OpenAI's GPT-5 Flop, AI's Unlimited Market, China's Big Advantage, Rise in Socialism, Housing Crisis

The housing issue is so oppressive to this generation and the cost of their education is so oppressive.

if they're unwilling to move to places where the real estate is cheaper, then you are going to get more expensive real estate. And maybe you can build your way out of that. Or maybe you can't.

Yeah, it's not comparable to Colossus. So it's just, it's not going to be decisive in this, you know, AI, you know, race that certainly China believes we're in.

My prediction will ring fruer than any of us hope. Socialism will sweep over this nation, I fear. And I think it's a cancer.

I don't see that, but if you want to see that, you can, but it will swing back. This country is incredibly resilient, and I have complete faith in that resilience.

So they won't work. And I think that'll be a quick, that'll be like a quick end to socialism.

If things take a downturn, then the backlash is going to be a lot stronger than anything that any of us can say about the failures of Zoran Mamdani, because what it's going to be is, look, the rich got richer and we got poorer, and it's going to be a redox of 2007, 2008, but with a much, even further to the left than Obama ever was, and that I'm deeply afraid of.

But I'm just shocked at their inaction. And aptitude and AI, how bad the products are from a user perspective. I mean, they're terrible.

it's been many years since they brought out anything that excites me as a consumer

I would not count Apple out. There's a system there that's built unlike any other in corporate history.

and that's when you will see the Federal Reserve step in and lower those interest rates in order to sort of artificially juice the economy

But you know, we are waiting on Gemini. I would expect there to be a very, you know, an impressive new Gemini model.

So all of the dollars that are going into the ground are being used. We're not building ahead of demand. In fact, we're clearly still behind demand.

But this is the first time they have not released a model that was a decisively better. And the progress for Grok 4 was exceptional. Grok 5 is coming soon, you know, they have more.

Anthropic just released a paper this month saying, we want 50 gigawatts of power for the AI in America and over the next three years. That's about as much power as was added all this year.

It'll take a year, two years for those policies to actually hit and destroy all of New York.

And they're going for trade degrees where plumbers and electricians are making 100, 150k a year.

Now they have opted out of education. They're starting to look at and go, I'm going to UT. I'm going to be in a state where I can pay, you know, 50k in total for my degree.

And so the point of this chart is if we really need all we could eat on energy for artificial intelligence, and if artificial intelligence, the race is the, you know, race for national security and dominance in the world. This is saying we're taking a step backwards on this supply.

Yeah, so in the small modular reactor, Gen 4 stuff, we as well as others have investments there. A great company we like called X Energy.

the idea that the federal government ought to prevent the state of California from filling the field with some really bad AI legislation that essentially destroys competition among all the various players

And China has both manufacturing, productivity, materials advantage over the United States on that front. So it's not about having the best model. It's about having a supply chain that can support their ambitions in warfare.

So just to give credit where credit's due, I think all the stuff we're seeing on the small modular reactors at some level, owes its renaissance to AI and the energy demands of AI.

These are these very clean, meltdown proof nuclear energy production systems that are being deployed at scale in China now, and the US doesn't have any, and we have no path to getting these deployed.

The thing I most worry about with respect to tariffs is if it does create a new revenue source for the federal government, it gives the federal government another crutch to keep spending up.

Otherwise, China is able to sort of climb out the window, which is, I think, what they've done on everything from Nvidia chips to TikTok to their actual tariff rate, which I believe is now lower than the tariff rate we have against Canada.

I would just say he showed his hand in April. He looked into the abyss and if it is clearly not working, he showed that he will change it.

And so they are, I would say, rate limited at this point by this particular chart in terms of their competitiveness.

The second thing I would say is I do think they are making an effort to throttle it up.

And if you didn't control the chop, the thing that made the stamp, you didn't actually control the factory. That is not a long-term recipe for success.

Is this stuff going to hit fast enough to actually justify the amount of investment, or are you going to see a crater here?

a billion business users in the world, it's going to put you at a billion dollars in revenue, which would be like a $5 to $10 trillion TAM just for the business side

You can calculate something called return on invested capital. It's actually gone up since they started making these AI investments.

I am inclined to think that he is much more sensitive to the market than he lets on.