俄乌局势深度解析：升级、风险因素、金融冲击与退场路径

David Friedberg (00:00:00): Dude, Saxx. I love that look. Look at that shirt. Look at that, man. David Sacks (00:00:03): Is it too noisy for a podcast? David Friedberg (00:00:04): No. You look very relatable. You like a you're like a an American man, like, just like at home, doing stuff, Jason Calacanis (00:00:09): he trying to go full tucker on us? Chamath Palihapitiya (00:00:12): It is a really, really horrendous shirt that you're David Friedberg (00:00:14): -- David Sacks (00:00:14): That is a horrible Jason Calacanis (00:00:15): I mean, I that was the same shirt tucker words wearing last week. David Friedberg (00:00:18): Oh my god. is gonna be so appealing to Middle America right now. He's like -- Jason Calacanis (00:00:21): Absolutely. Look. He's going for the every man. Yeah. David Friedberg (00:00:23): He's an every man. He doesn't have a blazer on. Jason Calacanis (00:00:24): He's trying to get the purple pills. Are you gonna go wood with Tucker? Yeah. David Sacks (00:00:29): I may not be a man of the people, but I do try to be a man for the people. When year winner's ride. Jason Calacanis (00:00:37): Rainman, David Saffens. Chamath Palihapitiya (00:00:38): And it said, we open Jason Calacanis (00:00:50): Hey, everybody. Welcome to another episode of the All In podcast. It's obviously been an intense week. And there is a topic. There's really only one topic to talk about this week, and that's the Russian invasion of the Ukraine with me to break all this down. I'm gonna from a couple of different angles. The rainman, David Sachs with his power flannel on today. He's gonna go chop some wood after trying to appeal to the everyman. Power final. It's a power final. It's a power final. I think that was gifted by Tucker and the Sultan of Science hot off the -- How David Sacks (00:01:25): do you know how do you know it's flannel instead of a cashmere? How do you know it didn't come from one of Shamossel at all? Jason Calacanis (00:01:32): Chamathi never wore that shirt. David Sacks (00:01:33): Maybe I'll David Friedberg (00:01:33): -- Jason Calacanis (00:01:33): If you sent that shirt to Chamathi, burn it, that would go right in his pizza out there. Chamath Palihapitiya (00:01:37): I wouldn't burn it, but I I would wipe my butt with it. Jason Calacanis (00:01:42): Here we go, folks. And hot off the launch of the Cana beverage printer replicator, the Sultan of Science himself, David Friedberg, and Back from a little holiday, the dictator himself, Chamath Polyhapphatia with a Jedi robe. Tell us about the Jedi robe that you elected for this week, Darth Palpatia. Well, this is Darth. Palpatine. Chamath Palihapitiya (00:02:10): Well, I don't I mean, this is look. This yes. It is cashmere. We're we're running out of time. I have to wear it through the rest of my few garments, my new garments before springtime, and then I have to go to the you know, the linen and the cotton. Jason Calacanis (00:02:24): Got it. So you're enjoying the final days of Kashmir. Chamath Palihapitiya (00:02:27): Well, I do I did find some baby cashmere, light, thin, you know, you can wear them probably until April, maybe even May. So -- Right. We have that going for us. Jason Calacanis (00:02:39): Alright. Well, there you go. And is there a specific date that you shift over from to the linens and Chamath Palihapitiya (00:02:45): To be to be honest with you, I have a I have a team I consult with. Got it. Jason Calacanis (00:02:49): The team's working on that. Right? Chamath Palihapitiya (00:02:50): They're working on that. Yeah. They're working on recommendation. Jason Calacanis (00:02:52): Alright. So we can still laugh It's kinda hard to talk about other topics when a war has broken out. I don't know if I have to go too deep into recapping what's happening because it is a a static situation. But there's been massive fallout from the war both economically, lives lost, and it's escalated pretty dramatically. We had a pretty crazy moment last night. We're taking this on Friday. March 4th Last night, a nuclear facility, the largest one in Europe, was involved in a firefight. It seems to have been secured, and the Russians have taken control of it, but there were people bombing it. Where to begin here? I think maybe, Sachs, we can start us off with a little bit of your assessment of the situation as it stands in week David Friedberg (00:03:38): 2. David Sacks (00:03:39): Yeah. I mean, when we broke up last week, this war was just breaking out, and we were still talking about ways that we diffuse it. Obviously, that was too late. And I think everybody, probably, Putin, first and foremost, thought this would be a cake walk, and it has turned out not to be the resistance by the Ukrainians has been fierce, and it's been sort of galvanized by their leader Zelensky, you know, at the very beginning of the hostilities, he made the decision to stay and fight. He had that video that came out with his cabinet standing behind him that galvanized all the people if Ukraine stand behind them. And then the West, it now wants to stand behind the whole country of Ukraine. So it's really been you know, amazing leadership by Zelensky. And, you know, it's too bad in a way. We didn't have that kind of leadership among our allies and say Afghanistan. you know, we had this guy, Ghani, who got in the first helicopter out of there when the when the trouble started. So, you know, his his leadership is so strong and admirable and basically galvanized the west, and I think that Putin, I think, must have underestimated the level of resistance he would face and also the unity of the west in terms of sanctioning him and providing support for the Ukrainians. All that being said, I think we're now at a very dangerous sort of crossroads because the situation is is very volatile. And you've got so much variance in the outcomes that can occur now. I think you're seeing people prognosticate everything from, you know, Kyiv gets turned to rubble in the next week, and the Russians basically power through and win. So this turns into a long term insurgency. to, you know, there's gonna be some sort of uprising in Moscow and and, you know, regime change there. And I think because the variance is so high, because all or, you know, because the two sides are playing for all the marbles, so to speak. And you've even got, I think, intemperate and insane remarks by Lindsay Graham, basically, calling for, you know, calling for Putin's Alster, you know, which I think is gonna give -- I Jason Calacanis (00:05:44): mean, that quote just to to pause there. David Sacks (00:05:47): It's gonna give the Kremlin, I think, a propaganda tool, but for for rallying people internally. But the the the point is just where it seems like we're playing for all the marbles right now. And I think that's a very dangerous place to be. And I'm seeing, you know, insane rhetoric and commentary by people trying to push us into war. And so just the other day, you know, one of the one of the things I tweeted about is one of the craziest things you hear is we're already in war 3. Well and, you know, Kasparov said this. I mean, he's kind of a known to be a little bit of a hot head, but you also had Fiona Hill. He's supposed to be a Russia expert. from the state department who frequently is the go to source for CNN and other publications, also saying we're already in war 3. Well, No. We're not. I mean, if we were in War David Friedberg (00:06:30): 3, David Sacks (00:06:31): you'd see the mushroom clouds assuming you were still alive and not vaporized. So it is incredibly reckless for people to be saying things like this. And there is just, you know, this drumbeat of war that is being pushed by cable news and by the Twitter sphere And just today, thankfully, this morning, NATO announced that it would not be imposing a no fly zone. over Ukraine. That was the David Friedberg (00:06:55): -- Jason Calacanis (00:06:56): Why is that important? Explain that. David Sacks (00:06:57): Well, because because there's all these people who are saying, well, we we we shouldn't send boots on the ground to Ukraine. We don't need to get militarily involved, but let's let's do a no fly zone to basically help the Ukrainians. Yeah. You force What a no fly zone means is that you're gonna shoot down Russian planes. David Friedberg (00:07:12): Yes. David Sacks (00:07:13): That's what it means. You are going to war. It may not be boots in the ground. It's boots in the sky. So had we done that? Had we given into the emotional appeals? And I think we all feel the tug on our heartstrings. But had we given into that, we would be potentially in a shooting war with Russia. And that would be the most we're already in. I think the most serious foreign policy situation in, you know, my lifetime, and, you know, I'm almost half a century old. So, you know, it's It's very dangerous. And, you know, I've been saying for last month on this podcast, I've been actually advocating for the cause of not getting militarily involved. And a month ago, it seemed like an argument I didn't need to make. But now it really does because both sides are are sort of and and this is there's almost a unanimity in Washington that we need to continue escalating the situation. David Friedberg (00:08:04): Saks, my my concern is less about the Washington intent to to put boots on the ground or boots in the sky. And I'm much more concerned about NATO allies. There's 30 member nations in NATO. And if any one of them does something stupid. If there's any action by any even rogue element within the military, or some statement even by some politician at some NATO member. you know, you could see a reaction potentially from Putin, and then Article 5 kicks in, which is this collective fence article in NATO, and then the United States has an obligation to enter the conflict. And and that's the once an you didn't mention, which is the scenario I am most concerned about, most frightened by, is we don't know when the when or if a Franz Ferdinand moment could occur here. that someone does something stupid, some Polish tank rolls across a border and shoots down some shoots at some Russian, you know, tank and then the Russian tank crosses over and then all of a sudden, we've gotta go to the rescue and we've gotta go defend that that that NATO member and then all of a sudden This whole thing sparks into a wildfire. Jason Calacanis (00:09:23): It felt like last night could have been that when you look at the fog of war, you know, was basically, this nuclear reactor, if it explodes if it has, you know, an an episode, would do just tremendous damage to the whole content. I mean, if you're a living a in a NATO country or in Moscow, if that thing had gone up, which I know is a very would be rare occurrence, and they were shutting it down, etcetera. So but there there was a rumor last night. It felt like there could be a tipping point. David Friedberg (00:09:51): Nuclear material is like a whole another level. It's like it has nothing to do with war at that point. It has to do with extinction. you know, a a nuclear reactor is almost like a temple on earth to god. It's like this holiest of holies, no one can, should, or ever, could consider that to be a point in conflict ever. It's nothing should be touched. Let the wars of humans continue on the rest of the earth. surface, but nuclear weapons, nuclear reactors, that's unleashing the fury of the gods on Olympus. And when they come down, they scorch the earth and nuclear material, you know, is an extinction kind of or it it's, you know, kind of a cataclysmic event for this planet. And so, you know, that that that goes well beyond this idea of, like, is it NATO or did someone shoot at someone? Let's all go fight. it becomes, like, almost existential to the to the condition of humans. Jason Calacanis (00:10:46): Well, so what does that say about Putin then? I mean, Putin targeted that facility -- No. David Sacks (00:10:50): Hold on a second. Hold on. I think that's news at this point. Do you see the tweet by Michael Schellenberger? So -- Wow. -- hold on a second. You said this is -- Last Jason Calacanis (00:10:57): night Street. I did see last night Street. David Sacks (00:10:59): Okay. So I don't necessarily think this fogger war. I think this might be disinformation. So here's what happened is and and it it it wasn't just misreporting. Zelensky tweeted out a video where he basically was saying, this plant has been attacked. It's on fire. It's gonna be Chernobyl times 10. for all of Europe. And then the foreign minister of Ukraine came out with another statement just like that simultaneously. So this was coordinated And then I saw on all the cable news networks, all of them. There was no difference between Fox and m CNN, MSMC, same reporting, they were all in a panic about this. And then, you know, and that now then we find out very quickly the truth, which is confirmed by the White House, which is no radiation, no explosion. The the fire was sort of tangential. It wasn't core to the plant. So I think we have to be very careful now to guard ourselves against disinformation that is designed frankly to escalate the situation and pull us to draw us into a war. Simultaneous with this, there was a New York Times op ed by Zelensky and and one of his aides who was standing next to him. sort of transcribing. And the headline was something like I'm fighting to the last breath. Look. That that is heroic. I mean, I think we can all recognize that whiskey's bravery and courage in in in in doing that. However, the point of that article was to tug on our heartstrings to get us to involved in the war. And what he said in that our that article was You don't need to send boots on the ground, but impose the no fly zone, which we just talked about, is a declaration of war. Chamath Palihapitiya (00:12:28): Yeah. But Jason Calacanis (00:12:29): no. No. What I was talking about with the nuclear power plan is Not that it wasn't being hyped up by the media. Certainly, like, this was becoming, like, their ratings bonanza, and they were definitely hyping it up and maybe Zelensky was giving a warning, hey. This could