Goosed in the Shell (A Better Offline / Trashfuture Collaboration)

Summary

TRASHFUTURE x Better Offline — "Goosed in the Shell"

Date: July 8, 2026
Hosts/Guests: Riley, Nova, Ed Zitron, Zoran (guest), plus regular crew
Main Theme:
A satirical, incisive collaboration episode dissecting the delusional finance and "psychic trauma" of the modern capitalist and tech landscape, with a special focus on SoftBank's infamous "golden goose" investor presentation and the AI bubble’s techno-messianism. The hosts mock, analyze, and mourn the power of billionaire-indulged mania — particularly Masayoshi Son’s vision of empires, geese, and artificially superintelligent eggs.

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Episode Overview

This episode opens as a mock investor summit, with the Trashfuture and Better Offline teams play-acting through new fake business ventures (00:15), before delving deep into SoftBank’s surreal slide decks and the wild world of AI boom financing. Throughout, the hosts unpack how industry leaders—Masayoshi Son in particular—fuse tech optimism, personal delusion, and nearly unlimited risk into a spectacle that drives real-world market risk and material consequences.

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Key Discussion Points & Insights

1. Satirical Joint Ventures and Data Center Hyperbole

• The collaboration is framed as a tongue-in-cheek announcement of a "joint venture" between the shows, mimicking Silicon Valley’s vaporous M&A world (00:15).
• The hosts joke about building a podcast-generating data center spanning "19 Staten Islands" for $1 trillion and generating "$50 a year" (01:05), lampooning the scale and absurdity of real tech investment announcements.
• Nova: "Not only am I starting more podcasts, but I'm also folding more into the existing podcasts. So pretty soon everything will be Trash Future. Yes." (01:33)

2. Roast of SoftBank’s “Goose and Golden Eggs” Slide Deck

• The episode’s core is a live, satirical reading of SoftBank CEO Masayoshi Son’s investor presentation, which uses a goose analogy to represent SoftBank’s strategy (04:02).
  • Slide 43-44 features a goose and five golden eggs representing investments; the goose = SoftBank, the eggs = portfolio company exits (04:17).
  • Ed’s anatomical extrapolation: "Masayoshi mounts and impregnates SoftBank, by which I mean it invests money in companies using SoftBank's funds ... Then it lays the egg. The portfolio company goes public." (06:05)
• Hosts mock the insular, barely-comprehensible logic and the presentation’s mixture of “graphic design is my passion” energy with megalomaniac grandeur (05:50).
• Memorable moment: The running joke of "goose not valued" and “goose value zero," riffing on the deck's myopic focus on the eggs (company exits) instead of the goose (SoftBank itself) (08:47–10:06).
• Nova: “We’ve created a kind of system where, if you are at the top of it, you can have the delusions and society has to conform around you. You are the king of France. Everybody has to act like you are made of glass.” (09:12)

3. CEO AI Psychosis and Delusional Capital Allocation

• The hosts discuss how CEOs are “getting AI psychosis,” highlighting the media trope and its real consequences, especially when leaders are surrounded by yes-men and AI Hype (08:12).
• Ed draws a parallel between behaviors tolerated from billionaires versus everyday people experiencing mania or breakdowns, underlining the structural privilege: “Because he invested in Alibaba, we have to take this shit seriously now” (18:19).
• Nova: "It's digital Versailles: everyone stinks, everyone's weird, and everyone's just like, 'Wow, we all love loops now, right?'" (09:46)
• Masayoshi Son’s obsession with “whimsical white boys” is, per Ed, both a recurring risk pattern and a running joke (11:40).

4. The Masayoshi Son Legend and “Goose Fraud”

• Ed details Son’s hit-and-miss record: luck with Alibaba and ARM; disastrous WeWork adventures; whimsical risk-taking (11:46–12:24).
• Joke scenario: If Ed got 10 minutes with Masayoshi Son, “I could get $7 billion” (12:15).
• The “goose math” is highlighted as irrational, as Son invents ever higher values for SoftBank on the promise that more geese = more eggs = future profits, regardless of actual value in the holdings (18:19).
• Riley: "Eggs do not lay eggs, obviously. So I've heard this, the mission to go, how do you go from 3 eggs to 74 eggs? The increase of 71 — load more geese—and Masayoshi someone's got to start fucking them." (14:46-14:59)
• The show lampoons Son’s belief in his own legend, especially the life plan chart—now extended from 50 to 60 years, with "realizing artificial superintelligence" as the new goal, crossing out any notion of retiring or succession planning (23:39–25:33).

5. AI Mania, Data Center Infrastructure, and Economic Consequences

• Discussion pivots to the real-world infrastructure crunch: demand for data centers, GPUs, transformers, and grid access—problems compounded by AI-driven speculation and political favoritism (33:00–39:52).
• Ed: "If you took away the money, this person [Son] would sound fucking insane," underlining how unchecked capital warps what society tolerates as “vision” (33:58).
• Riley and Nova dissect the knock-on effects: AI data centers skipping the line, compounding scarcity for infrastructure needed elsewhere, and the role of SoftBank’s SB Neo project (35:10–39:17).

6. Bubble Dynamics & Tech Industry Denial

• The episode tracks declining profitability, eye-watering CapEx, and the looming risk for SoftBank if OpenAI fails to go public at sky-high valuations (41:02–44:49).
• Ed, referencing open reality-avoidance: "The only reason we don't treat [Masayoshi Son] like he's an insane person is because he hasn't blown himself up yet." (21:17)
• Riley details how anticipated AI-driven job destruction hasn't materialized as promised, with industry leadership quietly walking back their own doom-and-gloom (51:02–56:19).

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Notable Quotes & Memorable Moments

• On Geese and Delusion:

  • Ed: “Masayoshi Son is the gander. Masayoshi mounts and impregnates SoftBank.” [06:05]
  • Nova: “We've created a kind of system where if you are at the top of it, you can have the delusions and society has to conform around you. You are the king of France. Everybody has to act like you are made of glass.” [09:12]
  • Riley (mocking): “Imagine this in the Dark Souls font. Goose not valued.” [09:06]
  • Riley: "Eggs do not lay eggs, obviously ... The value came from the goose. I think I read that in capital." [14:46–15:10]

• On Tech Mania:

  • Riley: “If you are a CEO and you get AI psychosis, you don't get on the PATH train and have a heart attack while trying to meet your fake girlfriend from CharacterAI... They get up on stage and say, I'm destined to bring about the birth of an artificially superintelligent God through this goose.” [08:12–08:28]
  • Ed: “Literally the only reason we don’t treat this man like he’s an insane person is because he hasn’t blown himself up yet.” [21:17]
  • Ed: “Goose fraud right now... 57 claims $74 trillion of egg value... that is not what's on SoftBank's website. It's $30 trillion.” [21:16]

• On Infrastructure and Capitalism as Paperclip Maximizer:

  • Riley: “You don’t need the AI to be a paperclip maximizer because capitalism is already maximizing the paperclips in the form of data centers. We're cannibalizing useful things to build this.” [40:16]
  • Ed: “If you took away the money, this person would sound fucking insane. ... But because it’s Mashiyoshi Son... you’re like, oh, yeah, yeah, absolutely." [33:59]

• On the AI Bubble Peak:

  • Ed: "The coyote has looked down." [57:14]
  • Riley: “The thing has to start costing what it costs… Not even making a profit, just costing what it costs. And that's now happened." [57:35]

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Timestamps for Key Segments

• Podcast/”Joint Venture” announcement & satirical setup – 00:15–01:49
• Goose analogy reading & SoftBank slide deck roast – 04:02–08:47
• Discussion of AI psychosis & CEO delusions – 08:12–10:06, 17:22–18:19
• Masayoshi Son's legend, accidental hits, and “goose fraud” – 11:40–15:15
• Infrastructure bottleneck, data centers, and inevitable collapse – 33:00–39:52
• AI bubble, IPO struggles, and financial media enabling – 41:02–44:49
• Walk-back of tech job apocalypse & Unit economics woes – 51:02–57:35

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Tone & Style

The episode is sharp, relentless, and ironic, mixing deep technical understanding and current-critical economic insight with absurdist humor and precisely-placed pop culture references. The analysis, while comedic, is rooted in pessimistic realism about the late-capitalist tech-finance singularity making “paperclips” out of everything — from real infrastructure to human workers, to the very idea of value.

