A (3:06)

So let's talk about this decoupling. It seems to me there's sort of two decoupling that have happened. One is crypto no longer being completely tied to the fate of Bitcoin. And then digital assets blockchain starting to become understood as its own kind of world know in some ways interrelated to crypto, but not necessarily. So why has this all happened?

B (3:29)

So I think a few reasons. I think the first one is really some regulatory clarity around stablecoins. The Genius act which passed last year, gave a really a regulatory framework for stablecoins which is important not just because, you know, there's already usdc, some other stablecoins tether that's, you know, global, but not so much in the US but it gave institutions, large institutions, financial institutions, a pathway to adopting stablecoins and integrating them into some of their more traditional financial services and to payments. So that has led to a ton of activity, innovation and investment into stablecoins generally, whether it's payment rails on ramps, off ramps, things like that, creating better privacy, whatever it is. Now that's like a real tool for financial innovation versus Bitcoin, which a lot of people still use as sort of a speculative asset or a store of value.

A (4:23)

Right. So explain to the listeners what stablecoin is for those who might not know, and then kind of why it is a useful tool for financial institutions.

B (4:33)

Sure. So a stablecoin is a digital asset. You can think of it just as a crypto token, but it's pegged and it's backed by things like US Treasuries, like real world assets that are considered extremely stable. Like, like treasuries. That's extremely, you know, one thing I try to get people to understand. You know, when I have friends, cocktail parties and I have to talk about

A (4:53)

crypto, do you like a little booth and cocktail party?

B (4:57)

You know, I try to limit to about you know, 18 to 23 minutes. That's like my maximum. I'm like, get me out of here. But I think it's particularly difficult for Americans, at least up until now, to understand the real use case for stablecoins because we have the most stable currency in the world. So why would you need a digital currency to do that? Right. But it's a lot different if you live in 50% of the rest of the world where your currency is constantly going up and down. You're trying to build a business, run a business, have access to capital and you're subject to these currency fluctuations and you want to make current. We often talk about cross border payments and I see people's eyes kind of glaze over because they think, oh, it's maybe someone sending money to Central America or something like that. Which is great and important because it's done cheaper through stablecoins and through blockchain, fewer intermediaries, et cetera, faster settlement. But there's a lot of businesses, South America, Africa, all over the place where they're constantly dealing in cross border payments. Now instead of using your local currency or using a dollar, which can be difficult to get access to sometimes or have US bank accounts, certainly stablecoins allow you to trade, make payments on a single currency pegged to the US dollar. So you're basically trading in dollars, but it's settling faster and it's settling in a trusted ecosystem.

A (6:19)

Right. So it's basically you're using the US dollar but without a lot of the fees and inefficiencies of SWIFT and of the entire kind of payment system. Before stablecoin came along.

B (6:32)

Yeah, exactly. And you still have what's known as kyc, know your customer. So you know, you know, and that's things like USDC or other stable coins outside of tether that you know you're not financing some shady criminal activity.

A (6:47)

Right. So it's interesting, when bitcoin kind of first became a thing, let's call it, not when the white paper was written, let's say the mid mid 2010s. One of the real arguments was this will be the mechanism that really is a good hedge against the, the currency fluctuation in Latin America, Africa, Southeast Asia. That didn't really happen. Now it is. So was stablecoin sort of always ultimately the fulfillment of that promise and potential.

B (7:15)

I think that's the greatest, safest explanation for Stablecoins for Bitcoin is that it's a protection against currency fluctuations.

A (7:26)

And so when you think about your own financial portfolio, where does. Because when you. The way you just described, Stablecoin is a really useful financial mechanism, but not an asset class per se. So how do you think about where crypto, whether it is Bitcoin or something like Tether or whatever it might be, as something that you use or think about?

B (7:50)

So I've been running this crypto practice for five years. I don't trade crypto at all. Maybe some. I have to use the technology once in a while to understand a client's business, someone like that, but I'm not involved. One is just personally, I feel like I'm exposed enough to, you know, the volatility of the crypto market by the nature of my work. And the other one is it's, you know, all sorts of conflicts, et cetera. But I think it still should be a relatively, you know, again, not financial advice. I feel like that's a thing I have to say, even though who the hell would take my advice? You're really, if you're doing that. But I think, I still think, you know, it should be a pretty small piece of people's portfolio. I think these speculative meme coins, shit coins, whatever you want to call them, most of the time, it doesn't pan out. I think that people should have the ability to take a flyer on one of them once in a while when they want to, because obviously we have a financial system that I think doesn't work for most people. So if you want to try to hit it rich, it's probably better than a lottery ticket.

A (8:51)

Should stable Coin issuers be able to pay yield?

B (8:54)

Oh, I think absolutely. I mean, it's just like this is just a pure. So, you know, I think you're referencing the Clarity act right now, the big stable coin, sorry, the big crypto regulatory clarity bill that's in Congress. And the big fight right now is between the industry led by Coinbase on this and the banks, you know, kind of propped up by this community bank group that's saying if you allow stablecoin issuers or their affiliates to pay yield, there's going to be a huge deposit flight from these banks and it's going to destroy community banks. I think the Coinbase general counsel, Paul Gruel said it's a totally speculative, theoretical thing. That that would happen. I tend to agree with him. I don't think tons of small businesses in the Rust Belt are going to all of a sudden take their deposits out of their community bank and then buy USDC on Coinbase. It just seems, but you know, still banks have a lot of political muscle, you know, and so it seems like they're probably going to come out with a win on that fight. But absolutely, I think you should be able to pay. I think you have to do it responsibly. I think we saw from the FTX Genesis crash of a few years ago, if you're promising people, you know, 15% yield weekly on your, you know, shit coin, then like that's, that's a problem and people should be, you know, shouldn't even be.

A (10:16)

That's consumer protection. Right. We should always say if a bank made false claims, they should be held responsible too.

B (10:23)

Yeah. And I think that's actually there's some people the kind of anti crypto crowd has been really against Clarity will definitely vote against it. And they claim it's about consumer protection, but actually the versions of the bills that have circulated, they still have fair amount of consumer protections and for state and federal regulators to go after those who are making false claims and trying to pump and dump.

