Cathie Wood (2:38)

Absolutely, absolutely. And also when A company is breaking new ground, literally in this case, and really inventing something. The supply chain doesn't exist very often, or not all parts of it exist. And I think also as he's discussing, you know, where he's going and how he's going to do it, he is getting the supply chain ready. You know, he always sets the time frame, you know, much sooner than most people expect. But it's to get his employees and the supply chain focused because when he moves, he moves fast.

Carol Massar (3:18)

You've really helped to define people's perception of Elon Musk and the company Tesla largely as one that is not about making cars, but one that's about autonomy and robotics. When you walk out the Hilton here, different than where I live in Washington D.C. driverless Waymos are picking people up and driving away with them all day long. The mainstreaming of autonomous vehicles is just about here. I'd like to know if you see that actually fulfilling itself in the next year and if this is a zero sum game or you're going to have Uber, Waymo, Tesla, all involved.

Cathie Wood (3:55)

Okay, this is where vertical integration comes back into the conversation in the robotaxi world. Tesla's vertically integrated and has created the platform upon which others will build their companies. So I credit our team. So, Tasha, Daniel, Bret Winton, we have been focused on this from day one, 2014, when I founded Ark, and yet less slowly, slowly than all at once. So vertical integration for Tesla means it will have the lowest cost structure by far. Now it's going to use uber's umbrella here, $3 plus per mile. But if our analysis is correct, those costs as robotaxis scale are going to drop to 25 cents per mile. Think about it. The cost of transportation is going to collapse here and no one cost structure, according to our estimates, in 2030 will be 50% higher than Tesla's because they're dependent on other auto manufacturers and others in the supply chain that Tesla is not.

Joe Weisenthal (5:11)

How are you thinking about the Space X ipo, Cathie? Do you anticipate? There's so much enthusiasm going into it, massive size, massive interest, but do you think there'll be a drop off initially after, you know, once it makes its public debut, and then ultimately kind of play out like Tesla did, that eventually it goes up again? Like, how do you see the trajectory?

Cathie Wood (5:32)

Right. So this is only at least what we know so far, $75 billion. There is so much demand out there. We have in our venture fund. So Ark VX Space X is the largest position. And because we're direct to consumer when it comes to venture. Although the fund has scaled north of 850 million, investors had to look for us. And how did they find us? They were looking for Space X. So the demand is voracious out there. Only 75 billion. Yes, it's a big IPO. But just think about how, how Space X has reawakened the dream of space exploration. This has captured the imagination not just of investors, but really everyone.

Joe Weisenthal (6:24)

So does that mean you don't think it'll, you think the enthusiasm will continue or do you think there will be some settling?

Cathie Wood (6:29)

I think there'll be supply demand imbalance in the beginning. You'll see that pop. It will be volatile, I would imagine, but we hope to, to serve in terms of providing our research. We've already got a Space X model out there on our site, arc-invest.com we have not added data centers, orbital data centers in however, our preliminary work suggests that that part of the business could take relative to our existing model could take Tesla from a revenue generation point of view, orders of magnitude higher, 10, 20 times higher.

Joe Weisenthal (7:09)

I'm so glad you went there. Data centers in space and I mentioned before we got going, it came up on a real estate panel where so many of the real estate investors, even like related companies has switched their focus to data centers. But we brought up data centers in space. What does that mean though then for all of the data center build and money that is happening here on Earth, does that mean a lot of that goes away? There's a little bit of a bubble. Like how do we reconcile that?

Cathie Wood (7:34)

We think, and this is the important judgment call, is this hype? Is this 1999? I can tell you unequivocally it is not. As I mentioned, the seeds were planted then. Now we're ready and we think this technology revolution is going to dwarf the industrial revolution by far. So I think that we'll need the orbital data centers. And of course Elon is informed by his experience in Memphis, Tennessee and now Mississippi. Memphis became not in my backyard. You're increasing my electricity prices and you're, you're, you're, you're, you're ruining our land. So he's basically saying I'm not going to have to worry about not in my backyard.

Joe Weisenthal (8:24)

But does it make a bubble of the stuff on there?

Cathie Wood (8:26)

I don't think so. I don't think so. We think we're going, we need all of this. Yep.

Joe Weisenthal (8:30)

Sorry. I know I'm dominating. I didn't mean to.

