The Biggest Risk After Nvidia Earnings

Last week, all anyone could talk about was how we are in an AI bubble. How there's way too much hype, way too much spending, no real returns. The market pulled back about 3%, big tech got hit. The hardest Nvidia was down 7% since November 1st, all gloom and doom. And tell Nvidia enters the chat last night and all of a sudden, nobody's talking about bubbles anymore. The beat earnings estimates all around $57 billion in revenue, they're expecting $67 billion next quarter. They said Blackwell demand is off the charts, that's a direct quote. They said cloud GPUs are basically sold out everywhere, no surprise. Stock jumped 5% after hours, which at this scale, that's $200 billion in market cap in a matter of minutes. The ripple effect was widespread, small caps were up, crypto was up, biotech was up, the tone completely flipped, people on X were trolling the AI bubble, laughing at Michael Burrie's latest big short, pointing to the hyperscaler backlogs that are now reportedly over $500 billion. And their speculation, the Trump could reopen China, which would mean another $5 billion a month in demand for Nvidia. Basically, the narrative went from AI bubble to AI tsunami overnight, but there is a real risk out there. And it's not the obvious stuff that everyone he always talks about. Today on Dummoney, we're going to reveal the biggest risk after Nvidia's earnings and the trade set up, we're about to play. This is Dummoney, why? Either I'd say if you're along with Chris and Jordan, we are Dummoney, welcome to Dummoney Live. Quick reminder, smash the old like button for the almighty algorithm, it really does help people find the show, helps YouTube know that we're not wasting our time here this morning. Chris Jordan, Nvidia didn't just beat the kind of reset the narrative briefly, but as we're watching in real time, that's all falling apart. We were watching this reaction in real time last night, though, what were your first takes on Nvidia earnings and what's happening right now? Well, listen, Nvidia earnings were exactly what I anticipated them to be, which were unbelievably good. Right? We knew this, I feel like everybody knew this, but what's the takeaway is that there was so much concern going into earnings. There's so much anxiety and so much fear and so much doubt on this AI cycle that whatever happens, someone is going to find a hole in it, right? And since fear and doubt, the fear doubt index was like pegging all the way on the fear side or what is it? The fear and greed index was like all the way in fear, like further than we've ever seen the needle go. Yeah, I think we learned a lot over the last week and what we learned was the psyche of investors right now, both institutional and retail. It is shaky and it doesn't really matter what Nvidia earnings are. It really doesn't matter how great Gemini 3.0 is. It really doesn't matter the degree to which people like us can clearly see the biggest thing that's ever happened in maybe all of most of humanity, like a recent unity, right? And it's just so obvious to us, none of that matters because ultimately you have investors that have an enormous amount of doubt around what AI is, what it can be, the degree to which it will be monetized, the timelines, the economics, the circular financing, I've never seen so much. I think the valuations too, I mean we saw Michael Barry shut down his hedge fund because he just doesn't, he can't get over the valuation mismatch that he sees. Dude, he's couldn't get over any, here's the thing, dude, I don't even know where to start with Barry. Yeah. He's, I heard a rumor. I know you, you can talk in a second, but I want to say one thing and that he, the one thing that he called out, or I think that he called out, I didn't actually read his letter, there's a second hand, but the, companies like CoreWeave, that they're the appreciation model, he thought was way off, but they're not depreciating these assets, these GPUs nearly passed enough for what their useful life should actually be. Right. He called out that they, they had a depreciation schedule and over time they've been increasing that depreciation. They have been increasing it, right? But he saw like a 5% on the first year, the depreciation schedule for some of these and he was like, whoa, that is not near enough. Okay, but what we're, what we're finding out is that the demand for inference is higher than anybody anticipated it would be. The supply glut on compute is deeper than we ever thought it would be, demand for a compute is higher than anyone ever anticipated that it would be and because of that, it still makes economic sense to utilize these chips in years, four, five, six, even if you're utilizing them for things that you ordinarily didn't really have on the books, like you weren't using them for those use cases. Right. Correct. And that's, you know, I'm just addressing his caution, not reality. Okay. But I think the truth probably sits somewhere in the middle. It probably sits somewhere in the middle, a burry, his analysis and what we're hearing out of companies like Google and Microsoft and Amazon and Nvidia. And I, and I will say, Nvidia addressed that directly in the earnings call yesterday. This is from the transcripts directly talking to Michael Burry, I believe. They said the A100 GPUs we shipped six years ago are still running at full utilization today powered by vastly improved software stack. So like, yes, the numbers, the number of years that this equipment is sitting on their books has been extended, but Nvidia is saying, well, it's still working six years later. Yeah. Now, I, I agree, I lean more towards big text explanation than Michael Burry's, but it really doesn't matter. This is what I've been saying. Like, if it's off by a couple of years by the time we learn that in for me, that will not be the primary driver of price action or evaluation or, or, or, it's just not going to be that important. Because the size of this AI cycle is so large that a big tech is correct. Even if they're off by a couple of years, there are