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Conclusion

The hosts argue that unchecked delusion at the top bleeds into macroeconomic instability, that AI mania is pushing real material shortages and market fragility, and that society’s willingness to indulge billionaire eccentricity has created a world where the “goose” — or perhaps the planet itself — is repeatedly sacrificed for imaginary golden eggs. It’s all absurd, but also deadly serious.

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For further context, see:

• SoftBank’s infamous investor decks
• Recent news of US and EU data center expansion
• Ongoing financial reporting on AI bubble valuations

This episode is essential listening for anyone interested in the real, surreal, and darkly funny consequences of techno-capitalist mania.

Transcript

[Riley]

It is with great excitement that I would like to announce the newest joint venture in the high tech world between Crash Future Podcast limited, Formerly Oil Warehouse, formerly nft, Tax Loss Harvesting Service, formerly, I believe, several kinds of consulting firm, and maybe a private investigator. And our good friends at Better Offline.

[Ed]

And of course I'm representing the softbank Zitron merger we did earlier in the year. In which case I am now technically Masayoshi Son's son. And so we are related. He is my father and I am his son. Now I am Masayoshi's son. We are all Masayoshi's son on some level. Welcome to Better Offline and Trash Future at the same time.

[Nova]

Yeah, it's TF X Zitron.

[Ed]

Oh, it's beautiful.

[Riley]

I'm so excited to announce that between our two shows, which are our independent company and iHeart, we're actually going to be building a look Meta and Blue Owl have said they're going to be building a data center, an AI data center the size of, I believe, several Manhattans. But we are are building a podcast generating data center that will COVID 19 Staten Islands and cost only $1 trillion. Is expected to generate upwards of $50 a year.

[Nova]

People are telling me you're on too many podcasts. November and I will not stop. Not only am I starting more podcasts, but I'm also folding more into the existing podcasts. So pretty soon everything will be Trash Future. Yes.

[Guest]

Zoran's like trying to stop us from building the data center, saying that it's not viable. And to that I tell, I say to him, well, have you ever started a business that's been successful? No, you haven't, so shut up.

[Riley]

We all know that's one of the two things that can happen in New York City.

[Nova]

Yeah, I mean, this is really a really obvious thing. When you look at Zoram Namdani, you look at that guy and you say, that guy doesn't know a thing about being successful. I'm pretty certain that guy's never succeeded at anything.

[Ed]

Yeah, he's truly disliked by New Yorkers. That's the thing that I hear from them. They're not just like welling up with pride over his fourth of. They don't love the fact they fixed the Williamsburg bike lane. No, no, no. It's all just everyone sitting in their apartments in Connecticut where they live most of the time, other than the one day of the year where they come into New York to complain.

[Riley]

Well, OK, I did say 19 Staten Islands. What if we data centered over Staten island and just made it 19 stories. How about that?

[Ed]

Actually, based on everything I know about Staten island, the people there might approve, but they might, they might just be like, fuck it. We've, we've done our best.

[Riley]

We've automated Staten Island. No. Welcome to tf. Better offline. And here's the thing TF listeners have been saying to me, like in our discord and stuff, why haven't you covered the Masayoshi, the newest piece of, I guess outsider art published by SoftBank in the form of their investor presentation.

[Ed]

It's so beautiful.

[Riley]

There's always a lot in them. And Masayoshi san, your father, yes, our

[Nova]

I believe uncle has fucking podcast Napo babies.

[Riley]

There's always some visual metaphor. I think that Masayoshi san decides this is going to be how I communicate to everybody. The thing that Chad GPT and I stayed up all night for a month kind of coming up with.

[Ed]

Yeah.

[Riley]

And it used to be like flying unicorns, right? How they would fly over like the trench of despair and into like the future of optimism.

[Ed]

Yeah. The trench of coronavirus. Right? That was.

[Riley]

Yeah, the trench of COVID That was the one.

[Ed]

The valley of coronavirus.

[Riley]

Now this SoftBank presentation has, I would say, a different recurrent visual metaphor that starts around slide 4, 40.

[Ed]

And we'll link to this in the, in the notes so that you can behold the goose.

[Riley]

Yeah. So can everybody turn to slide 44 in your packs, please?

[Nova]

I'm there.

[Ed]

This is, it's beautiful. I am crying.

[Riley]

So what I have in front of me in case you can't Turn to Slide 44 in your packs because you're catching up on our investor presentation. Our presentation of SoftBank's investor presentation. Imagine you're an investor in SoftBank. Maybe you're a pension fund, you're Ontario teachers, you've invested in SoftBank. And Masayoshi San, you can see his face light up because he's about to give you his visual metaphor. Slide 43 to 44, transition. It's a picture of a goose and five golden eggs.

[Ed]

Yep, that's right. And yeah, the thing is, like, it actually does make sense when you read it 100 times because. Well, actually, let's go a little bit into it and then I'll give a full explanation because there is a logic. It's just insane.

[Guest]

Generally I love the graphics. Like, I've got a friend who's like, he does like his, his job is to sort of apparently upgrade decks. He goes like, he does consulting for like companies to be like, here's how you could make your PowerPoint presentations look better. Because I had a real, like, do

[Nova]

you pronounce it unionized or unironized moment there where I'm like, dex, like the thing you have, like, outside of a house.

[Guest]

Well, I mean, I asked him in terms of, like, what you mean, like Magic the Gathering, which. Which I guess would make more money.

[Ed]

But.

[Guest]

But I saw this and I sent this to him and he was. And he. And he. And like, his reaction, I think, was one of the funniest things that I've ever. I've sort of ever encountered. Every graphic in this presentation is a mixture of. Graphic design is my passion, but also, like, it's one, like, I sort of feel like it's actually ironically beautiful.

[Ed]

Yes.

[Guest]

This is amazing. It's an amazing.

[Ed]

It's genuinely beautiful because, like I said. So I must be clear, when the goose is SoftBank.

[Nova]

Right?

[Riley]

Okay.

[Guest]

The goose appears like seven times in this as well. Right?

[Ed]

Okay. So SoftBank is the goose. Masayoshi Son is the gander. Masayoshi mounts and impregnates SoftBank, by which I mean it invests money in companies using SoftBank's funds. At which point the goose, which is SoftBank, becomes pregnant and the portfolio company grows larger. Then it lays the egg. The portfolio company goes public. Basically, SoftBank is a company that invests in companies that then go public and make SoftBank money, in theory. And Masayoshi Son just vigorously, you could

[Nova]

more normally call this like an incubator, but instead he's picturing himself as a virile goose.

[Ed]

Yes, exactly. He's just. He is just like, absolutely going to town on the goose of SoftBank every year.

[Nova]

Jesus.

[Guest]

Jesus.