A (10:45)

Right. Crypto was created as something meant to be anti establishment. Right. The white paper itself was written during the financial crisis in 2008. The way we're talking about it right now feels like the opposite, which is, and it's not a bad thing at all, it's probably a good thing. But stablecoin being a highly efficient mechanism as part of the overall financial institutional picture, has that anti establishment thing just gone away completely?

B (11:14)

Yeah, I don't think it's gone away completely, but I think you make a really credible case that it's no longer this anti establishment, totally detached from central banking system kind of financial ecosystem. That's because I think people and the people who helped build the crypto ecosystem over time, they have to continue to raise capital, they continue to find product market fit and, and the greatest opportunity for pause market fit is in the traditional financial services system and disrupting these payment flows and settlement mechanisms that are really inefficient today and can be made much more efficient by blockchain.

A (11:52)

So originally the early traders and acquirers and miners of crypto were very anti central bank, anti establishment. Do they now create something entirely new or do you think they're such a tiny, tiny, tiny fraction of, of the overall population that deals with crypto One way or another, that just doesn't really matter.

B (12:13)

Yeah, I think you do they create something new. It's a great question. Would love to see someone like that. But I think the sort of anti central bank art and traditionalists those are, we call them bitcoin maximalist, bitcoin maxis and they're the ones who sort of avoid crypto innovation and some of the sort of like central banking, traditional finance sphere and they go all in on bitcoin and there's just for bitcoin innovation. So that's sort of their corner of the market now. They were right very early on. Right. They made tons of money and the assets still performing very well relative to you know, 2014, 2015, 2009, Bitcoin prices. Right. But that's, that, that's, I think they're sort of niche.

A (12:54)

And when we talk about digital assets as distinct from crypto, what does that mean and kind of what should people think about it?

B (13:03)

So I think people should think about the efficiencies that blockchain technology has created and continuing to adopt and digital assets are adopting across, across financial services and then crypto take away sort of the FTX type of disaster, take away these meme coins NFTs which honestly no one ever explained to me in a compelling way. What.

A (13:27)

Yeah, I mean do they even exist anymore?

B (13:30)

Basically not. Right. I mean I, I don't, I, Yeah, it's just, I never understood nft. It's a jpeg, it's, it's a photo. I know that's gonna be, that's like heretical to like half the people who may listen to this and like hate me forever, but like it's complete horseshit and I wish they never existed. But I'm glad that that's, that's been flushed out digitalized. I think number one, you've seen really smart, extremely profit driven business leaders and titans like the Larry Finks of the world who've said, hey wait a second, we were really skeptical of digital assets for a while, but now we've drawn tons of investment dollars from retail and institutional and things like infrastructure funds on traditional equities. But those things have become pretty expensive for people. And if we want to unlock our greatest opportunity to unlock more investors and more dollars is by tokenizing some of these assets. So like an infrastructure fund which basically even I couldn't invest in it until, I don't know, five or six years ago because it was what didn't make sense and there were, there were high capital requirements. Now all of a Sudden, if you, if you tokenize that, that fund, you can invest, you know, maybe 1,000, 5,000, $10,000 in it instead of having a $50,000 minimum. Right.

A (14:43)

And so in terms of regulation of it, because, you know, you're probably one of the, certainly the, I would argue, the foremost expert on how states might regulate both digital assets and crypto, and generally one of the foremost. Where's digital asset regulation, though?

B (14:59)

I think it's going to happen and that's Clarity.

A (15:01)

Yeah, but do you think it goes beyond that? That kind of covers what's needed?

B (15:04)

Well, I think there's going to be a bunch of rulemaking. You know, federal agencies interpret the, interpret the laws that are passed. But I think the SEC chair, the CFTC chair have been telegraphing how they want to do this for quite a long time, you know, if and when Clarity passes. So the cftc, which is, you know, been largely considered a bit of, you know, the smaller regulator for commodities rather than the sec, they're going to take the primary role in regulating crypto. And that's all well and good as long as they do a good job. And then, you know, there's a question of like, what role states are going to have so that they'll still have what we call blue sky laws, which are consumer protection laws, which should always

A (15:44)

exist for every industry. Right?

B (15:46)

Yeah, exactly. And there are still even securities, you know, we think of the SEC only there are still state securities regulators. I know this gets boring really fast, but in some.

A (15:55)

Not to our listeners.

B (15:56)

Okay. I think state. States are going to retain a rule. I think there's a question of like, you know, some of the more muscular state crypto regulators, like a New York.

A (16:05)

Right. Like, should the BIT license still exist?

B (16:09)

I think it really depends on, like, what. We still don't know what the final language of the Clarity Act's going to be. So there might still be a role for the BIT license, but I think it's a question of, you know, can. Can New York State be quite as critical and I think tough in their review process and application process for a bit license? Like, well, its value have diminished so much that relative to how New York wants to regulate them. Do you just go a different way?

A (16:37)

Do you see the arbitrage there similar to kind of state sports betting licenses compared to cftc, dcms, prediction markets?

B (16:45)

Oh, it's interesting. Yeah. I mean, prediction markets, you know, another question, and I do think it's a, it's a fascinating interplay. Right. You have states that want to regulate prediction markets. The Fed saying no, it's all US and prediction markets obviously want to go to the Feds. Yeah, I think that there's. I. I think that there's already an opportunity. There's already plenty of states that don't, I think, regulate crypto very critically. And so I'm not sure the floor can fall much farther for a lot of those states. But there are states like California and New York where there's just so much capital, there's so much trading activity that if those states can find a way to make your life a little difficult or make you adhere to their standards, they're going to find a way to do it.

A (17:28)

And we're going to talk about the presidential election a little later. But let's just assume for sake of this question, that a Democrat wins in 2028 and takes office in 2029. Do you think there's a. What's the chances of the regulatory framework changing meaningfully? And do you think once Genius and Clarity are both fully enacted and all the rulemaking done, it doesn't really matter what the President wants?