bigger things, right? They're just, they're big, they're bigger opportunities out there. I, I think the opportunity, I think the one thing that every investor needs to be thinking about the next 12 to 18 months, the only thing that any investor needs to be thinking about as it relates to AI investments is that the degree to which we start to see monetization of compute. And I don't mean monetization of compute, the first level, right, just like literally selling compute to people that are building things that are speculative, but actual and clients utilizing that compute at their companies to either generate more revenue or to meaningfully cut cost. And as we start to see that happen, I talk of the AI bubble will start to dissipate. I don't think that's something that's going to happen in a matter of weeks or a matter of months. It's like a one to three year kind of timeframe for, Jordan, do you agree, like you're on the, yeah. So I've been thinking about this. And I think when you're seeing right now, I mean, you're still seeing early adopters. And by that, I'm not talking about individuals, I'm talking about organizations. So you're seeing, you know, I follow this law firm that is implementing AI across their, across their staff. And, you know, it's, it's receiving mixed results, right? But some of these smaller firms are the more progressive ones that are trying to figure it out. And they're implementing it across their organizations, right? So you're going to see that happen before you see like big Fortune 500 companies implemented across their entire organization. And you need to see some of those success stories that then you can have consultants come in and like start to implement it across bigger organizations. So yeah, I mean, it's going to take time, but it's happening. I think, I think the success of AI is its own worse enemy in that it has accelerated so quickly, quicker than anything we've ever seen in our lifetime, that people's expectations for monetizing that inside of huge incumbent companies are just irrational. The fact that we're even asking the question right now, in terms of to what degree are you monetizing this AI at these huge companies is actually insane. It should be five years out. It should be 10 years out. But because it's moving so quickly, people actually thought that you would see it immediately. Now maybe we will start to see it in the next one to two years. But guys, tell me if you disagree with me. I have, I have 100% confidence that the monetization is coming and the cost savings are coming. Like, we're so early, but there's so much visibility into that. Like I don't even know, we don't even know what the monetization model would look like. The early attempts at monetization are probably going to be so far off from where it actually eventually settles. Think of early internet. We didn't even know about hate search, you know, when the internet was new. Well, I'll give you one right now. I just got out of a visiting of, you know, obviously, I'm not at home. I'm in Austin right now, but I'm on my way home after this. But I just got out of the meeting and there is a company that is one of the most bleeding edge voice AI companies, okay? So I can't, I won't name their client. I'll just say their client, the one we had discussed in this meeting is one of the largest in the world. And they are utilizing this voice AI right now to conduct, I think, 10,000 interviews a month. They're actually doing 10,000 HR recruiting interviews end to end. This is deep tech interviews, okay? They can conduct interviews in 10 languages, okay, the AI can. And not only is it conducting these interviews as opposed to wasting all these employees' time to interview people that will never be hired, but it's collecting all of the data on all those interviews. So every single answer of every single individual that's being recruited by this company is getting, you know, input into the model. And then within the next couple of years, they'll look at those people that they actually hired, how they are doing. And the AI will actually learn what better questions to ask. And it will be able to filter out organically the candidates that are best suited for that particular role or that particular company culture based on real results. Like that is one of a billion use cases for big incumbents, okay? Every single facet of their business from customer service to strategy, it is all going AI. We know it. There's not like, there's not any question, guys. There's literally no dispute over this. The only dispute is timeline. And I think the big timeline and the other dispute is going to be models in that, you know, I was reading an article where they interviewed John LeCoum the other day. And he is not that bullish on LLMs. He thinks they're pretty limited, that eventually you're going to basically reach an end to what they can do. And newer models will have to take place, which are going to require even more GPUs, more resources. And so I think these things are still going to involve. I think what we're seeing right now is what we're going to see in one, two, three, four, five years. >> Jordan, you're exactly correct. We don't exactly know how we are going to get to a point of finished AI, right? Like what will be the actual approach that works in 10 years, in seven years? But we've seen enough, like there are enough approaches that will work good enough that do you agree that even if we have to bandaid our way there, like, think about the internet, early internet, Jordan, the companies that were ultimately solving a lot of those problems are not ultimately the companies 20 years later that are solving those problems that are better companies, better approaches that did it more efficiently with more accuracy. But it didn't mean that we still didn't have companies making a ton of money in early internet days, right? Like solving the problems just not as well as we can solve them today. >> All of this step will evolve over time, and it will continue with a life of its own. >> Yeah. >> I will think that AI is just going to