[Nova]

Just. Just sort of coming up to the. Coming up to the lecternate, grasping it with both hands and talking to a lot of people who have real sort of influence in terms of capitalist central planning and going, I've been fucking gooses.

[Ed]

Can you imagine, like, being a major investor in SoftBank? The Japanese government is invested in this company through ETFs, like, and you're just like, great. Wonder what Masayoshi Son's got for me this year. And you're just like, the. What, what, what?

[Nova]

I think the sort of interesting question about this slide deck and about Masayoshi Son himself is like, yes, there is a logic if you work hard enough. This is also true of the ramblings of someone experiencing a florid mental health episode on public transport. Who we've, you know, decided as a society now, I guess it's okay to kill that person, but it's not okay to kill Masayoshi Son. And I don't really know how to reconcile those two things.

[Ed]

Not to say that we approve of that for legal reasons. Just to be. Just to be clear.

[Nova]

Yeah. I mean, that's your dad. I wouldn't say that you should leave.

[Ed]

He's my father.

[Guest]

Alone.

[Ed]

Anyway. Sorry, Riley.

[Riley]

So basically, and this is the mental health point, I think is interesting, right, because there's this idea that's been going around, it's been going in legitimate business publications that CEOs are getting AI psychosis.

[Ed]

Yes.

[Riley]

It's just that because they're CEOs when they get AI psychosis, they don't get on the path train and have a heart attack while trying to meet their fake girlfriend from character AI, which more or less sort of actually happened to somebody.

[Ed]

Yeah. Details slightly different, this AI specifically.

[Riley]

Yeah, yeah, yeah. But in this case, they get up on stage and they say, I have. I am destined. I am destined to bring about the birth of an artificially superintelligent God through this goose. That has historically not been valued. Because if you turn to slide 47, you'll see the main problem is goose was not valued.

[Ed]

Yes. Goose value zero. And I think of. I don't know if you remember the Rob WISMAN Fake Uber YouTube thing. The listeners are going to love this because it's just. And it's just him going, uber driver sucked me off. And he's just like shrugging. I just think, like, goose value zero, zero. It's really good.

[Riley]

Imagine this in the. I imagine this in the Dark Souls font. Goose not valued.

[Nova]

Well, this is the thing, right? What we've got here is. And I think it's interesting, the AI sort of cyberpsychosis thing, because Masayoshi sometimes is very open about using AI, spending a lot of time talk, talking to AI, really internalizing and personalizing the AI for himself. What we've done is we've done a kind of like European medieval royalty thing where we've created a kind of system where if you are at the top of it, you can have the delusions and society has to conform around you. You are the king of France. Everybody has to act like you are made of glass.

[Ed]

Oh, God. It is. It's just Versailles. It's digital Versailles. It's just that, like, everyone stinks. Everyone's weird. There's like, it's either shit or oranges in the air. No, everyone's just like, wow, we all love loops now, right? And everyone goes loops yeah, yeah, yeah. I love loops. Loops are the best. Where we hate. We hate the other thing now.

[Riley]

And so each of these eggs is a trillion yen. And the market saw only the eggs, which is the value of the companies. But the goose not valued. Goose not valued. Goose value zero. Yeah, goose value zero. But in fact. But it says eggs do not lay eggs. And it was the goose that created the value.

[Guest]

Many people are saying that I died this whole time.

[Ed]

I had it wrong. I thought the eggs laid the eggs.

[Riley]

Yeah.

[Ed]

Fuck.

[Nova]

It's very funny to have a sort of like arch capitalist go, wait a second. This business doesn't create any of its own value. And this value's gotta come from somewhere. So I assume it's from, you know, analogously a goose and non. Analogously me.

[Riley]

Yeah.

[Ed]

So yeah, I've been doing the haters guide to softbank and they just went out. So like very fresh in my mind. And the thing that you'll note when you look back at Masayoshi san is he's a terrible fucking investor. Like historically bad. Other than like four times when he was amazing. He bought Alibaba at $20 million, invested it, put 20 million in worth about $100 billion equity value at the top, sold it for about 30 billion because that's Masayoshi son. He bought ARM for $32 billion, took it private and then took it public. Now it's worth a bunch more money. But Yahoo. Japan is the craziest one. Like classic loser company, Yahoo. But it turns out that he managed to, through one of his weird joint ventures, stop it from being absorbed into the problematic Yahoo. So he accident. But every time he does something. Well, it's by accident. Every time. He loves also, I swear this is true. He has a thing for whimsical white boys.

[Nova]

Like, well, who doesn't?

[Ed]

I mean the Greensill, like Lex Greensill and him used to talk on the phone every day. He invested in WeWork in 28 minutes. They signed the $4.4 billion deal in the back of a car on an iPad. And it was like 2017. So the iPad wasn't very good at the time. So they're just like this fucking like clunky. Probably cracked like across the front font, probably 72, just like, no, we must do this. We must do this now. We have to do this.

[Nova]

I'm being whimsical in front of the wrong people.

[Ed]

Exactly. No, I genuinely think that if I got in front of Masayoshi son For maybe 10 minutes, I could get $7 billion.

[Riley]

But he is Your father. So you hope that you will. He will give you the time.

[Ed]

I wish all of this could. I wish I could get in front of him. I wish I could just tell him some of the great ideas I have about like, I don't know, look, I have a newsletter with 108,000 subscribers. Masayoshi son. What if it had a trillion subscribers? Huh? Right? And he'll be like, whoa, that's.

[Nova]

And we're in on the ground floor of this. We can get in.

[Ed]

That's a big number, Ed. I'd love to invest $7 billion. And I'll be like, I think that should be good enough to get us started. Masayoshi son. Another $10 billion and I guarantee you a trillion subscribers will happen by. It could be as early as 2090. Easy peasy.

[Nova]

Well the thing is, right I think this is a good start.

[Riley]

Right.

[Nova]

But we've got to aim higher.

[Ed]

Okay. Okay.

[Nova]

So like yeah, what we do is we get you in front of him and we say all of this. But then you know, as he's sort of like he's warming to you, you see that he's kind of receptive to this. What you do is you switch it up, right? You lean forward, you jump out of the seat, you grab him by both lapels and, and you look him dead in the eye and you say and I'm going to invent God.

[Ed]

Oh yeah. And how he loves that. And here's the thing. How do Christians like get a relationship with God? The Bible, a written document. What if the Bible could be emailed to people every week? Every week they email the Bible. That's what, that's what where's your head at Is. And Masayoshi Son by this point is just. He is taking out a margin loan. As I'm there he's like calling his back like I need every dollar. I've got. Sell it all. I need to back this, redirect all

[Riley]

of it from OpenAI. I've got a new person who has recently who told me they're going to build God most recently. So basically because that's a little like we work was supposed to be heaven on earth like that was the pitch is that that you could remake, you could remake a kind of prelapsarian, non alienated community. You could have Gardens of Eden everywhere was the point. But just at office sharing that same thing with flow. That's supposed to be that too. It's just like no, no, we've got a much, a much more abstract God.

[Guest]

Yeah.

[Riley]

Any case.

[Ed]

Yeah, yeah. Sorry, back to the geese.

[Riley]

So back to the geese. Can we focus on the geese on this technology podcast, please?

[Nova]

Sorry, I got us off of goose. My bad.

[Riley]

So eggs do not lay eggs, obviously.

[Ed]

Obviously.

[Riley]

And so I've heard this, the mission to go, how do you go from 3 eggs to 74 eggs? The increase of 71 xload more geese

[Nova]

and Masayoshi, someone's got to start fucking them.

