situation like in Italy or even the UK where they're literally rationing ventilators and making horrible triage decisions about who's gonna get a ventilator and who's not. You know? We haven't seen those types of cars in in the US. But But if by health system, we mean the FDA, the CDC, the WHO, which isn't part of the US system, but we do rely on them to some extent. You've just seen, I think, you know, amazing, really malpractice or negligence if they are a former company think they'd be sued. You have the you know, you have on the c d c website things that haven't checked it today. But as of a few days ago, we're just blatantly not true. I mean, saying that you only needed a mask if you were actually taking care of a person with with with COVID nineteen, that that standing, say, a three foot distance was sufficient for for that that was sort of an simple amount of social distancing even if the other person is coughing or sneezing, and that's not true. They're just saying things that that weren't true. And then, you know, on on the you know, the the CDC and the surgeon general until, basically, the last few days were telling us that mass didn't work were ineffective. Didn't and then now they've they've they flipped to recommending them, but they're still not required. And I just wrote a blog today that I published about half an hour ago that Jason Calacanis (00:14:35): I thought the best part of that blog post, by the way, it's up on Medium and and Sakses. tweeted it, and I retweeted it. David, is what you said at the end, which is we're taking the most draconian measure, quarantining people, which we use as softer term shelter in place, but it's a quarantine. Call it what it is. You're not allowed to leave your house except under rare circumstances. But we won't do the basic thing of wearing the mask. It makes no sense. And, Chamath, I think you had a really interesting question early on here, which I think we should all circle back on one more time, which is What what is this reveal? Right? Like, in this kind of a crisis, and I love the statement of Saxx where, you know, some decades, nothing happens. And then a week, you have a decade happen. The thing that that I am I think is the big takeaway for me is handicapping who you can trust and what people's agendas are and how they behave in a crisis because there are a group of people building models. And what is the motivation of somebody who builds a model? We think about we all get pitched as investors or when we worked inside of companies, we build models, and we know the models mean nothing. They're made by humans. And what's the motivation of somebody building a model in today's climate that then people adopt that model, and there's life or death. What would you handicap? Would you go conservative? Would you go aggressive? Would you lean into people dying in the case of supporting the economy? And so the there's the model makers There's the government, local, and federal. You have the media who are trying to get clicks in some cases. You have a capitalist who are trying to you know, protect their book and their bets. How how do we all look at and think about people's agendas and, like, the CDC having an agenda? the local government and the model makers having agenda. Jason Calacanis (00:16:18): Chamath, maybe you can take that one. Chamath Palihapitiya (00:16:20): Yeah. I I think that the masks issue is actually the most instructive thing in this whole debacle. And the reason is that there was pretty obvious data very early on that it was something that had unknown but pretty useful upside and absolutely zero deleterious downside. Right? So if you were thinking about risk management and I gave you some options. Option 1 is do nothing. Option 2 is here's some drugs that you can take prophylactically, and I don't really know the either the efficacy or the long term damage to a broad based population of people taking them. And option 3 was a piece of cloth over your nose and mouth. Jason Calacanis (00:17:15): Yeah. Chamath Palihapitiya (00:17:16): And for 10¢, and apparently, at a minimum, it prevents other people from smelling your bad breath But at a maximum, it prevents projectiles of of disease laden spit getting into -- Death. Jason Calacanis (00:17:30): -- earth -- Death vapor. Chamath Palihapitiya (00:17:31): causing you to die. Yes. And and we couldn't agree that that was a Jason Calacanis (00:17:37): -- David Sacks (00:17:37): Why? Jason Calacanis (00:17:37): -- peace why? Why? Is this it was the agenda here because they didn't want people buying up the masks and not going to health care workers. Why couldn't we agree on something this simple? Chamath Palihapitiya (00:17:48): Because It was never about the n ninety five masks. You could have worn a cloth mask. A tea cloth could have covered it up and given you Jason Calacanis (00:17:55): 70% Chamath Palihapitiya (00:17:56): efficacy. This has everything to do with incentives and everything to do with your other question as well, which is like, you know, how why do modelers behave the way that they do? All of this is about being taken seriously. And so to be taken seriously, you have to understand the incentives in the game that you're playing. So for a modeler and a forecaster, the incentive is all around being conservative because that's how you're taken seriously. there's nobody that has any upside in showing a model that shows 10,000 people dying. All of the attention and the the gravity with which you're taken, and the attention that you get is when you first put out a model that shows that 2,000,000 people could die, which is what Imperial College did. And then eventually, you walk it back and you walk it back. And after the actuals exceed the forecast, then the data converges on what actually happens, and you see that these models were woefully inaccurate. It's the same with why the CDC or the WHO are just so completely incompetent. because the incentives in those organizations are essentially to play their game, and that game is not one of public health, but it's one of politics. Jason Calacanis (00:19:15): Right. Chamath Palihapitiya (00:19:16): And so you have these people fighting each other over political territory and the right to basically make decisions versus the actual substance and the validity of the decision. Jason Calacanis (00:19:27): David, does that does that correlate with your thinking and then superimpose the media on top of that? David Sacks (00:19:33): Yeah. I mean, it's I think there there's a couple of things going on. One is that that there is a huge culture clash going on between the people who need conclusive scientific proof before they're willing to recommend any course of action. And then between other people who are willing to take a more experimental approach to try things to iterate the way that we do in start up land when confronted with kind of ex you know, company existential issues. And And the latter approach is smart when, you know, there's a lot of upside in trying something and not much downside. You know? And and the And and the the the the other approach of this sort of this scientific, the pseudoscientific sounding approach where you're constantly demanding conclusive evidence It's actually people pretending to be smart, you know, with people who wanna sound smart, but it's actually a pretty dumb approach. And So we've seen this, like, ultra clash playing out over and over again, you know, and Jason Calacanis (00:20:39): So experts should read it, Pete, it back to you, David. Experts are afraid to do something experimental with low downside because they have reputations, and they wanna sound smart, whereas entrepreneurs or maybe capitalists or other problem solvers or perhaps even gamblers are gonna say, there's no downside here. What's the downside to putting a mask on? Nothing. Let's try it. The same thing with Chloroquine and the Z Pak. Very early on, people were saying