Military Testosterone Screenings, Diarrhea Parasite Politics, and Data Center Debates

Yeah, you need to appreciate government before you start shitting yourself Hi everyone, this is pivot from New York magazine and the Vox Media podcast network. I'm Cara Swisher and I'm Scott Calloway Hey Scott are you recovering from the game? God that was rough was it oh my god, yeah, I've got like Argentina, I want to say Argentina is the better team, but they played the better game. It was an amazing game Congratulations to team Argentina. What I would just say to team England and the people are surrounding that that team Me and my boys got so much joy for watching team England through this tournament It was so much fun for us. It created so much additional connection. I had such a great time So not that anyone's gonna hear this, but thank you team England It was wonderful. Who's gonna win now? Who's gonna? Argentina or Spain? I say Spain. I think you're right I think this kid you mall and you actually called this you said You said that the very beginning of the tournament you thought it was gonna be Spain. I did I did an interview with smart people and they said Spain. I'm going to the game on Good, that'll be fun. I'm going because it's this is this is the one place my total advocacy for drinking has paid off You know who's taking me who? The end of oh my god, they're like that's the dude that likes alcohol bring him. Oh my god How do you get why don't I get invitations? I pick the winner and then I never get invited to any so okay So they're but I have to but I have to pay for my boys to go. I'm buying tickets It is crazy crazy to go to the funnel. That's what that's money well spent for you Scott gallery. Anyway, Scott I saw the honestly. Oh, what do you think? I loved it. It was great. Really? Yeah I went with Casey Newton After going I was in San Francisco. I went to my son where my son is working, which is He's he's working at a restaurant called Boulevard. He's the salad year And we had dinner there and then we went to see they obviously I was thinking of you the whole time You know it's interesting because you know Elon's against it, right because it's like I know that I know I think of the movie I know what is here. Here's the thing. It is an anti-fascist movie. It's about it's an anti-fascist movie It disguised as of course the Odyssey, but the way he's done it He finally reveals himself at the end Matt Damon is amazing Anne had the way off the fucking charts. There's a very little CGI and so it's real people Like so that's the thing. That's what's astonishing because you keep watching you think for a minute It's AI or CGI and it's not a surely there is in it for five seconds as Calypso and it looks like an ad for Lankoam essentially It's a person you met. It looks like a perfect you'll see what I'm talking about her outfit is fantastic Just there's a lot of sort of stunt casting that I don't know if I Preferred because they're not on very much the distraction. I find those are yeah It is it really is my second favorite movie Oppenheimer my other one is Chris Nolan But I think literally perfect film perfect. It feels it feels like that movie I know perfect film for me was done Kirk There's elements of all the movies in this movie. There's a done Kirk like scene on the beach You'll love it. You love it. I it's gonna make all the money and it's gonna deserve it And it's gonna win all the Oscars and it deserves it. You should dress like Odysseus this Halloween That's my feeling really. Yeah consider it. Yeah, I think you'd be as long as I get together Where we're gonna show off my muskles. That's what Halloween is for Muscles you can chop your mud and speaking of muskles Scott. I'm gonna start testing my co-host testosterone levels I feel like I need to do that now defense secretary Pete Higgs says says the military will begin annual testosterone screenings for service members Age 30 or older with voluntary testing for younger troops service members bound to have low testosterone Will be offered voluntary hormone replacement therapy as part of a new program. I didn't know they did gender affirming care I thought they were against that. Let's listen to a clip from this bizarre announcement This initiative. It's not about artificial enhancement It's about restoring and optimizing your natural capabilities Protecting your longevity and ensuring you have the biological foundation required to sustain the fight Well, now we know he's on tea. You know, let me let you run with this you have take it you take testosterone You've talked about it Why is he doing this explain explain it make the good case for that guess well? I mean it if part of If part of health care coverage is like I'm on testosterone because I think it's good for my brain and my heart health and It makes quite frankly. It just makes me feel younger weird things like I don't have to pee as often And my doctor said we're not gonna take you, you know, you know, I'm not using it to be a monster or more aggressive I'm using it because I want to quite frankly feel 45 again and hormone replacement therapy is something that I think You know under a doctor's supervision for men and women and I take I take hormone replacement. Yeah, I think it's I think it's a can be a real value out under the supervision of a doctor But this is for formative in my opinion Stupidity a man young men don't have or a military and men don't have a testosterone problem It we have a loneliness problem young men are falling behind because they are low touch on testosterone They're falling behind because they're low on purpose education work and relationships and we're having trouble finding although Actually recruitment is up this year. We're having trouble finding 70% of people remember how joining the army used to be the option of last resort 70% of men that walk into a recruiting office right now for the armed services don't qualify because of obesity or mental health problems So if you want to if you want a more lethal fighting force we need to make more investments In young men and it's not about pumping them full of testosterone. I know. So this is this is this performative stupidity he conflates this weird notion of masculinity and fitness and optics With or doing bad pull ups our military is headed towards asymmetric war. You know who's gonna have the best Right you're you're going to have the most lethal fighting forces will be the ones that master AI asymmetric drone capabilities Really good management ability to attract the best and brightest and have special forces of just out of fucking control brave and smart and strong people