[Riley]

It was the goose that created. It was the goose that created value. So the value came from the goose. I think I read that in capital. Yeah. So goose value is 71.

[Nova]

Right.

[Riley]

So goose value 71. And people didn't value the goose at 71.

[Ed]

No.

[Riley]

What matters is not the eggs, it is the goose itself. And true value is the power to keep laying eggs.

[Ed]

Right.

[Riley]

And because of this, he estimates that in the next 16 years, he will be the first yen based quadrillionaire, or at least softbank will be a goose worth a quadrillion yen.

[Nova]

I'm not sure what affects me more, the fact that this is written so much like sort of serial killer taunting the police or the fact that it kind of appears to maybe be working.

[Ed]

Well, the thing is, it works because Masayoshi Son is able to keep getting debt and genuinely, had OpenAI not come along, Masayoshi son might have been fine. Aam turned out so well as a chip maker. He's been able to do basically unlimited margin loans. And he was ok. He could have been fine. But then the whimsical white boy apparated in front of him and he was like, okay, this is it. This is my boy. I will give him. He took out a $40 billion margin loan. Not margin, sorry, a bridge loan. It's a year long loan.

[Riley]

Yeah.

[Ed]

Jesus Christ.

[Riley]

If you want the story on bridging loans, refer back to our episode with Rob Smith about bridging loans and what kinds of things they're for and what kinds of they usually have. So the true source of the value. Could everybody Please turn to place 55. This includes everyone listening. Okay, great. On your, on your packet. So the true source of the value is the golden egg factory inside the goose.

[Ed]

Yes.

[Riley]

And then it actually gets helpfully broken

[Nova]

down like a womb, I guess.

[Riley]

Well, so the goose here is Softbank bringing out artificial superintelligence. And the internal mechanism is an AI generated factory of eggs that are also labeled artificial superintelligence.

[Guest]

Yeah.

[Ed]

Each egg is asi.

[Riley]

Right.

[Ed]

But eggs used to be. Eggs used to be just a trillion dollars of yen, but that. Sorry, a trillion yen. So like six something billion dollars. Well, I don't really know what the eggs mean anymore other than asi, which is. It's kind of like a. Was like Ben Garrison cartoon, like.

[Riley]

Well, I mean, this is where we want to go. I want to go back to what Nova was saying about mental illness, right?

[Guest]

About.

[Riley]

This is someone who. Because we know what happens with Masayoshi san. We know he talks to ChatGPT every day. He's like one of the. Probably one of the world's biggest users of its like, talk to you function. And he has been convinced by it that he's going to build God. But because he is a. Because he is one of the central economic planners of the global economy, he gets to allocate capital according to his delusion, as opposed to the poor schmuck dying on the PATH train who just gets like scraped off the wall that Masayoshi san gets to fucking run through. Yeah, it's a bit like the Peter. A bit like Peter Thiel, I think also went crazy with AI has gotten more unhinged in public. For example, he recently said that the Pope is a Chinese Communist Party agent, which he's not supposed to know, right? Look, that's. You're not. You look. You don't have any way of proving fairness.

[Nova]

In fairness, the odds of him having figured that out were crazy low. So like, it's no shame. Shame on the Vatican. But like, Jesus, guys.

[Ed]

The other thing is as well is it's like on top of just the ridiculousness of this, and if you had a homeless man on the tube saying, true source of values, golden egg factory. Inside the goose, you see the internal mechanism, right? What you see are the eggs that produces them is the factories. You would like, hopefully get them the help they needed. But because he invested in Alibaba, we have to like take this shit seriously. Now. Slide 56 is also good because he invents a new kind of goose math where egg value.

[Nova]

You've been wasting on this. I've been using Terrence Malick's old goose math.

[Riley]

You've heard of girl math? Get ready for goose math.

[Ed]

Well, it's like goose value Alpha. I don't know. I'm not going to come up with a natural thing because SoftBank is a valueless company outside of the things it holds. It is just a large holding company that is kind of a big part. It's like the second or third largest company on the Japanese stock market. And it's like that. The other thing that I keep coming back to that really isn't shown here is that's not actually the net asset value of SoftBank. Like that's like I'm going to just go right, like the net asset value right now is yeah, 40 trillion. Like this is from SoftBank's own website. So what he is doing here is he's like, yeah, I'm adding the other 30 trillion from OpenAI. He's just adding. He's just making up how much OpenAI is worth. And as eager listeners will know right now, Masayoshi Son tried to get a margin loan on this OpenAI stock. All of it. And yeah. Then couldn't. The banks were like, no, thank you.

[Riley]

I was going to play this game later but can we get an applause sound effect please? Because we're going to have an impromptu episode of everybody's favorite game show with. With so far its only contestant, possibly host Ed Citron. Welcome to. Is that good?

[Ed]

Yeah.

[Riley]

Ed, thank you for coming on the show.

[Nova]

Sprinting. Sprinting down from the audience.

[Ed]

Yeah.

[Riley]

Chosen again.

[Ed]

I really hope I get on.

[Nova]

Is that good?

[Ed]

And Zetron, my fingers crossed, like

[Nova]

do

[Guest]

you have like a phone, a friend option on that?

[Ed]

No, it's just a switch.

[Riley]

It's just an unlabeled switch. So Ed, thank you for playing as that game.

[Ed]

Thank you for having me.

[Riley]

So, all right. The situation you just described where Masayoshi san, who's already borrowed a lot of money to invest in OpenAI, essentially like a sports gambler paying for his bets by borrowing from the mob. The bet on Open, if you can't roll over the bet to keep on doubling down on the bet. Is that good?

[Ed]

Yes. Cool.

[Riley]

Thank you. No further questions.

[Nova]

Again, it's amazing.

[Ed]

It's just really funny as well because literally the. We keep coming back to the point. Literally the only reason we don't treat this man like he's an insane person is because he is. He hasn't blown himself up yet. Like he really. And it is. Yeah, it's like he has taken out so much debt on OpenAI, like way more than we work, like historic amounts. And he's just. And he's even the more I think about, he's doing goose fraud right now. Like he's like 57, claims $74 trillion of. Of egg value or shareholder value. And that's not what's on SoftBank's website. It's $30 trillion. Sorry, it's 48.26 trillion yen is the equity value of holdings that's lower than 74. I'm pretty new to goose math, but I can see that that is still a. Drives me insane actually. Because in a world of deep equality Masayoshi son gets away with it only because he's a whimsical man out in Japan.

[Nova]

Like

[Riley]

because he's fun.

[Ed]

He is. And the thing is people you like, oh, we got a psychosis. It's like I think he might have had it already like without.

[Riley]

He just got it from world's first case of world's first case of AI psychosis inflicted before 2022. Well, can I first person to get AI psychosis from GPT2.

[Ed]

I actually want to read you a quick quote about Masayoshi Son from an article. This is. I promise you this is worthwhile. It's actually very important to understand the whole goose thing. So from Kakashi, great pseudonymous analyst guy I follow. So okay, his dad was talking about him and 6 year old Masayoshi san. He was sumo wrestling his older brother and losing badly but he refused to stop when his father finally pulled him away. The boy's eyes were in Mitsunori's words, his dad like an animal's a wolf's eyes. I thought to myself this bastard is not human.

[Nova]

Doing hype edits for your son like play fighting is really funny.

[Ed]

I just really like the idea of him just getting his ass kicked when he's six and he's like, he just turns around. He just has like demon eye.

[Riley]

Like world's first person to have laser eyes in real life. Look, here's the thing, here's the other thing, right? We're talking about Masayoshi san's life. The presentation concludes with what used to be his 50 year life plan but now is his 60 year life plan.