B (17:53)

Yeah, I think it's gonna. Well, okay. I think there's. It's unlikely there's gonna be unilateral action by a Democratic president to really tear apart the entire digital asset framework if it comes together through Clarity and Genius. Having said that, if there is a huge market meltdown, if there's a few big, high profile examples of fraud in the industry, that could change. I still think it's very difficult, obviously, to pass a bill through Congress. One of the things we avoid at the business is trying to pass bills through Congress unless there's a really compelling case to do so. I think that the people working on crypto in the administration right now, obviously advised very closely by the industry, have mapped out a way to make their current policy preferences almost indestructible, no matter who the President is. Right.

A (18:47)

And Congress, you give Democrats that seem to be very anti crypto digital assets, all of it, and then others that are very pro. How do you kind of break down? It doesn't shape out by party in the way that a lot of issues do. So how does it work?

B (19:03)

No, I think it's mostly some really loud voices in the Democratic Party are anti crypto. But all far left. Yeah, pretty much all. All far left folks. You know, it depends how you define. Like, do you call Rokhana really far left or not? Yeah. So, you know, there are people like that who are not extremely anti anti crypto, but obviously AOC has become A bit like that. Elizabeth Warren, of course, the champion of it. But if you look at things like the stablecoin bill, genius that had, I think over 50 Democratic votes in the House. And you know, from what I hear, Democratic leadership in the Senate is begging some of the members who are opposing the Clarity bill to just go along

A (19:48)

to get the 60.

B (19:49)

Yeah, exactly. So, and I think part of that is, of course, you know, the amount of political money flowing through, you know, Congress, etcetera, from, from the industry. And then part of it is also there's not a huge upside to being anti crypto politically. I mean, there's not a lot of voters who are saying, like, I want to make sure you're voting against crypto. But there is a constituency that says if you're anti crypto, get the hell out of you.

A (20:11)

Yeah, I mean, you know, it's interesting that, you know, I can reveal this because the Times did a front page story on it the other week which was, you know, we're running this campaign for the climate industry to basically get people, Washington to kind of take them more seriously. And when they came to us, what they said is we to be like crypto.

B (20:28)

Right.

A (20:28)

Which really shows you in a short period of time what an amazing job fair shake and that whole world really did around it. So, all right, let's switch to politics and we'll start in New York and then go national. So the budget is technically supposed to be done March 31st. It's April. What's today, 5th, 6th, something like that? Not done yet. I don't know that a single voter knows or cares in the slightest. But watch the holdup.

B (20:53)

There's, there's a handful of issues. I mean, one of the things is, is a really sort of mundane thing around auto insurance premiums. The governor wants to eliminate these sort of like fake accident claims which drive up insurance rates. I mean, we had an insurance company come into the business a couple years ago and said they wanted to make a change like this because they were losing hundreds of millions of dollars a year in the state. So insurance companies are usually, you know, politically extremely conservative. Don't want to rock, rock the boat. They won't even want to talk about how much money they're losing. So Uber has stepped up and they've really been, you know, kind of leading the charge to make this change and support the governor.

A (21:27)

On the other hand, because their insurance gets hit when a driver gets into an accident. That's sort of a. And there's basically a false claim around it.

B (21:34)

Yeah, right. And there's still, you know, you can still, you know, the amount of damages you can seek in court relative to your injury is still, like, pretty out of whack.

A (21:42)

Right.

B (21:43)

On the other hand, you have the trial lawyers, or as the governor's come to call them, billboard lawyers. And, you know, they obviously want to retain the ability, I mean, you would know this from scaffold law kind of issues. They want to retain the ability to, you know, extract maximum penalties and fees.

A (21:59)

So explain to the listeners. So if I'm a listener who's not conversant in New York politics, I'm saying, how does this affect the budget of New York one way or the other? Why is this a budget issue?

B (22:10)

What happens is the budget you think is just about dollars and cents, right? Well, under New York law, thanks to some, some important court cases under, you know, David Patterson, who was a sort of buffoonish governor, but was governor and had some, technically, was the governor. Technically was the governor and, you know, whatever. I have a lovely relationship with that, with that sort of his tenure, who he is. But anyway, he, he won this, this huge case which said that the governor, at the end of the day, can ram through any kind of spending package that he or she wants absent agreement from the legislature. That's where it changed the game. Where at once they were equal parties, the governor and the legislature, now the governor has enormous leverage to just sort of power through whatever they want on a short term basis until the legislature agrees to her language. So what's resulted in is the governor now tries to put in as much policy as possible into the budget.

A (23:11)

Right?

B (23:11)

Because they said, all right, you want me to agree to these dollars and cents, you also got to adopt these policy changes. The legislature hates doing that. They often find a way to meet in the middle now, the sort of nitty gritty stuff of like why the budget is late and why that matters. Does it matter all that much every month, month and a half late? I don't think it really matters. But the governor, this governor has been fine blowing past the budget, blowing past the budget deadline because eventually legislators stop getting their paychecks.

A (23:39)

When does that happen?

B (23:41)

April 15. If the budget isn't passed, then they will stop getting their paychecks. So the governor feels that her leverage increases because these lawmakers, who actually are now the best paid lawmakers in the country, will stop getting their paycheck. Maybe they can stop paying rent, et cetera.

A (23:57)

Right. So the DSA and Mandani are pushing very hard for an income tax increase. The governor's made it pretty clear she's not gonna go for it. The left, I think both for purposes of just in their mind, social justice combined with the need for New York City, in their view to have more tax revenues. They don't have to cut anything that's in that kind of a political sacred cow for them is desperate to raise taxes. What do you think happens on that front?

B (24:27)

I don't think they raise taxes this year. I think even corporate tax. Yeah, maybe there's something small around that. But I think, I think the governor is holding pretty strong the fact that she's not going to do it. She's like, I'm in the reelection. I've, I've worked very well with the mayor. Give me a break. I'm just going to do it next year when I'm not not up for real.