escalate. But the Russians did target that. They were bombing around it. They were firefighting sort of Friedberg point like, this is, I think, crazy behavior by Russian troops by Putin to actually, you know, try to seize a nuclear power plant. It seems pretty crazy. Tremoth, you've been silent thus far. Let's get Chamath involved here. Chamath Palihapitiya (00:12:59): There's a 17th century phrase that says adversity makes for strange bedfellows. And I think what happens when you are in the middle of enormous adversity You know, you need to do whatever it takes to win. Right? That's, I think, why Zelensky is so patriotic and viewed so heroically around the world He's trying to defend his country and his people. I wanna take the counter of David what you said. I actually think we are at war, but it's the most positive form of it in the sense that we are learning a different kind of warfare. Now if you think about how we used to fight up until basically the Persian Gulf War, it was armaments and tanks. And then that evolved in the Middle East because we had to fight insurgents and, you know, urban terrorism in many ways. Right? I think this is a a way in which we are learning that there's a different kind of warfare as well, which is fundamentally economic. And so, you know, it may not take the same shape as drones and missiles and fire and guns and bullets. But I think you would be foolish to make the mistake that we are now not at economic war with Russia. And at the end of the day, the outcome is the same, which is either they survive or they don't survive. And everything we've done points to that we are willing to fight, and we are willing to put a lot of economic collateral and chips on the field in order to win this battle. So I think in that respect, we are kind of at a war. Jason Calacanis (00:14:52): Can we are we on a is this a nuclear level economic decoupling? Chamath Palihapitiya (00:14:56): Like, everybody has a historical framework where they wanna go back to how the natural path of escalation works. And I think this is a very different form of escalation that we need to consider, and I think that this is the kind of warfare that may actually, you know, be the the way in which wars are fought in the future. You seize assets you shut off access to supply routes. You make it impossible for anything to work. So, you know, I'll give you a simple example. A form of warfare is what's happening right now in the sense that, you know, for example, the Russian skies are completely clear, not just because that, you know, no external airlines will necessarily fly there, but because Boeing And Rolls Royce And GE And Airbus basically pulled all of their support all of their parts. Right? We've gone to war with respect to their petroleum and LNG supplies. How? Not necessarily because we won't still stop payments, which we are still enabling, but because the actual refiners won't take the oil and the LNG because they then would be subject to sanctions. The people who would ship that are no longer taking those payments or those those barrels of oil into the marketplace because they can't get insured by international banks. So in all of these various ways, we are actually at war. And I think, you know, maybe this is the way war should be fought in the future because it'll save 1000 of lives in in the more classic way of describing how lives are sacrificed for. David Friedberg (00:16:26): I wanna make a counterpoint. My concern, Timok, is that we've rushed into a reactive response with respect to sanctions and seizing assets in a way that maybe not be calculated over the long run. Meaning, like, are we setting ourselves up for another Iraq, Afghanistan situation where we we rush into a war and we don't have an exit strategy. And the issue is that a lot of the asset that we've effectively wiped the value down to 0 have a repercussion effect on global businesses and the global economy. as a as an example, you know, this company that we were texting about called Luke Oil, they were worth $60,000,000,000 a few days ago. we effectively wiped them out to 0. And 65 to 70 percent of the shares in that company were held and owned by public retirement funds, pension funds, mutual funds that are used for retirees in Europe and the United States. And and so, you know, a significant amount -- This Chamath Palihapitiya (00:17:28): is a complete red herring. I I I've told you this in the private chat. I think this is a complete complete red herring. And the reason it's a red hearing is that the global total market cap of all of these businesses is meaningfully different than the amount of total CapEx that these guys represent. And in as much as you are gonna take the equity values of certain of these companies to 0, it's in the grand scheme of things, not that much equity value. David Friedberg (00:17:53): we can absorb it. We're not talking trillions of dollars. Forget about the equity value. Just think about the economic repercussions where there is leveraged positions and swaps and derivatives in place, counterparty swaps in place with a lot of these companies that are now gonna default. And we're not gonna know that till the end of this month, when everything has to settle, and no one's gonna be able to make their payments. Jason Calacanis (00:18:15): Small price to pay, Friedberg, David Friedberg (00:18:16): if well, hold on one sec. This applies both to Russian companies that are suppliers and buyers of assets, products, and services from international businesses, and all of a sudden, that line item just zeroes out. Chamath Palihapitiya (00:18:29): I don't believe the economic value of all of that oil exceeds the market cap of luke oil. I don't believe it. And I don't believe further that the economic value that's held by non Russian actors is meaningfully more than a few tens of 1,000,000,000 of dollars. David Friedberg (00:18:48): We're gonna find out pretty quick. For sanctions By the way, Russia and the Ukraine combined, account for roughly 25 percent of global wheat exports. Chamath Palihapitiya (00:18:56): Let me let me say differently. David Friedberg (00:18:57): That wheat goes to Egypt, and from Egypt that goes throughout Africa, And there's a lot of nations and a lot of people that depend on that food supply. And that food supply is now cut off. Okay. Chamath Palihapitiya (00:19:08): I understand. But now we were talking about something different You wanna talk about wheat? We can talk about wheat. Jason Calacanis (00:19:12): But you're talking about generally David Friedberg (00:19:13): I'm talking about zeroing all this stuff out and cutting them off completely. Jason Calacanis (00:19:16): Hold on a second. One of the things you have to realize, Friedberg, is that the purpose of sanctions is to create massive pain that stops a madman dictator -- 100% agree. David Friedberg (00:19:24): -- Jason Calacanis (00:19:24): from invading other countries and causing a world war. So while it is tragic that some tension hold on. Let me finish my break. While it is tragic, that people will suffer, and people maybe can't get their Netflix or can't get their Facebook or some weed will get disrupted. All of this is the the is the better choice than going to war with Putin. And it's meant to create pain and suffering. It does not create pain and suffering, then Russia will not change. David Friedberg (00:19:53): I understand that's the point of sanctions. Jay Kal, I totally get it. I totally understand the intent, and I totally understand the point. My my point is, have we really done the calculus? Because when you make this much of an impact this fast, when you rush into what we might call an economic war with such significant abrasion, in such a significantly short period of time. I don't -- Do we really have a sense of where the calculus is? Because I don't know where the week exports are gonna come from for Egypt now. And I don't know where the millions of people that depend on that wheat supply are now gonna get fed from. And I don't think we have an answer. If we had a strategy that said, here's the solution, Here's the solution from an energy perspective, from a food perspective, from a capital perspective, to fill all these holes. Otherwise, we may all end up sharing that cost over the long run. it's gonna be a big cost to bear. Chamath Palihapitiya (00:20:39): I think you're wrong. And the reason why I think you're wrong is we've already seen how this has played out before. So in the last two years, we learned what governments are willing to do when you have supply shocks and demand shocks. And what they do is they turn on the money printer and they create enormous amounts of stimulus. Okay? And what we have now is a point where if these shocks are really, really, really meaningful globally, I think you're going to see the Federal Reserve and the ECB and the Bank of Canada, and the Bank of Japan step in in a very coordinated way to provide liquidity to these markets. And I think what that has the byproduct of doing is blunting the economic consequences to everybody but the person who is sanctioned. David Friedberg (00:21:28): Do you think that's inflationary as well? Chamath Palihapitiya (00:21:30): No. And the other thing, in fact, it's the opposite. I look, David and I have been the ones that said the risk is to a recession. We are now teetering towards a recession. Nick, you can throw this thing that I sent to you guys before. If you look back over the last 30 or 40 or 50 years and you look at every single period of when there has been a recession, What's interesting to note is that it's not always been the case that the price of energy has risen by 50% in a recession. But it is always the case that when energy prices spike by 50%, we enter a recession. We will contract as an economy the government will have to become more accommodating, that is the price of this economic war that we have started. And I think it's a just price because what's happening is not supportable. David Friedberg (00:22:18): So, Tamak, you are sure that we're or or you you feel strongly that we're not entering into a condition of significant stagflation where we're not able to restimulate the economy and we inflate everything with all this money printing. Chamath Palihapitiya (00:22:31): I don't even know what stagflation is to be completely honest with you. I don't think I've ever seen it. I know how it's classically described. I think it's, like, pseudointellectual kind of gobbledygook speak. What I can tell you is I think that prices are too high in certain core commodities and goods. I think what's gonna happen is we are going to find a way to subsidize those prices coming down. And I think the simplest way to do it is for the government to step in and become a buffer. And it will drive massive deficits. It'll drive increasing amounts of debt. But I think that is a simple way for us to make sure we put and ratchet the pressure. And just to speak on this other point, we have only just begun. Meaning, just today as we started the pod, Biden came out with an incremental new set of sanctions on Russian crude. So we're not at the even in the beginning. We're at the beginning of the beginning. David Friedberg (00:23:23): I'm just worried this is a new kinda nuclear war. I mean, it's it's frightening. Jason Calacanis (00:23:27): If this is if this is the new nuclear war, then it's a blessing because we're not gonna have millions of people die. Saks is are the sanctions just right, too strong, too little, David Sacks (00:23:36): I think -- vis a vis, Jason Calacanis (00:23:37): like, versus going to war. David Sacks (00:23:39): I think fever what fever is saying is that we're on the exploratory path here that starts with sanctions then leads to more and more sanctions that includes arming the Ukrainians and David Friedberg (00:23:49): -- No. No. No. That's that's Chamath Palihapitiya (00:23:51): a big that's a big leap. And I think I think -- No. David Sacks (00:23:53): We're already arming Chamath Palihapitiya (00:23:54): them. Jason Calacanis (00:23:54): Germans gave the gave the Ukrainian Javeline missiles last week. Yeah. I mean, this is not necessary. David Sacks (00:23:59): I know. Absolutely. Right. And there's there's a lot more coming. So, you know, what I would say is back to something Shamas said, which is we're already at war. I you know, call me a call me nonbinary. Call me a nonbinary thinker, but I don't I don't like dividing our options in that simply into warrant piece. I think there's, like, a spectrum here. And there Jason Calacanis (00:24:19): and and you could call David Sacks (00:24:21): that spectrum and escalatory path. So there's sanctions. There's arming them and and so on down the line. And I don't like characterizing what we're in or what we're doing as war. Because once you're in war, then it justifies anything and for the other site too. Jason Calacanis (00:24:37): So -- Such a you're such a pacifist, Saxx. It's awesome. Keep going. David Sacks (00:24:40): Look. We have to remember -- Wait. Chamath Palihapitiya (00:24:41): No. Let me just clarify what I'm saying. Yeah. Let me just wait. I didn't say wherever I said word form of awards. An economic war. It's just a different kind David Sacks (00:24:48): of -- -- stays economic then. Chamath Palihapitiya (00:24:49): You know? David Sacks (00:24:49): I don't I don't I don't like using that metaphor, but let's not debate semantics. But To to Jason's point, in my past fist, what I would say is, you know, during the Cold War, we have to remember that this philosophy of containment that we had the goal was to prevent the spread of communism while conceding that the countries that were already communist that were behind the iron curtain, we would not challenge. We would not seek to roll that back. Why? Because we did not want hot war with the Soviet Union. And everything was calibrated to make sure that we did not blend ourselves into nuclear wars, mutually assured destruction. And yet, it almost happened anyway, most notably with the Cuban Missile Crisis. But rules of the game evolved. Right? And so we did things like arm the