[Ed]

This is so good.

[Riley]

So his 50 year life plan was get acknowledged in your 20s, finance a war chest in your 30s, in your 40s, take on a challenge in your 50s complete business.

[Nova]

Love to do that.

[Ed]

Just like a fucking like it's any of them. Just any of them. Like an 18 year old girl's Instagram

[Nova]

post

[Riley]

or take take on a challenge.

[Ed]

Sure.

[Riley]

Remember ice bucket challenge for ALS in 2011 take on that challenge done to finish the decade 50s complete business. Okay, so complete all the business handover business to next generation but no fucking crossed out. No crossed out. This is the 60 year life plan. 60s crossed out handover business to next generation gone. It's not replaced. It now just has a 70s value which is realizing ASI or artificial superintelligence a similar a term that's sort of

[Nova]

used in her this Is like not a new hubris. Right. You could have done this at any point in human history. There were guys back in the day whose life plan was 20s unite Southern Song Dynasty. 30s conquer Northern Song Dynasty. 40s establish mandate as Son of Heaven. 50s alchemy. 60s alchemy. 70 never die.

[Guest]

I feel like it's missing like a little detail. I feel like you need like a bit of a side quest to sort of really make this fun. Like, you know, you should like, you know, 55 start a band. I don't know, there's so many like, yeah.

[Nova]

60 learn to ride a motorcycle. No, in this case it's really just like the most obvious thing of like. 20s conquer entire known world. 30s weep because there's no more worlds to conquer. 40s build giant statue. 50s start reinforcing statue at legs.

[Ed]

Yeah. I also want to be clear. It's really funny to do this insane hour and 50 minute long presentation where you're like slide four JPY one quadrillion and then just be like, and I'm not retiring for at least another decade. Fuck you.

[Nova]

I don't think that I live in a functional enough economy or society to have a life plan. Like my life plan is like 20s fuck around with mental health and drop out of uni. 30s podcast, 40s podcast, 50s podcast. 60s climate wars maybe.

[Riley]

Yeah. Woke battalion and climate wars.

[Nova]

She thinks the climate wars aren't gonna start until she's in her 60s. Fucking idiot.

[Riley]

So this is. But this, basically this is the story of someone who has. I think we come back round to this. Cause I think it's very important. Someone who has been driven to mania about this thing, but who happens to be able to force that mania upon everybody else.

[Ed]

Yeah.

[Riley]

And you know, one of the things I wanted to dig a little deeper into actually is his claim that artificial superintelligence is coming. Artificial superintelligence, artificial general intelligence I think are used pretty interchangeably. He uses artificial superintellence.

[Ed]

That's basically the same thing.

[Riley]

Yeah. And so basically Masayoshi san and Sam Altman are now. So Sam Altman's guys, excuse me. Told Masayoshi san probably in the. We just need another. Can you take out a loan to give us a loan? Said that an AI model is designing the next future AI model at OpenAI. Ah Son said you can't see the

[Nova]

model or anything to do with the model. Read this like philosopher got in to talk about, you know, the fucking constitution or whatever.

[Ed]

It's just like it's. They find a new key to jingle and it's like, well, why don't we invent, I don't know, make the model do something new. It's like, what if we just made the model do that? What if we just fucking, you know, like, the model could do the model stuff and we could just sit here and take the cash. Masio. And like, it's the laziest thing in the world. It's like, if any other situation, it's like, I'll have someone else do it. You'd probably be like, they'd be like, well, no, you've gotta do something. I gave you 40 billion doll. Like, probably want to do something with it. But Masayoshi Son's like, hell, yeah. What's funny is Masayoshi Son, Sam Altman came to him in 2017, I think, and asked for $10 billion. Masayoshi Son said yes. But then Sam Altman just kind of walked off and took the money from Microsoft. And that drove Masayoshi Son insane. He was like, oh my, I missed out the one that got away. And now I will shower her with jewels and gems. She will be mine.

[Riley]

Yeah. And like the time to get it. If you wanted to sort of make money on that, the time to get in was then and the time to get out is now.

[Nova]

Yeah.

[Ed]

He really.

[Riley]

Financial advice, by the way.

[Ed]

Worst times, he's only. I would say maybe if OpenAI goes public, which is now an if he might have done very well based on the first 40 billion, the next 30 at the highest possible valuation. Insanely stupid. Just. And also these hogs are going to need more money than this $30 billion is.

[Riley]

We're going to go into that? Oh, yeah, we're going to go into that. We're needing more money. But just before we move on from sun, he said, so that's going to happen to all the major models. So once that happens before we move

[Nova]

on from sun, like, there will be blood.

[Riley]

So once that happens, the model generates the next model and it's going to be exponentially smarter than all of us. That's a super intelligence. In my mind. I thought it was coming in four years instead of the next 10. Now I'm saying it's coming in the next two. Then the CNBC article goes on to say the SoftBank CEO says he currently uses OpenAI's ChatGPT for up to three hours a day as the AI is smarter than he is on, quote, most subjects.

[Nova]

That's so I believe that three hours

[Riley]

a day is so if you're awake for 12 hours that's a quarter of your time spent just talking to the. The mirror that drives you crazy. That's cool. It's what if narcissist wasn't just sucked into the pool but also driven mad by it.

[Ed]

It's just. It's so good as well. Because the grander theme of this it's pretty much all of these CEOs have AI psychosis because usually even with human beings there is a limit to how many ideas someone will say are good or at least before you fire them. With an AI you can just berate them into any idea. You could just be I heard a story of someone at a major tech company where they weren't. They didn't have security access to access something and they just said actually yes I do to the internal LLM and it gave it to them like it's just like this is just like anything it disagrees with. You could just be like actually that's true and it'll go yeah, absolutely. Yeah sure. Like just so can you imagine the shit he's saying? You know, you're exactly right. The goose will lay golden eggs forever. You're absolutely right. Just the I would love to read his logs. I'd love to read the insane back and forth he's having with them.

[Riley]

Masayoshi san, your understanding of goose biology isn't just detailed, it's prescient.

[Nova]

So in fact ChatGPT role playing as a goose with him.

[Riley]

No, I think you need Grock's adult mode for that.

[Ed]

I show my blue mish

[Riley]

so here's what you've said actually Ed about Masayoshi San and OpenAI. If OpenAI doesn't go public, there's a very real possibility that SoftBank collapses or at the very least is forced to finally put an end to the era of unrivaled financial risk. It's easy to like Masayo Shison to laugh at his goofy geese related presentations and I'll say as a side note it is and his ridiculous statements about the future. But in reality he's a deranged, delusional man with too much money and a few lucky breaks that have saved him from annihilation. His future lies in Sam Altman's hands and if this is what finally ends his wasteful reckless reign, it's a well deserved punishment for believing every damp quirked up white boy to beg him for a billion dollars. He's an enabler enabled by other enablers that's created a culture of unbelievable risk and destruction. Yeah, tell me what you really think

[Ed]

that guy is smart. But it's really funny as well because we live in. My girlfriend brought this up. There's a Twilight Zone episode where there's a kid who, if he doesn't, if he doesn't believe you're happy, he turns you into an ear of corn. We basically live in that society now where it's like all of these CEOs get COD. The AI bubble is just a large coddling. It's just like, yeah, the rich people always have good ideas. We must orient ourselves around them. Despite the fact that most of the industry's revenue is either anthropic and OpenAI or anthropic and OpenAI paying for the compute to lose money. Like, it's not even sophisticated. It's just that it's people nibbling around the edges. And Masayoshi Son, literally, I must be clear, had he just not invested in OpenAI, SoftBank would be doing great. It would be. It, it would perhaps not have had the massive on paper gain of OpenAI stock going up, but like, it probably also wouldn't have needed 40 fucking billion dollars. 40 billion dollars. It's just, and I, I wasn't able to add up all the debt and do a deep analysis of that part yet, but it really does seem that at some point he's just not going to be able to refinance the loan and run out of money. It's just like a teenager with a credit card, except it's $150 billion of debt and there's goose involved.