But those people are in their 20s and they are soaked in testosterone. That's correct. I that's what the whole thing I was like we're literally Ukraine and and the most recent conflicts have all shown and with Iran against the United States has shown that Might is not the actual winner here or Largeness or muscularness. It's something very different and you know, testosterone can also if it's taken wrong Fuck you up like beyond belief correct. I mean, I you have a doctor's care But I know a lot of people who do this is off the shelf and problematic and cancer Causing and everything else if you don't do it properly. Yeah, I for the most part. I don't think young people Need the average young person needs the following Nothing they need relationships. They need a gym. They need the money to have decent nutrition You know, but they don't some of the craze around peptides and enhancements And I realized this is somewhat hypocritical, but as a 61 year old male desperately clinging to just try and feel 45 again I do think there's a difference But it worries me this notion that young men this peptide stacks and I think that stuff is Is borderline a little bit scary and Your your 25 or 35 year old self is pretty fucking awesome on its own as long as you do some very big good sleep good nutrition gym three four times a week Some some practice to push your limits You know be strong good fast. I agree. I can't tell you the matter like people tell me they're buying off the shelf peptides I'm like oh my god. Yeah, I don't do any of that shit. Are you I'm like the comes from China. It's not It's not you know what's in there tested I hope you like sepsis like I just seem like oh my god It's not to say there shouldn't be they shouldn't be doing all this research on peptides By the way, GLP ones are a peptide But the way people are doing and this just sort of brings it out this idea. Let's jack up our let's steroid up our Our troops and make them insane like I don't know just so unhealthy anyway typical of p-tag sath because he's just done as a box of hammers Next one Elon Musk likely broke Wisconsin law when he promised to hand out those million dollar checks to voters in 2025 State Supreme Court election, which he lost According to Wisconsin Election Commission The bipartisan panel found probable cause that Elon violated a state law that makes it a crime to offer a person anything of value to get them to vote Now it's in the hands of Wisconsin DA to decide whether to pursue charges. I'm doubting they will But you honestly when he did that that was kind of so grotesque is he did it several different places across the country I suspect he'll do it again if he's not stopped so I don't mind this moving forward in some fashion But he you know, he's unchecked. I mean, there's the money. He's been he's put 90 I think 90 million dollars into Elections right now at this point just him and for the midterms and can you know can griffin the whole bunch of people are just Shoveling the money and in the Supreme Court the most recent decision just allowed them to shovel it even more Yeah, I think Ken Griffin is probably running for president by the way. Oh really so say more As you well, he's taken a lot of public stands on politics and if you're a billionaire the key to happiness is to be anonymous And he's decided not to be anonymous. Just to me has political ambitions. Oh interesting. Um also it's smart guy a lot of money But you know know, he's been very, very vocal, but like the problem is he's going for the Mark Cuban slot, except he's like half as nice like kind of on the there's a huge line on the Republican side. Everyone keeps talking about the Democratic, the Democratic primary is going to be a is going to be a gladiator, because there's a lot of good people. Handsome off. Handsome off. I'm having, do you see him in the Senate? He's amazing. He looks like he's hot. I think he's hot. I can't believe it. It's hot. It has got total Kennedy vibes, total Kamala vibes. I'm having them name dropping. I'm having coffee with another potential presidential candidate, Senator Kelly from Arizona, who you meet with, you want to talk about testosterone? The guy flew a craft 30, thousand miles an hour, an hour, while also flying combat missions. He's a solid man. He's a man. He's a twin. You know, and he's like, talk about someone who's been an outstanding husband. He's anyways, he's a great role model for young men. But look, I, the problem is in election interference in Wisconsin. The problem is we've essentially decided that money can run unfettered. And so what do we have in society? Most people would agree the 1% has disproportionately benefited. It's not even the 1%, it's the 0.01% and the 0.01% right now is in a position because of citizens united and the most recent Supreme Court decision. I told you my conspiracy theory, which I think is just just self evident. I believe that this phone call took place. President Trump is there any way you can lean on the SEC chair or the NASDAQ to let to include SpaceX right out of the gates in the NASDAQ 100. And as a result, you'll get, you know, retail investors will have the opportunity to invest. I'll have more demand. And I see my network increasing of a small group of stocks and not a lot is out there. And so it put it, it juices the stock. But go ahead. It's trillions of dollars that have to all be allocated to one of 100 stocks based on the market cap, which creates a unbelievable demand to what that isn't that has never been there for, that has never been there for a new issuance in history. So President Trump, if my net worth goes up 120 billion dollars because of a smart move on your part, I don't see any reason why I wouldn't put one to 10 billion dollars into the midterms. And these elections are won or lost by two or three percentage points. You're telling me a billion dollars can't get you another couple points in Maine. I mean, or wherever it is. Maybe they didn't win in Wisconsin. He spent 25 million dollars there. Well, that's the silver lining here is that money seems to have some effect money. The ROI on money is going down. It used to be that 95% plus of the people who raised the most money won because it was largely based on a currency and television buys. But Tom Steyer spent a quarter of a billion dollars to come in fourth or something in California. So that's a good news. But still it goes back to the same thing. The problem isn't people, the problem isn't people with billions of dollars. The problem is if you can directly connect it to undermining our democracy, you have unelected people deciding who's going to be president. So