A (24:43)

Why even then? Because I don't. I think she truly, from what I can tell, does believe that companies and high income earners are fluid. Right. They can move. They don't have to be. It's not like you're giving up your US citizenship to avoid attacks. And therefore that's going to be just as true in a year or two or three from now as it is today. Once she gets through this reelection, I mean, I guess it's possible she runs again in 2030, but that seems pretty unlikely. Which means she's basically bulletproof politically at that point. Isn't this her sort of weakest point? And then from here on out, if she doesn't want to do something, there's really nothing anyone can do about it.

B (25:22)

Yeah, that's true. I guess she'll determine, you know, how important is it to her legacy that she really puts a cap on taxes moving forward. Look, taxing the rich more is always politically popular. That's the thing you mentioned the left pushing for it, I think.

A (25:35)

But if it's politically popular and substantively dumb, and there's a ton of evidence showing that and you are no longer running for election again, why would you do it?

B (25:44)

Yeah, I mean, just because politicians, even when they're not running again, as you've seen, like sometimes they still care about how much she's.

A (25:51)

I have to say I find her to be very resolute in a way. She has sort of struck me over. When she came in, I was dismissive of her to be perfectly fair, county clerk in Erie County. Like lieutenant governor's not a real job. And then I think she has really sort of proven to have a set of principles and values they're very centrist. And she's tough. I just don't see her getting pushed around or bullied into things she doesn't believe in.

B (26:19)

Yeah, I think, I think the perception of her has changed a lot. And I think that's due to the fact that she has really dug in on these issues because I think even, you know, we saw, you know, Cuomo who everyone said is like, oh, the toughest governor. Everyone. You can't move him.

A (26:29)

She's much tougher than him.

B (26:30)

She is much tougher than him.

A (26:31)

He was constantly pivoting to every thought. He did run for president one day. I don't think she cares about that. And as a result, she actually has more principles and more toughness, in my opinion.

B (26:41)

I agree. I agree with that. So we'll see. I mean, look, at the end of the day, politicians tend to move to where they think they need to be in order to retain power. Right. I mean, if you're, if she may be resolute in the fact that, you know, she doesn't think raising taxes is good. At a certain point, though, you become a lame duck very quickly if your approval rating drops, you know, five, six, seven, eight points. Yeah. So maybe there's a middle ground they can forge. Look, at the end of the day, if, if a governor did raise income taxes by, you know, a tenth of a point, you know, there's incremental things that, like, is that really going to cause more.

A (27:16)

And it also depends where the economy goes more broadly. Right. If Wall street is a huge, as it is, massive factor in sort of overall New York tax revenue and let's say the Iran war deepens and further escalates, not de escalates, and all of a sudden profits are dropping and bonuses are dropping. That's an argument not to raise taxes. If things are soaring, then you could say, yeah, people can afford an extra 2, 10 of a point or whatever it might be. Siena poll has her up 13 over Republican Bruce Blakeman. We did a poll recently that had her up 15. Do you see that number going up or down as we head towards November? And any world where she doesn't win,

B (28:00)

I don't think there's any world where she doesn't win because she's, I think, pretty strong independent of any Republican opponent or domestic.

A (28:08)

Massive Democratic year.

B (28:10)

In a massive Democratic year. And a. And a candidate who's really struggling to gain traction. I mean, look, Lee Zeldin also looked like he wasn't going to gain much traction. Ultimately, he lost. And I think it's overstated a bit how close the race was, except in

A (28:23)

22 you had one, the Democrats were in power. Usually flips the other way. Two, we were still on the Cuomo hangover from his scandals and removal. And she was his lieutenant. I know they hate each other, but she was his lieutenant governor. I just. Those weak. And she has done a lot since then. Right. I just don't see how any of those weaknesses are still there.

B (28:45)

No. And Blakeman's a bad. Yeah. I mean, I think fundamentally the point I was gonna make, the same as yours, is that Democrats were in control. Now Donald Trump's in control. You know, I mean, if the Iran war is any indication of how people are gonna continue to view him, it's. It's gonna be a really tough year for Republicans.

A (29:05)

Congressional primaries in New York are coming up in June. Our friend Michael Asher is one of the candidates in New York 12. For the listeners who don't know, that is most of Manhattan, basically all of Manhattan north of 14th street and maybe up till somewhere in the hundred wherever SBI district starts 120s or 30s. How do you handicap that race?

B (29:26)

Yeah, well, this could be really turned into just a Michael Asher propaganda.

A (29:29)

I mean, we're both, just to be clear, very close.

B (29:32)

Yeah.

A (29:33)

Let's just put that aside and try to handicap the race.

B (29:35)

I think that, you know, look, I think, I think, you know, I think voters, let's say west side, but it's really east side, west side. I do think they take very seriously who the representative is. And I think at the end of the day, they want a serious person representing their interests and fighting the Trump administration. I think that's going to overcome this early celebrity boost that Schlossberg has, who seems to be by every count largely a dilettante, a very effective messenger on

A (30:05)

go to social media that made Zoran mayor.

B (30:08)

Yeah.

A (30:08)

Trump president.

B (30:09)

I mean, I think, I think Zoran outstrips, you know, Schlossberg and talent.

A (30:13)

I agree. But.

B (30:15)

But also, you know, people pay a lot more attention to who's running for mayor, to the. To the candidate for mayor than they do the candidate for Congress. Right. So, you know, I don't think. I don't think George Conway is real.

A (30:27)

Do you think he takes some of the pop kind of celebrity votes away from Schlossberg, though?

B (30:31)

Yeah, I do.

A (30:32)

I think in a weird way, it's helpful for Micah to have Conway in the race, but simply because if you were just someone who does social media and does vote, and now you're choosing between Schlossberg and Conway, as opposed to just, oh, this is the person I follow on Twitter.

B (30:45)

Yeah. I had someone from out of state ask me, what's the latest in the Schlossberg Conway race? Right. But we're also still several months out and I think that some of the PAC spending on behalf of MICA has just started. It's hard to really measure the impact of sort of the, you know, community and political club support, elect, you know, elected official support and early polling. So I think it's going to be a race that's going to tighten very quickly and it's going to tighten really close to the end.

