Episode Summary: Prof G Markets: Is Google a Buy? + Is Uber Recession Proof?

Release Date: May 12, 2025
Podcast: The Prof G Pod with Scott Galloway
Host: Vox Media Podcast Network
Episode Focus: An in-depth analysis of Google's stock valuation amidst emerging AI competition and Uber's recent earnings performance in the context of potential economic downturns.

1. UK-US Trade Deal Framework

Discussion Overview:
Scott Galloway and co-hosts delve into President Trump's recently announced framework for a trade deal with the UK. The proposal aims to reduce tariffs on British goods while maintaining a broader 10% tariff on imports from other nations. However, the deal remains largely unfinalized, with significant disagreements on several key points.

Key Points:

• Tariff Reductions: Intent to lower auto tariffs from 25% to 10%, aligning with existing tariffs on other countries.
• Steel and Aluminum Tariffs: The UK expected the US to eliminate these tariffs, but the US opted for an alternative arrangement instead.
• Social Media Taxes: Uncertainties remain regarding the UK's proposed taxes on social media companies.
• Beef Trade: Discussions about expanding access to beef and establishing reciprocal trade agreements.

Notable Quotes:

• Scott Galloway [04:12]: “From everything I can understand about this quote-unquote trade deal, this agreement, nothing's really been determined.”
• Ed [07:22]: “The UK is going to have to drop the tariffs on digital services.”

Timestamp Highlights:

• [06:50] Initial announcement and enthusiasm surrounding the trade deal.
• [07:22] Breakdown of the specific tariff changes and ongoing disagreements.
• [11:41] Analysis of Trump’s focus on appearances over substantive policy outcomes.

2. Federal Reserve's Interest Rate Decision

Discussion Overview:
The panel discusses the Federal Reserve's recent decision to keep interest rates steady amidst economic uncertainties exacerbated by rising tariffs. Jerome Powell emphasized the need for caution, indicating a "wait and see" approach to assess the actual impact of these tariffs on inflation and unemployment.

Key Points:

• Rate Stability: Interest rates held steady, with Powell resisting pressure to cut rates despite Trump's demands.
• Market Expectations: Predictions of a possible rate cut have been slightly adjusted downward from an 80% to a 70% probability for July.
• Economic Concerns: Focus on potential stagflation—high inflation coupled with stagnant economic growth.
• Future Projections: Anticipation that any rate cuts might be postponed until September, contingent on forthcoming GDP reports.

Notable Quotes:

• Scott Galloway [12:22]: “Jerome Powell is extremely cautious. He wants to see the actual impact of these tariffs.”
• Bill Gates [14:24]: “The biggest fear is that we continue to see inflation and the economy slows. That's called stagflation.”

Timestamp Highlights:

• [12:22] Powell's cautious stance and emphasis on data-driven decisions.
• [14:24] Concerns about stagflation and its historical implications.

3. Melania Coin: A Case of Insider Trading and Market Grift

Discussion Overview:
The hosts expose the fraudulent exploitation surrounding Melania Coin, a meme cryptocurrency associated with Melania Trump. Using analysis from the Financial Times, they highlight how insiders made nearly $100 million through predatory trading practices before the coin's public launch.

Key Points:

• Insider Exploitation: 24 anonymous accounts purchased Melania Coin before its official announcement, leveraging insider knowledge.
• Profitable Trades: One wallet acquired $681,000 worth of Melania Coin just 64 seconds before the project was revealed, subsequently selling with significant profits.
• Market Impact: Approximately 800,000 investors lost billions as the coin plummeted by 96% post-launch.
• Regulatory Gap: The lack of proper cryptocurrency regulation allows such schemes to flourish, with current laws failing to categorize meme coins under securities.

Notable Quotes:

• Scott Galloway [16:32]: “We've been saying from the very beginning, since the beginning of Trump Coin, Melania Coin, how awful this is.”
• Bill Gates [17:48]: “There are never been a president or prime minister who's been able to aggregate a billion dollars a month in these types of gains.”

Timestamp Highlights:

• [15:30] Detailed breakdown of Melania Coin transactions and profits.
• [19:36] Ed and Bill Gates discuss the systemic nature of the grift and its broader economic implications.

4. The Crypto Conundrum: Insider Trading and Regulatory Failures

Discussion Overview:
The conversation shifts to the broader issues of insider trading within the crypto industry, emphasizing the absence of stringent regulations that enable such fraudulent activities. The hosts advocate for new legislation to address the gaps and hold perpetrators accountable.

Key Points:

• Insider Trading Risks: Proximity to power allows a select few to exploit market movements, undermining the integrity of financial markets.
• Regulatory Inaction: The SEC's current inability to regulate meme coins and similar crypto assets leaves room for continued fraud.
• Proposed Solutions: Introduction of new legal categories for meme coins and stringent enforcement to curb insider trading.

Notable Quotes:

• Scott Galloway [24:24]: “We need to actually take action. We can talk about how it's a big grift, but how are we actually going to address this?”
• Bill Gates [19:53]: “The rivers of capital into the US have reversed flow. EU index funds have had their greatest inflows in the last 30 years.”

Timestamp Highlights:

• [19:01] Discussion on the need for SEC regulation and potential legislative reforms.
• [20:00] Ed elaborates on the economic consequences of unchecked insider trading in crypto.

5. Google's Stock Dip Amid AI Search Engine Threats

Discussion Overview:
A significant portion of the episode analyzes Google's recent 9% stock decline triggered by Apple SVP Eddy Cue's testimony during the DOJ's antitrust case. Cue revealed potential integration of AI-powered search engines like Perplexity into Safari, signaling a shift away from Google as the default search provider.