mujahideen you know, rebels in Afghanistan with Stenger missiles. So that would be sort of the equivalent of the javelins. But we sure as hell didn't put the American flag or a NATO flag on the boxes and on the trucks delivering those weapons. We delivered them through Pakistan, through intermediaries. There are rules of the game that we all understood. Now I hope we are following similar rules, but it feels to me like we are and and I think one good thing is that both Biden and certainly Putin remember the Cold War. They're very involved in the Cold War, the old enough to remember it. And, hopefully, we remember those rules. The most encouraging thing I've heard Biden say this entire time was when he reiterated at the state of the union that we would not get militarily involved. It's very important that he keeps saying that because, you know, the Russians are looking at these statements. So we just have to remember that, again, we're on this escalatory path. And and one of the things that's going on here is is is a purity spiral. So There's a social media version of this, and there's like a parts in version of this. So the social media version of this is that the way that you show that you're on the the side of the good of Ukraine is you advocate for the no fly zone. You advocate for the escalation. But if you advocate for slowing down or deescalating or just taking a breath, you're called a Putin bootlicker, you're called Neville Chamberlain I've already gotten about a 1000 reply tweets coming at me saying that. David Sacks (00:26:55): So the purity spiral on Twitter that we've seen in so many other contexts now pushes everybody into the into world war 3. Similarly, there's a partisan dynamic where no matter what Biden says or does, no matter what new sanctions he imposes. The Republicans will always announce him for weakness, and the media and Fox News will always announce him for weakness. it's a one way ratchet. How much more do you want him to do is the question? And I think Friedberg asked, you know, a a great question, which is what is the end game here? What are we trying to accomplish. And what I'm worried about is the the dynamic, this this frenzy that you know, what what biology is called the chimp frenzy of social media, right, with cable news and now social media, and partisan rhetoric. It all pushes us towards continual escalation, at World War 3. And who are gonna be the grown ups who say, listen. This is foolish. Stand down. Take a breath. By the way, we might wanna keep some of these cards in reserve We don't have to play every single thing right now. Jason Calacanis (00:27:57): To your point, I saw Lady G trending. I guess this is his nickname. But Lindsey Graham literally explicitly said somebody in Russia needs to assassinate Putin. I mean, this is a crazy escalation. And then on the other side inside the you have people saying, you know, Putin's a genius. And so Chamath Palihapitiya (00:28:17): We are gonna continue to ratchet up these economic sanctions, guys. We are this is the beginning of the beginning of the economic sanctions. We're not even in the middle of them. David Friedberg (00:28:25): What do you think he's gonna do, Shamak? Like, what is the exit ramp for Putin? If we keep doing this and he's in the Chamath Palihapitiya (00:28:30): in the corner -- I have no idea, but I think that it's clear. It's pretty it's pretty plain as day if you're going to be unemotional and just look at this from our from the American and European perspective, which is the only end game now is regime change. Right? And one step be before regime change is a complete sort of detant and somehow you know, surrender by Putin in the sense that he pulls back from Ukraine. David Friedberg (00:28:58): Not if 70% of his people support him, which is what a poll pulling figure it showed this morning. Right? And and -- You're Jason Calacanis (00:29:04): careful with those polls. I mean, people in Russia are not exactly gonna say, I'm anti Putin in a survey. David Friedberg (00:29:10): Well, Jake, Al, I mean, look, you can say that to to kind of defend what you believe about -- No. Jason Calacanis (00:29:14): I'm not saying it to defend what I believe. David Friedberg (00:29:16): -- Jason Calacanis (00:29:16): saying, like, look, I'm saying you pragmatic. David Friedberg (00:29:17): just suspend it and assume for a moment that maybe that is the position of those people. Maybe they do believe in pride of nation. Like, the United States would believe in pride of nation if we were attacked. If everyone took economic sanctions against our country, would we not stand up and defend our president and our nation and say that our country is the prime country and our way of living and our life, and we should be left alone you know, this is this is not an issue for the world to get involved in. Chamath Palihapitiya (00:29:46): Okay. But let's play Jason Calacanis (00:29:47): this up. David Friedberg (00:29:47): And so how do you end up assume that is the case. How do you end up having a regime change where you don't have a country that's actually in revolt, Chamath Palihapitiya (00:29:54): but you have a country. But let's play this out. Like David Friedberg (00:29:56): -- Where people are are are rallying for what this AI is doing if that is the case. Right? Jason Calacanis (00:30:01): Let's move our conversation to exit ramps. Chamath Palihapitiya (00:30:02): From where we are, there's there's 2 options. Right? There's 2 options. Option 1 is Ukraine successfully defense itself. Right? And option 2 is Russia, quote unquote, wins. Okay? Let's just go down that branch for one second. Jason Calacanis (00:30:15): Or they settle. There's a 3rd winchima. They they come to a peace treaty, which is what's happened previously. David Friedberg (00:30:21): Oh, there's Chamath Palihapitiya (00:30:21): a third, and then there's, like, I guess what you're saying, Jason, is, like, everybody just kinda stops where they're they are in place. Yes. Jason Calacanis (00:30:27): They do a peace treaty. Something. They give them the east of the of Ukraine. Chamath Palihapitiya (00:30:32): Got it. Well, let's let's play it. So then what happens to all of these economic sanctions? Are they undone? David Friedberg (00:30:39): That would be part of the negotiation. Right? Jason Calacanis (00:30:41): Yeah. Maybe undone based on conditions. David Friedberg (00:30:44): -- question is are their reparations paid one way or the other and how do those funded. Well, those definitely should the IMF get involved and say, hey. We're gonna fund your $300,000,000,000 war damage bill to the Ukraine and know, they're at some big Chamath Palihapitiya (00:30:56): just confiscate the $650,000,000,000 sitting in foreign bank accounts that's owned by the central bank of Russia. David Friedberg (00:31:02): Again, like, how do you go back and lead a nation, and how does a nation accept that? How do they accept that their sovereignty has now been challenged when a few months ago they they were the aggressor. Right? Chamath Palihapitiya (00:31:13): But they don't all I mean, look at David Friedberg (00:31:15): what happened to Japan, by the way. You know? I mean, you know, it's it's a very similar kind of psychological shock that that may not be as easy to swallow with modern Russians. Chamath Palihapitiya (00:31:25): Don't all roads then lead to. This is going to take a really long time to figure out. David Friedberg (00:31:29): along it's either gonna take a long time or it's gonna catch on fire. Jason Calacanis (00:31:32): I thought Georgia took, like, 11 days. So, I mean, I the there's a Sun Sue quote, which I don't wanna butcher, but It was build your opponent, a Golden Bridge to retreat retreat across. There needs to be a Golden Bridge here. That's my talking about it. We don't slow that. We did talk about episodes ago where we said David Friedberg (00:31:47): -- Well, we're not -- What if -- We're not the people running the country. I I'm talking about, like, where is Biden and where is the rest of the state department in saying, here's an exit path for Putin and clearly state it over and over again and give him something to win. Right? Chamath Palihapitiya (00:31:59): Like David Friedberg (00:31:59): -- Jason Calacanis (00:31:59): I think I think we gave a suggestion, David. from wrong if you suggested or I did 2 weeks ago when we sort of started talking about this, which was, hey. Why don't we just say, hey. We're we're not going to allow the to allow Ukraine to join NATO for a decade if you leave now. Chamath Palihapitiya (00:32:14): You know? We're so past that. David Friedberg (00:32:15): We're so past that has nothing to do with, I think, what's going on now. Chamath Palihapitiya (00:32:19): You had countries you had countries, like, that came off the sidelines and have done things. They've they haven't done 30, 40, 50 years, and in some cases, ever. David Friedberg (00:32:27): I mean, their industry just got gutted this week, Jake House. So, like, they're not they're not there's a there's a 100,000,000 people worried about a hundred million people worried about food. Jason Calacanis (00:32:36): If we had done it preemptively, we would David Friedberg (00:32:37): -- Chamath Palihapitiya (00:32:37): I think David Sacks (00:32:38): I think it would make a huge difference. Chamath Palihapitiya (00:32:39): Like, look at Germany as an example. Germany undid 40 years of policy. You know, they had consistently been under investing relative to their GDP in the military. And they made an explicit commitment to basically just ramp that up back above 2%. You know, they've also made commitments around their energy independence. You know, Switzerland is freezing bank accounts, something that they've really never done, and they've always stayed neutral. Sweden sending military support. So there's a lot of countries in Europe, in continental Europe that have found a voice? Jason Calacanis (00:33:10): Well, it's terrifying, Regeman. I mean, to to live with this threat, just east of you, this would be like us living with this threat and central America or something. This is, like, two steps away. And I think that's what people forget is the geography here of, you know, France, Germany, Poland, Ukraine. Chamath Palihapitiya (00:33:26): think this NATO commitment doesn't necessarily get it done at this point. David Sacks (00:33:30): Yeah. I agree with that. I mean, I didn't have to be part of anything. Chamath Palihapitiya (00:33:33): What's the actual -- -- in my opinion is that you ratchet these economic sanctions up so severely that then, you know look. The thing is, hopefully, in the aperture of war, memories are short in the sense that, you know, if you ratchet these things up very aggressively, Now all of a sudden something from even 2 weeks ago seems like a much, much better place to be. Right? And so that could be an off ramp, which is like you basically find a way to take a lot of pressure off these economic sanctions in return for it to taunt. I mean, I don't know. But I'm making this up. I have no idea. Jason Calacanis (00:34:10): I mean, it feels like there is no exit here because Putin has a lot of pride and nuclear weapons. Is this a no exit situation, Saxx? David Sacks (00:34:19): think there's always an exit. We have to be willing to to contemplate what that is. I think to your question, let's just go back for a second. That to your question, would it made a difference if we had taken NATO expansion off the table, say, last year? I think this year is probably already too late. But I think the answer is yes regardless of whether you believe that NATO expansion is a real issue for the Russians or whether you think that's a pretext. because, you know, people are in one of those 2 camps. Putin has been saying since 2008. In 2008, there's a NATO summit in Bucharest in which they basically declare they proposed that Ukraine and Georgia could eventually be eligible for membership. That basically started this whole thing. The Russians at the time said this is an absolute nonstarter for us. It's a red line. No way will we allow this to happen. And in fact, later that year, they rolled the tanks. into Georgia to put a stop to that idea in Georgia. In Ukraine, the conversation was deferred. They had this basically pro Russian democratically elected Prime Minister president Yukunovich, who was deposed in a coup in 2014, a coup that was supported by our state department and probably the CIA. Okay? In reaction to that, Putin sees Crimea. Not a year later, not months later, days later. The reason why he was able to seize it so quickly is the Russians actually have a naval base there at Sevastopal. k? It's it's a leased the area's leased from Ukraine but they have a naval base there. It allows them to control the black sea. So the the Russian thinking on this, if you believe it, goes, that listen. We're about to have a pro western ruler come into Ukraine installed by a an American backed coup. And now we're gonna lose our main naval base in the block c and it could be replaced with a NATO base. There's no way that's happening. So they moved to seize Crimea. And then after that, they started backing Russian separatists in the Donbas and the civil war began. David Sacks (00:36:25): Okay? So That basically is what's been leading up to this. And then last year, they started getting very exercise about the possibility of this NATO proposal, which again goes all the way back 2008 becoming formally recognized and Ukraine joining NATO. And for again, this is from the Russian perspective. Okay? And we could talk about whether it's a pretext in a second. But from the Russian perspective, they said that, listen. And Putin gave a speech like this. If Ukraine joins NATO, because of Article 5, the next time we have a border dispute, which is all the time. Right? we could end up getting drawn into what we're through with you guys. And so there is no way we're gonna allow Ukraine to be part of NATO. And So they proposed they basically, by December, had given an ultimatum to the state department. Now what was the response to that? Blincoln came