[Riley]

And what SoftBank is doing via OpenAI right now, this is a very refreshingly candid Telecoms.com article, is that it's going to take on additional debt in order to build data centers. More data centers in the U.S. tens of billions of dollars in AI data centers in the U.S. and giving more money of that to OpenAI. So the data center project is called, I believe, SB Neo.

[Nova]

Yep.

[Riley]

And they are going to again, say, okay, we're going to build 10 gigawatts of data center. Right. But, but quick question. We talk about data centers a lot, you and I. We talk about data centers a lot on this show. You and I talk about data centers a lot. Do you have any of the enormous supply chain bottlenecks that have largely prevented data centers from being built? But yet let alone the sort of, let's say, lack of demand from outside the industry for their services, are any of those bottlenecks alleviated? Can you get a gas turbine right now?

[Ed]

No. And the thing is as well is Just data centers are taking like 18 to 36 months to build. So him saying, we're going to build five or 10. He did a thing with France as well. It doesn't bear repeating. Something with Emmanuel Macron and he's like, they're building 5 gigawatts there, 10 gigawatts here. You may as well be talking about the year 2090s, like, because just, just the speed of construction. Put aside any thoughts I have about the AI bubble. The speed of building these things is very slow. And that's before the power comes in. It's just the power doesn't exist either. Again, if you took away the money, this person would sound fucking insane. Well, they do right now. But like, you would laugh them out the building if just a random guy was like, I'm going to raise 10 gigawatts. So a trillion dollars, because a gigawatt is now $100 billion trillion dollars. I'm going to raise a trillion dollars for a data center and then one company's gonna rent all of it. And yeah, that company loses money, but, like, they won't. And anyone else, you'd be like, you sound like a moron, man. But because it's Mashiyoshi Son, because it's obnaii's Sam Orton, because it's Dario Amadei, you're like, oh, yeah, yeah, absolutely. Yeah, absolutely. That makes perfect sense.

[Riley]

These are the guys, they're the guy, they're the pharaohs. All things have. And with inequality accelerating with the bets, the actual bets on the future getting better, getting smaller and smaller and smaller and concentrated on a smaller and smaller number of big hands, if you like, you get a kind of, you sort of rebuild like a pharaonic system of kingship from first principles, where, you know what, you, you can just be like, you know what? We're working, we're monotheistic now. Egyptian polytheism is done. We're gonna try monotheism for three generations. And you. But like, the problem is also being in a pharaonic system like that, with sort of this much concentration of, you know, with this much allocation of productive capacity to madness is quite, I'm going to surprise you, quite damaging. Because the question of can you get a gas turbine that's super important for lots of stuff other than AI data centers. It's just these data centers are in some cases because of political pressure, like in the uk, able to skip the queue for certain kinds of planning or grid hookup capacity or, you know, they're just, they're clogging up the order book for these things that will just get deployed to these data centers that we're going to explore. If people are, let's say using enough and profitably enough to make them viable and all those spiking infrastructure demand has now is now going out to other. It's like spreading through other pieces of infrastructure. Hard to build infrastructure equipment.

[Nova]

Riley, quick question.

[Riley]

Yeah.

[Nova]

Has anything else happened recently to maybe fuck up like global infrastructure at all?

[Riley]

Something in the World cup maybe? Yeah, the England win.

[Ed]

People watch the World cup because I kind of feel like the Straits of

[Nova]

Hormuz fucking up the supply chain for this and everything else is sort of like one point on the sort of trifecta the palace logo of we are really fucking bad at long latency stuff as people. So like, I'm sure all of the consequences of this will just be fine for an extremely fragile, sort of delicately balanced goose fucking portfolio.

[Ed]

But that actually leads me to an important point which is let's take the AI people at face value. Don't know why we're doing that, but let's do it. They are saying because Based on Nvidia CEO Jensen Huang says trillion dollars of GPUs visibility sales through the end of 2027. It's about $400, $500 billion a year worth of AI compute revenue. Just needed to pay for that. Put aside my thoughts. Just like you need that. This is not a hyperbole. This is like you need that money. The demand doesn't exist. But on top of that they are just saying, yeah, the AI bubble is going. The boom, even in their mind is going to just keep going. We're just going to spend $3 trillion on this every year. And when you ask them how that works, they're just like, the money will be there. The money. How are we going to substantiate? The money will be there, the money will be there, it'll happen. The demand's there. And you're like, well, there's compelling proof it isn't there. And they're like, well it will.

[Riley]

And it's a great way of magicking away these long latency problems you bring up nova, like climate change, for example. We were talking earlier, it was like, well, well, the warming that's happening now was from emissions from, I don't know, 40 years ago, whatever. Right. Like this is all baked in.

[Guest]

Yeah.

[Nova]

If you stopped any CO2 emissions like today, we would still be locked in on decades of warming, which is really going to fuck up my life plan, I think.

[Riley]

Yeah, that's going to climate wars in the 60s. Come on.

[Guest]

Yeah, you're going to have to add another decade.

[Riley]

But their answer to this, the way that the AI comes and forestalls actual good long term latency planning is it's like, well, the AI is going to be smarter than us because it's going to be super intelligent. So we won't have to solve long latency problems. We don't have to worry about the fact.

[Ed]

I love that.

[Nova]

Well, that's a relief, to be honest, because I hate solving problems. And to be Honest, in my 60s, I'm hoping to get into like alchemy. So.

[Riley]

So here's another stat I picked up, right. Which is it's no longer. It's not just gas turbines anymore. High voltage transformer lead times have gone from 12 months to 48 in some cases. So good luck. So for example, at a time where we need to do, let's say an energy transition or a time when, say even just in the uk, right, national level grid upgrades are more or less needing to happen in the next 10 years or gonna be like rolling blackouts. All the high voltage transformers you can order are going to the God machine, which will then solve the grid problem some other way.

[Ed]

I just love the idea. We'll work it out when we work it out using the working it out machine. Just keep giving it money and then it was fucking duh. At some point, you know, you work it out. What are you being a quat by it? Wait, come on man, just give me 10 billion.

[Riley]

You're being, you're being lame.

[Ed]

You're being lame, man. Come on.

[Riley]

So, and also it's like another thing is really funny that this fear is always, oh, AI is going to be a paperclip maximizer. Right. The entire, the whole world and universe and all matter will be made into paperclips by an AI. But if you look at what we're doing with data centers and we're going to go on again to the profitability of them in a second because some stuff has happened there is you don't need the AI to be a paperclip maximizer because capitalism as a system is already maximizing the paperclips in the form of the data centers. We're cannibalizing useful things to build this that you can't upgrade the grid anymore because all of the transformers are being turned into effectively paperclips.

[Ed]

Yeah.

[Riley]

And I know that's not even touching databricks, which is another N scale type snafu that got uncovered by a similar

[Nova]

that you can be saying that Riley.