A (31:15)

Yeah. Any of the other congressional primaries, you're

B (31:17)

keeping an eye on Dan Goldman and Brad Lander. Just because I think Brad Lander that's

A (31:22)

used to live in that district.

B (31:23)

What's that?

A (31:24)

That was your old district?

B (31:25)

Yeah, that's my old district. Lander with my former councilman. I just think, like, he's. He's just one of the most annoying, grading people I've ever met. And I think that just the TUS

A (31:36)

team is very pro Goldman just to be.

B (31:38)

Yeah, pro Goldman. I've never even met Dan Goldman.

A (31:41)

But Chris didn't hit you up to give to him?

B (31:43)

Yeah, no, I actually accidentally donated to him through a link that wasn't attached to Chris. So I gotta. But I also, I also, like, as a, you know, I'm also sort of. I'm not this sort of like super hard, hardcore, like pro BB APAC guy. But I do think, like, Brad Lander really like personally offended me with his first campaign ad, which was. I think it's just like a treacherous Jewish thing to do to like your number one talking point against your opponent who's also Jewish. Like, he takes APAC money. Like, get the fuck out of here. All right. You know what I mean? Like, we're not. We're not attacking other people for the type of Jew that they are. I just think that's weak and it just shows to a lack of character. Yeah.

A (32:22)

How do you think Zohar is doing?

B (32:25)

I think he's doing fine. Yeah, I think, I think, I think. Look, I think we're still. We're just maybe approaching the exit to the honeymoon. Right, Right. So these next kind of like four or five months are going to be really critical to, I think his public approval. You know, he's really seems to be picking up fights with the city council in ways that are a little bit surprising. But I also think he's trying to show like he's not Just this kind of, you know, soft bubble type of. Or he's not, he's not relying on a political bubble of support. He's really going to like, dig in on what his positions are. And I think that's. That's an important message to send to the rest of the body politic. Do you.

A (33:06)

I mean, the budget is pretty tough. Right. There's a. It's a substantial deficit. And I just don't see a world politically where the council agrees to raise property taxes, which is the only tax that can be done without Albany's permission. And, you know, if you were to raise property taxes, putting aside politics for a second, like if you said to me, we're going to put together a really, really thoughtful group of people to just look at the current property tax system, figure out what works, what doesn't work, what should be changed. There's probably a lot that should be changed.

B (33:39)

Oh, my God.

A (33:40)

For sure. But just doing it as a way to solve a budget problem short term is probably both bad policy and bad policy politics.

B (33:48)

Yeah. I went on the policy because I think. I think it was Bloomberg who changed, who did property tax reform in his first year. Right. And it's considered a major success and a smart thing to do. So I think part of it is maybe he sees that that's 24 years ago. Yeah. Right. Post, you know, 9, 11, et cetera. So obviously, much, much different circumstances. I, I think that, you know, look, there's always a sort of kabuki dance between the gov. The, the mayor and the city council. The mayor threatens things that aren't realistic. The council puts together a budget that's not realistic, and they find a way to meet.

A (34:22)

I'll give Julie Mannon, who's the council speaker, a lot of credit, which is. I thought this was the most substantive budget out of a council that I've seen in a long time. It wasn't. Just typically, the dance is mayor poses a budget. The mayor throws in a bunch of cuts to stuff that council members really care about. Parks, libraries, community groups. They all scream. And at the last minute there's, okay, you got me, here's your money. And it's just like this totally predictable dance that like a kindergarten class could enact. This feels like a real back and forth over the substance of how the city spends its 124 billion or whatever the number is.

B (35:00)

Yeah. I mean, look, there's. There's still at the very least $5 billion apart. Right. Yeah.

A (35:05)

Which is most of the deficit.

B (35:07)

Yeah. So I think they're going to have to find a way to bridge that, especially in the absence of any new revenue raise from Albany. Right. And look, Albany could find a way with some interesting math to, you know, send more money to the city in the short term. They've already kind of.

A (35:21)

If I'm, if I'm Hochul. Because I don't think real voters are paying any attention to the intricacies of the city budget one way or another. If you believe that New York City is run really inefficiently, if we have way too many city workers, way too generous benefits and, and on the pension side especially way too little use of technology to do things better, why would you bail New York City out? Why don't you do your job?

B (35:48)

Well, I think it's one to prevent any sort of upset or not raising taxes on the rich. I think too, it's just a way of continuing to. Hochul has shown she has tried to gratiate herself with politically popular contemporaries like even Eric Adams until he became toxic.

A (36:08)

Yeah.

B (36:08)

And Zo Rom by working with them on policy stuff and helping out their, their, their politics. So I think that's what you do. I, I, I think she also has a guard against, she doesn't want it to be seen as a bailout. Right. So it'd probably have to be, you know, the, these, you know, these dollar figures begin to sound so, you know, so minuscule at a certain point, despite the fact that they start with a B. But, you know, a billion or $2 billion over there, you know, some accounting

A (36:33)

changes smooth it out. But ultimately. So let's say they use every gimmick possible to kind of paper over the deficit this year and let's say the economy doesn't take off and as a result, revenues are not what they need them to be to fix it in the out years. What do they do?

B (36:52)

That's going to be the real big political test for the governor next year and the mayor if that happens. Yeah, and the mayor because. Well, I think that if people get wiped out and ordinary people are feeling real economic pain, the politics of tax increases on the rich and opposing them becomes, even at the policy side, the policy case becomes better. The politics becomes really.

A (37:15)

So I wonder though, if there's. According to the Citizens Budget Commission in 2012, New York City had 12.7% of America's millionaires. In 2022, we had 8.7% of America's Millionaires. According to them, it's a $13 billion a year difference in tax revenue for the state and the city, which would more than take care of all the deficits and everything else. And the people who really pay the price for that, ironically, if you're the far left, are the people who the far left claims that they want to help the most. Which is the poorest among us? Right. Really poor people need maximum tax revenue for Medicaid, for public housing, for food stamps. And when there is less money, there's less money. And like, I don't really know that social justice pays the rent.

B (38:06)

No. But you can understand, of course, why people who are, who've been damaged by a, you know, by a capital system or by a financial system and political system that doesn't look out for their interests and that has damaged them. And they see people who've accumulate extraordinary wealth. So it's like, it's more macro thing of, like, why.