end, and the bubble is going to pop, and it's over. I'm sorry to say that I don't think that's-- >> No, we're at the beginning of the next industrial revolution. And yes, it grew fast, and everybody got nervous that people were spending too much. And I saw this on X the other day. This is where Nvidia sits in the mix here. You have all these companies that are building as fast as they can, spending as much money as they can, eventually going to figure out how to monetize it. And Nvidia is over here saying, we have the product that we can't make fast enough for our customers. >> Yeah, except maybe put TSM on the hill right above in video. >> Yeah. >> Yeah. >> Totally. No, they are the shovel in video-- >> Yeah, we're still making the shovels, right? >> They make them? >> Yeah, right. >> So, when we talk about what is the biggest risk? The biggest risk I could think of right now for investors is not understanding the timeline and not fully appreciating the degree of investor anxiety and fear. And as a result of that, you have to tap down your leverage, at least your short-term leverage. And for me to say that, you guys know I had been basically levering into this trade for the last 18 months with weekly options, obscene amounts of risk, obscene amounts of leverage, obscene amounts of margin. And what do we see right now today, after this magnificent and magnificent Nvidia earnings, we have a market collapse for evidently no reason except maybe profit-taking, maybe due to fear, maybe it's the algos, I haven't had time to look into it. The bottom line is, there is enough fear and doubt in this market. There is enough, I would say, misunderstanding around timelines that I would be very nervous now over the next few months of hitting on too much short-term leverage. You can get wiped out, because look guys, I cleared out my options this morning. I don't even have options, I have like a few, okay, I have a few, but not much. And for me to tap down my options to this degree, and I don't have any intention, unless I come across some really meaningful information this weekend of entering into any big levered positions next week. So that's where we are at. Look at that. I don't think we don't always have to have a narrative or something. Markets go up and down, right? And we've had a heck of a run, and for people to sell, for funds to cash out, some of what they've put together over the past year and a half, markets go up and down. They do. I am meaningfully reducing my leverage because in the short term, I just think there's going to be a lot of volatility and a lot of misinformation, continued misinformation hitting the market. People misconstruing what's important. And I don't see that ending, guys. I really don't, and it makes me really nervous. So unless I have, you know, like I said, if I come across meaningful information, it doesn't mean I don't still have my favorite AI stocks. I have one in particular that I've been talking a lot about. We've been discussing a lot. I think the focal point of our next episode, just hint, hint, it's blue energy, right? We're going to do a deep dive into blue energy on our next episode, which, and that was also up big earlier today. And this is the blue section is the overnight chart, and look at that clip this morning along with everything else. I think that thing was up like eight or 10% at the height that it's now to down like seven or eight. Unbelievable. That's just today. It went from up 10 to down eight or something, it's wild. So my approach to the market right now is figuring out, and by the way, this could change over the next couple of years. I don't necessarily think that all of Big Tech is necessarily all going to win equally from the AI trade. And I think we're going to figure out who the biggest winners are in Big Tech over the next couple of years. But if you do have companies like right now, blue energy is one of my absolute favorite AI plays, and we'll talk more about that next week. And you see these irrational drops. If you have an income, by the way, we're not financial advisors, it's just like the way I'm thinking about it. I have some income, some cash flow coming in from a few different places. I'm just layering into these trades. Every time they drop, I'm just layering into Mike. It's just, I'll continue to do that as long as my thesis doesn't change. But what I won't do is like power into weekly co-options every week, like I've been doing. I learned that lesson over the past week. I'm like, okay, this is where we are now. This is the phase of the cycle where we, it's more of a heads down building. It's going to take some time to show monetization. I don't think you're going to see any type of massive monetization in the next like few weeks, few months. So if that's what the market's looking for, I don't think the market's going to get it. I don't think they're going to get what they want. And if they're not going to get what they want, you have to be careful, right? Yeah. And I think that that's the right move here is not, you know, not being out of the market, but just not being hyper leveraged. By the way, guys, you know, everyone has been coming down on Big Tech the last few weeks with this circular financing stuff. I talked a little bit about this on that ice coffee episode I did last week with Graham and Jack. Which by the way, if you haven't watched that, it's an excellent, almost, is it almost two hours? I had to watch it fast speed, but it was a really good conversation you guys had on coffee hour with Jack and Graham. It's two hours and 20 minutes. I was the first guest they had in their brand new studio. I won't say anything more next. They want to reveal it, I guess, on their own terms. But I will say this, the episode got fairly personal. We talked a lot about wealth, about family and how you deal with that. And hopefully a lot of our, a lot of our followers at either now or in the future will be having to deal with all the newfound wealth from this AI cycle and they will relate to that conversation. But we talked about the circular financing and