E71: Russia/Ukraine deep dive: escalation, risk factors, financial fallout, exit ramps & more

if you are a company that wants to build a CRISPR-CAS9 gene editing thing, look, there's a lot of situations where 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 get sued. And many companies now are trying to license both sets of patents.

it turns out that if this ruling is to be believed, they actually have a license to a technology that they may not actually have a license to. ... 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 of Linux in computer software

what's going to be very, very difficult is the impact that this has on emerging markets in Southeast Asia, Asia, Africa could be really, really deleterious for some amount of time. ... I 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.

It's going to cause a humanitarian problem. It's really friggin sad. And it's, you know, whatever progress has been made could be unwound.

I think this is a complete red herring. ... 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 going to take the equity values of certain of these companies to zero, it's in the grand scheme of things, not that much equity value.

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 going to default. And we're not going to know that till the end of this month when everything has to settle and no one's going to be able to make their payments. ... 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

he said he's going to raise by 25 basis points in March. Everybody knew that, right? So we took the 50 basis pointer off the table. But then he was very clear that they were going to be data driven. ... I think there could be a real possibility that Powell becomes very accommodative. ... he and Biden and the entire administration come together with Europe and everybody else and say, get the money printer back going

By the way, Russia and the Ukraine combined account for roughly 25% of global wheat exports. ... That wheat goes to Egypt and from Egypt it 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.

Look, David and I have been the ones that said the risk is to a recession. We are now teetering towards a recession.

Look at Germany as an example. Germany undid 40 years of policy. 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%. They've also made commitments around their energy independence.

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, I think it's being talked about to repeal all the restrictions on fracking, it would pass the Senate 7525, meaning all the Republicans would vote for and half the Democrats would vote for.

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.

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 the EBV, the Epstein-Barr virus, from your body, you can wipe that out. So CAR-T can in the long run be harnessed not just for cancer, but autoimmunity

We have woken up from a delusion that we can intertwine our economies with rich and 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.

And so if we end up running massive deficits, and now we're at, you know, 150, 250, 300 percent of GDP, I think that, you know, morally that's that is the right thing to do.

And the Germans fell for it and turned off nuclear. And now all of a sudden, they're dependent on Russia.

I think that over the long run, we can get the cost of cell therapies below 5,000 bucks. ... And this is kind of the beginning of what will likely be a multi-decade kind of new therapeutic modality that's, you know, accelerating.

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 percent in a recession. But it is always the case that when energy prices spike by 50 percent, we enter a recession. We will contract as an economy.

Yeah, look, we're talking about I'm talking about capital and energy and food. And some combination of those things are going to cause some serious deleterious effects on people and on markets.

in times of uncertainty, you actually want to be deploying. So, you know, I announced what was it last week? I think it was a solar deal. The solar deal. You know, I put $228 million into this thing.

we need to build an alliance to deal with the eventuality of China going into the South China Sea and taking over Taiwan.

we can all support that because we know that Xi is watching. ... if Taiwan really wants to be independent, every adult there needs to learn how to fight and they need to have weapons.

I actually think we're in the part of the cycle here where we're starting to 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. ... But I think that there's a lot of good news out there.

deals are taking longer to close, people are starting to do diligence again, and people are discussing what the right valuation for this early stage startup is, which is good. ... late stage madness is gone. It's over.

Yeah, I mean, I think 100 times ARR is over, but we no one really knows where it's landing. So I've seen some deals get done at 60 to 80 times, but no one really knows where it should be.

No. And the other thing, in fact, it's the opposite. ... What I can tell you is I think that prices are too high in certain core commodities and goods. I think what's going to happen is we are going to find a way to subsidize those prices coming down.

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. ... The trickle-down effect, as we're already seeing in California, or San Francisco, with the average price per gallon of gas at over $5. The trickle-down effect on purchasing behavior, on businesses defaulting because suddenly their counterparties dry up.