like Elon and other folks in our circle, Why not just do it? Chamath Palihapitiya (00:21:06): Hold on a second. Hold on a second. Chloroquine, let's not put that in the same category. That's the point. Because it's a drug, Jason. Jason Calacanis (00:21:12): Yes. Chamath Palihapitiya (00:21:12): It's a drug for malaria. Jason Calacanis (00:21:13): Okay. But -- You have -- you have zero evidence. Chamath Palihapitiya (00:21:15): So no. No. Jason. Jason Calacanis (00:21:17): I'm taking it if you're it's sick already. Chamath Palihapitiya (00:21:19): No. We still don't know. Jason Calacanis (00:21:21): Right. Chamath Palihapitiya (00:21:21): Let's be clear. Okay? So masks is a wholly different thing. This is why I said it that way. Jason Calacanis (00:21:27): Yeah. Chamath Palihapitiya (00:21:27): You you if the the minute you start to add drugs, you come off as a armed your epidemiologist, and anybody reasonably smart can poke holes in your theory and you sound like a fucking moron. You cannot sound like a moron by telling people to wear a cloth over their nose and their mouth. Jason Calacanis (00:21:43): Okay. But the next step, if you were in the hospital and you've been diagnosed and they said, hey. The doctor says, you might wanna try this. There were people who were saying don't even try it, and there was a direct correlation when Trump said he was behind it. It seemed like the media and everybody were like, this is the worst idea ever. Chamath Palihapitiya (00:22:00): But but but this is your point, which is that the incentives of that game are to politicize things versus think about what's in the best interest in the public health interests of either the United States or the world. Jason Calacanis (00:22:11): But are we in agreement to try it if you were if you were in the ICU, and they said, hey. You wanna try this? You wouldn't try it? Chamath Palihapitiya (00:22:17): No. But this is the problem. It's like the posture of the American political infrastructure is broken. And moments like this shine a light on how broken it is. Because as David said, all of the testing and iteration All of those things are must haves in peacetime. They are nice to haves in wartime. Jason Calacanis (00:22:39): Right. Chamath Palihapitiya (00:22:39): You don't have a time to walk around and test fire a gun and make sure this works and that works. The enemy is in front of you. you shoot and you fire and you aim later. Jason Calacanis (00:22:50): Yeah. Chamath Palihapitiya (00:22:51): And in that posture, we have to have a set of rules that contemplate giving people at the ground floor on the border of, you know, where their life is at risk, the right to make a decision as well informed as it can be about what they can try to do to save their life. And doctors need to be equally empowered, and, you know, we have a effectively done that, but we just did it in fits and starts. And in that, there is all of this noise that delays the right decision, which is not that hydrochloroquine is good or bad, But it's that here's all the published data into the hands of the doctor who can actually read and understand it so that he or she and the patient can make a decision together. Jason Calacanis (00:23:33): Yeah. Agreed. Saks, what are your thoughts on chloroquine and the z Pak and and that whole sort of unraveling of this is the miracle. It's not the miracle. call. It's worth looking at and how that debate occurred, let's say, on the Twitter and then also in our stream when we were talking. David Sacks (00:23:51): Well well, Trump was not the first to embrace the potential of hydroxychloroquine. In fact, we were talking about our chat group before you know, became national news. Of course, once he did embrace it, it became political football, and a lot of people want to prove him wrong. And now it's hard to have a conversation about it without it becoming political. But the, you know, the argument for hydroxychloroquine really started with some research papers that showed that it worked in vitro, basically, in test tubes against the virus. And it worked against SARS, you know, which is a related sort of category virus. I'm not I'm not an expert or anything. This is just sort of, you know, me tell you what what I what I know is a consumer of information. And so it was not crazy to think this is something that should be tried in the context of COVID 19. Now we don't know if it's gonna work or not. I saw an interesting presentation by UCSF, and their working theory on it is that is a hydroxychloroquine plus CPAC might have some impact in the 1st week of the virus when before peak viral replication takes place, and this might help interfere with the virus replicating. Once you're in respiratory distress distress, though, and it's in your lungs, you have to you're into a different phase of this, and and they don't believe that Hi. You they they think you need to look at other things. So so it sounded like this was potentially valid treatment in week 1 less affecting week 2 and you know, by week 3 when you're at severe ARDS, you know, it's you gotta find other things. So you know, in terms of, like, what the right policy is, you know, this you know, I I be in favor of the right to try. I mean, ultimately, we should let patients and doctors make this decision together. And and so, you know, I think the FDA did the right thing giving emergency trial authorization to doctors to be able to try this with their their patients. And and what I think is happening is is that there's you sort of rapid decentralized information sharing happening among doctors and hospitals, and you know, I think they're they're getting to the right answer here. Jason Calacanis (00:26:14): Okay. Do we do we feel comfortable moving on to financial implications of this or Are there things about the modeling? David Sacks (00:26:23): On on upside downside. I agree with Chamath that hydroxyl chloroquine is a little bit more complicated. Mass are sort of the really unambiguous one because it's just so easy. There's so little down -- It's Chamath Palihapitiya (00:26:34): just cloth. It's cotton David Sacks (00:26:36): Right. Jason Calacanis (00:26:37): You literally could put it back down. Chamath Palihapitiya (00:26:39): your underwear. Jason Calacanis (00:26:40): You could use your Chamath Palihapitiya (00:26:40): own underwear and just put it across your face. I mean, this is what's so insane. That David's right. I remember having this argument with someone because on the CDC website, as David said, it would only recommend it not as a preventative measure for you, but if you are old, you should use a mask only if you were treating somebody with COVID Jason Calacanis (00:26:59): 19. David Sacks (00:27:00): There's there's such an element of these authorities trying to manage us. You know? I, you know, I I I really hate that that I mean, I do think that that they thought about, will we create a run on mass? Will you know, that that that they don't wanna tell us the truth because they're afraid of some consequences of telling us the truth. And, you know, I hate that feeling of being lied to by public officials because they're trying to manage Jason Calacanis (00:27:26): -- Chamath Palihapitiya (00:27:26): I I'm willing to be infantiled by people that are smarter than me. Jason Calacanis (00:27:31): Yeah. So can you give us a list of the four people you think are smarter than you? Go ahead, Chamath gives. Chamath Palihapitiya (00:27:35): I am I am not one of those 4 people infantiled by nameless bureaucracies. And I think that Americans deserve to not be infantiled. I mean, for the amount of money that we pay and the amount in taxes and the amount of power that we give folks The one thing that I'm realizing through this whole thing is, like, you know, the it it it is true in some respect that the countries that had some level of authoritarian management did well, but it's also true that the countries