it's all it is is leverage, Nvidia believes so strongly in their business plan that they want to lever into it. So rather than kind of give hundreds of millions of dollars back to shareholders, they would rather lever into their own clients to allow their clients to have the capital to spend more money with them to do bigger things with the compute that they're selling them. I don't think there's anything wrong with that as long as they're right. If they're right, that is going to benefit Nvidia and benefit the AI sector at large. Now if they're all wrong, if this whole AI cycle is nothing but BS, if like we don't need this much compute ultimately, like if they're wrong, they're going to be really wrong. And they will pay the price for making all of these investments and the circular financing will like meaningfully, you know, make the implosion worse, right? But if they're right, it's all good. I just think it's, it's wild that now is the time that everyone's calling AI bubble. Because it just seems like we're still so early, we've seen some early taste of what AI can do. But we are, we're not like, we're not there, they're so, and it can get so much bigger. But also guys, we spent the last two years complaining about how China is stealing our thunder and we're losing all of our economic advantages to China. But here we are and all of our big tech leadership is putting their entire reputation on the line. They're leveraging out their balance sheets to make the biggest bet that they've ever made on the future to keep America on top. And all we're doing now is complaining about them doing that, about them taking that risk. Well, you know what, big tech taking these risks is peak American energy. This, this is what America is all about. This is what got us here, okay? And this is what's going to save us. I see these guys like Jensen and Elon and like all of the tech leadership, even Sam Altman and people think they're crazy. I'm like, hell yeah, they're crazy, they're crazy Americans. This is the stuff that built the industrial revolution. If we didn't have guys like that 100 years ago, we wouldn't be here today at the top of the pyramid. If we want to stay at the top of the pyramid in 25 years, we need to take this risk. You're not going to get the reward without taking the risk. You want to stay on top, you better damn well, spend the money and take the risk to actually stay on top because China's, China's not going to not take that risk, right? China will spend their government money. They'll spend trillions of dollars themselves. And that's a thing. No, I don't know if you're watching, if you've watched the Gilded Age on HBO about the train rollout in the 1800s, it is basically what is happening today. And I see Jensen and Elon as those, what do they call them, those bagger barons or whatever, that basically changed the fate of America and the future of America. And we're so early in it still and this is a time though, the risk of another country developing AI. I think Sam Altman kind of said the quiet part out loud when he said that this is too big to fail and if needed, the government would step in to continue AI development. The reality is America is not going to let China get that far ahead. The government will step in. And that's where I just don't see any real risk in Nvidia longer term because they're going to be able to continue making their products. They're going to be sold out before they can even make them. They're going to have bigger and bigger contracts. They're going to spend their own money to reinvest in the people buying their stuff and America needs to win and will at any cost. Yeah, listen, they say they don't have a choice. I agree. They don't have a choice. If America doesn't take these bets right now, and when I say America, I mean big tech because that's where all the leverage is. That's where the balance sheet is. We basically have what, six CEOs that can choose to like do the right thing or just flounder and we've been floundering forever. Like think about what we've done the past ten years, how much time and energy and resources we have wasted just to continue to tweak the iPhone hardware, to tweak the algorithms on Facebook and on Instagram to be slightly better to generate a little bit more efficient revenue for those advertisers and for Meta, like all of those resources, all of those technologists just on the old technology, just tweaking the existing system, like it was an embarrassing use of American talent the past ten years. We finally have something that could change the world. We finally have something that could send us into the stratosphere of where humanity has been trying to go forever, which is like four day work weeks, okay, you don't have to work in a factory for 50 years, you maybe don't have to work in a cubicle for 50 years, right? We might actually be able to have more creative, better jobs 30 years from now because of AI and robotics, humans might be able to actually live a better life, spend more time with their family, with their friends, all that stuff. This is what we've been working for for thousands of years and America is at the perfect place to be able to bring this to the world. And you just wanted us to not take that risk and to let China do it, are you freaking kidding me right now? It's insane. And it's not just China. We have the Saudi government is spending tons of money in AI. We have EU spending billions in there, in there, what does it mean? But Dave, that's China because if it was not us partnering with the UAE and Saudi and all this stuff, if it was not us, they would simply do this through China. They're not capable or able or willing to do any of that on their own and China would have loved nothing more than to have all those data centers being built by them, okay? Instead, we made the bold moves and hey, this administration, I give them a lot of crap, okay? I give them a lot of crap, but I will say this, even if it was for the wrong reason, because you never know what the motivations are of this administration or any administration. The fact