anyways, I think we need one case isn't going to move the needle. I like that they're doing it, though, because that was at the time. I was like, can anyone stop this? This is insane. You're buying votes. It's so buying votes. It was like, you know, it just seemed like ridiculous that that it was so explicitly bad. I hope I hope they pursue it. But speaking of election interference, which is going to be a lot, or recording a president Trump's working as artists to interfere with the election, he's going to do a prime time address the nation where he will discuss, quote, free and fair elections and other topics of popery as one advisor put it. Should never use the word popery allegations about China meddling in the US election report to come up. And some reports suggest he'll once again push claims of election fraud in Georgia speaking of John Ossoff. Let's listen to what Ossoff had to say during an appearance on MS now. There's talk that he might try to declare me and Raphael Warnock illegitimate senators. Obviously, the president has no power to do that. But he does have the power to try to intimidate people. He's demonstrated his will to abuse power. I expect him to use whatever he puts out there on Thursday as a pretext, either for some attempted, unconstitutional use of federal power to interfere in the election, or to give his proxies and loyalists in state and local jurisdictions some cover for whatever they might attempt, or delay the groundwork for challenging the result. So there it is. And it's really interesting because especially because he's like handmade in statisticians like senators sent the alumnus rhymes with hummus dumbness. You know, I don't know if they they were properly elected like they are they go they follow along. And Trump also removed all three sitting members of the bipartisan US election assistance commissioner group that oversees the testing of voting systems. It's all over the place. This is something Bannon, Steve Bannon has talked about. There's all manner of attempts possibly using ice etc etc etc. Thoughts on this. Besides the handsomeness of john also. You can't have a democracy when one of the two parties acceptance speech as I was the following. We won or it was rigged. You just and election interference. The good news is that essentially affordability, which right now the Democrats are seen as better on is dominating in Gallup polls what people are concerned about. Only two percent of voters believe America's biggest problems election reform. So but at the same time, I also read 60% of Republicans think the 20 election was rigged. I mean, this is just so bad for America because when you repeat a lie, this is straight out of the GRU. When you repeat a lie over and over, it becomes less outrageous. Then it becomes normalized. Then it becomes self-evident. Correct. Yeah. And and our media, they just have a responsibility. I was just so I met I forgot to say I'm the guy interviewing to be the head of our intelligence service. I met him at like Jake Clayton. Yeah, I met him at a conference. I spent a little bit of time with him. Reasonable, smart, impressive man. Oh, the chance. Say that Biden won the 2020 election. Yeah, he can't. He actually can't do it. And because he then his nomination we pulled by Trump. And it's like, okay, at some point at some point these men have to be men and say, my kids are going to think I'm a coward. I just it's like, you don't think that video is going to be playback over and over and over in your kid stirred great civics class. Rest of his life. Rest your life. It's like. And by the way, maybe the nomination gets pulled. But don't you want to be that dude? Don't you want to be the guy that said, of course, he was elected. Yes. And then have Trump and then have Trump pull your nomination and be a fucking hero. I know, you know, of all people, Thomas Massey was like, um, we have the house, the Senate, the presidency, and pay pretty much to the Supreme Court. And we're called saying the election. Elections were rigged. Right. Like, wow, keep rigging them. Like it was it's ridiculous. I mean, I mean, one of the things it's just ridiculous. It's it's an astonishing repetition of lies. Those two, there was two hearings. It wasn't just him. It was also the attorney general can't say it. They can't say it. Biden was certified president. That's all they'll say, which is not the same thing. I mean, that the fact they can't say it and that's happened several times with cabinet members is really something else. It really is. And as it's as if they live in Putin's Russia and they do for the Republican Party, where if they say the wrong thing, they, they get like thrown out a window essentially. And this is a not a, not a real throwout of window, but it's a version of it, a political version of it. There has never been a testosterone therapy, like a Republican losing an election. Well, we'll see. We'll see. I don't know. You think tell us and John Cornyn are going to push back on blank. Look what truth tellers these guys are once they lose their election and they have only six more months in the summer. I'm waiting to see if they vote against top lunch. I don't think they will mean as personal lawyer. Yeah. I mean, I was his lawyer. I mean, I don't know what I mean. You know, I don't think they're going to, I think they're going to vote for and they're going to let it out of committee. I just don't, I, I don't think they still can't sack up too late. Tom sack up. Tom sack up. Tom takes some testosterone if you need to take some bar. We can't stand. He can't stand except the whole thing. You're right. When do they, when do they stand up on stuff like this? And it's like what Adam Schiff said to Todd Blanche, what happened to you? He used to be, he used to be a person of quality. And it's really interesting. Anyway, we'll see what happens. And I'm not, are you watching the speech tonight? Oh, I, I could care less. I don't care. I mean, you know what? I will watch it. I'll just watch it on one of three social media platforms that'll give me the two or three clips. Cal State is now saying there's a 45% chance of Democrats take both the Senate and House at the midterms. Yeah, both. Anyway, that's still 45. Let me just say I'm going to go back because this is the same thing. This repeating of the lie that you just said, the reflecting pool, this is the kind of thing. The lie, the lie, the lie, the lie, the lie. And then everyone, and by the way, the media repeated it. We should have, like, just now the reporting is in. And I got, I got to commend CNN. We did a very tough report on it. Just like stop repeating