[Riley]

Sorry, sorry. Check out no Gods, no mayors. But we'll go into that on Thursday. I wanted to talk about some profitability stuff. Right. As we mentioned that OpenAI's going public is now an if in that earlier episode of Is that Good that we played. So I actually want to quote from friend of the show Mike Isaac. The Wall Street Journal reported that the company planned to go public by the end of 2026. OpenAI said this month it had filed confidential paperwork with securities regulators to kick off the process. A trillion dollar valuation of the public market which would exceed the market capitalization of Walmart would be staggering for OpenAI, a startup that is not believed to have turned a profit and is aggressively spending on new data centers. OpenAI's advisors presented company executives with the option of waiting till 2027 or lower the target valuation for a quicker IPO. Mr. Altman responded that any change to a trillion dollar valuation was a non starter. I assume this is me editorializing because he's in a pissing contest with Elon Musk.

[Ed]

I mean I think it's also the. So their last pre money so before the cash they actually raised valuation was like 730something. So a trillion dollars would be a 30% premium. Ish. That's not a lot. And the fact that the bankers are saying that they couldn't get that because I'm reading between the lines but I mean that's what's happening. They clearly talked to some advisors who were like, you know that's a negative. That's worse than people are giving this credit for. If you can't get a 30% premium it basically means all of your private investors at the last round fucked up because you're not even get like a good venture capital return would be like 3x. You're not even getting just 2 like it's. You're genuinely making nothing here. And also they're saying they couldn't list at 1 trillion so they probably wouldn't be able to list at much above 800, which is fatal. I mean just. And this is fatal for SoftBank as well because SoftBank needs OpenAI to go public. But it's just like these things. The reason we keep having bubbles is because when stuff like this happens the media and a great many different people immediately move not to go hey that's a problem, we should fix that. Or like hey, we should be worried about the company that's become the single focus of everyone isn't gonna make it. Instead it's like, no, no, no, let's rationalize this bad boy real quick. Let's enable the enabler. Like we need to make sure we keep this. And it's just completely nonsensical. And to be clear, when this explodes, I'm going to be ripping holes in anyone who tries to be like, how did we not see this coming? You didn't look, is the big thing.

[Riley]

Well, because the main, the thing that is at the bottom of this is always the unit economics. And what I think is very telling is that Open Air executives and talking about the IPO said, well, the company's moving in the right direction because more than 5 million people use Codex on a monthly, on a weekly basis. The company said, now more than 5 million people using Codex on a weekly basis. Pretty good. Which means, I assume they've solved their unit economics problem and that's not costing them a huge amount of money.

[Nova]

Yeah, they've definitely avoided, they've gotten out of the sort of thing that they were doing of just going, hey, AI is free until everyone uses it and then they can start charging what it actually costs. Right, Right, Yeah.

[Ed]

And what's great about that is they did that and they were like, okay. And now they jack up the price and within one month they're like, oh, everyone's like, we gotta limit the cost of this just immediately. And by the way, on a 200 buck a month subscription to ChatGPT, you can burn $14,000 worth of credits of tokens. Jesus, it's so good.

[Guest]

It's.

[Nova]

I mean, so this is the thing. We've had everybody panic, right? And go, oh God, it's expensive. Now we gotta like maybe think twice about using it. They're still charging a fraction of what it cost. Just a slightly smaller fraction.

[Riley]

A slightly larger fraction.

[Ed]

Yes, exactly. And amazing.

[Nova]

And also instead of it costs like I have $14,000 for a dollar, you can set that on fire in front of me. What they've gone is it now costs $2 to do that.

[Ed]

And everyone has, well, what's happening is it's a little different from that where it's. The enterprises are having to pay the actual per million token rates. So they, and they, this is, it's really, it was actually a very funny punchline setup because all of the business idiots who've been using AI who have got AI psychosis told all their people because they were all able to burn as many tokens as they like, use this constantly, use it for everything. If you don't use this, I'll kill You, I will shoot you with a gun. And then the moment that they, because in, I think it was March or April anthropic and OpenAI were like, okay, you're gonna have to pay on a per million token basis within one month. Were just like, John Major star. Like, I've got austerity measures. We've got to be very careful with the cost of a out. We couldn't, couldn't possibly. And it's just so funny because it's like, even if they cut the price in half, it's not clear if that would actually fix the problem because you can't measure the ROI of any of this. So it's just a certain degree of like, great, now it's half of. Half of a thing that we still can't measure. So we probably have to cut that too. It's just, it's truly ludicrous. It's genuinely, I mean it's genuinely hilarious as well.

[Riley]

I mean, I know. Have you, have you heard of the new plugin for Claude called Caveman?

[Ed]

Oh yeah. Where it's just like, it just gives you very simple single sentences.

[Riley]

Yeah, this is a plugin. That was you. That is, that is useful to, let's say, be austere with tokens by saying, okay, well maybe we can save a little bit of money on our token budget if we make Claude be kind of rude and abrupt. I don't think that says anything good if that's, if that's the solution you're using.

[Nova]

It's kind of funny how much of the cost of this was making it glaze the user at least.

[Riley]

And so in late June there has been this huge. It's not because this is not just prices rising. There's been a huge sell off in names across the stock market related to AI Nvidia. SpaceX by the SpaceX already is down like hundreds of billions of dollars from its post IPO pop. So if you thought you were going to get on the Elon scam, you got hosed. But this is also related to Microsoft, Alphabet, Amazon and Meta all suddenly becoming like high capex heavy industry companies more or less overnight. So the customers of these companies, right, they're the ones who are supposed to provide the money to help them lose money more efficiently, still aren't able to capitalize on them. Like consulting firms aren't using it to get better. Banking companies aren't using it to get better. You're not using it to really generate a lot of return on investment. And so more and more people are realizing this Subsidized pricing is coming up against reality and that exuberant investment pop is that's been happening for the last little while. Those names are beginning to go down. In fact this is from Katie Martin in the ft. The once vaunted Magnificent seven stocks, an imperfect but nonetheless go to gauge of hyperscaler performance performed slightly worse than the UK government debt. Mm.

[Nova]

Oh, how are you a worse investment than Keir Starmer?

[Riley]

Yeah, that's like, that's like at the World cup. It's like getting rolled by Qatar at the World Cup. Like come on, you shouldn't be beating us.

[Ed]

Can't believe they did that to a poikia.

[Riley]

And I mean this is. The bank of International Settlements is also getting it on this as well. Yeah. Now suggesting that with the five largest hyperscalers setting to spend over a trillion dollars on AI related capex from 2025 through 26 that the commitments are outpacing earnings and free cash flow leading some to issue debt to raise additional financing. And that again the bank of International Settlements is now saying this is now, let's say a significant global risk.

[Nova]

Yeah, one of those guys.

[Ed]

If only someone had fucking said something. It's so funny as well when like the BIS put that out. So like the central banks and immediately I saw an analyst, this guy called Daniel Newman on Twitter who is a massive word. I won't say it was just immediate, like what was this? A press release? A press release from the haters? It's like no, it's a statement from the central bank of central banks. You're a financial analyst. But this is the media behind this. The media is just like immediately ready to just attack any bad sign. And it's very strange. I know it's always been like this but to see it reach its kind of pornographic heights. I think it's just that the data centers are too easy to invest in, the AI companies are too easy to invest in. There's so many places to put your money and they're so brain damaged from years of ignoring the consequences of their actions that they don't think anything can go wrong. Masayoshi's son, all of them, I mean all of the data center operators, same deal, hyperscalers, same deal. They all think that they have found the Mandate of Heaven printer.