that we got those deals sewn up in the Middle East, I think will ultimately be huge for us, absolutely huge, because they were getting locked up one way or the other. Mice will be our American companies, our chipsets, right? Like our models, getting built out there, because they have money, they have resources, like let it be us, like I think that doesn't get enough credit, honestly. And we'll play out over the next 10, 15 years. Oh, for sure. Anyway, I'm off my high horse now, I just like, there's been so much negativity. Have you ever seen so much neck during this cycle the last couple of years? We have a lot of negativity in every cycle, so it's, I'm unfazed by it. Yeah, so Jordan, we go through this cycle where it's like, you know, a few months of, wow, like AI is really doing well and like look at the improvements and look at all the benefits and how people are using it. We have stuff like Sora coming out and it blows your mind. I think Nano Banana, the next one was just released a few hours ago too. I haven't looked at it yet, but I heard Google did that today. Is that correct? Version three and the, what is it, anti-gravity where you can just like vibe code, a full app? Yeah. Like I wish I had an app to develop right now because I would love to actually have a good use case for that. Well, well, Dave, you do have to give it a few weeks, let, let, let the real developers sink their teeth into it and they will find, you know, they will find the deficiencies in this model. I know everyone's hyped on it now, it will probably, they will probably be a little less hyped. I would imagine in a few weeks than they are today, but I have never seen anyone so hyped on a model than this Gemini 3.0. Google knocked it out of the park. Demis has to miss like, you got to give them credit guys. They have been bleeding so much talent over the last six months. Every single time I see an AI start up, it's always like a Google deep mind or two or three people. I'm like, do they have anyone left over there? But obviously, they have nothing with Apple, like Apple, I don't think has an AI department left. They all, they all left. I think I think met a bot. Most of them. Yeah. Oh, so the one thing, getting back to the biggest risk, the one thing I really wanted to like share with investors because I went through this myself and I was, I've been really introspective about it the last week. We have experienced so much dopamine the last year, a year and a half in this, a trained this AI. I go, okay, it's not normal. It's not normal. I constantly get pinged by good buddies of mine and they're like, what options are we buying this week? I'm like, what's happening this week that you're buying options and like, they're like, oh, I bought, I have too many in video call, like, why do you have in video calls two weeks ago? What are you doing, dude? These are regular people. These are like normal people that have like gotten into this sector, made so much money. I think they're over leveraged. I think we've been spoiled. Listen, congrats. If you were early AI and you were part of this the last year, it's been awesome. But you got to slow yourself down. I don't think that's where we are anymore and if you just continue to go, go, go, like you were the last, you know, 12 months, I think you're going to get yourself into trouble. Like you just need to chill out with the leverage, dude, like, I'm going to chill out. If I'm chillin out, you better chill out with the leverage because I rarely chill at leverage. So I think that's the environment, man, that we're in right now. I wonder how long you're going to be able to chill out on your leverage. I just can't see it happening for more than like, we're going to see a little bit of a mark. Like, I thought today was the day we were going to, we were going to actually turn around. I thought, I thought, in video might pull the whole market back up and we would just see all kinds of new highs. But no, we're not, we're like, even like, I mean, Microsoft is up here today, but some of the others, Amazon's only up like 1%, like, we're not, we're not flying as high as you might think if you're super leveraged in the stocks that we mainly talk about on this channel. But this is good. This is what we want. If you're an investor, I would assume that almost everybody watching this show has an income for the most part, okay, however big or however small that income is. We've been talking about this for two and a half years. This is the big one, okay, and if you want to be part of it, it's really hard to be part of it when valuations spin out of control. When everything is getting pumped and hyped, ultimately having these corrections is awesome because if your dollar costs averaging into the AI super cycle, days like today are exactly what you want to see. I don't know what's happening right now. I'm looking at the charts. I don't know what's causing this other than maybe just a cycle of fear and people want to get out before someone like profit, like, I don't know what the hell happens. I look at AI cannot figure out why the market is crashing right now. Literally the headline that AI put together for Nvidia, Nvidia slips 1.57% after strong Q3 earnings and multiple price target raises on Thursday. It can't give me a reason why it's going down. The guidance is good, the earnings is great, the analyst upgrades and price target raises, the White House export bill stance, the White House is urging Congress to reject a bill that would limit Nvidia's chip exports. How about that? The broader look, the market and sector context, despite Nvidia's strong earnings and guidance, the stock declined, reflecting profit taking and this is what AI came up with for why the market is going down and particularly Nvidia this morning. Profit taking, broader market caution amid mixed economic signals, S&P and NASDAQ showed modest gains today, but tech stocks face some pressure. No, Dave, I found it. It's Morgan Stanley no longer expects Fed rate cut in December. But we already saw that in the prediction markets yesterday, does Morgan