A (38:25)

I get it. I guess where I'm wondering is, is there a world where you actually, I guess Cuomo tried to do this Merrill campaign, but he was just personally too toxic for it to work, where you're uniting kind of the poor and the rich against the sort of far left, simply because the poor and the rich, in this case, even if it doesn't look like it, their interests might align. Because if the rich leave, which they can and they do, the poor are the ones who suffer the most.

B (38:52)

Yeah, I just don't think anyone's cracked that code yet.

A (38:54)

No, but I think it's, you know, look, for example, as you know, I've been a very big critic of the New York City Partnership and Cathy Wilde. But I do think in my conversations with Steve Phillip, including him on this podcast, I think you have different leadership there that at least understands it and is thinking about things differently. Doesn't mean he's gonna be able to accomplish it. His board is still the same board, basically a very risk averse people. So who knows? But I wonder if that's not a coalition that could come together simply because it just feels to me that a lot of the policies driven by the DSA are about the emotional needs of their members who tend to be in the second and third decile of wealth, as opposed to the best interests of the people who actually have the least.

B (39:38)

Oh, yeah, it's like wealthy renters in the story. That's like the dsa.

A (39:42)

If you were aoc, would you run for president or would you run for the Senate against Chuck?

B (39:47)

Or do you run for. Neither. That's.

A (39:50)

Yeah. And stay in the House or just leave entirely?

B (39:53)

Just, just, just stay in the House.

A (39:55)

Okay.

B (39:55)

I mean, if you can be, you know, chair of oversight in Congress, and you continue to be, you know, the sort of like, you know, spiritual and sometimes the substantive leader of the other progressive wing, you know, is that better than being, you know, allowed but not very effective Senator? And you want to run for president, And I think the answer would be if he had to pick between the two. I think you run for president.

A (40:22)

I agree. I mean, there's a world to me where she replicates Bernie in 2020, but, you know, if there's no global pandemic, it's not quite the same thing. Meaning you're gonna have something like 15 to 20 center left Democrats who are all, in my view, effectively the same. Right. And, you know, Newsom might be the Hollywood candidate, Rahm is the asshole candidate, and, you know, people can have their lanes, but basically they're all the same. And then one true progressive, which might only be 20 to 30% of the Democratic primary electorate, but if 15 people are splitting 70% and one person's getting 30% in those early primaries, just like Bernie basically did really well in 2020 until Covid hit and Covid and Super Tuesday basically kind of happened exactly at the same time. I was like, oh, shit, that guy can't be in charge. And that was it. And Biden kind of just got it by default. If you're her, even if you can't win the nomination, but you win a bunch of early races and you do a lot better than anyone expects. And yes, you lose your House seat, but so then you go do the Joe Rogan thing and you make God knows how much money with your own, you know, you own the mechanisms yourself of your, you know, YouTube show, your podcast and everything else, and then run again, you know, in four years or eight years or whatever it is.

B (41:42)

Yeah, right. You can. You can run 100% it. I mean, I do think I. I'm always surprised. For, you know, people unlike us who work outside New York City, the level of vitriol and hate for AOC in some spaces outside of, like, major urban areas is intense in a way that I don't really understand, frankly. I mean, like, people I know, you know, guys who. Who I think generally support Bernie might think he's a little too left, but kind of relate to him. You know, even I don't want to overstate the impact of, like, the Joe Rogans of the world. But, like, they get a Bernie, they can hang with a Bernie AOC they think is like some demon witch coming down.

A (42:20)

Some of that is sexism and, and racism.

B (42:22)

Yeah. Yeah, for sure. Yeah, absolutely.

A (42:25)

So I would argue that unless she is the nominee or Bernie or something like that, any of the center left candidates beat whoever the Republican's gonna be, at least if the election were held today.

B (42:36)

I don't know. I know you're really bullish on this. I'm not quite as.

A (42:39)

Tell me why.

B (42:40)

Because, Because I think that Republicans have. Have tracked Trump really closely. I think they obviously struggle on the ballot whenever or they struggle, all of them. Yeah, yeah, right. But, you know, Look, I think J.D. vance strikes me as a somewhat scary guy. And has he, has he learned the ways of Trump and cultivated a big enough donor base? He doesn't seem to have an enormous grassroots support, which is a big distinction.

A (43:11)

I don't think you can sort of pretend to be Trump and have it work. I mean, Trump is so singular.

B (43:17)

Yeah, well, I think you can't pretend to be Trump. Like, I don't think Rubio, who's becoming sort of the chattering class's preferred Republican candidate, I don't think Rubio can become Trump in a way. Like, in a way that doesn't totally backfire. Can Vance do it a little bit? Yeah. I mean, his, his personal story is, okay, he seems to be willing to say what he needs to to win any kind of fight. And then I think the biggest open question is, like, what is the Democratic brand in 2028? That's. That's a totally open question. What do we do if Democrats win the midterms? Are they actually better positioned? Do they use it to fight these annoying culture wars that are just like an absolute hamster wheel?

A (43:58)

Yeah, hopefully they're smart enough to not do that.

B (44:00)

Yeah, hopefully they're smart enough to not do that. You know, they're probably going to have, especially with Trump as a lame duck, theoretically, you know, to exercise some real oversight and extract enough wins that they become a party of strength versus a sort of lame duck Republican Party. But I think, you know, it's politics a couple years. Anything that's true.

A (44:20)

Fair enough. All right, I have three Hugo jump on the mic for this. I know you don't have a video unless you want to chart it, but these are three totally random questions that occurred to me this morning. So one's sports, one's cultural, one's sort of financial. So on the sports one, I would argue that if you were assembling the greatest basketball rosters of all time and they each had to play against the aliens, Right. And you were picking between the players ranked number one to number 100 of all time. Kevin Durant would be my last pick because he is a cancer and ultimately every team that has him does worse. And the only time that wasn't true was with Golden State because they had Steph Curry. So given that, where would you put Durant?