his lies. And tonight, if you, if you all repeat his lies, you're as complicit. it in this in what's happening here. You have to say this is not true. This is not true and not even entertain it in some level. You can report on it, but you don't have to entertain it the way they as if it's an equal thing. I just that to me is really what really drives me crazy. Anyway, let's go on a quick break. We come back. Things are going to get explosive and not in a good way. Support for this show comes from Odo. Running a business is hard enough, so why make it harder with a dozen different apps that don't talk to each other? Introducing Odo. It's the only business software you'll ever need. It's an all-in-one fully integrated platform that makes your work easier. CRM, accounting, inventory, e-commerce, and more. And the best part, Odo replaces multiple expensive platforms for a fraction of the cost. That's why over thousands of businesses have made the switch. So why not you? Try Odo for free at Odo.com. That's O-D-O-O.com. Scott, we're back. I never has diarrhea been so political. Now let me pronounce this right. A cyclospora outbreak has now spread to 34 states. It's a parasite that contaminates fresh produce and causes severe water diarrhea with frequent and sometimes explosive bowel movements according to the CDC. Officials are still investigating the source. Mission officials say the evidence points to lettuce or salad greens. Federal and state officials are also looking into whether Taco Bell restaurants played a role. This is so ridiculous blaming Taco Bell for this. And making things more difficult. The CDC, of course, scaled back the country's comprehensive system for tracking foodborne illus outbreaks last summer. Thank you, RFK. That's your fault. They cut these things. States can report cases through other systems, but experts say the cuts created blind spots making outbreaks harder to track. Just ridiculous. These people made the cuts and this is the result. Everyone's having diarrhea. It's the fact that diarrhea is the is the brand for the Republican party, like bringing us diarrhea measles and possibly polio is and Ebola is really quite something. I just I don't know. I like lettuce and now I'm like nervous about eating it. It's crazy. The memes are amazing. Let's go through a few of them. Someone on X posted, I found an explosive diarrhea parasite with a picture of Stephen Miller. Also first Mitch McConnell and now cyclospora big week for evil vegetables and maybe explosive diarrhea will finally be the thing that brings both sides together. Thoughts on explosive diarrhea? Yeah, I don't know. I I'm I was feeling really good. I'm I had the best. You know, it's coming. I had the best bowel movement I've had in years the other night. And then I realized I was still in bed. Look, I don't you know, all of these things. Okay, that was good. Whether it's testosterone. Yeah, like the CDC, we need we need thoughtful people. It is goes back to the same thing. This is true of Democrats and Republicans. We've taken for granted how many competent people to work for the government work for the government. And that you need a diplomatic core that can say this memo of understanding doesn't mean fucking anything. And we need to do hard work of diplomacy here. We need we need talented medical professionals in the CDC to go. This is a risk. These are the preventive steps we need to take who have the support of the White House and are you know, trying to figure out ways to undermine, you know, vaccines. So for every look for every one dollar invested in public health preparedness, you get multiple dollars in avoidance of healthcare costs and productivity losses. Foodborne illnesses already cost the US tens of billions annually. You don't notice these things when the CDC is working, you only notice it when someone is shitting themselves. There's small outbreaks. There's small outbreaks as opposed to these enormous okay, but America, you know, and this is true of Democrats and Republicans, you need to appreciate government before you start shitting yourself. But in this case, this was the Republican's cutting these programs that have been in place. Agreed. Elected by an American populace. Correct. That's correct. That's absolutely correct. But I don't think we voted. I don't think even those people voted. We didn't vote for diarrhea. Right. Nobody voted for diarrhea. And you would assume that this is the kind of stuff. You know, the fact that they go for this stuff is really interesting to me. I'm like, that seems like a, like a real, like, I don't know. It's just, it's so, it's not just shortsighted. It's just dumb. Like, let's stop the tracking of foodborne illnesses. What, what plus, who made that decision? Like, I want to be in that room. Like, who said, yeah, that's what we're going to cut, because that's something that, you know, isn't important like salmonella or something like that. I don't know. It's, it's a really, I think it is all knitted together. And again, back to the reflecting pull. It's like, those were no, no bid contracts back to all the no bid contracts all over all over the place where you have shoddy work or shoddy this or shoddy that. And then in this case, it's diarrhea. I just, and of course, it's now it's going to hit lettuce makers, you know, people who sell lettuce, grocery stores, the, all the implications, everyone's eating chocolate chip cookies, they get fat or whatever. Let me ask you a question. I, as a marketing person, how would you sell this as a Democrat if you're, is it, is it worthwhile to make use this in, in the election? Yeah, you know, bombs, diarrhea and inflation. I, that word is so powerful that I would probably couch it in America's health being ignored, which drives up costs. So you, you, you can't afford the treatments to the diseases you shouldn't be getting. I mean, yeah, I, I think, I don't know, I think they need to test it. I, I still am all about accountability and affordability or maybe affordability and accountability or renewal. I'm, you know, I'm working on a bunch of messaging around these issues. This is, it needs to be more than a meme. It needs to be broadened to our health is, is been compromised by an, an incompetent set of officials where it comes back to the same thing. And that is opting for fail to overconfidence will hurt the American public. Yeah. And the Democrats, if you look at past administrations, sure, you know, politics plays a role, but here are some of the, you know, I would hold up. I, I would say, okay, let's just look at Surgeon General Morty. Let's look at, let's just look at these people's