Stanley have to say it? That's what we want, guys. When you see the market drop like this, when you see these corrections, the only question you have to ask is why? That's it. You got to figure out the why and if the why does not change the important thesis that we're all trading on, then that's great news. If it's just about the stupid Fed cut or not Fed cut, that's exactly what I want to see. Yesterday at noon is when the markets flipped on whether the Fed would cut 25 basis points or maintain. And we're now at a 63% chance of maintaining, according to prediction markets. If this market drops much more, Dave, I'm going to want to put on some leverage. I know. That's what I'm saying. I saw someone in the comments say they give you two weeks tops. I was more like two days. I'm just so glad I took off my leverage this morning. I didn't even have that much. The funny thing is I say I took it off. I'm literally at like 90% margin, but I'm talking about option leverage here. Yeah, yeah. I basically, I still have some margin balance just because I can't, I'm not going to sell stocks when they're, you know, dude. This is a brutal day, brutal. I mean, my account just got, yeah, mine too. My account today, the swing from today's high to current is painful. This is unacceptable. This is completely on, we need to close down the government again and get Jay Powell to cut those rates. Papa Powell, you listening? The fact that this could have been more brutal, if I didn't pull out of those options, scares the hell out of me. But no, guys, listen, this is par for the course. Yes. You're going to see a lot more of what you see today because the market, people are looking for a reason, they're looking for a reason except it. That's where we are. That's where in that phase where people feel that there's enough risk with the, with the bubble. Yeah. I just, like, we saw the dot com bubble and that actually was a long term took, took years to get back from the crash of the dot com bubble. I just don't think the AI bubble, I don't think AI's progressed far enough to call it a bubble. The dot com bubble was a bubble of fraud. It was literally, I mean, we were on an unnecessary companies like pets.com was fun, but it didn't need to exist and it didn't, especially at the crazy valuations that it IPO'd, like, that didn't make sense, but the government didn't need a pets dot com. The government does need to have AI that is competitive across the globe. You know what? I talked about that on the ice coffee hour and I, Jordan, I want to get your thought on this too. The thing I am most, am I naive by saying this, the thing I'm most excited about, about AI? Well, other than curing cancer and stuff like that because that's like, that, that is like the greatest thing ever is AI government and I don't mean like AI's running the government. I mean, AI is consulting the government and it is being heavily utilized inside of all the world's governments. Imagine how a fish, hold on, hold on, hold on. The government has practically unlimited resources to be able to educate themselves and to make the best decisions possible already. You think that just because they're going to use AI that they can get better decision-making, I mean. Yes. And I will tell you why. I will tell you why. Basically. Jordan is living in a fantasy world where he thinks the government knows best. Yeah. That's our point. The point is that the government could have access to the best. It's just the best universities they can consult with people. They don't do it. They don't. Jordan, you're missing the one thing, the one thing you said is not even for the IRS is by a fax machine still. No, no, dude, dude, you're missing the point. They can do anything, AI just does it. It just does it. That's the thing. The government, they literally, they won't even talk to each other. They won't even get in a room and say, hey, we want that we mostly want the same thing, but we think you should go about it this way. And like, well, we think we should go about this way. And in today's government, they're like, well, F you, and then they never talk to each other again. AI will be like, hey, here is-- You're too practical, Chris. No, no, no, no. I mean, there's too many-- the problem is, it's not that they're trying to make the best decision. They're not. They're trying to get their constituents to vote for them again. But Jordan, they won't have a choice because what's going to happen is that governments, some governments, will use AI. And what will happen is we will quickly figure out that if your government is not using it, your company will implode because if China is using AI to basically have the most efficient, most productive, next level decision making on every single facet of every policy and everything that they do, and I'm just using China as one random example, right? I would use an example of a small country that is completely in shambles, turns AI on, and it takes them from worse to-- Yeah. So what I'm saying, Jordan, is if countries and states and provinces start using AI and they're able to get five to 10x more out of every dollar spent because there's better decision-making and better approaches, and they don't have to argue because the AI just basically just does it for you for the most part. I mean, there will always be political hands. There's always political decisions. I don't think that's for society or what the best decision is. Okay, Jordan, I agree, but what AI can do is it can meaningfully help. It's the ultimate tool, okay? And it's a tool that I think could radically improve the productivity of our government and our tax dollars. I could, is the key word, will it? I don't know. Okay, I don't know. I don't know if everybody's going to get better in our lifetime, but I know that AI has the potential of, I mean, if you think about AI could actually help negotiate between two opposing sides and extend that out, could negotiate between two countries. And at some point, what if we have a little bit more globalization where it isn't, even that the country lines are more