out at the critical moment and said NATO doors open and were remain open. Basically, said, you guys can you know, take a hike. Now, obviously, that was an extremely provocative thing in the Russians invaded Ukraine days later. Now think it's pretty obvious that if you take the Russians out their word that they believe, forget about whether you think it's true or not. But if you believe take them out their word that they at The same word they've been saying since 2008, that this is a red line for them and they have a serious vital national interest there, then you should have diplomatically tried to resolve this issue. But even if you believe, it was a pretext. And Putin is making up this whole red line thing, and his real goal is the expansion of Mother Rush and all that Jason Calacanis (00:37:59): kind of stuff David Sacks (00:37:59): or reunification? Let's say that's his real goal. It still wouldn't have been a good idea for Blinken to basically declare that we were gonna take NATO expansion off the table, which is simply an affirmation of the status quo. It's not appeasement. You're not giving anything up. You're reaffirming the status quo. would Jason Calacanis (00:38:17): that happen? -- something from happening in the future. Right. David Sacks (00:38:20): Why why would that have been a good idea? Because the polling on this showed that the Russian people by 2 to 1 were in favor of basically taking this kind of military action against you create to prevent NATO expansion, but they were not in favor of doing it purely for unification. So you would've if this was a pretext by Putin for his expansion's dreams, you could have taken away that card, and it would have changed his calculus. Would it prevented the war? We can't say. But in his calculus, he's gotta think, well, ways second. Maybe the people won't be behind this. Jason Calacanis (00:38:54): Here's the good news too. If you had given him that chip and said that we're not gonna let them into NATO, and then he does invade. Now you've proven that this person is in reunification mode, and he's deranged, and he's a little bit longer, and that this could go to other places. And Finland and Poland, and other people have a real reason. David Sacks (00:39:12): Yes. You would have much less internal support. Jason Calacanis (00:39:14): So -- It would have been a much better chess move. Chamath Palihapitiya (00:39:16): Right. David Sacks (00:39:16): So there was a failure to listen. And And this is what concerns me. So I wanna you know, George Herbert Walker Bush, who I think was a great foreign policy president, only serve wasn't so good on domestic, at least got reelected didn't get reelected. But everyone recognized him as a great foreign policy president. And He has a quote about this style of foreign diplomacy that we that his son practiced, Dick Cheney, and rumsfeld. And the same people now in the Biden administration, it's all the sort of NeoCon form policy. He said the way he he called this Iron ass foreign diplomacy. He called Chaney and Ironass, and he called rumsold arrogant. And, you know, what he basically said is that these guys, he's taught about Cheney and Rumsfeld. They don't listen. They just wanna kick ass and take names. They never wanna listen to the other guy's point of view. And, you know, he thought this was tragic. He thought it ruined Bush 43's presidency. And I gotta wonder, I mean, are we practicing the same style iron ass diplomacy here. You know? Well, now it's too late. We're already at war. I mean, I think if we had practiced I I I think if Herbert Walker Bush and James Baker, it had been president last year and and James Baker was secretary of state. Do you think we'd be in this mess? I don't think so. I think James Baker would have figured out diffuse it. Jason Calacanis (00:40:38): Who is the -- Now it's too late. David Friedberg (00:40:39): -- Jason Calacanis (00:40:39): who is the political scientist that you shared that link from in the group chat from the University of Chicago David Sacks (00:40:46): who -- Yeah. guy, John Muirshimer, who's sort of king of the realist. David Friedberg (00:40:48): -- David Sacks (00:40:49): the video Jason Calacanis (00:40:49): from him. Yeah. It's quite convincing that -- Yeah. -- we should have an approach that was, hey. We we don't need to insight Ukraine to break off, we could let them make their own decisions and that we're kinda taunting Russian said, I don't think you know, he makes a pretty convincing argument there, and I don't think you need to be a Putin. Apologies. You can keep in your head this person's a dictator This is a communist country. He's a murdering sociopath. And at the same time, we should not provoke him and let the Ukraine make their own decisions but not encourage them to come into NATO, and we should have taken NATO off the table. It's pretty clear that that would have been a a better decision here. But we we still can't think of an exit ramp here, which and I don't hear -- Well, David Sacks (00:41:36): it's always -- -- talking Jason Calacanis (00:41:36): about Putin has never said I want x. David Sacks (00:41:40): Well, no. I think no. There there have been times where he well, I mean, look. David Friedberg (00:41:44): I think his demands David Sacks (00:41:44): his demands have been a nonstarter with I think at this point, he wants Crimea. He wants the Donbas to be independent, maybe, under the suzerainty of of Russia, so I'm gonna protectorate, basically. And he's talked about this denosification, demilitarization of Ukraine. I mean so now I think the demands are escalated because they're at war. And David Friedberg (00:42:05): -- He's lost too much. He needs to get more. Right? I mean, part of the the the problem is -- Are Jason Calacanis (00:42:10): you saying he's stuck and he needs to -- No. David Friedberg (00:42:12): I think what's you've once you've invested a $100, you gotta make a 150 back. Whereas before, he had invested $10, he would have been happy taking 50 out. You know? And I think at this point, he's put too much in to walk out with the same sort of deal, you know, he was looking for. -- Jason Calacanis (00:42:26): chances he's overplayed his hand? David Friedberg (00:42:28): Like, the economic cost at this point to him the loss of jobs, the loss of customers, the loss of the value of his currency, I mean, you add all this stuff up so much has been taken away. It's very hard to see him coming feeling like he can come out of this thing ahead, and so he's only gonna keep plowing forward. Jason Calacanis (00:42:46): Does does he face the risk of Roe and Shamoff? I mean, is this like, at this point Chamath Palihapitiya (00:42:50): Well, here's what I would say. In 2020 Russian GDP, was David Friedberg (00:42:55): $1,483,000,000,000,000. Chamath Palihapitiya (00:42:59): Now what percentage of that do you think is actually exports versus a domestic economy? let's say half. Let's be to just take a guess. Right? So you're talking about David Friedberg (00:43:08): $750,000,000,000 Chamath Palihapitiya (00:43:10): of exports. So let's just say that, you know, between the BOJ, Bank of Canada, ECB, and the Federal Reserve, We all just collectively printed David Friedberg (00:43:23): $5,000,000,000,000. Chamath Palihapitiya (00:43:25): You can absorb many, many years of Russia's export loss Now it does have some gnarly implications. You know, you probably have to work more closely, for example, with Iran. You to get an Iran nuclear deal done wise so that we can get access to their oil. Right? So it blunts the loss of the of the Russian reserves as an example. You know, we'd have to do some clever things on sustainability and farming. My point is, though, that I think the economic calculus of this decision is not as grandiose as it once may have seemed post a COVID scenario where we were printing, you know, 100 of David Friedberg (00:44:04): 1,000,000,000 Chamath Palihapitiya (00:44:04): of dollars a month. Jason Calacanis (00:44:05): I think there's a a The only good news I can take from this acts is, you know, the the free world has now learned about what a dependency Like, we've literally working up from the delusion that we can intertwine. Chamath Palihapitiya (00:44:17): Hold on. Jason Calacanis (00:44:17): Let me just finish this one segment, and I wanna get your feedback on it. We have woken up from a delusion that we can intertwine our economies with rich nuclear powered dictators in communist countries, both China and Russia. And now I think the great decoupling and the great independence is upon us with us moving semiconductors back on shore going nuclear, maybe it fracking seems I think even any environmentalist will take fracking in Europe, fracking in the United States over a dependency, over a dictator. So is that not a silver lining here? David Sacks (00:44:51): Yeah. I mean, look. I think it's so obvious now to everybody. that we need to be energy independent, that it was insane for us to throw away that energy independence. We've restricted it. I think that if there was a bill introduced and I think it's being talked about to repeal all the restrictions on fracking. He would pass the senate 7525, meaning their Republicans will vote for a half the Democrats will vote for. So I think everybody's on board now, and there is some remarkable you see the tweets from Michael Schellenberger about it. It has come out that You know who is backing all these Jason Calacanis (00:45:24): The anti fracking. Yes. The anti fracking David Sacks (00:45:26): environmental movement in David Friedberg (00:45:28): -- Chamath Palihapitiya (00:45:28): In Russia. David Friedberg (00:45:29): -- David Sacks (00:45:29): in Europe David Friedberg (00:45:30): -- Jason Calacanis (00:45:30): And they fell David Sacks (00:45:31): off right. and they fell for it. Exactly. Jason Calacanis (00:45:33): And the Germans fell for it and turned off nuclear. And now all of a sudden, they're dependent on Russia, and he has the pretext to now invade. David Sacks (00:45:40): Right. These environmental groups in in Europe have been useful idiots for Putin and the Kremlin. Chamath Palihapitiya (00:45:46): Yeah. That's what that's what's so sad. I think I saw a tweet. It was something to the effect that 25 years ago or 30 years ago, Europe actually produced more liquefied natural gas for Europe than Russia did. And the whole thing flipped because all these environmentalists forced Jason Calacanis (00:46:02): you to shut down. Chamath Palihapitiya (00:46:04): They outsourced their guilt, but it turned out that all a lot of those organizations may have been funded by Russia to basically affect that change. I wanted to say something, Jason, before you know, there's a common thing that you hear right now which is, oh, economic sanctions don't work, and I just wanted to talk about that for one second. which is I think I I think there's a lot of people. There's a lot of chatter that historically economic sanctions aren't enough, which is why you can't draw a very clear bright line between that and military intervention as well. And I and I as I thought about it, this is why I think you can actually fight an economic battle and an economic conflict without pulling you into a military one. And the reason is actually because of what's happened in the last 40 or 50 years. You know, you have like the the most critical infrastructure in the world, I think, is the financial infrastructure, whether we like it or not. Right? Because, you know, energy infrastructure tends to be more localized, other forms of infrastructure are localized, but the one real asset that is absolutely global and universal is the financial payments infrastructure. And, you know, what has really happened is that you can really cripple a country or an entity when you blacklist them from these organizations and these networks. And so this is why I actually think people underestimate the severity of of economic sanctions if done correctly. And I think before, You've never really other than, you know, Venezuela and a couple of other, you know, North Korea. Jason Calacanis (00:47:35): North Korea, Cuba, Venezuela. Cuba, you've never really explored Chamath Palihapitiya (00:47:39): the totality and the impact of this kind of sanctions on a large global actor, which we're David Friedberg (00:47:44): -- Jason Calacanis (00:47:44): This is almost greater than sanctions. You're being you're not allowed to participate. It's not even like you're saying, you can't export this, you can't import this. It's you're now not allowed. You have no seat at the table. Chamath Palihapitiya (00:47:56): I think the crude oil example and the airline industry example are 2 incredible examples of the ripple effects of these sanctions. Right? So again, just to reiterate, Like, if you're a European based refiner, in order for you to go and buy that oil, you may have you know, a working capital line from a German bank, well, that would violate the terms of that bank now, and so you can't go and get that. Right? If you actually have that oil on hand and you refine it into gasoline and you wanna put it into the open market and you call Flexport as an example and say, help me get this stuff to x, y, z location or Mersk or somebody else, they won't do it. Jason Calacanis (00:48:34): I mean and if you look at the tech sanctions that have started, it sounds minor, but You have Netflix is pulled out of the country. Apple is not selling products in the country. Google is starting to restrict services in the company, and this is going to have a massive impact on their ability to just participate in society, they just turned off proactively this morning. I don't know if you saw that it was right as we were getting on air. Facebook's been banned. Instagram is still on Twitter still on, but the Russians now are are turning off information into the country while every other con every other company is turning off their services there. Chamath Palihapitiya (00:49:04): I think the global economy or not even a global economy. I think Japan, Europe, Canada, America can collectively support David Friedberg (00:49:17): 5, 