backgrounds. Let's look at the former, let's look at some of the people who ran our, our intelligence. And who's running it now? I just run ads around. All right, let's look at past defense secretaries and petexeth. Let's just compare compare and contrast. Yeah, and contrast. And that, unfortunately, that doesn't fit on a bumper sticker. There's probably something very clever around this they can come up with. There is a grift kind of thing that's really, I think, is actually very strong. Like just, just this weed, the SCC under the moron, brand, and car signal that will vote to repeal the cap on ownership of TV stations, a limit that keeps owners from controlling the stations over 39% of the market. So trying to get next star and whatever that company is next or until whatever the heck it is, they're trying to merge companies and they've been blocked by various lawsuits. And, you know, Americans, confidence and technology companies has fallen like drastically. I just think that you put out an idea of the grifters you're here and you're getting diarrhea, the rich, they're getting rich and you're getting diarrhea. Well, like what can we do about it? I'm most again, other than just barking into a mic. I'm putting out a bunch of threads in a bunch of posts. I initially thought this is, this could be the Democrats making light of a bad situation in placing blame where they shouldn't. And then I did just a touch of research. On July 1st, 2025, the CDC's food-borne surveillance network called FoodNet, cool name, dropped a number of pathogens that require states to track from 8 to 2. Only Salmonella and E. Coli remained mandatory. Cyclospora, Listeria, Campiolubacter, Shigella, Vibrio, and Yersinia all became optional. Cyclospora has been tracked continuously since 1997, meaning 28 years of monitoring ended the summer before the biggest outbreak on record. Folks connect the dots. Since early 2025, the administration has kept more than 3,000 positions from the CDC, roughly a quarter of the workforce. And what do you know? We're having a cyclospora outbreak. Exactly. This is math. This isn't politics. Connect the dots, connect the dots. They can't run. They can't govern is what you want to really. They cannot. They don't govern. And when they govern, they steal. I mean, I think that's. The administration dissolved the CDC's division of parasitic diseases in malaria. Yeah. And they keep saying it's bloated bureaucracy. We'll talk about. Okay, bloated is a key word here and wasteful. I mean, these words are taking on new meaning right now. And the pattern isn't limited to one parasite. A second one of flesh-eating new-world screw warmth showed up in U.S. livestock in June for the first time in nearly 60 years. 60 years. And so these. These. Talk about gross. These larvae burrow into the flesh of living animals. And the USDA is fighting it by releasing millions of sterile flies in Texas. Mexico and Canada have both restricted U.S. cattle imports over the spread. So this. This neutering. This neutering of our government agencies and replacing them with loyalists and competence. And competence. Is. Folks, the chickens are coming up to Bruce, except the chickens have diarrhea. We'll give you salmonella or whatever. So. We can't paint a pool. But again, I come back to the same place. >> Confidence. >> Our government is stacked with, or was, stacked with talented people. >> Tell the people. >> I agree, I agree. >> Anyway, on a much different note, open AI's much anticipated first device is going to be smart speaker according to Bloomberg, the device which is under development is meant to be human-like AI companion that lives in the home. It will help control smart home appliances, play media, answer questions, and tap into the capabilities of chat GPT. It sounds like Alexa to me. Open AI believes the device is different from anything Apple has on the market, which might come into play with Apple loss that we talked about. Obviously, the delay, anthropic is allegedly going to go public in the fall sometime. Open AI probably is not. Is this a product that's going to work, Scott? This seems like a product, Scott Galloway, does not like, but perhaps he does, I don't know. >> I actually, I liked it more than I thought it would. I thought it would because you keep talking about, and at some point there needs to be a post smartphone era, right? >> Yes, that's correct. >> I don't think the most valuable product of the next decade or decades won't be the one with the best screen. It'll be the one that knows you really well. >> Right, absolutely. >> The inside, it won't be who builds the biggest model, or best model, it'll be who owns your kitchen, your living room, your car, your earbuds, and Apple won because it own the interface, not because it had the best technology or model, and OpenAI is trying to own the relationships. Now, granted Meta tried to do this with their, I figured it was called, that's green. >> Yeah, they had one, I don't remember that, yeah. >> So, I actually think strategically, going for a speaker and trying to go in home, I'd heard it was going to be some weird fucking pin or something, or an attempt to be-- >> Yeah, the pins have been tried that you carry with you. At some point you will, let me say, you will have a pin on you at all times, or it will be your AirPods, it'll be extra smart, right? >> I think that's right. So, I think that the idea of a better Alexa, the idea, I don't think smartphone.ai was going to work, but the idea of a really intelligent speaker, conceptually, I think this is strategically, I think it's correct, the thing that everyone learns and is just littered with dead armadillos, is believing that because they're good at software, they'll be good at hardware. There are so few companies who have made the leap to hardware. What hardware in the home do you trust, though? My son literally took all the Alexa's out of our house. Like, he's like, they're not going to surveil us, that was one of the issues. The other, they're always listening. People are nervous about this kind. Even the alarms that people put on the cameras, like, they got manipulated from outside where people were looking inside people's homes. I mean, I think, and then Amazon, I remember, Amazon was going to have a drone that followed you around your house and did things, like a little floating thing. Eventually, people will have a version of that, presumably. It's just who do you trust to be in your home? Because I wouldn't put any of these things in my home at this point. Yeah, but this, so my first thought, when I read this was two things. I think this is actually smarter than