that had robust civil services filled with people who are at the top of their class also did well. Singapore, South Korea, where it is a stature it's a point of pride to work for the government, where it's some of the best paying jobs. Japan. And so, you know, one of the things that that I realize is, like, career bureaucrats really do infantile Americans in a way that's really unproductive and and unhealthy. I mean, you know, it doesn't it surprise you and kind of, like, perturb you that The x head of the FDA is way more prominent and out front with his point of view than the current head of the FDA? I mean, what the hell is going on? Jason Calacanis (00:28:48): I think what we know is going on is, I mean, Trump was elected, and he he he dismantled some of this, and the system has broken out and inherited it. Chamath Palihapitiya (00:28:55): I think no. I think that that's unfair. And, you know, I'm I'm I'm not I'm not a big Trump supporter, but I think it's unfair dependent on the reality is maybe he defunded or underfunded a bunch of things. But the hollowing out of our institutions have been happening for 40 years, and it started with Reagan. To be clear, because we tilted the scales towards free market trickle down economics where government was viewed as a stop for really smart people to inject themselves into industry at higher levels. or it was a place that's, you know, capable people would never go because capitalism, the way that it was structured, was set up in such an aggressive tilted manner for those that were capable. And, unfortunately, it hollowed out the government from people that were really strong of character in a broadly speaking kind of way. And so what happens is that then bureaucracies form the incentives change and you get what you've gotten right now, which is, again, it is a it it it is a point of argument on something as simple and frankly idiotic as a mask. Jason Calacanis (00:30:08): Okay. Let's move on to talking about the economy. And, David, you've been quite a heretic on Twitter because you decided to engage in the one conversation you're not allowed to have which is talking about people's livelihoods as opposed to their lives, you could only keep one thought in your mind as far as the kind of woke far left is concerned and the Twitter mobs. You could only talk about people in life and death. You can't talk about their livelihoods, but You've been talking and starting a dialogue on how you would structure teams in a start up for how do we deal with the crisis versus how do we go back to work. So explain how you would do this if this was a startup company, if you were doing it on an entrepreneurial level, and what you think the road looks like. Let's start with San Francisco Bay Area, and then we'll extrapolate to the most acute area in America, New York. David Sacks (00:31:08): Yeah. Well, the the the the big question that everyone's gonna be asking by the end of April is what now? because I do think you're already seeing this in the New York data that quarantines work, but that shouldn't be a total surprise to us. Historically, quarantines have always worked. I mean, quarantines were the way that people dealt with plagues when they didn't have any technology. It's the problem is just they're incredibly costly. And if the quarantine goes on for months is our only way of dealing with the virus, then, you know, we could be looking at the depression. So the so the question really is, you know, once we've arrested the exponentiality of the virus and I I you know, I think we have to do that first. But once we've arrested the exponentiality, the big question is gonna, well, now how do we get out of this? And what I worry about is that the the daily update mentality, you know, I think it's great that our leaders are giving us these daily updates showing that they you know, this they're showing a bias for action, which I think is good. But I worry that we're not gonna be ready. It that this precious time that we're buying with quarantine is not gonna lead to a better plan in May because no one's really working on that plan. They're just working on sort of the the triops, the the the immediate response, the making sure that that, you know, hospitals around the country have the ventilators of beds they need and we put in the orders. Jason Calacanis (00:32:35): Why is it, David, that people can't keep these 2 parallel processes in their mind at once? You've been attacked viciously on Twitter. the media attacks anybody who brings us up as, like, only caring about capitalism when in fact, you need to do both plans. You need to figure out how people get back to their livelihoods and we avoid a depression, which would kill more people ultimately. Right? I mean, I think there's consensus about that, whether it's depression or suicide, etcetera. or people not being able to feed themselves or, you know, have nutritious food and health care. So why can't people put these two things in their mind at once And then let's talk about the actual plan. If you were planning and you were the mayor of San Francisco or you were in Trump's cabinet, and they said, okay, David. You make the plan for the Bay Area to go back to work. Take us through your 1, 2, 3, and then we'll throw it to Chama. David Sacks (00:33:24): What what I would do is, like, I would do what I would do in a company for a product release is I'd have, you know, in a company, I'd have a product manager for the 1.0 release and I have a different product manager for the 2.0 release because it's very hard for you know, somebody to be all in on 2 different leases which have 2 different schedules. So, you know, I think the team that we have right now that's basically concerned with the immediate response, the the triage that you keep doing what they're doing. Make sure that you know, the country's reacting the right way that has all the supplies they need that you know, they're berating 3 m into giving us more PPE or whatever it is. But I think that there should be a separate team kind of a a, you know, a a a czar for the 2.0 response. which should be focused on how do we create a new system that gets us out of lockdown but doesn't retrigger the exponentially of the virus. And I think that that person and that team should be ready to slide the new system into place in May I don't know if it's beginning in May, end of May, whatever, but sometime in May, they should be ready to slide that new system into place so that this precious time we're buying isn't wasted. Jason Calacanis (00:34:35): Give us your 1, 2, 3. 1 is masks, obviously, I would think. David Sacks (00:34:40): Mask is a total no brainer. Jason Calacanis (00:34:42): So that's number 1. Give us your 234. if you if you wanna riff here a little bit. David Sacks (00:34:46): Yeah. I mean, the other elements of the plan that people keep talking about, it's it's, you know, rapid, ubiquitous testing. I mean, you and you have to have same day results to keep this this business of it taking 2, 3, 4 days in the lab. The problem is if someone is infected, they could be passing it on during that time, you don't you don't you don't isolate them in time. So we have to have massive ubiquitous same day testing along with contact tracing so that when you do find out that somebody's got it, you can not nicely, not just them, but all of their contacts. That's the system that seems to have worked in South Korea. And, I mean, those seem to be the the the the pillars. Jason Calacanis (00:35:27): And and is quarantining the high risk during this 1st phase of the rollout with testing social distancing and masks, that's that seems to be the no brainer. I would add 4th bullet point, which is if you're obese, diabetic, asthma, or some combination of those in over 60 and or over 60, you gotta stay home now, and you cannot be in touch with anybody who's out and about and part of that first wave to go back to society. David Sacks (00:35:57): Right. We we know that certain segments of the population are at much higher risk than than others. And so part of having a more fine tuned response to the virus other than just shutting everything down would say, well, let the people who are at very, very low risk go back out, still wearing masks, and having the right protocols and hygiene and all that all that stuff. But but but you keep the high risk population isolated rather than shutting down the entire economy. Jason Calacanis (00:36:23): Alright. Chamath, if you're on the board of directors, and David was the Tsar of the May plan to go back how would you what questions would you have for him and how critical can you be of his plan? Let's make this as if we were actually in charge to moth Savage David's plan. Chamath Palihapitiya (00:36:39): Well, I I I I probably would push David to consider a more aggressive approach here. And this is something that I've talked about before. Jason, you and I have talked about this on the podcast before, but We need a a biological patriot act. I know that it's unpalatable for people on the left for certain reasons and people on the right for other reasons, but it just doesn't matter what they think. It was reported today, by the way, that the CDC and the task force if the White House is considering immunity cards, but a much more beefed up version of them. They these these need to be cards that have, you know, some kind of chip inside them that are non hackable and issued by the government. But, you know, my what I would push David to think about if he was the czar of getting back to work is the following, which is I agree with the broad based testing. I think that you need to have some kind of, you know, wristband that allows you to be inside of certain green zones in in every single city or town in the country that allow you to you know, some way be back to normal. But there also needs to be red zones where you cannot. We need to have a very, very quick way of restarting a quarantine if there are hotspots that develop. But all of it needs to be supported by broad based testing and a biological Patriot Act. We do need to have immunity cards. And the simple basic reason is that it is the only way that one can prioritize the economic salvation of the US economy. Because I think once we have paid the cost from the public health perspective, which we are doing at the end of this quarantine in flattening the curve or crushing the curve. Our immediate focus has to be in resuscitating the GDP of this country. because otherwise, the number of deaths and the numb and the amount of pain that it that is caused by economic destruction will far outnumber the number of people that die from this, which is tragic already. And The only way that I can see for us to do that in a scalable way is with an immunity card, a biological Patriot So I would be pushing David to think about that and rip the band aid off and get that done. Jason Calacanis (00:39:10): And, David, I would also push you on thinking about quarantining not just at home, but maybe by region and hot zones. So if we know the New York corridor or the northeast corridor is severely infected, nobody in or out of that corridor without a visa, without and I know this is a very touchy issue well in terms of civil liberties. But until we're through this, I don't see why people from New York need to go to Florida without maybe a rare exception or, you know, something to that effect. Right? So if we know we got California out of it or if SoCal is still in the thick of it, but NorCal isn't, maybe we have some level of testing required to get on a flight to come to San Francisco or to go to leave New York. So those are two 2 punch ups. How would you look at those, David, as the new czar of getting back to work? David Sacks (00:40:02): I think it's all on the table. I mean, I like the green zone red zone idea. I like I like using immuno information. We've been talking in our chat group for, I think, a month about these blood serology tests. I tweeted I took one of those tests weeks ago. I think, like, 3 weeks ago before the FDA had even approved it, and I I tweeted about it. So, yeah, I think all that I think the the immunity part is I think we should use all that information. I mean, it would all be on the table for sure. And I but but I think most of all these ideas can be tied together into a coherent system, and I'm worried that our approach to date has been so ad hoc that we're not gonna have a coherent system ready to go as a replacement to shutdowns in May when we need it. Jason Calacanis (00:40:48): is part of this, you talked before about how you didn't like to be managed. I think we all agree we're being managed and massaged because they really do not want to even talk to us about going back to work in May or what happens they're afraid that we're gonna jump the gun, and we're all gonna just go to Crissy Field or, you know, whatever park or Central Park and just throw a giant party. but people are not stupid. There's a there is a certain self preservation here that should be inherent in all these discussions, which is, you know, any reasonable person watching the death toll in New York does not wanna leave their house. And so Why can't how much of the lack of discussion about this issue do you think, David, is because people are afraid treat people like adults because they think they're gonna just go out to Chrissy Field or, you know, Dolores Park. David Sacks (00:41:42): No. I mean, I I think you're right that there was this long period of time where the authorities were just trying to get everyone to buy into the idea that the virus was dangerous. They needed to shelter in place, and and they didn't want to to hear any views that that that appear to be contradictory. I don't think they were contradicting it. You know, I remember when the imperial college study came model came out, and they said that 2,200,000 people would die in the US, and I tweeted that. I thought that number was insane. It was fear mongering. And I think, you know, that's turned out to be the case. But, you know, people responded well well good. I mean, even if it is fear modern. We need to make people afraid because otherwise they won't do the right things. I guess that's true in a situation in which we're relying on everyone's voluntary compliance to engage in a quarantine or to wear masks. And I guess part of the response here is to figure out what what what action items should not be voluntary that we just need to do in order to get past this. Jason Calacanis (00:42:45): Shamofrio, that's Chamath Palihapitiya (00:42:47): I think that getting back to work is going to be much, much more difficult than people think. I think that the absence of a vaccine, which looks like at best 18 to 24 months from now, we will never get to a 100% of where we were before or at least the potential to be at a Jason Calacanis (00:43:08): 100%. Chamath Palihapitiya (00:43:10): And so I just think that over the next 2 years, we're in for a tremendous amount of difficulty. And this is sort of where, you know, I'd like to shift the conversation. I think that, you know, we've now poured between the United States government and the fed, almost Jason Calacanis (00:43:26): $10,000,000,000,000. Chamath Palihapitiya (00:43:29): We smeared it into the economy, and only 3¢ of every dollar has gone into people's pockets. And I think we're hoping that the other 97¢ somehow trickles down into their pockets in some way, shape, or form. Now when you look at that Jason Calacanis (00:43:46): 97¢, Chamath Palihapitiya (00:43:48): half of it was, you know, things like propping up the commercial paper market, propping up the repo market, but it's also been things like propping up investment grade debt, propping up high yield debt. And I have a real issue with this because I think that if we're gonna take 2 years to get back to normal. And I really do think it's 