blurred? Dave, what's going to happen is you're going to go to a summit between two countries. And instead of having basically two random people controlling what the narrative is for each company and the negotiating, each one will walk in with their AI brief. Of their deep research AI brief about how to go about getting to the ultimate end result. And you know what? Because both countries, AI's were super smart. Even though they were operating independently, both those AI's are going to come prepared to basically get to an end and actually come up with a solution because they will be infinitely smarter than the political jackass that used to have that job and be responsible for that. But Jordan, to disprove one little piece of your narrative right now, think about what the internet has done to government. Think about your driver's license. What did you have to do to renew a driver's license? I know it took them 25 years to figure it out, but finally, state governments now, you're able to renew your driver's license, renew your passport from your house now, okay? Just going online for like, not every time I just had to go in, I just had to go in this last year. Okay. Well, okay. Because I don't want to get, yeah, what I'm trying to say is whether it's that or paying your water bill or whatever it is, like there are meaningful efficiencies that just the internet. But on the opposite of that, there are then political decisions like Trump's right now wants to make it illegal to vote by mail, right? So he wants you to have to go in person to vote. And so he's trying to make things less efficient because that aids in their parties' success, right? Okay. That will always exist. It will never be like that. That's my point, though, is that some things maybe they can use it for, but there will always be these political decisions that they make to try to appease some base or to get some advantage in some way that's not optimal. Yes. They will slow it down. They will somehow not take advantage of it anywhere nearly as well as they should. But at some point, you can't stop that train just like finally in 2025, our government is finally on the cloud. It's like government services are finally becoming internet like capable. So yes, it will come late and it won't be as good as it could be, but Jordan, the AI train cannot be stopped. And I don't even think governments can stop it. I think eventually. I think companies right now, I can't even imagine government getting better at this point, but companies will. Right? I think the government will resist, but they will see another country that has some breakthrough in improvement and efficiencies that they will have that they don't compete like that. I mean, they do, but they don't, right? As soon as a country that never had some new weapon that has never even been dreamed up, has an AI that invents a new weapon that has never been dreamed up, so a photon gun, you know, you know what we're going to do? We're going to put AI on designing our photon gun arsenal. Guys, I don't even think it's like that outlandish to say sometime in the next five years decisions will basically be made to say, hey, we just, we need to have AI running essentially deeply integrated into each of these government divisions like it will become so obvious that to not do it seems just completely insane. It's like. Also, you're going to have to set goals for it and like what are those goals and what are you trying to maximize, right? So it's, is it, is it trying to maximize the fiscal, you know, the, you know, the fiscal position in the United States or trying to maximize, you know, human happiness or return. I mean, okay. Okay. Okay. Okay. That's the question. I'm here in Austin. I was watching the local news yesterday and they talked about the fact that the, they voted down the tax increase and because they voted down the tax increase, they now had to find ways to cut insane amounts of money from the Austin city budget. And they were talking about emergency services getting cut and all these other things getting cut. Now, you have a bunch of randos in a room. Could you imagine trying to figure out the best way to become more efficient as a government because you have to, Jordan. They have to. So they're about to make some very bad decisions, I'm sure, because like, what do they do, right? Now, now, I want you to think about where we will be in 15 years in that same exact situation where the general public goes, Hey, we're not voting for that tax increase, figure it out. They will have AI and AI will actually help them figure out how to be a more efficient. But how do they optimize for it, Chris? This is my point and so the way the way that the politicians are trying to optimize for it is that they don't want to upset their constituents, right? And so is that how they're going to program the AI or is that the input or the, or the, you know, however, they're going to set up the AI to be the most efficient. How is it going to be the most efficient by dollars, by what makes sense, what, what's the best public good, or is it going to be, how does it, how is this AI decision going to get me voted in next time, right? Which is just the exact same thing. But I think, I think all it's going to be is this, we have to cut 200 million from the budget. Can you please figure out how to cut it to where we stay in office? Okay. Now, I agree. I agree, I agree that it will be part of the prop probably if, unless there's some mandate that we get to see the prompts as a public and make sure that they're not allowed to put that. Like, that's the first part. It's done. That should be part of the government AI, what do they call it, where you have to be in sync with humanity? What's that called? Oh my God. They use that term alignment. The AI alignment for government should be no prompting that favors the politicians that should. You just, you just, again, you're using words that, like the words should, good luck getting a politician to do that because they, they sure haven't added anything to the discussion on time, you know, their, their time