I thought. At least strategically, obviously this is all about execution, because I thought they were going to try and put out some, you know, the Amazon fire phone or whatever it is. The second thought I had was, I'm going to buy Sonos stock. I think Sonos is going to be acquired. I think for Sonos has a market cap of $1.7 billion. That is literally changing their couch for these companies. And they immediately have an installed base of speakers where they can just upgrade the technology. No, fair point, which you can never work, which you know. I think Sonos is amazing. I love him, so I have to tell you, it's the most difficult to get coordinated. It is always glitching. It's always glitching. And I'm smart about these things. I love Sonos. But there's so, but you asked, there's so few trusted brands in the home. It's really interesting. Like, sub-zero is such an amazing brand. You can buy a $4 million home, and they will advertise that it has an $8,000 refrigerator called sub-zero. That makes no sense to me. You think about how many actual brands that the furniture market is totally fragmented. It is. Sonos is a decent brand. No, I agree. And they have an installed base. You're right, I let Sonos in the home. And by the way, the stock is off 56% in the last five years. That company is screaming to be acquired. I have a lot of Sonos in the home, and I don't. But I don't have Alexis. I don't have. It's a really interesting thing, because I, but remember when Amazon bought Euro, I guess, I was like, oh, fuck, you know what I mean? Like, 'cause I love the Euro guys. They were really interesting. And this is basically repeated for your internet, essentially. And then when Google bought Nest, I was like, oh, damn. You know, like, oh, they're here. And now I do keep a Nest in my home, and I do keep a Sonos. But I don't know if I want to add to your team around my house. I don't think I do. I think I do know. I think you're, I've always bought that people talk a big game about privacy. And if they can see their Uber QX60s getting a little bit closer on the screen, they'll give up all of their data. I'm just, I think people opt for utility over privacy. And then they talk a big game about privacy. Yeah, kind of, although you shovel a lot more stuff into LGBT than I do, I won't. I still don't, and I don't. It's just 'cause I don't want this particular company. It doesn't mean I wouldn't allow Apple in the home a lot more readily. But they never come up with any. Their device was terrible. I have one of those. I post them. It's in a box somewhere. I still have yet to integrate these into the home in a way that is useful in what they're talking about here. So you're right. We'll see. Someone's going to get it right. When we come back, we'll talk about a tumble for IBM shares and what it means for the market at large. (upbeat music) Scott, we're back with more news. IBM Stug is down 26% in the last five days after issuing a rare profit warning known in a shift in customer spending from software to AI hardware and chips ahead of the quarterly earnings. The sell off a raise $69 billion in market cap and the initial tumble marked the company's worst day since at least 1968, the S&P software industry indexes down over 13% for the year. You've talked a lot about the software companies. By the way, SpaceX has really taken a digger. Oracle is way down and just related. I think New York has become the first state to be on the construction of new data centers. The pause applies to new data centers requiring 50 megawatts or more power for up to a year while state regulators develop new environmental and energy standards. Governor Kathy Hockel noted the New Yorkers have seen their electric bill surge 68% since 2019 and a June poll revealed that 46% of New York voters bleed one year more. Tutoring them on large data centers would be good with just 21% saying it was bad. So this is all related to each other. This idea of this growth, talk a little bit about IBM and then the links to Oracle, SpaceX, everything else. They're really trending downward in a really significant way. And people are nervous. There's so much more discussion about possible collapse by lots of different people. Noble, the investor George Noble, Bill Cohen did a great interview with him. He's nervous. Thoughts? It felt like I was caught off guard by that. I mean, they came in at 17.2 billion versus 17.9 in the stock out its worst day. I think maybe ever or in 50 years and it erased a quarter of IBM's value over a $660 million revenue miss. That's about $100 in market cap every $1 of Mr. Revenue. The reason why is IBM's customers are rating their own IT budgets. In the last few weeks, clients pulled spending from software and mainframe deals and used it to panic by server storage and memory before prices rose further. So in the sell-off infected the entire enterprise software market, the fear is that there are the a canary and the coal mine here and that is the real loser is anyone who buys memory instead of selling it. So data centers are forecast to consume 70% of all memory chips produced in 2026 up from 20% to 30%. And three companies make up roughly 90% of the world's DRAM market and all three have shifted production towards AI chips. So their costs are going up and meanwhile, their revenues are flattered down. So you have margin compression and meanwhile in top line going down. So the losers are everywhere else. PC makers who consume a lot of memory or buy it, that was 15 to 18% of PC materials costs is now heading towards 40%. So in a competitive margin, in a competitive commodity market, your costs are going up waste. - That's a price. - Think about it Apple has already had to raise its prices but they have the margin power to do it. Xbox has raised prices by consoles as much as 150 bucks. Smartphone shipments are projected of all 13% on memory price surge. And software and services corporate IT budgets are being redirected to panic buying chips. So the AI trade has gone parabolic but the losers have suffered tremendously. Accenture is down 47% year to date. I think that's a lot of those back office jobs. People think AI will supplant. IBM's down 28%, Microsoft down 16, service now down 29, Salesforce down 34. Actually spoke at Salesforce yesterday. So this is, the market is reshaping around big winners and big losers and IBM's perceived as being on the wrong side of the trade 'cause now it's competing. It's competing to buy the memory against companies that have a better business model or better prospects. - Right, right. But what about the overall trend? 