[Riley]

Yeah. And like the thing that was that the test is it was this, the Mandate of Heaven is, is this going to, is this going to do. To like knowledge work, for example, what containerization did to stevedores. Is this going to do is. Is this going to be like the great enclosure of the digital commons once and for all. Is this going to be the thing that creates the new, I don't know, six person ruling class of the entire world by fundamentally transforming the economy with this like huge technological displacement of labor? Like that was the actual question, are you going to do that? And on day of recording, to which

[Nova]

the answer is, yeah, I reckon probably sounds good.

[Riley]

Well, here's the great thing and look, this is inferential, this is not deductive, this is not provable. But the Wall Street Journal has posted that Big Tech has suddenly flipped on the AI jobs wipeout scenario where they've collected some, let's say, barometers of opinion from the big guys, the Sam Altmans and Dari Ahmadai's and stuff, surveys, and they've said, hey, wait a minute, looks like all those jobs aren't going away. A lot of people were still fired with AI as an excuse. A lot of them got rehired in some cases. But this is excerpt one that the Wall Street Journal quoted a year ago. The message from many business leaders was that AI was going to wipe out jobs. For the past month or so, tech CEOs have been striking more optimistic tone. In late May, Sam Altman said we've been roughly right in the technological predictions and pretty wrong in the social and economic implications. Saying to cnbc, our industry underestimated how much we're going to be able to keep people at the center of everything. But what your, your, your thing was the replace all human labor machine.

[Ed]

Yes.

[Riley]

And your replace all human labor machine. What you're saying is it's replaced fail to replace all human labor, at least in the timescale that you need it to in order to go public at write down a value and you can decide how rich you are.

[Guest]

Yeah, I do kind of wonder whether the reason why they don't think of the idea of consequences is because the AI is not telling them that this might be the thing that happens. I know there's that sort of thing where Sam Altman sort of sounds like he is kind of just. He sort of his brain is entirely like ChatGPT and that sort of, you know, the guy who sort of drinks too much of the Kool Aid and becomes the Kool Aid guy.

[Riley]

That's how you make new Kool Aid guys.

[Nova]

That's presumably guy value zero.

[Guest]

That's right. Presumably that's how it works. But yeah, even when I sort of think about the boosters, the stuff like Ed, you were just sort of saying now, about sort of boosters and tech types who are, like, genuinely surprised when people are like, hey, maybe this thing kind of sucks or is overhyped. To me, it does sort of strike as not just that they believe that this has to happen and this is the inevitable next frontier, because if not, then what else? You've wasted all this time, you've wasted all this money, you've wasted all this energy basically kind of doing nothing except creating a vanity project. But one of the things that feels so evident about this entire cohort is that they just don't think about consequences because I guess they don't believe it exists. Because to believe that a consequence exists, you have to believe that other people live among you and that their lives are important and worthy of some kind of dignity. And once you do that, when do

[Ed]

you think Sam, or once you do, carried a wallet, when do you think, do you think he carries money?

[Riley]

Do you think he.

[Ed]

Do you think any of these people do? Because this is. Are they just so separated that the only people they talk to are just wormtongue, like, figures and chat GPT and one another?

[Guest]

Well, I mean, yeah, I mean, it sort of just does strike me as like the guy who sort of has never really had to experience any type of friction in his life and so doesn't have to, like, understand that. No, there are, like, parts of the world where you just can't. I mean, it's also like why they always get confused whenever, like, the European Union is like, yeah, we're gonna maybe regulate you. And they're not like, oh, the regulation is bad. And we can sort of. It's like, but why would you want to regulate us? What does regulation do? Like, why would you. Yeah, exactly. Why would you want to restrain us? The idea of sort of being held back is, like, completely foreign to them. And so imagine then sort of trying to explain to them, but, hey, look, there are a lot of societies in the world that don't operate using kind of the computer is not the be all and end all of communication. People actually talk to each other. There exists communities and barter systems and all those types of things. Imagine just trying to explain to them in general, hey, people just don't live like you

[Riley]

do when they want to.

[Ed]

What do you mean? They run out of money? What does that mean?

[Guest]

You know, it reminds me of, like, there was a clip that just was circulating today. It's a very old clip. It's like an Anthony Bourdain clip where he's explaining to a bunch of very rich Singaporeans. I think that he does his own laundry. And one of them is just like, well, what do you mean you do your own laundry? And he's just like, yeah, I go to the laundromat and I put the coins in and the machine kind of does it and I fold it and I feel quite good about doing it afterwards. And like, the reaction that this guy has is like, you are speaking to him in a foreign language. Like, he has never understood the concept of like, touching his own clothes before. And this is like, this reminds me so much of just like how all these guys view the world.

[Ed]

They got too rich.

[Riley]

So we got time for one more bit before we have to close. And this one is really interesting, right, because this is one of my favorite kinds of statistics, which is, how is AI actually being used in companies? What are they using it to do? Is it profitable? Are the pilots successful? And so on. The sentiment change isn't limited to tech leaders. This is from the excerpt again. A survey by EY Parthenon found that the percentage of CEOs who believe AI investments will result in significant reductions in headcount fell from 46% in January 2025 to just 20% this May.

[Nova]

And even, even the most credulous worm eventually turns.

[Riley]

Yeah. And like, so it just goes back to, well, if the firms aren't more productive and they're not able to be the same level of productive with the, with, with a, with fewer people. Like, if these things aren't happening and the thing is starting to cost what it costs. And what it costs is enormous and it's still being subsidized. And in order to continue building up the demand that they think that they'll need, even if the thing suddenly goes to a hundred, as everyone needs it for everything, even if all that happens, they still can't build the data centers, then it's just like in the grand story that, that, you know, that you've been telling Ed and that we've been sort of checking in on you with every once and again, is that like if the coyotes run off the cliff, he's held up the sign and is looked down and has held up the sign that says, oh, no.

[Ed]

Yeah.

[Riley]

Or he's opened. He's opened up the, the little parasol and the boulders falling on top of him. This is the moment where he has looked down. Yeah, because that was like the moment where he looks down. That was going to be when the thing has to start costing what it costs. Right. Not even making a profit, just costing what it costs. And that's now happened.

[Ed]

Yeah, and now all the companies are freaking out that it costs a lot of money. And I think it's just that. So you'll notice we haven't had a revenue update from in a while, and I have to wonder if that story might change too. But honestly, the biggest warning sign and the biggest sign that Coyote looked down is when Sam Altman, when asked about these costs, said on stage, yeah, it's become a huge issue.

[Riley]

Yes, someone should look into that.

[Ed]

It's like a. It's just like, oh, all right.

[Guest]

Well.

[Ed]

And he's. He basically. I forget the exact quote, but he was like, yeah, someone's gonna have to. Industry's gonna have to sort that out.

[Riley]

It's just like you are hopefully the big problem solving. Hopefully the big black problem solving box will do that. I shouldn't check what's in it.

[Ed]

Sell the compute to who? Sam fucking Aquaman?

[Riley]

Look, I know we're. We got a bit of a hard stop today, so I'm gonna. I'm gonna call it there. ED joint venture 19 stat 9.

[Ed]

$17 billion raised and 18. And we have lost the money already, so we're gonna have to keep doing this. Thanks a lot, everyone, for joining us.

[Riley]

We've been TF and ED's been better offline and we will see you on our various. If you're listening to this, you know the deal. If it's tf, we'll see you on the bonus episode. If it's better offline, you'll see Ed on better offline.

[Nova]

We should see you on the bonus episode either way.

[Riley]

Yeah, exactly. Thanks, everybody.

[Ed]

Cheers.

[Riley]

Bye.

[Nova]

Bye.