2 years because, Jason, a lot of the fears that you expressed people will have as lingering doubts and will prevent them from being at a 100%, which means businesses will not be at a 100% until you can get an injection and know that you're protected. We're doing an enormous amount of damage because we're taking 1,000,000,000,000 of dollars and flooding it into the economy in a way that's just not going to be effective. And I don't think that we're taking enough time to really think through these things. So, you know, on the one hand, while I appreciate the Jason Calacanis (00:44:39): velocity Chamath Palihapitiya (00:44:41): or not the velocity of the intention. You know? Like, I think Jerome Powell's commentary I applaud, which is like, you know, he's saying all the right things, which is we will do everything possible. But the lending program to companies has been haphazard and difficult Jason Calacanis (00:44:57): But it did get started in 3 weeks, and some people have gotten money in week 4 of this. I mean, it's pretty incredible. Chamath Palihapitiya (00:45:02): Now, you know, the the the numbers that I've read is that, you know, on average, the loans are turning out to be sort of, like, you know, in the tens of thousands. And on top of that, you know, David and I talked about this in the group chat, but the math makes it so that you're better off furloughing or letting people go than you are taking PPP, which means that a lot of this money may never get take it. And so, you know but again, all of that is still a small rounding error. We're talking about less than Jason Calacanis (00:45:31): 10¢ Chamath Palihapitiya (00:45:31): on the dollar. 90¢ of the dollar have gone into areas that will not really touch an average American citizen. And I think that's just fundamentally wrong because the trickle down theory of all of this you know, was started 40 years ago, and we can see now that it doesn't work. Jason Calacanis (00:45:51): David, any thoughts on the stimulus? David Sacks (00:45:53): Well, I think I think what's happened is that we have a 30% hole in our economy right now. You've got, you know, like, a 15% unemployment rate going to go going to 25 or 30 maybe as high as that. We don't know yet. You've got a you know, we think that GDP is gonna contract in in the next quarter by a quarter to a third. And so you've got this giant hole in the economy and what the the the fed and treasury are trying to do is plug that hole. for a period of time until they we can get through this this this health crisis. And and if the crisis only lasts a few months, maybe they can hold it all together. But I I do worry that if it lasts longer, it the it's gonna slip out of their hands. And And the result is gonna be cascade of of defaults and bankruptcies and and and and effectively a great unraveling of our economy. Chamath Palihapitiya (00:46:51): Yeah. I think that I think that though in fairness, like, this is where I think bankruptcy, it's almost viewed as a four letter word. but it's not. And in many ways, the bankruptcy process could actually be the saving grace of American business in this moment. And the reason I say that is that it allows, in a bankruptcy, these companies to discharge a lot of the debt and we could set up a mechanism where these bankruptcies could be done in a way where, again, similar to taking PPP, you don't let people go. you know, a percentage of the of the cap table must go to the pensions if they have them. A certain percentage of the cap table must go to employees. And then the remaining percentage goes to the secured bondholders. And so the existing equity holders and the unsecured bondholders would effectively, you know, not be made whole, but in that, all the employees would be. And if you combine that with a a UBI program where you put Look. There in in the United States economy, only $8,000,000,000,000 is wages. So, you know, we could do so much If we had given every United States citizen their absolute salary of 2019 right now We'd still have 2,000,000,000,000 left to bail out companies. Jason Calacanis (00:48:09): And everybody could take a year and get paid. Like, literally have a year of sabbatical and be patient. Well, I Chamath Palihapitiya (00:48:13): think what it really does is it guarantees the chances or it maximizes, sorry, the chances of the consumer led recovery. Like, The United States has never been an economic system that's been vibrant because of government spending or other things. We've always been vibrant because we've been consumer led. its consumer consumption, and its customers of companies buying products that they need or want that drive the economy forward. And if you think about our largest customer base, they are the US population. And by guaranteeing their revenue, so to speak, You actually allow them to then spend once they get out of quarantine, and you'll see them spend even in fits and starts. In this way, you know, you could spend $500,000,000,000 buying a bunch of junk debt. I really don't see as a reasonably, you know, said I'd be a participant in the markets, how it actually helps anything. I think all it does is it saddles you and me and all of our listeners with a bunch of toxic junk debt that eventually has to get sold by the Fed, as David said, in the grand unraveling, Jason Calacanis (00:49:20): And it would be more healthy. Would wouldn't it be more healthy, David, to allow a certain percentage of these companies the weaker ones to fail so that the stronger ones could then pick up those employees, and there'll be some stability. And I'm curious if you'd think that we're gonna be living in a world where and people have speculated about this. Maybe some the individual consumer changes their perspective. And maybe people come out of this crises with a different worldview. I don't necessarily subscribe to this, but, Shmuth, you do. We've had this conversation. so I'm curious, David, if you think the American consumer will forever change, and maybe they upgrade their phone half as much they, you know, spend less, and and they basically live a more modest rural lifestyle and people maybe stay out in Tahoe or Colorado, wherever they went during this crisis, what are your thoughts? David Sacks (00:50:12): Well, you're really talking about depression era values. And the the problem is if we acquire those values via depression, that that would be a pretty bad outcome here. So but, yes, that could happen. You know, I think where I agree with Chamath is that I think that even though the the federal government, the fed, the treasury, have a tremendous amount of firepower in a situation like this and may not be inexhaustible. And we have to kinda pick and choose and prioritize who's gonna get aid and and who's gonna get bailouts. And right now, it feels a little bit Willy Nilly. You know? And it feels like it it it it it under those circumstances, the bailouts default to the people who are politically connected and powerful as opposed to the workers, the pension funds, you know, the Main Street small business owner who's worked their whole life on a business now all of a sudden is is underwater. And I think, you know, it's it's it's gonna be very hard to get the the the the 8 to the right people. Chamath Palihapitiya (00:51:21): Look. In the last 4 weeks in the last 4 weeks oh, sorry. In the last week, this is an incredible step. I apologize. In the last week, the amount of distressed debt in the US has quadrupled in 1 week to a $1,000,000,000,000. Right. So as an example to David's point, that's much more visible to Jay Powell or to Steve Mnuchin. in the Fed and at the treasury than than it is that, you know, 1000 and 1000 of nameless anonymous small business Jason Calacanis (00:51:56): who owns Chamath Palihapitiya (00:51:56): that -- This is what? Jason Calacanis (00:51:57): Can you give an example of what that debt would be for the listeners? When you say distressed on -- Chamath Palihapitiya (00:52:02): I mean I mean so, you know, I mean, a a fallen angel today is Ford. So we were not to pick we're not gonna pick on Ford, but we're just gonna point to it as a well known company. So this is a car manufacturer. They employ 100100 of thousands of people in very important political states you know, Michigan, Ohio, I think, Tennessee probably. but Ohio and Michigan, obviously, critical states. And they, you know, issue debt into the market to fund you know, building factories or buying equipment. Who buys that debt? Pension funds by the debt, family offices by the debt. hedge funds by the debt. Now those guys were giving out a coupon, and they were paying, let's just say, Jason Calacanis (00:52:55): 4 Chamath Palihapitiya (00:52:56): or 5 or 6 percent a year on this interest. But now because of all this economic uncertainty, people think that their ability to pay that back has gone way down. And so now they have to issue debt at much higher interest rates, and the existing debt has a much lower credit quality. It's effectively like you having a credit card. And, you know, American Express calling you and saying, Jason, I think the odds of you paying your credit card balance have gone way down, so I'm increasing your interest rate to 24% from Jason Calacanis (00:53:25): 17%. Yeah. And then I get another credit card to pay it off. Chamath Palihapitiya (00:53:29): And and so, essentially, what's happened is the Federal Reserve has decided to become that next credit card issuer. Jason Calacanis (00:53:37): Now instead of instead of instead of Chamath Palihapitiya (00:53:38): instead of doing it for you, they're doing it for companies but not for you. And the question is, is that okay? Well, at some level, companies like Ford should be saved because I think these are iconic businesses that employ hundreds of thousands of people and there are critical linchpins in the economy. Right? Because they have a massive supply chain network, and, you know, they're really important for many other things. beyond just the economics that they themselves represent. But there are better ways to help Ford. You could lend forward as much money as they needed to meet their short term obligations similarly to the way that the Federal Reserve would allow bank to borrow from the from their window. And I think that that's a very reasonable approach. The question is really when the Fed then basically acts as a buyer of last resort and obfuscates the price of these bonds. And essentially is saying the American tax payer will own these bonds for the foreseeable future. If you think that at some point, those bonds that you bought for you know, 90¢ on the dollar are worth 90¢ on the dollar, then everything is okay. But if there's a chance that 90¢ goes to 70¢, the people that really eat that cost are us in the short term and our children in the medium of I have Jason Calacanis (00:54:59): a silly question. It's obviously not my wheelhouse corporate debt like this. Why wouldn't there be a clause that if they didn't pay back that 90¢ on the dollar that the American government bought it for, it converts into equity in the company. Chamath Palihapitiya (00:55:13): It's a great question. Because the Federal Reserve has chosen to go and essentially the equivalent of open an e trade account and step into the markets by themselves and just buy. So they're buying bonds, and they're buying individual bonds, and they're buying indices that control or that that have exposure to certain What they are not doing is going directly to these companies and negotiating essentially saying, I will give you Jason Calacanis (00:55:41): $4,000,000,000, Chamath Palihapitiya (00:55:43): And what I want you to do is retire that old debt and replace it with this new instrument, and here are the terms of this new instrument. The United States tax brackets you know, 3% or 4% warrant coverage of the company. Yep. Yep. You know, you must make sure that the pension holders Jason Calacanis (00:55:58): are made available. Why wouldn't we have closes. It's a basic blocking and tackling that, you know, seed funds have. David Sachs, what do you why is this not like a no brainer? David Sacks (00:56:08): Well, mean, I think we've gotta get a good deal for taxpayers. I mean, Jamath has said it. I've heard Mark Cuban say it pretty eloquently. I even heard Trump say that we have to good deal for taxpayers. I just think that they're in such an emergency. They're not really taking the time to do that. They're, you know, they're they're They're trying to do things they can do immediately. Jason Calacanis (00:56:29): Yeah. The the forgivableness of these of this money to me is the thing I don't understand. Why is any of it forgivable? Why isn't any all of it just you know, a 10 year or 20 year long loan that converts into equity over some tranches. Chamath Palihapitiya (00:56:42): But, Jason, this is why if you're if you're going to haphazardly fire 1,000,000,000,000 of dollars out of a bazooka, why not give more than 3¢ on the dollar to average Americans? Why not put it into the pockets of every single bank account? You know, you know who knows how much everybody made the IRS And, you know, the IRS has a mailing address for everybody. And the IRS either gets a check or mails a check to every single taxpayer in the United states, Jason Calacanis (00:57:09): which -- And they also have direct deposit for half of the people. Chamath Palihapitiya (00:57:12): And so, you know, it there's nothing stopping us from saying, well, you know what? Why don't we do 10% 10¢ of every dollar. Why don't we do 15¢ of every dollar to Americans? I really think this is the way that you limit the amount of waste that's going to happen. So the the intention isn't wrong, and we shouldn't castigate people for wanting to put money in the system as David said to plug the hole. but we can't be so haphazard as to not think about the moral hazards we're creating and try to fix them in real time. And so this 10,000,000,000,000,000 has already gone out the door. But if the next trillion or 2, don't touch Americans I think it's going to create an enormous amount of damage. We've only given people a few weeks of of a lifeline, and they need more. And you you can't tell companies that they can have effectively a a limitless lifeline, but not the individuals. because I do think at some point, companies will find a way to get out of these loans and or break the covenants with not much repercussion. Jason Calacanis (00:58:20): Okay. I wanna wrap with 2 sort of not doomsday scenarios, but I wanna touch on politics. And I also wanna know in the chance that this quarantine goes on for May June. In other words, San Francisco says, you know what? We're gonna keep going, and we're gonna and New York says we're keeping going. And we're talking about not just April being in quarantine, but May, end, or June, and we're looking at June 1st or July 1st. What are the chances, David, that people say, you know what? I am a free person. I wanna take my make take my life into my own hands. I wanna make my own decision. I'm going out. I'm gonna go surfing. I'm gonna do this. And we have this social unrest. And how do politicians handicap that in this new world? David Sacks (00:59:07): I I think that could happen. I mean, particularly among young populations who are not at risk, as much, you know, for the the relatively younger, healthier people who don't have comorbidity factors could say, look, I've got a 1 in a 1000 chance or, you know, or less of dying if if even if I do get this, and I'm just gonna take that chance. But it's all the more reason why I think we need a strategy to get out of lockdown that already includes the idea of letting out these these people who are at much lower risk and and isolates the people who are at higher risk. Jason Calacanis (00:59:46): And against the you have anything to add to that, Shamalff, that kinda