'Cause there's so much noise now. I mean, I was really struck by this George Noble interview that Bill Cohen did. The, you know, he's just like this is, he essentially was like this is bananas. What's happening right now? with the spending. And you do see SpaceX, despite the index thing, is drifting down, drifting down, drifting down, more and more at Ellsson, by the way, is enjoying the entire drift. He does a thread every five seconds about it. What is the, are you very worried? 'Cause a lot of people, I've just been hearing so much more noise around that. And it seems very interrelated to these data center slowdowns and that the business isn't quite there. And OpenA is not gonna go public this year, maybe anthropical, get through. Are you still remain worried or are you paying attention to that? 'Cause I think they're all related to each other. - I mean, and granted, I get this shit wrong all the time. I think we're literally late stage 99. - Yeah. - And I think it's unfurling, remarkably similar. First, it was B2C, the Amazon's, the Etoys, the Pets.com's of the worlds imploded because they didn't create the demand to justify their valuations. Okay, so what's under, what's under a huge chart right now? The ultimate consumer AI play, which is OpenAI. And then we everyone, but wait, it's about B2B. So everyone shuffled into anthropic, thinking it was the enterprise market. I think that's the next one to come from a trillion down to 100 billion. Oh yeah, 100 billion dollars is what Starbucks is worth. That's not, that's still a lot of money. And then the next, the next you to drop will be similar to what happened. Everybody got out of B2C, got out of B2B, and then they went into global crossing and Cisco 'cause it's still in the ground. And then I think the next you to drop, where I think we're gonna start to see weakness in the infrastructure players, specifically in videoing, in later part of this here, beginning and next year. This whole, I feel as if we are literally in the beginning of the unwind. Yeah. And these data center bands are construction of them. I think it's a good idea. Voters want this. I think it's actually good government to say, like let's take, it's not saying no data center. It says, let's take a year, let's figure it out. Let's do it so that consumers don't have to pay. It's a great political message. And it's not anti-innovation. It's slow the fuck, slow your role, dudes. Like this is ridiculous what you're doing to our environment and our costs. And you know, they try to blame things like cocoa and others. I think it's actually good governance. That's funny. It's become politicized. I think data centers have become the vessel for outrage around income inequality. And I think some of the concerns around them are inflated. The notion that they're gonna soak up all the water. They're noisy. Well, they're not, they're not many, most of them aren't near. I feel that essentially this has become the new, the new kind of whatever it is, squeeze toy or anger or mannequin for income inequality. And then in what is the biggest brain dead brand move of that century, they decided to make the spokesperson for data centers, Kevin O'Leary. - Yeah. - So, but if I were a civic official, first off, these people aren't, the people approving these data centers aren't stupid because these companies, data centers don't call the fire department or the police department and they pay property taxes. These people aren't stupid approving the data centers. What I would do if I were a local civic official following, I would say we will cram through your approval. We want 10 years guaranteed property taxes no matter what happens to your company 'cause I think a third to half of these things aren't gonna get built, but I still want those revenues. - Yeah, and also maybe some, you've gotta talk to voters about the electric bills and everything else, you know? And 'cause I think the people who are opposing them have made, have done a very good job of linking them with billionaires and like you're right, Kevin O'Leary, looks like a fucking idiot. - But that's math, a civic official should be able to say, we have economists and power people estimating what the increase in electricity costs will be. If those are in fact true, we need to add a minimum compensate consumers with the property taxes or fees you're gonna pay. And also I would say a friend of mine owns a shipping company and shipping container ships went to like from $30 to container to $150 because of Hormuz and I'm like is there any way you can buy futures or sell futures and lock in that price for the next 10 years and he's like I'm trying. If I were a civic official, I'd be trying to lock in the revenues and the property taxes these things are gonna pay for the next, they're supposed to pay for the next 10 years 'cause Kara, would I find generally in life and in business is this shit you are most worried about doesn't come to fruition because you start planning against it subconsciously. The shit we're, remember why 2K, how worried we were? - Do you know where I was? May I tell you a short story? I was sent by the Wall Street Journal on the best night of the New Year's for that 2000. I had to be at Yahoo and E-Trade. That was my life right then as a young reporter. I had to hang there and nothing happened. Go ahead. - Well, I used to go on Bloomberg when I was going on TV there and for fucking 12 months we talked about the collapse of Greece and how it was gonna affect the EU. The moment you start worrying about everything it doesn't happen. No one was worrying about plain slamming into the World Trade Center. We weren't that worried about a virus jumping the lab and in fact, I mean Bill Gates was, we are so worried about data centers that my view is in my thesis is that all of a sudden we've had this incredible flipping from a supply crisis to actually a demand crisis. Everyone, everyone that was supposedly gonna create all the demand for data centers is now selling their data center capacity and storage to the two companies creating demand, OpenAI and Anthropic. So if I'm a civic official I'm like, bank that money now, get their commitments 'cause I, and also all the innovation is gonna go into chips and inference and compute the requires less energy. And I'm like, the most fucking ridiculous thing. Have you ever been to one of these things? The idea that we can put any semblance of one of these into space makes the Reboven look practical. - I know Reboven. Like, you know, in my favorite version, everyone should phone Yan McCoon on the data space centers makes me laugh. There's part of me that I gotta say, he's on good one, good one. Space centers, data