B (45:08)

Yeah, I mean, saying that I, I, first of all, the disclaimer I put the NBA is my third, you know, sport that I follow. Most.

A (45:13)

Most. But you. We've been to next games together and

B (45:16)

of course, of course I, I will. I would all say the exception for Kevin Durant is also he's played on Team USA and the Olympics.

A (45:21)

That's true.

B (45:22)

Done quite well.

A (45:23)

That's true.

B (45:23)

Seems well liked. And it's weird, right?

A (45:26)

Somehow, somehow he seems totally different in that.

B (45:28)

Yeah, they're not paying for money. Maybe there's not all this sort of like egoism or less egoism, but he's

A (45:33)

now tanked the Rockets culturally just like he does every team he's on.

B (45:37)

Yeah. And he talks openly every season about how he might, he might just leave and go to a different team and how he kind of wants to.

A (45:42)

Yeah. He's so disgruntled.

B (45:44)

Yeah, but, but, but you said we're playing aliens, right? So it's like the Olympics. Short. Yeah. Right. It's like a short, a short tournament.

A (45:52)

Fair enough.

B (45:52)

Yeah. I'd probably put it in my, in my top top 25 then. Especially if he's like primed. Right.

A (45:57)

Got it. Hugo.

C (45:58)

Top 25 all time for sure.

A (46:00)

Well, he's one of the top 25 players. Right, but I mean, would you put

C (46:03)

it against the aliens?

A (46:05)

So you got, you got to make, let's say we have 10, 10 person teams.

C (46:09)

Yeah. I wouldn't put him in the top 10, but probably just right out.

A (46:12)

So you would put him on team number two?

C (46:14)

Sure, yes, I would. I mean, his ability to make a shot. I mean, like, I just.

B (46:20)

Yeah.

A (46:20)

In the game.

C (46:21)

You want him on your team, what

A (46:22)

if it's a seat? What if it's a season long competition against the aliens?

B (46:27)

Maybe not. No, because he may go. He may, he may defect to like Neptune or something.

A (46:31)

You never know with him.

C (46:32)

I don't hate him as much as you do, but I, I don't.

A (46:34)

Like, I just find just wherever he goes, the team gets like worse and everyone's miserable.

C (46:39)

I think one of Houston should have

A (46:40)

been so good this year.

B (46:41)

You were like going to Nets games

A (46:42)

for a while and you know what? He was.

B (46:44)

I did.

A (46:44)

Because I. So when they got Kd and Kyrie, I thought. And the Knicks were really bad at that point. I thought, oh, it. You know, Durant is technically, from a talent standpoint, the best NBA player to put on a uniform of a New York team. Right. He's better than Dr. J. He's better than Walt Frazier. He's better than Patrick Ewing. Starks. Even better than Starks. He wasn't fun to watch. You know he wasn't fun to watch. No, I mean, I went to games with you.

C (47:11)

Yeah. He has sort of a joyless kind of assassin kind of style. That's not fun.

A (47:17)

All right, so that's number one. Number two. And so I have complained about this before, but you may not be as avid of a firewall listener to know this, but I have now multiple times. You're not in the special group Equinox asked people to work in.

B (47:31)

I actually. No, I haven't heard it, but I actually walked by the Equinox on my way here and I was like, does Bradley go to that gym?

A (47:38)

I was there when he walked in.

C (47:39)

You go to this one right here?

A (47:40)

Depends what I'm doing. I have lockers at three different Equinoxes.

B (47:44)

Wow.

A (47:44)

Because there's one by the bookstore, there's one by the office, one by my apartment, and it just depends on where you are.

B (47:49)

Yeah.

A (47:50)

So this has happened twice. So first I thought maybe it was a Soho thing. It's the one on Prince and Crosby. But then it happened today again in Orchard street, which is in my understanding. And I've been working out in gyms for, you know, a long, long time. If someone asks you to work in, you say, yeah, sure.

B (48:05)

Right. Even if you don't really want to.

A (48:06)

Yeah.

B (48:07)

Yeah.

A (48:07)

Today was the third time, I'd say in a six month period where I've asked someone to work in and they said, no.

C (48:13)

What's your gym outfit like, Bradley?

A (48:16)

You think I'm wearing something that's like, I'm worried.

C (48:17)

I just want to get the full picture.

A (48:19)

Sweatpants and a T. Okay. So it's pretty normal.

C (48:21)

Okay.

A (48:22)

Not like a whole Lycra type setup. Just like a normal thing. So these are my questions. Is it A, that it's an Equinox thing? Because rich people only go to Equinox and rich people are much more likely to be assholes. B, totally random distribution. And it happened to just be that three times in a short. In a six month span. You know, the outlier was someone using something that I wanted to use. Or C, the Trumpian zero sum. You know, everyone out for themselves mentality is so pervasive that that's just the world we live in today.

C (48:59)

I'm gonna offer. Maybe this is a combination thing and I don't know how old these people were, but I do think there's a generational thing where people today.

A (49:07)

She was a woman who's probably 30, call her.

C (49:10)

Right. So that would be in the right area. I think there is. People really are in their silos, like even in public space a lot. Obviously walking down the street with their headphones or on their phone or whatever. They have a giant headphones, but they really do. One thing I noticed, I go to the same gym almost. I go to an Equinox, almost, whatever, almost every day. I never speak to anyone ever. I don't even say hello.

A (49:33)

What if you need to work in.

C (49:35)

See, I don't ever need to. So I admit it's totally fine to request. I'm not defending it, but I think

A (49:43)

you think it's a proxy for sort of what's wrong with society overall.

C (49:47)

It might be, but I. But I do think it is a generational thing where there's a kind of like. No, I agree, it's bad, it's bad. I'm not support. But it's not exactly just like Trump being zero sum. I don't think it goes to that place well.

A (49:59)

But it's a. We no longer have a society concerned with the collective good inside Equinox. And Equinox is a either.

B (50:07)

Yeah, I know what you mean.

A (50:08)

It gets it. Is it a reflection of that? Is it just random? Or is it that people who go to Equinox are more likely to be selfish than, say, Planet Fitness?