doomed day scenario or that eventuality? Chamath Palihapitiya (00:59:53): Well, I think that you're very right, Jason, that I don't think we're going to get out of lockdown until June 1st at the earliest. And I think that's in California. I think nuisance posture is basically that if April looks like the curves are decaying, it's gonna be mid May to late May before he list this thing. I don't Jason Calacanis (01:00:13): know if I can handle this. Chamath Palihapitiya (01:00:14): And but but it's it's also important that that we understand, like, You know, we just talked about companies. The only entity that's in even worse shape than companies and people are states and cities and counties. Jason Calacanis (01:00:29): Yeah. Their debt is incredible. They have no revenue and massive revenue. Chamath Palihapitiya (01:00:33): massive cost and their nonprofits. And think of the the, you know, the garbage collector, the fireman, the police officer, the teacher, these are, like these are the backbones and the pillars of of our communities. Jason Calacanis (01:00:45): It's such a good thing that we were so resilient, and we thought it had and built up massive surpluses in our tax bases. Oh, wait. We didn't do that. Chamath Palihapitiya (01:00:54): Well, there there there were there were some provisions to do that, these rainy day funds, but those are gonna get exhausted. And, you know, we're gonna have to bail those guys out as well. So this is what I'm saying, which is that when you're pumping in 1,000,000,000,000 of dollars haphazardly into the capital markets before you think about people, Or you think about the states and cities and communities in America, I just think it's a recipe for disaster. Jason Calacanis (01:01:17): Let me ask this even more simply, David, Under what circumstance would you be willing to go back to our poker game on a Monday night and have 6, 7 of us around a table sharing a meal and playing cards for 6 hours? David Sacks (01:01:33): Well, if there was if there was a a treatment for for the virus so that you knew that if you got it, you weren't gonna die, that would be a big deal. Jason Calacanis (01:01:41): Okay. That's that's the that's the after that. -- after that. David Sacks (01:01:44): There there's a Russian led aspect to to the virus right now, or even if your odds are low, you know, you you you still don't wanna take the chance. I think the the next thing that would probably help would would be that if we had this rapid ubiquitous testing. So I could know that the people who are in the room with me Or Jason Calacanis (01:02:04): -- We're all tested. David Sacks (01:02:05): We're all tested, and we're all negative. And, you know, they could repeat the the tests on a frequent enough basis that we could all trust in the result. That that would make a big difference, I think. Jason Calacanis (01:02:17): Alright. Let's wrap with politics. All of this is occurring in an election year. Bernie is out of the race. Biden is doing a daily webcast Trump's ratings are through the roof as he is more than willing to let us all know in his abhorrent narcissistic way that his ratings are just tremendous right now in the middle of 1000 of Americans dying a day. But we have to touch on this because elections are how we govern and make these decisions is by who we put into these positions. So what do we think? Let's just make odds here. Odds that Trump wins again, odds that Biden wins. If you had to lay the odds, if you had to give it a percentage or you wanna set a line? What what are what are your thoughts, David? David Sacks (01:03:15): I I always think that these things are basically a coin flip. I mean, this far out. I mean, right now, it seems like, you know, Trump's ratings have never been higher. He's pulling relatively well, and and Biden just seems completely irrelevant. But if we're still dealing with the virus by November, if we cycle in and out of lockdown, if we have kind of an unresolved situation, if the economy is in a very, very deep recession or depression, I think, you know, it's it's up for grabs. Chamath Palihapitiya (01:03:46): Shamal, I think that if if there is a v shaped recovery of any kind, Trump will win in a landslide. Jason Calacanis (01:03:55): Right now, we are in a v shaped recovery. The market has come back. Chamath Palihapitiya (01:03:58): No. We're not. No. We're not. Jason Calacanis (01:04:00): Well, if you use the market as a market, Chamath Palihapitiya (01:04:03): Now the market is the market is completely decoupled from Main Street. And so what Wall Street does is irrelevant right now. What I mean by recovery is what happens on Main Street. Jason Calacanis (01:04:12): Okay. Chamath Palihapitiya (01:04:13): Because if you have Jason Calacanis (01:04:14): 16, 17, 20, 22 Chamath Palihapitiya (01:04:16): percent unemployment, I mean, you could feel the prancing dog and deal beat Trump. Yeah. So I think that the president needs a massive victory here. So what does the game theory say? The game theory probably says that he'll try to force people to go back to work as quickly as possible. And if there's even a modicum, a shred of evidence on some kind of, you know, therapeutic, they'll you know, drum it up like it's like it's secure and try to confuse people that there's a vaccine. But I think he needs that because in the absence of that, again, I just go back to how difficult will it be to start real life. I think it's going to be difficult. And I think in that people won't have a lot of patience for the fact that, you know, the debt will have ballooned deficits will have ballooned. Trillions of dollars will have gone out the door, and people will be meaningfully struggling going into election day. I don't think that that to help Trump at all. And, you know, by the way and we'll talk about this in our next podcast because we should probably get an economist to talk about it, but you know, what is putting $10,000,000,000,000 or whatever the final number is? It'll probably be 20,000,000,000,000, you know, 11 times US GDP. What does that do to the economy? What does that do to long term inflation? Like, if you've seen what's happening Jason Calacanis (01:05:42): what Japan did, and they went through a lost decade or 2? Chamath Palihapitiya (01:05:46): No. I I think the best better example is what happened in China, which is a combination of fiscal and monetary stimulus in 200910. And the results are basically a lot of fake growth and massive inflation. And so, you know, it's it's probably useful to debate that in the next in the next pod. Jason Calacanis (01:06:05): What what are the chances? I think Chamath Palihapitiya (01:06:06): it creates a lot of risk for Trump. Jason Calacanis (01:06:08): Dark what what are the chances of a dark horse candidate in on the 0. 