6,000,000,000, $7,000,000,000,000 Chamath Palihapitiya (00:49:20): of subsidies to blunt the economic impact of these sanctions. That's effectively shutting Russian exports off for 8, 9, 10 years. Think about the the so, you know, the this this is that is the damage. Jason Calacanis (00:49:37): Any thoughts here as we and I come to no way out here and just watch an economy being disabled. David Sacks (00:49:46): So so I I think that we're gonna figure out a way out, we need to assess what our objectives, you know, what our objectives are. And we talked earlier on on on the show about this idea of regime change and that there wouldn't be an answer without regime change. I disagree with that. I you know, just those two words regime change to make everybody cringe because regime change was a justification for the Iraq war for Afghanistan, for Libya, for Syria, and every single one of those things has been a disaster. When has the United States of America successfully achieved regime change in the last 20 years without creating enormous blowback. There's an assumption that somehow if Putin gets toppled by an internal coup, that we end up with Gorbachev 2.0. Well, maybe we do. Jason Calacanis (00:50:34): To Corey? David Sacks (00:50:35): Maybe we end up with a hardliner who's even worse. I don't, you know, I don't And and David Friedberg (00:50:39): -- Jason Calacanis (00:50:39): So what should the goal be? Obviously, regime change would be wonderful if the Russian people chose that, but what what is the -- I see cease fire. Seas fire piece. Right? Yeah. I agree. David Sacks (00:50:47): Seas fire. So I think Putin miscalculated the resolve of Zelensky and the West. You know, Zelensky was like this TV actor became president. He was right. Before this, he was like 25% popularity. Now he's at 90 something percent. I think Putin underestimated his resolve. He David Friedberg (00:51:05): -- Chamath Palihapitiya (00:51:05): Would Jason Calacanis (00:51:05): you say Putin has lost the information more? I mean, that that's pretty staggering. I mean, it's pretty clear that Putin thought he could win this information warrant. This is the first meeting. David Friedberg (00:51:15): -- Jason Calacanis (00:51:15): even see him tonight. -- more. Yeah. David Sacks (00:51:17): I I agree. It isn't me more. I think we're being heavily propagandized. But if David Friedberg (00:51:21): -- Jason Calacanis (00:51:21): But the west is winning the propaganda war. David Friedberg (00:51:23): But, Jake, how David Sacks (00:51:24): do you just look at look David Friedberg (00:51:25): look at yeah. But, I mean, look at where you're sitting. Right? David Sacks (00:51:27): Ukraine is engaged in that too. Right? Sure. Yeah. You had you had the whole snake island thing where basically the, you know, the David Friedberg (00:51:34): -- Jason Calacanis (00:51:35): That one that's being confirmed as fake news. David Sacks (00:51:36): That was fake. Okay. You had Snake Island. We're the 13 Ukrainian soldiers that were gonna -- Turn Jason Calacanis (00:51:40): death for you. We're gonna David Sacks (00:51:41): you bring us death rather than surrender. It turns out they actually surrendered. You had the old woman? walking up to the Russian soldiers with her. David Friedberg (00:51:48): -- Jason Calacanis (00:51:48): to get the hell out of here. David Sacks (00:51:49): Yeah. Exactly. That was a fake. What else? I mean, I think this Jason Calacanis (00:51:52): Everything's fake. David Sacks (00:51:53): This Chernobyl 2.0 was fake. Oh, the Well, that was half -- The fighter pilot. The fighter pilot was the the ghost of David Friedberg (00:51:59): -- David Sacks (00:52:00): Yeah. Exactly. That turned off to be a fake So look, we are being heavily propagandized. Now I don't blame Zelensky or the Ukrainians for trying to propagandize us because -- Yeah. They're Jason Calacanis (00:52:10): on the right side. David Friedberg (00:52:10): -- David Sacks (00:52:10): country fighting for their lives. And if they can pull us into the war, it would help them. It might also cause War War David Friedberg (00:52:17): 3. Jason Calacanis (00:52:18): Or just Harley and and, you know, flip Russian sentiment. Chamath Palihapitiya (00:52:21): There's something else that's really interesting. I just went to the World Bank site just to check Whether the GDP number that I just gave you was right, and it is right. But what's even more interesting is that Russian GDP has actually decayed 35% in the last decade. It what it peaked in David Friedberg (00:52:40): 2 1013@2.292 $1,000,000,000,000. Chamath Palihapitiya (00:52:45): And so and all the way down to now 1.483. So I think the point is with, you know, all of these other things that they've been having to deal with because of their foreign adventures. You've seen a contraction of their economy already. Jason Calacanis (00:52:56): Freeport, did we over did the west and everybody overestimate Russia's capabilities here? I mean, is that a possibility? because they seem like they're getting beaten pretty or they're they're being fought back at a way people didn't think they would be able to. David Friedberg (00:53:10): First of all, I have no freaking clue. 2nd of all, I don't know, like, what people think that they thought they knew or do or don't know. But I think importantly, we don't really know what's going on over there. You know, we are hearing stories every day that we feel is conclusive and factual and on the ground reporting. And then a few hours later, we find out may or may not actually be true. you know, this is the fog of war. And I wouldn't take anything that I'm reading on Twitter or seeing on CNN or hearing some comment about, nor would I feel the same about any commentator in the Ukraine or Russia or anywhere else for that matter. facts are gonna be fact. I'm not sure facts are necessarily gonna get to us. And so I don't know what's going on the ground. With Russia, there's a convoy supposedly that we know we can see from satellite imagery that's moving towards Kyiv, it stopped. We don't know why it stopped. There's claims by one group of people that says they're of food and they're defecting. Just claims by another group of people that say they're waiting to encircle the city and then command pressure and use this as leverage effectively to try and get a good negotiated deal. to exit, we don't know. And so, you know, for us to be like, you know, 4 guys commentating at Starbucks, I think is a bit of a mistake because there's very few facts that we can actually say is objectively true at this point. Now what we do know is Russia has a lot of nukes. And so regardless of what's going on the ground with tactical stuff, you know, any sort of assumption that leads to our belief that an alternative intervention or or some other force can ultimately win against Russia is is completely false because Russia has thousands of nuclear warheads. And, you know, if Russia wanted to exert its military authority over anyone in the world, they can. And and so I wouldn't kinda take any of this stuff that Russia is gonna lose a war, you know, a war on the ground in the Ukraine. David Friedberg (00:55:08): I mean, at the end of the day, they've got the ultimate Trump card. David Sacks (00:55:10): Well and also, they haven't brought out the heavy the heavy RV. They can David Friedberg (00:55:14): -- -- David Sacks (00:55:15): bump keyed into rubble. Okay. David Friedberg (00:55:17): If they go bunker, mustard bombs, they've got stuff that yeah. Jason Calacanis (00:55:20): What is the strategy here to just David Friedberg (00:55:21): -- David Sacks (00:55:22): Listen. They can pull a Grozny. They can pull a falluja. I mean, look. You know, we they we can dig in. Let's not pretend like we haven't done it too. They can bomb these cities into rubble from the sky. David Friedberg (00:55:34): And they're not because it will be too bad. You know, Jason Calacanis (00:55:37): their their their callback would be too bad from the west. David Friedberg (00:55:40): We don't know. We don't know, but there's certainly there's certainly strategy, these guys aren't a bunch of idiots scrambling around trying to figure out what to do. They've got the 2nd most powerful military on planet Earth that can literally destroy every human on planet Earth. they are they are pretty smart, and they are gonna figure something out to get themselves some sort of an advantage ultimately what that is we don't know. You know, we're sitting here trying to figure out how to play chess when we never played it before. Jason Calacanis (00:56:03): I mean, Saxs, that that might be something worth discussing. I mean, there is a contingent that's a, listen, Putin isn't thinking about this strictly logically. David Sacks (00:56:14): Yeah. I I understand that point of view. You hear it a lot on on the press. Jason Calacanis (00:56:18): What do you think? David Sacks (00:56:19): Here's what I well, here's what I think is I think Putin underestimated Zelensky's resolve, Ukrainian resolve, and I'd say the west resolve. I think it would be a mistake, however, for us to underestimate his resolve. Jason Calacanis (00:56:31): Yeah. David Sacks (00:56:32): And that's what I'm afraid of next is that he doesn't wanna give up and listen to go back to to, you know, the Mersheimer point. So there's a school of realism and what Mersheimer says, and he predicted a lot of this. So You have David Friedberg (00:56:45): -- Jason Calacanis (00:56:45): That's amazing. Yeah. He he gave a great talk in 2015. I watched him right before we got on air. Right. David Sacks (00:56:50): One of the ways I Yeah. One of the ways I I assess who I wanna listen to and learn more from is when I see someone making farsighted predictions that come true, I'm like, okay. Jason Calacanis (00:57:00): Pretty good one. Yeah. David Sacks (00:57:00): Yeah. Exactly. You're like, okay. guy has a mental model that seems to predict the world. Right? I mean, like Carl Popper said famously that difference between science or religion is that science makes predictions that are falsifiable. If you make predictions, one prediction after another, the ends are becoming true, maybe you have a way of thinking about the world that is predictive. So This guy I I would just say I I can't summarize all this thinking here, but I would just say I mean, I went down kind of a rabbit hole on YouTube just watching his stuff. I obviously not all of it is right. Okay? But and but, you know, the media has been demonizing this guy because for the few things he's gotten wrong about the situation, instead of all the things he's gotten right and, you know, if you were to do the Washington establishment by the same standard, they've gotten far more wrong than he has, especially over, you know, since the Iraq war over the last 20 years. But anyway, the point he makes is simply this or one of the points is Listen, this situation in Ukraine is to the Russians what the Cuban missile crisis was to us. Meaning, it is not a pretext for Putin to go in and expand his empire. What is really going on here is they have to find this As a red line, they see as a vital national security interest. And so we should be thinking about them and their resolve the way that we thought about the Cuban Missile Crisis. So in other words, the Russians are acting like the Americans did in the Cuban Missile Crisis. And remember, Fidel Castro thought he had the sovereignty. He thought he had the the right to go make a treaty and a deal with whoever he wanted. And he went to the freely went to the to the Soviet Union to try and make a deal. And the Americans said no way. And, you know, in our backyard David Friedberg (00:58:39): -- -- David Sacks (00:58:39): not in our backyard. And we imposed a blockade And we were flying the bombers, and Kennedy had advisers and generals who were willing to go to nuclear war. to win that standoff in that confrontation. And, ultimately, the way that they solve the problem is JFK sent Bobby Kennedy to go secretly cut a deal with the Russians to pull the Jupiter missiles, the warheads out of Turkey. So there's a quid pro quo. They kept a secret for 6 months. Kennedy got to declare a a victory, but the the Russian the Soviets got something out of it too. They were able to diffuse the situation. So if there's any way to make a deal like that, I think it would be a good idea. Jason Calacanis (00:59:20): Yeah. I mean, the reason don't you think the reason he's don't you think the reason, Saks, that he has misunderstood is because we are propagating democracy. And when we do something, Well, it has the shine of, hey. We want people to be free. We want individual freedom. We want individual human rights. We want individual expression. These things are the height of human existence. And when communist countries do it, while they're trying to spread communism and authoritarianism and reduce humans individualism and freedoms. And and that is a valid argument, but he says in his talks, like, listen. You can put that aside and just say, you know, missiles in your backyard, not good. David Sacks (00:59:59): Yeah. Exactly. So this is the the fundamental dichotomy in in sort of the informed policy thinking or international relations between idealism and and realism. Idealism says it's all about values. And so we're going around the world. We're promoting democracy. We're supporting allies who we think will spread democracy. There's good guys and bad guys. We're on the sides of the good guys, and that's who we support, and we change the regimes that are the bad guys. But the reality is to think of this as great power rivalry, and we have to understand the way that great powers have always reacted and behaved. And great powers, whether it's Russia or the Soviet Union or us will behave viciously and ruthlessly towards anything they perceive as a threat. to their national security enter their vital national security interest. Jason Calacanis (01:00:42): What are your thoughts on this being the moment? We we make the next big transition. We were in a bipolar, world order. We're bidding unipolar for the majority of our lifetimes where