Carol Massar (8:32)

I mean, you guys should walk Away with this about something that took place today. You woke up and saw your third largest holding.

Joe Weisenthal (8:40)

Yes.

Carol Massar (8:40)

Just go through the roof in amd. Another blow the doors off quarter and it's really creating this question now about whether we should be paying a lot more attention. The market is to CPUs after GPUs went crazy. We're looking at people take money out of Nvidia now and chase stocks like amd. Do we need both or is that where you're looking?

Cathie Wood (9:01)

We think we need both. I do think there is more competition. We want it, we need it. But it was interesting. Sarah Fryer at OpenAI. I'm going to give her a shout out because I heard her speak and she, she was saying, you know, people are chasing GPUs. They're going to be really shocked at how agentic I activate CPUs and inference generally activate CPUs. Yesterday Lisa Su provided a stat we had never heard before. Right now for every, for every CPU there are four to five GPUs. When it comes to enabling AI, Lisa thinks it's going to go one to one. Well in the future I think that has been the sleeper and you see intel has taken off. In fact we're seeing a lot of stocks that were, you know, they were very big in the bubble. And I just said to our team today, I said what's going on? We're going back to the future. You know, intel resurrect, isn't that right? Yes. And Flex Tronics, it's now called Flex Boom. So I think we need it all.

Carol Massar (10:12)

Not to mention data storage which has been one of the most remarkable examples of, of a shortage creating a monster rally. So you need these old fashioned chips.

Cathie Wood (10:22)

Yes.

Carol Massar (10:23)

To get to this new fashion.

Cathie Wood (10:24)

All hands on deck.

Joe Weisenthal (10:26)

We want to ask you about a story that came out Google Microsoft to give US agency early access to AI models. So basically the White House vetting AI models this good or bad and knowing

Cathie Wood (10:37)

this administration and David Sachs are our eyes are. I don't think we're talking about heavy regulation here. We might be talking more about national security. National security. We heard this with Mythos. You know, software that you know has not, has been in place for 60 years and never been penetrated. I can find these vulnerabilities. So they're probably trying to tighten up a lot of what we do out there and make sure that our industry industries are safe.

Carol Massar (11:11)

Doesn't that bring a political implication though to what may or may not be available to people? If, if the White House is Choosing which platform we ought to use now.

Cathie Wood (11:18)

You know what's interesting and this is taking a leaf from Open Air in its early days. Chat GPT are saying we don't think we can release this. This is too powerful. This is great marketing. It's true that it's very powerful, but it's also great marketing. A lot of the people at Anthropic came from Open Air. So while they're blazing trails, no question about it, and they're leapfrogging one another, which is great. Competition is great for us here, including competition from China. I think, I think that, you know, we're, we're on our way.

Joe Weisenthal (11:56)

I want to ask you about stablecoins tether and their potential. Do you think it has a chance to become big in the US under the Genius act and you've also invested in Circle. Are you looking at other stablecoin related players beyond that? Crypto bill? Tell me there's a lot going on right now.

Cathie Wood (12:12)

Is a lot going on.

Joe Weisenthal (12:13)

There's a big meeting at Mar a Lago. Like I know a lot of crypto folks like tell us well and you

Cathie Wood (12:18)

know, in the last election I do think the crypto community was very, was part of the swing factor because they knew deregulation regulation would take place under this administration. That's absolutely true. So yes, we're seeing the deregulation. You know, this is, this is creating a new financial world order. Many people think the dollar should be going down because of our deficit and debt and all of that. And what we're seeing here in the United States is deregulation, tax cuts and a very business friendly, very business friendly administration. We think the return on invested capital is going to go up in the US generally. And we think that the crypto revolution, we were at risk of losing it. Yeah. And yes, we do think USAT has a shot.

Joe Weisenthal (13:13)

You do?

Cathie Wood (13:14)

Yes.

Joe Weisenthal (13:14)

All right, I'm not going to, I have like a million more questions. Kathy, thank you so much.

Cathie Wood (13:21)

Really appreciate it. Thank you really, you so much.

Joe Weisenthal (13:24)

Really appreciate it. Cathie Wood, of course, she's the CEO, CIO and of course founder of Ark Invest, someone. Like I said, it was 10 years ago that we first started talking about Elon Musk. So really tremendous to catch up with her again.

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