in office limits, their ability to invest in the stock market. Yes. Okay. But even, Jordan, I agree, it won't be perfect. But even if it's imperfect, even if part of the prompt is, by the way, when you're doing this, do it in a way that is likely to get us re-elected, whatever, that's not optimal for anybody, except for them. But it's still going to be amazing relative to what they're doing. I think that's where you've got these big fallacies, right? And the fallacies are that there's an optimal, like the, and optimal path when there's many optimal paths, just depends on what you're trying to optimize for. I, whatever the optimal path is, I think AI is just going to do it. So they're going to be the optimal path, they're, well, we'll have to decide what the ultimate path is. I mean, we're just going to have to submit to the AI overlords, the same way we do in our online ads. Even if it doesn't result in as much efficiency as I anticipate it will, and Jordan is right, I do think it's an evident ability that governments will go to AI and start to plan for this and prep for it. That will happen. And we haven't really seen that part of the cycle yet, which I think is super interesting, because that part of the cycle should be pretty massive, Jordan, don't you think? When we have local, state, and federal government across every single sector, saying, hey, we need to start to make plans for an AI world and to make sure that we now have compute, that we have models that are specific to us, like that work has to start fairly soon, I think. And I don't think we've really seen it yet, because it has to get voted on, right? It's a tough thing to push through, but don't you agree it's inevitable in the next couple of years that will start to see the, what we'll call it the sovereign AI cycle, and this is not the Middle East, but like every country in the world, including right here. Or I have teams of people that are going to be working on these things. They have to, right? And so you've got to start small. You've got to figure out what problems you want to try to solve using these things. And that's what we see companies doing right now. Companies are more efficient than governments, so you're going to see companies, especially smaller companies. And we're seeing this right now, implement these things, and that's just going to grow over time to larger, larger organizations, which will then grow in the sovereign. The thing that I, the thing that's on my mind that does want me to lever up at some point, not right, we're not yet, is I feel that there is a moment that's coming, and it will be a statement, and it will likely get leaked first. And it could be this administration, I'm going to say it probably will be this administration. And the statement is we're going all in on the federal level with AI, and we are committing to buying $1 trillion of compute over the next time. Like isn't that an inevitable thing that's coming, and is the market appreciating the fact that that's on its way? And when that day happens, could you even imagine what that day looks like for Nvidia? Like, and not just Nvidia, like, or Nvidia energy companies, and energy. So we already had the chips act that put $52 billion straight into R&D for chips. I think that you're right. We're going to have some moment that we're going to say, oh, compute is actually important to us too. Not just the companies that make the technology, we're actually going to need the compute power ourselves. And we haven't talked that much about U.S. sovereign compute, and also U.S. like that whole strategy for you. That hasn't happened. Knowing what the conversations that are happening right now between the Trump administration and all these big tech leaders, you know that's cooking. It has to be, right? Yes, it has to be. Yes. Because like, it's an everybody win situation, and it's going to pump the market, boy, I will definitely be levered for that trade. I mean, the day that Nvidia was announcing their earnings, their CEO was at the White House, and the president quoted him in three posts on his social network that the president owns, which also makes a lot of sense. We always talk about having a prepared mind and understanding like what the future thesis will be that you don't know when it will surface, but you know it will. This is a big one. I think if I'm an investor right now, I'm trying to figure out when that might leak. If there are any leaks on it, like, I'm going all in on that. So that's like at the very top of my list of things to monitor. Anyway, Jordan, I know you got to get out, man. Yeah. You do too. I'm going to get in the road and get home. All right. Well, that was quite a discussion. We hope you guys enjoyed it. So we were capping it off, chill out in the leverage. Essentially, you do not know the degree of anxiety and fear in this market right now. There are not a ton of big, like instantaneous catalysts left in AI that will just be coming at you every few days that you can count on. So I think it's really weird to be overlevered, to be playing weekly options unless you're a complete degenerate right now. Yeah, I feel like now it's just kind of some thesis that drives that right now. Well, yeah, unless time-based thesis, right? If something pops up, if there's some new piece of information that I'm not aware of as of today, that kind of surfaces that make sense for a levered time trade, fine, but I'm not seeing it right now. We're kind of in by and hold. We're kind of in a boring time period. And there will be some crazy announcement. There will be something that you need to have that prepared mind, but now is not the time. It's like by hold, by more, by hold, and dollar cost average. It's like, it's like all of the most generic financial advisors would tell you, it's by and hold, and dollar cost average. I feel so boring. It's refreshing for me to say this stuff like this. I feel like too much time with Graham Stefan over the course of the year. We're now a personal finance channel. All right. That's going to do it for this one. Thanks for watching.