Key Points:

• Eddy Cue's Testimony: Indicated a decline in Google search volume on Safari, suggesting a pivot to AI-based search tools.
• Market Reaction: Google's market value shrank by approximately $250 billion in response to Cue's statements.
• Valuation Analysis: Scott conducts a sum-of-the-parts valuation, arguing that Google's core businesses are undervalued and that the market's pessimism is overblown.
• Investment Thesis: Despite the stock drop, Google remains a robust investment opportunity due to its diverse revenue streams and strong AI investments.

Notable Quotes:

• Scott Galloway [32:26]: “The market's gotten a little too carried away with this whole AI is replacing Google thesis.”
• Bill Gates [33:07]: “The carcass is bleeding but this is going to be a big carcass for a long, long time.”

Timestamp Highlights:

• [27:20] Explanation of Eddy Cue's impact on Google's search dominance.
• [33:07] Ed reflects on Google's valuation and investment potential.
• [37:19] Bill Gates shares insights from his activist investor experience related to sum-of-the-parts valuation.

6. Uber's Q1 Earnings: Profitability and Autonomous Vehicle Ambitions

Discussion Overview:
The panel reviews Uber's first-quarter earnings, noting a slight miss in revenue but a significant beat in earnings per share (EPS). The conversation highlights Uber's strides toward profitability and its strategic partnership with Waymo for autonomous vehicles.

Key Points:

• Earnings Performance: Uber achieved $0.83 EPS against the expected $0.50, demonstrating strong profitability measures.
• Revenue Insights: Although revenue slightly missed forecasts, it increased by 14% year-over-year, indicating healthy growth.
• Cost Reduction: Significant decreases in operational costs contributing to improved EBITDA by 35%.
• Autonomous Vehicles: Partnership with Waymo introduces 100 autonomous vehicles in Austin, touted as a major growth opportunity.
• Market Perception: Despite strong earnings, Uber’s stock dipped over 2% due to mixed signals on revenue and future expectations.

Notable Quotes:

• Scott Galloway [43:59]: “I think what I'm learning about Uber is, yes, still a growth company, yes, still a tech company, but now it has the scale and it feels like the model actually makes sense.”
• Bill Gates [46:27]: “Dara is one of the amazing CEOs... Uber's just sort of running away with it.”

Timestamp Highlights:

• [30:01] Initial reaction to Uber's earnings report and stock movement.
• [37:19] Discussion on Uber’s management and strategic direction.
• [53:58] Analysis of Uber's long-term autonomous vehicle strategy and potential risks.

7. Upcoming Week's Market Highlights

Discussion Overview:
Towards the end of the episode, the hosts preview key events and earnings reports to watch in the coming week, including notable companies like Walmart, Toyota, and Alibaba. They also mention the release of the consumer and producer price indices for April.

Key Points:

• Alibaba's Performance: Anticipation of strong growth in Alibaba's cloud unit, potentially boosting its stock.
• Consumer Sentiment: Changes in global perceptions of China influencing Alibaba's business prospects.
• Other Earnings Reports: Expectations from major players like Walmart and Toyota.

Notable Quotes:

• Scott Galloway [56:07]: “This episode was produced by Claire Miller and engineered by Benjamin Spencer... Thanks for listening.”

Timestamp Highlights:

• [56:07] Preview of next week's earnings and economic indicators.
• [57:16] Ed's presentation on Alibaba's market position and expected performance.

Conclusion

In this episode of Prof G Markets, Scott Galloway and his co-hosts provide a comprehensive analysis of critical financial and economic developments. From dissecting the intricacies of international trade agreements and central bank policies to exposing fraudulent cryptocurrency schemes, the discussion is both insightful and actionable. The deep dive into Google's undervalued stock amidst AI competition and Uber's path to sustained profitability offers valuable perspectives for investors navigating a complex market landscape.

Key Takeaways:

• Trade Deals and Tariffs: Understanding the nuanced outcomes of international trade negotiations is crucial for anticipating market shifts.
• Monetary Policy: The Federal Reserve's cautious approach underscores the delicate balance between controlling inflation and fostering economic growth.
• Crypto Regulation: The urgent need for comprehensive legislation to curb insider trading and protect investors in the burgeoning crypto market.
• Stock Valuation: Recognizing undervalued assets like Google can present lucrative investment opportunities despite short-term market pessimism.
• Corporate Profitability: Uber's successful transition to profitability and strategic investments in autonomous vehicles exemplify effective corporate management and innovation.

For listeners seeking to stay informed and make strategic investment decisions, this episode offers a wealth of knowledge and expert analysis.

Notable Quotes with Timestamps:

• Scott Galloway [04:12]: “From everything I can understand about this quote-unquote trade deal, this agreement, nothing's really been determined.”
• Bill Gates [14:24]: “The biggest fear is that we continue to see inflation and the economy slows. That's called stagflation.”
• Scott Galloway [16:32]: “We've been saying from the very beginning, since the beginning of Trump Coin, Melania Coin, how awful this is.”
• Ed [07:22]: “The UK is going to have to drop the tariffs on digital services.”
• Scott Galloway [32:26]: “The market's gotten a little too carried away with this whole AI is replacing Google thesis.”
• Scott Galloway [43:59]: “I think what I'm learning about Uber is, yes, still a growth company, yes, still a tech company, but now it has the scale and it feels like the model actually makes sense.”

For more insights and detailed discussions, tune into "Prof G Markets" on your preferred podcast platform and stay ahead of the financial curve.