we only experienced the United States. And now is this the moment we move to multipolar sex? where we're gonna or have we moved there already? David Sacks (01:01:00): It's it's it's there's a transition that's happening mainly because China. So we're and I you know, it seems like what we're doing is pushing Russia irrevocably into into Xi's arms. He's gonna be part of -- -- huge mistake. As part of that. Well, I'm I'm surprised to hear you say that, Jake. How? Jason Calacanis (01:01:15): Well, I said it 2 weeks ago. I I mean, I said this sounds crazy, but if we could get Putin to be, you know, in talks with us, then he's not in talks with Xi Jinping. And when you saw him with, you know, taking pictures of Xi Jinping, That should have been a red alarm bell to everybody that our foreign policy is not working. Because if he's talking to Xi Jinping supposedly, And who knows if this is true again, fog of war to Friedberg point? You know, maybe Xi Jinping told him, can you wait till after the Olympics to do this invasion? If they're coordinating that level, that's really problematic for the US. We need him on our side. We need to get Pakistan on our side. India. South Korea, we need to build an alliance to deal with the eventuality of China going into the South China Sea and taking over Taiwan. So, Chamath, what are your thoughts on Does this give Xi Jinping a window or not? And is there any path to getting Russia back in Talks with the West. Chamath Palihapitiya (01:02:10): Maybe he can help get them restarted in a way that could normalize relations. Is this well, the the real question is, like, if you're Xi, do you look at this and say it emboldens me? or I have to be even more strategic and crafty. What do you think? Jason Calacanis (01:02:31): I said the latter. Yeah. Yeah. It's the latter. Right? If Russia had rolled, David Sacks (01:02:35): Right. It'd be the form. This is one good thing. And I'll I'll sort of contradict what I said a little bit before. Look. I I I don't I'm not passionately attached to either the realist or the ideal a school of thinking. I think they're interesting. We need to consider both perspectives. What I would say is that the resilience, the ferocity of the Ukrainians, the resistance defending themselves giving Putin a punch in the nose, we can all support that because we know that she is watching. And if he sees wow, the Russians really got a tough time with Ukrainians. What you know, am I gonna be facing a similar situation with Taiwan? And what's interesting is that the way the Ukrainians, they basically were willing to arm every man woman in I don't know, child, but every man and woman there, they were handing out the a k Forty sevens. Basically, they Israelized. Right? You wanna know how Israel survived in a neighborhood where everyone to kill them. Every single adult serves in the army, and they get guns. It's like, you know, the second amendment over there. Force Yeah. Exactly. So yeah. So I think that the Ukrainians have shown a model that's really based on the Israel model, which is, listen, if Taiwan really wants to be independent, every adult there needs to learn how to fight and they need to have weapons. And that's gonna be the best guarantee. We can be their ally, but that's gonna be the best guarantor is creating a credible deterrent to Xi moving on them. Jason Calacanis (01:03:58): I mean, do we transition to another story here? I mean, this is this is one of the problems when you were living in these kind of times is that if you talk about anything other than David Sacks (01:04:08): this normal day -- -- trees can I saw a tweet. When all the decision trees can go to 0, meaning that there's a 1% chance of or point 1 percent or point 01 percent chance of of war 3, the nuclear war, then, yeah, it's hard to talk about anything else. Hard to think about anything else. So David Friedberg (01:04:21): -- Jason Calacanis (01:04:21): Yeah. David Friedberg (01:04:24): I watched Ozarks this week. Wait. Amazing. It's great Chamath Palihapitiya (01:04:28): series. Ozarks. Jason Calacanis (01:04:29): Is that good? Always Art is great. Jason Baby, an amazing great performance. David Friedberg (01:04:32): -- is so freaking good on it. Chamath Palihapitiya (01:04:35): Breaking bad 2.0. That series twice, and I've fallen asleep in episode 1 half time. No. Jason Calacanis (01:04:40): No. No. You you gotta keep going. It rolls. It's it's it's basically breaking back David Friedberg (01:04:44): 2.0. Chamath Palihapitiya (01:04:45): Yeah. I I started season 2 of euphoria. Jason Calacanis (01:04:49): Oh my lord. Chamath Palihapitiya (01:04:49): That is how you live David Friedberg (01:04:50): with your kids watching. Chamath Palihapitiya (01:04:51): Oh my god. Yeah. It's either that or it's, like, the best deterrent. So, like, you you make them sit and watch it, and they'll not only will they never not do drugs, but, like, they'll they just won't do anything. They'll just, like, stay in the house. Jason Calacanis (01:05:03): It's scarring. It's basically requiem for a dream meets, like, Disney plus afternoons. Like, these are Disney Stars Living in requiem for a dream. Do not want you to Chamath Palihapitiya (01:05:12): decompress after I watch it. Jason Calacanis (01:05:14): If you have kids, it's terrorizing, and it's terrifying. Chamath Palihapitiya (01:05:17): It's terrifying. It's absolutely terrifying. It's scary. Jason Calacanis (01:05:21): And very artistic too, I have to say. I give them a lot of points. David Friedberg (01:05:23): -- talk about markets? I mean, you know, I feel like there's -- Jason Calacanis (01:05:26): Yeah. It's good amount of markets. David Friedberg (01:05:28): Important discussion because the markets are so volatile during these kind of volatile information times times of, you know, information that's changing day to day, intraday, you know, where do you guys think about kind of spending your time right now? Are you kinda just putting your head in the sand and saying we'll pull it out afterwards? I mean, how do you guys Yeah. Chamath Palihapitiya (01:05:49): I mean, well, what's funny is, like, I -- Sacks Jason Calacanis (01:05:52): is curled up in a ball. You know, Chamath Palihapitiya (01:05:55): in in times of in times of uncertainty, you actually wanna be deploying. So, you know, I announced what was it last week? I think it was. Jason Calacanis (01:06:04): A solar deal? Chamath Palihapitiya (01:06:05): The solar deal, you know, I put $228,000,000 into this thing. And then I did another deal. I put 45,000,000 bucks into this thing. You guys know about, which we haven't announced yet. Yep. So but other than that, I've been literally white knuckled. I don't like to open the stock app. There's no point. Jason Calacanis (01:06:23): Take some drop to me before you open your Morgan Stanley account. Chamath Palihapitiya (01:06:26): The stock out. And it what's what's so funny is, like, my Bloomberg terminal, which is right beside me here at my desk I have not logged into David Friedberg (01:06:32): it. Okay. Jason Calacanis (01:06:33): Put in a draw David Friedberg (01:06:34): and unplug it. Chamath Palihapitiya (01:06:35): There's just no point. Like, at the end of every week, I get a report, right, kind of like our P and L. And I just look at the top line where, like, Connor always sends me the top line is like, you know and and the last, like, 8 weeks in a row, we've lost 1%. We've lost 2%. We've lost 2%. the time that they Jason Calacanis (01:06:50): were Saks wishes he lost 1%. Here David Friedberg (01:06:51): he goes. Chamath Palihapitiya (01:06:53): I celebrated. I got so drunk that night. like, fuck the league. Jason Calacanis (01:06:59): This is where it well, it really does help. Right, Saks? To think in decades. Like, if you think in decades and you've you're a venture investor, you can kinda put this stuff out of your mind, which is what what I'm doing. And the great thing is I'm seeing amazing companies, great founders, deals are taking longer to close. People are starting to do diligence again. people are discussing what the right valuation for this early stage start up is, which is good. That's healthy. I think we're getting, like, half I don't know what you're seeing in the in the early to mid stage market privately, but I'm seeing really healthy discussions and late stage madness is gone. It's over. David Sacks (01:07:32): Yeah. I mean, I think a 100 times ARR is over, but we no one really knows where it's landing. So I've seen some some deals get done at 60 to 80 times, but no one really knows where it it should be, you know? Chamath Palihapitiya (01:07:43): I sent you guys this tweet from Morgan Houssel who is a great guy. and he has this fabulous tweet. He says this he he it says this the shock cycle. And it's this beautiful cycle. Assume good news is permanent, oblivious to bad news, then you ignore the bad news, then you deny the bad news, then you panic at the bad news, but then you accept the bad news, And then you ignore the good news. You deny the good news. You accept the good news, and then you assume the good news is permanent. That starts the cycle. If I if I could just put it out there, I don't know, today, if you guys saw non farm payrolls, but we had a huge print in unemployment, like, really great print, meaning, like, a lot of employers were able to find people to take jobs. It was a big number. But the interesting thing about it was we didn't see wage inflation tick up with it. And if I had to look at that And if you actually look at a bunch of the earnings reports that have come out in the last 3 or 4 weeks, I actually think we're in the part of the cycle here where we're starting ignore the good news. And we're so negative, and we're so emotionally wrapped up in everything. that people forget that actually the world tends to keep moving forward. Right? We are not in World War 3 by any measure are we in not we are not anywhere near that. Okay? And I just think it's important for people to take a step back and take a really deep breath, but I think that there's a lot of good news out there. Jason Calacanis (01:09:15): There is a ton of good news. And for people don't know the term David Friedberg (01:09:17): -- -- Chamath Palihapitiya (01:09:17): ignore it. Jason Calacanis (01:09:18): So people don't know the term print when we say there's a print. That is just a colloquialism in the financial markets that something was formatted for printing obviously, and you got good news. So an official report is sometimes called, we gotta pray. David Sacks (01:09:30): I agree with I think what's going on is there is some underlying good news. Right? But there's this overhead of a small chance of something catastrophic happening. So how do you price that in? Right? It's it's it's It's like a one outer. Right? Yeah. Yeah. Exactly. But it's Jason Calacanis (01:09:45): it's like 1 -- -- quads were set over set. David Sacks (01:09:47): Yeah. So 1 hour to 1 hour to the apocalypse, basically. David Friedberg (01:09:50): If it's a tiny probability thing happens, the the game is over. so, you know, why it doesn't work out. Jason Calacanis (01:09:55): So it doesn't matter. It doesn't matter. It doesn't matter. So if it's a -- -- cost of your house doesn't matter if there's a nuclear war. David Friedberg (01:10:01): That's right. Chamath Palihapitiya (01:10:01): This is this is the thing that people underestimate is, like, that's not a that's not a risk that one should be hedging in any way. financially. Right? At that point, the only thing that matters is the health and safety of your family and your friends. But really, in your immediate family, like, can you take care of them and make sure they're safe. And so, you know, if you're if you're investor in the financial markets where you're building a company, managing for that externality, in my opinion, I'm not makes a ton of sense because I don't think you can manage to that externality. Jason Calacanis (01:10:30): You have no impact on it. It's cat out. It's it's something completely out of control. David Friedberg (01:10:34): -- Chamath Palihapitiya (01:10:34): scenario. Yeah. So I think you have to manage to the 99.999 percent of normalized outcomes. And I think right now, there are some what's called green shoots, meaning like some positive news in the world and some positive data. By the way, the other thing that we saw today was or this week was Jerome Powell. And you know, the Jerome Powell testimony was also in the middle of massive amounts of bad news. Some actually pretty decent good news, which was he said he's gonna raise by 25 basis points in March. Everybody knew that. Right? So we took the 50 basis points off the table. But then he was very clear that they were going to be data driven. And in the language of the Federal Reserve, what that essentially means is like we're gonna be patient and wait and see And if you couple it with what I said before, which is the economic cost of these economic sanctions towards Russia, can be calculated, and I think that we have proven a willingness to print capital and money. And so if you put those two things together, I think there could be a real possibility that Powell becomes very accommodative. And, you know, he invited and the entire administration come together with Europe and everybody else and say, get the money printer back going because we are we are gonna stand the line on these economic sanctions, and we're gonna, you know, sort of soft land the economy here because we think there's recessionary risks. A foot let David Friedberg (01:11:56): me just provide a a little bit of a counterpoint which is where I'm most concerned we don't know what the repercussions are fully in a dynamical system of global capital, of pulling out this much capital and devaluing assets at this scale so quickly, the shock to the system I don't think has yet been realized, and I think we'll know at the end of this month when books close what things actually do to businesses to swap agreements, to trades, you know, trade balances that are outstanding. And you could talk about economic stimulus as being the way to