centers in space. Like I'm like, what, load of crap, but I love you for trying it. It's like having the, you know, we were supposed to have 50,000 optimist primes in our home this year. Do you have one yet? - Oh no, but hold on, let me ask my robot. - Yeah, yeah, exactly. - I think we will, by the way, I think we will. - You think we're gonna, you think it's gonna be Jetsons, you think we're gonna Reboven? - Eventually, but it will be dead. It doesn't really matter, but yes, I do. - Yes, yes. - My Filipino nurse Manny is cheaper than a robot and has softer, gentler hands. - Yeah, right, okay. But someday you may be taken care of by a robot anyway. But I like the fact that they just lie through their teeth about something and the lie is very creative. Anyway, one more quick break will be back for predictions. (upbeat music) - Okay, Scott, let's hear a prediction. What is your prediction? Besides, I'm gonna make a prediction. Odyssey is gonna, like, blow. - Yeah. - That's a pretty safe way. - I gotta say, no, but I think like way more than people think. It is really that good. And I think people are, again, just like they were with smaller movies like Obsession and Backrooms, they love getting in the theater when something's worth it. This one is worth it. I think it's gonna blow out well beyond what people think the blowout's gonna be. - I like it. I'm gonna see it. I'm excited, do you like it? - Yeah. - So my prediction is that OpenAI is gonna buy Sierra and install Retailer as CEO. - Oh, great idea. Did I say this? Who said this to me? Someone asked me who I thought was should be CEO of-- - You planted the seed. You said Retailer. - Yeah. - Okay. - Look, the most successful companies don't stop with the platform. They own the application layer. And Apple didn't stop at iOS. It created the App Store. - Explain what Sierra is for people who don't know. It's his new startup. - So it's essentially, they're in the application layer for AI where they're one of the best enterprise AI products. And they're essentially they are, of evaluation of $45 billion. OpenAI is supposedly where they $800 to call it $500. So for 1% of the company, they get a CEO. And right now, Retailer is probably, they need to bring in an adult that comes to the markets. And OpenAI does, if OpenAI does in fact have the best model. Sierra has one of the best enterprise AI products and Brett Taylor is arguably the best enterprise software operator of his generation right now. And as these foundation models get cheaper, intelligence will commoditize. So the scare ass that won't be IQ, it'll be customer relationships, workflow integration, and enterprise trust. And that's essentially what Sierra is offering. - Can I also say he can go toe to toe with Elon. He's the one who got Elon. Remember, Elon tried to pull out of the deal. He was rock, he was the chairman. - Yeah, he forced him to close. - He forced him to close. - He said, there's companies worth three, you wanna pay $44 sign here, here, here, and here. And remember me, you're the guy that signed these documents. You're closing. - Right, he can go toe to toe with Elon. And actually it's very well-liked and so very well-liked, unusually well-liked. - Essentially, essentially Sarah's the Salesforce of AI. And if OpenAI wants to be more than the Nvidia of AI, it needs to own the Salesforce of AI. - Do you think Sam Altman will give up the CEO shit? - I'm not so sure. - Well, this is what typically happens. The CEO is taking so much shit and is seeing the valuation go down. That has got to be fucking Vietnam minus the charm right now. I mean, I can't even imagine what it's like to be saying. - He likes being liked, I'll tell it to say that. - I can't even imagine what it's like to be Sam Altman. So he probably has agreed. This is typically what happens when the CEO's 10 years like this and a founder. They agreed to bring in a president. And then we all interview the president and the person we really like goes, says the following, I'm not going to be your fucking president. Make me CEO. And then we all agree to make him or her CEO. Brett Taylor isn't going to take a president job. Right. And everyone to meet him. He did. It's sales just remember. He was. Yeah. That was as a younger man joining, joining Mark Benioff, one of the greatest entrepreneurs in software, right? Yeah. He's his own, he's his own CEO now. And so this, this, this solves so many problems. It gives the market a sense of calm. And then an adult shows up. It's a chance for them to turn over a different leaf. It's a chance to create cloud cover to dramatically decrease the ridiculous capex. It's a chance for Sam to say face and be the chairman in the visionary and prepare and pretend that it was his idea. And they also get a company in the application layer for one percent dilution. This makes so much in some, the two most of the three most acquired, no, two most acquireable companies right now, Sonos and Sierra. But this just makes so much industrial logic. I'm surprised. It may, it may even be, we may even be in the midst of it right now. But Sonos should be picked up by one of these guys looking to get into the home for scrap. But the real one here is Sierra. And it's not, it's not, it's an aquahire. It makes industrial logic, but what they really need, if they announce Brett Taylor is CEO. Yeah, big deal. The valuation of the company goes up $100 billion. They get 20 X on the acquisition price. Say they pay 10 billion for it. They get 10 X just by, with two words, Brett and Taylor. Yeah. Open AI is worth more than $100 billion. Am I your muse? I think I'm your muse. Do you know that? Well, you're my inspiration on a lot of levels, Kara. I am. Yeah, there you go. Anyways, Brett call us. Sierra is going to be acquired and Brett Taylor by Open AI and Brett Taylor is going to be installed to CEO. I like it. I love it. Anyway, we want to hear from you. Send us your questions about business tech or whatever's on your mind. Go to nymag.com/pivot to submit a question for the show. We're called 85551 pivot. Okay, that's the show. Thanks for listening to pivot and be sure to like and subscribe to our YouTube channel. We'll be back next week. Today's show is produced by Larry Naaman, Zoe Marcus, Taylor Riffon, and Todd Weisman, earning a tight-engineer at the episode. Thanks also to Drew Burrows, Mrs. Varian, Dan Shalon, the Shakuros VoxMeat as the executive producer of podcasts. Make sure to follow pivot on your favorite podcast platform. Thanks for listening to pivot from Vox Media. We'll be back next week for another breakdown of all things tech and business care. Have a great weekend.