0. So it's Biden for sure. Yeah. It's my chance for us to struggle. -- David Sacks (01:06:18): barring a Biden health emergency. Chamath Palihapitiya (01:06:20): I mean -- Yeah. Jason Calacanis (01:06:21): -- David Sacks (01:06:21): I mean, he is -- Yep. Jason Calacanis (01:06:22): -- David Sacks (01:06:23): he's, you know, not a spring chicken. So Jason Calacanis (01:06:26): So either person either person gets coronavirus. It could be yeah. David Sacks (01:06:32): Well, no. I I I look, if anything happened to him Jason Calacanis (01:06:34): -- David Sacks (01:06:34): Yeah. Yeah. Jason Calacanis (01:06:35): -- David Sacks (01:06:35): look, I I'm not we shouldn't even talk about these possibilities. I don't wanna sound you know, it's not like he no one wants this to happen. But I look. I think Chamath is right. They're not gonna replace the head of the ticket, absent you know, some something health wise happen. Jason Calacanis (01:06:48): What is your game theory then on how Trump will play this? Because in Chamat's mind getting back to work earlier makes it seem like we're getting back to normal, and he did that. but a politician might also say, you know what? I I think there's a chance of the second wave, so I wanna keep it closed until June or July 1st and then time it And I know this sounds incredibly cynical that a a elected official would make health and economic policy decisions on their reelection but that is the reality we live in. Is it not? David Sacks (01:07:20): Sure. Of course. I I think the next big political debate is is gonna be around this what now. You know? We yes. The quarantines have arrested the exponentially the the the virus, but how do we get out of them? And And, you know, Trump's gonna have to make a a decision about when and and how we get out, and he's gonna be eager to to get out of lockdown to to restart the economy. But on the other hand, if he mistimes it and we cycle, you know, the virus then takes off again and we cycle package on the other lockdown, that's that's very dangerous for him politically too. So he he's got a needle to to thread there. I agree I agree with Chamath that if if this ends up being v shaped, Trump is a shoe in. But if it ends up being a recession a deep recession or depression, if we end up then I think the question's gonna be does he appear to be more in the is he is he a Hoover or is he more in the bowler of an FDR? You know? And Jason Calacanis (01:08:24): Explain that for people listening. David Sacks (01:08:26): Well, I mean, so so Hoover took took the blame for the great depression. FDR gets elected in 1932. we're still in the great depression in 1936 when he gets reelected. You know? And because he's seen as as a as a man of action. He has these fireside chats, and he's he's doing things. And And I I do think that, you know, Trump kind of pivoted from initially being Jason Calacanis (01:08:53): -- Chamath Palihapitiya (01:08:53): Denier. Denier. Jason Calacanis (01:08:54): -- David Sacks (01:08:55): a little bit flat footed on the virus now doing these daily briefings and I think the American public is giving him credit for action right now. And so the so so, obviously, if those actions work, I think he gets reelected. And if they don't work, The question is, you know, does he get blamed for that? Is it is he a hoover, or is he an FDR? Jason Calacanis (01:09:16): Alright. On that note, encourage everybody to wear masks, social distancing, And for those people in the audience who are startups and investors, keep keep the faith, keep investing, keep starting companies, never a bad time to start a great company in my mind. And Chymouth, any final thoughts? Here we are. It's what is today's date? Is it I know it's April. I think it's somewhere around 10th. It might even close. It's Friday. Right? Chamath Palihapitiya (01:09:46): April 10th. Let's let's just make a decision. to be all in on masks. Jason Calacanis (01:09:53): All in masks. Chamath Palihapitiya (01:09:54): All in on masks and take it into our own arms. We don't need to be told that these things make sense. They make sense. You're an idiot if you think otherwise. Jason Calacanis (01:10:03): Do you have a closing balance? Oh, can can you watch what they have at the thought? David Sacks (01:10:06): Totally agree with that. That was my blog today. We shouldn't have to make it the law, but I I think we we should because still people who aren't adopting it, but it's the lowest cost thing we can do. And if you look at the Asian countries that have controlled the virus, every single person wears a when they go out in public. Every single person. Jason Calacanis (01:10:26): It's a simple no brainer. Give people a $1000 fine if you're not wearing a mask. give them a warning first and hand them a mask. Like, literally, the cop should have masks, and they should hand them to you. So they put this mask on. And if I see you again, you get a $1000 fine. David Sacks (01:10:39): the the the post office should put 1 or a number of these in everyone's mailbox. This is the first step to having a more fine tuned policy than just quarantine. And if we can't even get this right, then, you know, I I fear for for what's coming next. Jason Calacanis (01:10:56): if you there's a great execution idea. The mail carriers, every mail carrier leaves them, you and then you could also get the private sector. Do you tell every UPS FedEx driver the government gives them those masks. Amazon. Amazon. They just all have it. Hey. Jeff, somebody clipped this and said, it's Jeff. Jeff, if you wanna do a Mitzvah, give all these masks to the drivers and just leave masks on everybody's doorstep and forget about Trump and whatever government officials gonna drag their heels on it. Go ahead. You do it Jeff Bezos. And, hey, how great was Jack giving away a $1,000,000,000? I mean, we saw him get barbecued on -- Chamath Palihapitiya (01:11:28): Strong. Jason Calacanis (01:11:28): -- social media. But What a strong move, and he's gonna -- Strong. He put it in a Google Sheet. He's like, here's a Chamath Palihapitiya (01:11:35): Google Sheet. Jason Calacanis (01:11:35): -- Chamath Palihapitiya (01:11:35): and made the sheet open. I mean, it's the strongest move ever. It's like, you know, everybody You know, I've I've always been very skeptical of philanthropy because I feel like it's, you know, a a a a dalliance of the established rich in North America because they like to have their name some things. And here's a guy who just basically poned all of that. I don't need a hospital with my name on it, I don't need a building with my name on it. Here's a Jason Calacanis (01:11:58): $1,000,000,000, Chamath Palihapitiya (01:11:59): and here's a Google spreadsheet to track it, which means I'm gonna have zero in you know, overhead and running it. I mean, it's it's so strong. Jason Calacanis (01:12:06): It's literally like he the only thing that could be stronger is if he connected it to a Stripe account, And, like, as he as he swiped his credit card, Chamath Palihapitiya (01:12:14): it just -- It's just so strong. Jason Calacanis (01:12:15): He should put a Zapier that tweets it. Chamath Palihapitiya (01:12:17): I mean, he has a Google Doc, which is set so that everybody could read it at all times. I mean, for a $1,000,000,000, it's just amazing. Jason Calacanis (01:12:25): He should start a Slack instance with, like, each of those nonprofits having a their own channels. Completely, by Chamath Palihapitiya (01:12:30): the way, he completely poned the giving pledge in one fell swoop. Jason Calacanis (01:12:33): Yes. The giving pledge, which nobody has any, it's pretty opaque. Now it's just like yours. Chamath Palihapitiya (01:12:38): basically pretend you're gonna give your money away. We don't need to know how much. You don't really need to do it. There's no accountability, but we have this fun party once a year. We can all hang out. And, you know -- How does Jason Calacanis (01:12:47): the parties Chamath Palihapitiya (01:12:47): accept each other? I haven't signed it. I'm not signed it. It's not like the giving much. Yeah. So stupid. It's like the sign of insecurity. Jason Calacanis (01:12:57): Saxy poo. Thanks for coming on the pod, rain, man. We appreciate it. Chamath Palihapitiya (01:13:00): Love you, sexy poo. Jason Calacanis (01:13:01): We love you sexy poo. Chamath Palihapitiya (01:13:02): love you, Jacob. Jason Calacanis (01:13:03): Love you too, Tremont. Best to see. We love you. And everybody, stay safe, seriously. And oh, and I just wanted to close. Chamath Palihapitiya (01:13:09): Wear a mask. Jason Calacanis (01:13:10): Wear a mask. and to those people on the front lines, the janitors, the Google, the Amazon drivers, Instacart, people in the food supply. Yeah. The fuck You are the best. It's amazing what you're doing. What a sacrifice. Chamath Palihapitiya (01:13:23): Get the money to them. Jason Calacanis (01:13:24): Yeah. And I seriously, give them Amazon, let us tip those drivers in our -- Get the money to them. For sure. Double the pay. Okay. We'll see you all next time. Bye bye.