solve that. but we don't yet know what's broken. And there like like, let me just give you guys another example. Today, corn, I think, is trading at 7.60 a bushel. That hasn't happened, guys. I can't tell you in how long. This was a commodity that was trading at 3.50 a few months ago. And so we're now talking about that the trickle down effect of that price into the beef, the trickle down effect as we're already seeing in California where the or San Francisco where the average per gallon of gas at over $5. The trickle down effect on on purchasing behavior on businesses defaulting because suddenly, their counter parties dry up. We don't know, and we won't know. And it's not -- Why Jason Calacanis (01:13:12): should we know some of those? David Friedberg (01:13:13): We know some of them, but we don't know what we don't know. And the thing I'm concerned about is this is a imagine when I say a dynamical system from a physics perspective, it's like take a 100 slinkies and tie them together into a giant graph of slinkies. and you start punching one of the slinkies like this. If you punch 1 or 2 of the slinkies hard enough, you don't know how the repercussions will cause a slinky all the way over there to suddenly shoot up. or shoot down. Chamath Palihapitiya (01:13:35): But -- You're also denying your ability to change a difference, Linky. That's the whole point of a dynamic system. David Friedberg (01:13:40): You could put energy back into but we don't know what's broken, and there could be something that's irreparably broken. Jason Calacanis (01:13:44): through these Chamath Palihapitiya (01:13:45): we've gone through these things before, and I think you're not learning from history or you're at least not willing to admit it. But -- No. think we're seen hold on a second. We seeded in TARP. Okay? We did not know the total extent of what happened in the GFC, and we had to invent a financial framework to soft land the global economy, we figured it out. When we went through LTCM and John Merriweather blew up Jason Calacanis (01:14:04): Explain what that is. Chamath Palihapitiya (01:14:06): There was a huge hedge fund in the late nineties that basically had a massively levered exposure to the financial markets to the tune of, like, tens or tens or 100 of 1,000,000,000 of dollars. David Friedberg (01:14:17): Go read the book when genius failed if you wanna read the story. It's a it does a good job summarizing it, but it's it's a great story. Yeah. Go ahead. Chamath Palihapitiya (01:14:22): And, again, we have to step in with a governmental framework and a broad infrastructure of actors across the world to soft land the financial economy in a way not knowing what the actual what what part was broken. So I I just fundamentally disagree with this idea that we're running blind. David Friedberg (01:14:39): Yeah. Look. We're talking about I'm talking about capital and energy and food. And some combination of those things are gonna cause some serious deleterious effects on people and on markets. And look. I I get it, Tamat. I I know that there's solutions for repair, and I know that we're gonna act swiftly and aggressively. And every time, by the way, I just wanna point out, in each of those scenarios you've talked about, we've acted more swiftly and more aggressively than we did in the scenario prior. And it's getting to the point that, you know, what is the value? How much debt how much deficit Are we really willing to take on? Everyone obviously has these kind of, you know, intrinsic existential questions about how much we really can act long term without the dollar collapsing, but certainly in the context of a global economy collapsing, the dollar will always be the safe, Avan. But there are other things at play here like you know, the cost of gas for the average American, you know, the the the the amount of wheat and the amount of food that people in Africa are gonna have access Jason Calacanis (01:15:33): to instead. What you're saying here, Friedberg, is that some of these things we have been through. And if you look at gas as one example, I think you're bringing up the important ones here. Food and energy gas We actually know what happens when gas prices go up. We saw that not long ago. People bought more hybrids and the miles per gallon per car. you know, when you raise prices, consumption goes down, and people get creative. David Friedberg (01:15:54): -- Christmas, Jake. I'm talking about the short term acute effect. Chamath Palihapitiya (01:15:57): The thing that Emera has the ability to do is they have the ability to change the financial incentives for actors all around the world in a split second. Jason Calacanis (01:16:07): And behavior can change. Chamath Palihapitiya (01:16:08): And and so I actually think free brew the Nuance thing that you're saying, which I completely agree with, but maybe we should say more explicitly is It probably is a reasonable way to manage risk in America, Europe, Canada, Japan. But what's gonna be very, very difficult is the impact this has on emerging markets. In Southeast Asia, Asia, Africa could be really, really deleterious for some amount of time. David Friedberg (01:16:32): And sad. And it's a human it's gonna cause a humanitarian problem. It's really freaking sad, and it's, you know, whatever progress has been made could be unwound. Chamath Palihapitiya (01:16:39): I think you're right. By the way, I think think that that is actually really the risk that I think holding the line on these sanctions really does. It pushes the risk towards EM countries. And then I think we're gonna have to figure out what our moral resolve is to go and fix those. David Friedberg (01:16:55): And that's my point earlier, which is we're gonna bear the cost ultimately in the United States. is gonna have to step up in a really outsized way to solve this problem. And while we might not be sending troops on the ground, we're gonna end up paying several Jason Calacanis (01:17:05): extra money in the world. David Friedberg (01:17:06): -- Jason Calacanis (01:17:06): just the United States Friedberg. The United States seems to be working in coordination with our allies in this situation. We're not acting unilaterally anymore. That's a good news. David Friedberg (01:17:13): We're gonna have an economic cost. Right? There's gonna be some z Chamath Palihapitiya (01:17:17): there's there's there's no amount of money that you can actually put on human life. And so if we can avoid a military war I just think that there's just there's there's no red line on cost there. And so if we end up running massive deficits and now we're at, you know, a David Friedberg (01:17:36): 150 250, 300 Chamath Palihapitiya (01:17:37): percent of GDP, I think that, you know, morally, that's that is the right thing to do. Jason Calacanis (01:17:43): Saks, is is is the world becoming Chamath Palihapitiya (01:17:45): more -- -- idealistic and realistic. Let me Jason Calacanis (01:17:48): bring Saxon here. Sax, is the world becoming more anti fragile slash resilient, pick 1 of the 2, I guess, to these kind of upending events because of COVID, because of China pulling out of financial markets. We just went through this. FreeBird was like, hey. This is unprecedented. Actually, I think we have a little bit of precedent here. We have the complete shutdown of the economy from COVID in recent memory. And we have China deciding that all these companies are no longer public. We've seen they did their own economic sanctions. They sanctioned themselves and pulled out of markets. what do you think, Saks? David Sacks (01:18:18): I mean, I think the current crisis is a reminder that it's not too anti fragile. I think we are in a transition. We've the the Cold War ended about 30 years ago. And since then, we've been engaging in this sort of unipolar foreign policy where America calls all the shots. now the world is becoming more multipolar. I'm not sure it's all the way there yet. And you have countries like Russia, and China reasserting themselves, and that's making the world a more dangerous place. Jason Calacanis (01:18:48): Well, you also have the EU working together in unison, and they seem to be, maybe they're gonna become a bigger actor here because of this. Right? We're seeing them take up David Sacks (01:18:56): a bigger -- That was sort of a a positive surprise as long as they don't pull a transferred and then, like, Freeburg said and inadvertently blunder us into the into a war. Jason Calacanis (01:19:05): Okay, folks. This is this week in dystopian outcome. David Friedberg (01:19:08): Oh, let's talk about something good. Come on. Chamath Palihapitiya (01:19:10): Another good news David Friedberg (01:19:11): is talk Chamath Palihapitiya (01:19:11): about the big David Sacks (01:19:13): CAR T Breakthrough. Chamath Palihapitiya (01:19:13): Let's talk about the David Friedberg (01:19:13): big CAR T Chamath Palihapitiya (01:19:13): Breakthrough this week. There are always good news, guys. Good news is there. We just David Friedberg (01:19:17): well, the good Jason Calacanis (01:19:18): news is that we're managing crises after crises. China crises. Chamath Palihapitiya (01:19:22): You wanna tell people about this revolution here during David Friedberg (01:19:25): I mean, look. There's just there was another CAR T therapy approved 2 of them approved in the last week for myeloma CAR T. Just I think we've talked about it in the past. You know, every human body has T cells are a core part of your immune system. T cells are programmed, so they have a a sensor, you know, that that tells them where to go and what to destroy. And so as T cells learn what to destroy, you know, they can be really effective at at clearing bad things out of your body, clearing pathogens and and invasive things out of your body. And so a few years ago, you know, humans gained the ability to engineer T cells by adding the genetic code to a t cell effectively engineering, it to go after a very specific day. And so the big revolution in CAR T therapies has been in oncology and cancer. So, you know, programmed t cells to destroy specific cancer cells in the body that, you know, you would historically have had to use really difficult, systemically challenging drugs like chemotherapies and so on to wipe out lots of cells And in many cases, doesn't eradicate all the cancer. And CAR T turns out it can be extremely effective at finding very specific cancer cells in your body. And in many cases, causing complete remission in cancer. And so, you know, there was one CAR T that was approved that showed I believe it was an 88 or 90 percent complete remission in multiple myeloma, which is a form of blood cancer. So they they take your t cells out of your body, You you just get a little blood draw, basically. They go in a lab. They're zapped with electricity, which causes them to open slightly and an engineered, but a little crisper edit happens. And those those cells are now edited. The DNA in those cells is edited. and now those cells know to go after the cancer target. You put them back in your body after they grow up for a few days and they filter them and test them, make sure they're safe. And after they go back in your body, the the key cells go to work and they clear all the cancer cells out of your body. David Friedberg (01:21:22): It's an incredible technology. Incredible technology. Therapies are unbelievable. David Sacks (01:21:26): The Jason Calacanis (01:21:27): Is the name of the company involved in this a 2 bio? Is that the David Friedberg (01:21:29): -- Chamath Palihapitiya (01:21:29): No. a 2 did something else. No. So that breakthrough was even even more important, I think, in the long term. What he's talking about is Janssen And Legend are the 2 companies that basically got approval from the FDA. Now the thing with Cartia is like, you know, carte has been incredibly believed in blood based cancers. Right? But that's an entire category that excludes solid tumor cancers. What you're talking about Jason this week as well what happened was a 2 bio basically figured out how to modify these t cells in a way where you can actually attack and target a very specific solid tumor. So there's a lot more work for those guys, but If you play that out, now you have this incredible ability for your own body to be trained to fight and kill cancer, whether it's in your blood or whether it's a solid tumors. David Friedberg (01:22:20): Now the the price the the price of these therapies today, they're they're charging, call it 400 to $450,000 per treatment. And by the way, the treatment, it's a one time shot. I mean, it's like -- What? Yeah. They pull the blood out of your body. And then the the the expensive challenging part is how do you take the cells, isolate them, engineer them, test them, screen them, make sure they're safe. The way that is done today is very expensive and time consuming because the volume is low, and there haven't been as many kind of engineering breakthroughs Jason Calacanis (01:22:50): in the last couple of years. It takes a month? David Friedberg (01:22:52): It could take a week to 4 weeks. So before you Jason Calacanis (01:22:54): get to -- -- first and ten people, is it the equipment that's expensive? No. No. David Friedberg (01:22:57): Like, I I actually I Chamath to come with me. We went and visited one of these labs a few weeks ago, but I I I won't get into it. But it's it it it's unnecessary early inefficient in the sense that you can charge so much. Because when you spend half a $1,000,000 to treat a cancer patient, you just save yourself 1,000,000 of dollars in long term care for that cancer patient. Jason Calacanis (01:23:17): So the price is determined by the alternative cost. David Friedberg (01:23:20): -- price is, like, how do you save money over the long run for the payer, you know, the insurance company? And so if the if the insurance company knows over the long run, they're gonna pay $3,000,000 in care for this cancer -- Jason Calacanis (01:23:30): The state answer is 25. They're David Friedberg (01:23:31): totally willing to spend half a $1,000,000 to you know, to to to end the cancer. Jason Calacanis (01:23:35): Is that the right financial calculus for this term? -- thing. David Friedberg (01:23:38): So if you look at the actual cost of doing this, there is a university in the Bay Area that is doing CAR T therapies, and their cost is about $40. They built their own lab to do this. David Sacks (01:23:47): Got it. Jason Calacanis (01:23:47): Ten next. And that, by the way, is David Friedberg (01:23:48): also extremely inefficient. we I think that over the long run, we can get the cost of cell therapies below 5000 bucks. And when you can do that, by the way, CAR T can be used not just to go after cancer, but you can get it to go after autoimmunity. So people with lupus and rheumatoid arthritis, there are known b cells in your body that are making antibodies that are causing the inflammation in your body destroying your own body. And so down the road, we could use CAR T to destroy lupus to destroy antibodies b cells that are producing antibodies that are, you know, fundamentally causing autoimmune conditions, including what we talked about a few weeks ago, multiple sclerosis, given that we now have a strong belief that if you can get rid of that the EVV, the f t bar virus, from your body, you can wipe that out. So so CAR T can, in the long run, be harnessed not just for cancer, but autoimmunity and potentially other pathogens in the body in a really targeted way. And this this is kind of the beginning of what will likely be a multi decade kind of new therapeutic modality that's that's, you know, accelerating. Jason Calacanis (01:24:49): had a question for you about, though, on the on the pricing model here of, hey. The way we price this is, how much are we saving the insurer? Is that too much price optimization. Is there a better model here? Chamath Palihapitiya (01:25:01): I have no idea. Okay. I would like to talk about something else. Related to this, Jason, There's this massive patent battle going on for crisper. David Sacks (01:25:12): Yeah. Chamath Palihapitiya (01:25:13): And I think it's worth Jay Cal if you can give just a 2 second primer because I think we should talk about patents just for a second. And, you know, there are there's the stream version, which is what Elon has done. And then there's the other extreme version, which is these two folks fighting over Jason Calacanis (01:25:26): what -- So obviously Elon has gone with putting the patents app making his patents open source and putting them out there and using them as a deterrent like nuclear weapons have been. But the US patent and trademark office published a a ruling on Monday in favor of MIT and Harvard over Berkeley. The ruling cancel certain patent applications made by the University of California, its partners. Regarding a CRISPR system known as CRISPR c a s 9. Cast David Friedberg (01:25:48): 9. Jason Calacanis (01:25:49): Cas9. The ruling states that they failed to provide persuasive evidence that they got the gene editing technology to work before The broad group did. The central question and dispute is which group got to the CRISPR Cas9 tool? Chamath Palihapitiya (01:25:59): Basically, the whole thing here, Jason, is, like, there is a group led by these 2 incredible scientists who they won the Nobel Prize, Jennifer Dudna and Emmanuel Charpentier, There Berkeley, and and she Emmanuel, I think, is she's at a a university in Germany, I think. But then there was a a different team trying to develop a system for CRISPR Cas9 from MIT Harvard at the Broad, and they all filed patents on top of each other, and this whole thing was a thing and you know, the the big implication of all this is what our company's supposed to do. Right? Because if you are a company that wants to build a CRISPR cas9 gene editing thing, look, there's a lot of situations where a a single point edit or a broad edit can have a meaningful change in your health. So these are businesses that should exist. You didn't know what to do because if you license the IP from the wrong person, you'd get sued. Right. And many companies now are, like, trying to license both sets of patents And I just think to me, it frustrated me when I read this article. And, you know, this is the conversation I had with you guys in the group Chamath, is I think we need to think of and imagine a new way for patents to work because it it shouldn't be the case that, you know, folks are competing for is really effectively credit, and then what stops behind them are all the commercial companies and investors and all of the and and on just the normal individual day to day people who want solutions to solvable problems, but the reason it doesn't get to the starting line is because of patent credit. and having to deal with patent trolls. And I just think that that's a terrible situation for us to be in. Jason Calacanis (01:27:39): Especially if it's something that could change the course of humanity, almost feels an arbitrator has to come in here and force a settlement. What do you think Friedberg is the right thing to do? Obviously, we have a tradition of people getting to you know, monetize. Dare, I say, there are innovations for some period of time with a patent. David Friedberg (01:27:55): I have multiple businesses I'm involved in where we leverage CRISPR And I I will tell you that the, you know, the the group at Harvard so so the history is the group of Harvard and the group at Berkeley argue each argue that they discovered CRISPR Cas9 around the same time each or each argue that they that they have a right to CRISPR technology. based on their discoveries that were made around the same time. And so for yours, each of them have been starting companies and licensing CRISPR technologies to different companies. And all of those companies now, including several that are public, it turns out that if this this ruling, you know, is to be you believe they actually have a license to a technology that they may not actually have a license to. So there is a company that emerged a few years ago and actually made an open source version of this this system. And so I have at least one company in gene editing and plant plant gene editing where we leverage this open source version of this system. and many more companies, many more businesses are embracing that open source alternative. I don't think that we see this turning out to be any different than what we saw with the proliferation after whomever was trying to, you know, make everyone pay a licensing fee to use their operating system and guess what markets discovered? They discovered that, hey. If someone is able to make something free and open source, and everyone will embrace it. And here we are, where most of the Internet is run on open source software. So you know, I I I I don't know what the right thing to do with respect to patents are because, you know, the the truth is a lot of very difficult, very expensive technology r and d dollars go into developing a technology that is theoretically someone could look at it and make a copy of it. And so I do think that there are rights to defend with respect to patents. I think that there is if there is something that is a critical resource that an entire industry really needs to access, an open source solution will emerge. You know, the markets take care of it, and I think we've already seen that with CRISPR. David Friedberg (01:30:01): So, you know, it's hard to say. At the end of the day, you wanna license some you know, patent a molecule and be the only person that can make that molecule, make money from it, go ahead. But if everyone's gonna need that molecule to run their business and to change the world, someone's gonna make a cheaper alternative or a free alternative. That's just the way markets work. So -- Jason Calacanis (01:30:18): Sachs would like to recite a poem for peace at the end of the podcast he's gone totally soft. The pacifist, David Sacks. David Sacks (01:30:25): No. I'd like to I'd like to address what what you said when you called me a pacifist because I think Jason Calacanis (01:30:30): actually -- -- god. Here we go. After hours. This is all in after dark. Here we go. David Friedberg (01:30:34): He's an existential pacifist. Go Jason Calacanis (01:30:36): ahead, Saks. We need your power. David Sacks (01:30:36): When did I become passive? Well, I'm not I'm not really pat look. I still believe in the idea of peace through strength like Reagan said. But I remember when we what is the only clean win that we've had in a war since world war 2? America has. It was Jason Calacanis (01:30:49): this -- -- win. Straight shot. David Sacks (01:30:52): The 1st Iraq war when we drove Saddam Jason Calacanis (01:30:55): out of David Sacks (01:30:56): out of Kuwait. That was George Herbert Walker Bush. Chamath Palihapitiya (01:30:58): Our last conventional war. David Sacks (01:31:00): Well, it was also the last war that we actually won. Every other war that we've done has been turned into a fiasco David Friedberg (01:31:06): -- Jason Calacanis (01:31:06): Winning was pretty easy to define. Get out of Kuwait. The other ones, we were trying the revolutions. David Sacks (01:31:10): But remember, everybody wanted him to go all the way and march into Baghdad and change the regime, replace Saddam. And he said no. And he had the wisdom to stop. And everybody called him a whip, but he still had the termination and the the wisdom to stop. And then what happened is, his son comes in 10 years later and they finish the job -- Yeah. David Friedberg (01:31:29): -- David Sacks (01:31:29): they get they take out Saddam and they destabilize the entire Middle East. That's what the iron asses got us. So what has turned me against these regime change wars. It's look. When I was in college, I thought Herbert Walker Bush was a wimp, you know, and and George W Bush was doing the right thing going into Iraq 20 years ago. But we've seen the results. And anybody today who doesn't modify their point of view on these regime change wars is a fool. I mean, they're not paying attention. And so for Lindsey Graham and, you know, these other guys out there to be a lot of Republicans to be talking about regime change as something we should be seriously promoting. They've totally lost a script and they should be denounced as reckless, dangerous fools. And look, I've seen it on both sides of the aisle, but what we need to do now listen. If it ends up being the case that the Russian people wanna make a change, that's -- That's their call. That's their call. Jason Calacanis (01:32:23): Yes. David Sacks (01:32:23): I don't understand. I'm not opposing something that they might wanna do. But for the idea that that should be our goal, that's our endgame, that's our objective. That is a recipe for disaster. Jason Calacanis (01:32:35): Yeah. We'll just wind up getting in a perpetual war. Then when we leave, it will revert. And that's what we saw. It reverts back to communists or authoritarianism. The people have to really want it. Revolution are hard, fought, and bloody. And if you think you can just go in there with a couple of drones and get everybody to decide oh, we embrace democracy from this point forward because you drone the hell out of the country is farcical and it's proven to be wrong. A 100% agreement with you. David Sacks (01:33:00): No. No cease fire is gonna be possible. mean, it's gonna be hard enough as it is to get anything remotely like a deal, but it's not gonna be possible if you're you've defined regime change. Yeah. That's your objective. Jason Calacanis (01:33:11): That's way to dig Putin in. Like, that's literally what he wants to you know? That that that you're giving him all the pretext he needs to keep this thing going if it's self preservation. Alright, everybody. There's your overtime. Zack is the Saksis writers were freaking out in the writer's room. I had to get his last point in before I pinned him as a pacifist. David Sacks (01:33:30): There are no writers for this stuff, Jacob, because, look, everybody on cable news is singing from the same hymnal and following the same script. They're all being the kinds of war. There's only one cheek right now, which is we're not doing enough and we're being weak and Biden needs to do more David Friedberg (01:33:45): -- Chamath Palihapitiya (01:33:45): Not being weak. David Sacks (01:33:47): I agree. Jason Calacanis (01:33:47): Having patience is not being -- We David Sacks (01:33:49): are doing a lot. We're doing a lot. We should be careful. Jason Calacanis (01:33:52): De escalation is the opposite of weak. Chamath Palihapitiya (01:33:55): These economic sanctions are real. We have to follow through, and I think we have to make sure that the economy is supported while we do it. Jason Calacanis (01:34:03): On that note, let's pray for peace, and we'll see you all next week on the podcast. The All in Summit is May 15th to 17th, 16th, 17th are the 2 days of the conference. Poker on 15th tournament for charity. events every night of the week, and you can apply for a scholarship at the website summit.allinpodcast.co or just type in the all in summit. into Google will be the first link. And 400 of 600 tickets have been allocated either sold or for scholarships. We're gonna do the best we can to have as great of an audience there as possible. And for the dictator, Chemov Polyha Patia, the rain man, David Saxx and the Sultant Sultant of Science hot off the launch of Cana. Congratulations. Turning literally water into wine. David Friedberg. I'm Jake out, and we'll see you next time. Chamath Palihapitiya (01:34:53): Love you, boys. Jason Calacanis (01:34:54): Love you, Westy. David Sacks (01:34:58): year winner's ride. Jason Calacanis (01:35:00): Rainman, David Sachs. David Sacks (01:35:04): And it said -- We open sit to the fans, and they've just gone crazy with it. Chamath Palihapitiya (01:35:17): besties are golf. We should all just get a room and just have big huge orphan because their office is just it's like it's like sexual tension that they just need to release about. David Friedberg (01:35:36): What? You're the big bee. What? David Sacks (01:35:38): You're a thief. What? Jason Calacanis (01:35:41): Where did you get Murkeys are back?