C (50:17)

Well, there's no doubt about that.

B (50:18)

Yeah, I think so. I think especially in downtown Equinox, especially in, like modern day SoHo, you get maybe sometimes a special kind of asshole.

A (50:26)

Yeah. So we're going Asshole.

C (50:28)

But you live outside the city right now and I would bet it's not like that.

A (50:32)

Yeah. Is there a gym that you go to in Westchester?

B (50:35)

Yeah, I just stop because I have a little like, home gym set up now.

A (50:38)

Would. Were people good about letting you work in?

B (50:39)

Oh, absolutely. Yeah. Yeah.

A (50:41)

All right.

C (50:41)

So.

A (50:41)

So it's a Equinox downtown thing.

B (50:44)

I think it's okay. I think it's. I think I'm open to any possibility. Yeah, I think, I mean, that. That Equinox that I walked by on. Is it on Orchard?

A (50:52)

Yeah.

B (50:53)

So I was like, that one's going to be. That's. That's going to be a tough One to break into.

A (50:57)

Yeah, yeah.

C (50:58)

Bond street, tough one.

B (50:59)

Yeah.

A (51:00)

And Princeton Crosby's got to be the other problem. Princeton Crosby. It's just so crowded that even if everyone is being polite, it's just so crap. I basically just try to do cardio there because using weights there is almost impossible. Our last one, which unfortunately is less fun, more serious. But there was a piece in the Journal this morning about possible OpenAI and anthropic IPOs in 2026. And I guess here was what I was wondering, which is these are really, really highly valued companies. OpenAI is just short of a trillion dollars. Anthropic, last I saw was 450 or something like that. They lose incredible amounts of money. Right. So they were using OpenAI's finances and saying in like two years, whatever it is, they're forecasted to lose $90 billion. Right. Why would anyone invest in the IPO? I understand investing in IPOs when you think a company is way on the rise, the price is attractive and therefore there's a lot of gain. But if you're already at a trillion dollars and you're losing incredible amounts of money and there's no real clear sign as to when that's going to change, and there's only a handful of trillion dollar companies already, so it's not like there's that much room to grow from there, why would you invest in it? Why wouldn't you just wait?

B (52:19)

You know, I think FOMO hype and you know, if you think that really AI is not going to be commoditized, but there is going to be one clear winner and you can have. You have a chance of picking.

A (52:28)

Do you think that?

B (52:30)

Do I think it's not going to be commoditized? Yeah, I think that it is probably going to be like three or four companies at least. And you know. Well, yeah, I think if it's anything, if it's anything more than two, sorry to see.

A (52:44)

Yeah, I mean if you look at the companies that are in that, putting Tesla aside, they are the one outlier. Right. And I don't know if they're exactly a trillion now or a little below or above, but they're always around there. Everyone else, their stock price rises or falls based on earnings and earnings mean you have to have more P than L and more P than the analysts expect you to have. So I just don't understand logically why anybody would want to participate in an OpenAI PO. And I'm not really sure about anthropic either. Hugo, what do you think I mean,

C (53:17)

I think what Eric said is basically right. It's just kind of a flyer. Right. It's like, I want to be part of the future. There's a kind of brand affiliation or mood affair. Affiliation is probably the right term. Like, you know, I mean, you look at the meme stocks and stuff, crazier things have happened. And so I. I think that the.

A (53:33)

So you think you would just be buying it just because you think that in three months it's going to be at a peak and you're selling then.

B (53:40)

I don't even.

C (53:40)

I don't even know if someone's thinking in time frames necessarily. They're just thinking like, oh, I have 10 grand, and here it goes, you know, like, like. And enough people do that, and there you have a hot stock. So I don't. I don't know that there's. I agree with you. There's an illogic to it. And yet there is also a kind of like, we don't know what the future is going to be. So on some, you know, once. Once these. Once agentic AI takes over and they're, you know, trading stocks for you and doing all this stuff, the profit potential of them goes way up because they can literally do everything and take a fee for everything. So now, is that the future that's coming? I don't know. But if it is, you basically have companies that have like a toll booth on your everyday life.

B (54:21)

Yeah. And I mean, even that Wall Street Journal story did say that there were the projections that they're shopping around or that. I think it was. I don't know if it was anthropic or open. I. But they forecast profitability, I think, in 2030 or something like that, or maybe. But.

A (54:34)

Yeah, but as someone who gets decks from founders every day, everyone forecast profitability at some point, you know. All right, Eric, any recommendations you want to give the audience? Books or movies, TV shows, restaurants, anything?

B (54:48)

TV's been a little. A little. A little weak recently, but I'd say go to. Go to Yankees games. I think we're.

A (54:55)

How about your friends and neighbors? I feel like you live in that town.

B (54:58)

I actually do live in that town.

A (54:59)

Yeah.

B (55:00)

There's lots of scenes in my town.

A (55:02)

It.

B (55:02)

My town's not really like that.

A (55:05)

Heels and Ry. Oh, okay.

B (55:07)

I wish I was. I wish, but I don't know. I don't want to wish. Live in that. But I wish all.

A (55:12)

Did you watch the opening of the new season?

B (55:13)

Yeah, I actually thought it was like, so the dialogue was so crappy and like, yeah, I found the.

A (55:18)

Did you watch it? The James Martin character was so Gatsby on the nose. It's so obvious that he's a fraud that, you know, but, but I, that show does allow me to feel morally superior. So I like watch.

B (55:29)

There you go.

A (55:30)

Great.

B (55:30)

Yeah. Good. And it's fun. It's like fun to see your, your like family restaurant in there. You know what I mean? There you go.

A (55:35)

All right, Eric, thank you for joining us.

B (55:36)

Thanks, Bradley. Thank you.

A (55:41)

Firewall is recorded at my bookstore, P and T knitwear, located at 180 Orchard street on the lower east side of Manhattan. We'd love to hear from you with questions, feedbacks or idea for a guest. Just email me at Bradleyirewall Media or find me on LinkedIn. And to keep up with what's on my mind and my latest writing, please follow my new substack@bradleytus.substack.com thanks again for listening.