Elon’s go-to banker leads SpaceX IPO, SaaSination, Bejing’s robot Boom | Diet TBPN

There's a whole bunch of interesting news. We're going to talk about Michael

news. We're going to talk about Michael Grimes today, what Apollo is doing, some new humanoids out of China. There was

one piece in the journal that I wanted to read for you. Streamer Braden Peters suffers awkward encounter with Arizona State fraternity leader. Video of the interaction has drawn widespread

attention. Braden Peters, the online

attention. Braden Peters, the online streamer known as Clavvicular, found himself at the center of viral attention this week after a brief in-person encounter with a fraternity leader at Arizona State University left him

visibly diminished. This is uh this is

visibly diminished. This is uh this is newssh just today. Video of the exchange, which has circulated widely across social media platforms, shows Mr. Peters appearing noticeably

uncomfortable as the unnamed fraternity member dominated the interaction through sheer physical presence and social confidence. Viewers noted that Mr.

confidence. Viewers noted that Mr. Peters, despite his considerable height, appeared to shrink during the exchange, struggling to maintain composure as the other man controlled the tone and pace

of the conversation with apparent ease.

The clip has been viewed hundreds of thousands of times now with commenters largely agreeing that Mr. Peters was in the parlay of his own audience thoroughly outclassed. Neither Mr.

thoroughly outclassed. Neither Mr. Peters nor the fraternity leader could be reached for comment, but we'll be following that story, of course. Uh,

anyway, moving on. Michael Grimes, he's Elon Musk's banker and he might be the most important person in the SpaceX IPO.

That's probably going to happen this year. Kevin Quac summed it up. He said,

year. Kevin Quac summed it up. He said,

"Michael Grimes moving back to Morgan Stanley is the strongest signal so far that SpaceX that the SpaceX Open AAI anthropic IPO Jubilee, it's a real thing. We're going to dig into it." A

thing. We're going to dig into it." A

lot of people are actually very familiar with Michael Grimes. took Facebook,

Google Tesla Uber Spotify Salesforce LinkedIn Workday and literally hundreds of other tech companies, uh, public. He's been in the industry for decades. He

>> He has a reputation because he he becomes a a customer or user. Yes,

that's a fun fact. Of the different products as during the kind of bidding process, he's talked about playing Farmville. How many hours did he play

Farmville. How many hours did he play Farmville?

>> He didn't say how many hours he played.

Uh, at some point, we'll have to ask.

They just had played hours of Farmville in the leadup to the Facebook IPO. To

understand the IPO thesis, the investment thesis for Facebook at that time, you had to believe that other businesses would be built on top of Facebook. So, you had to understand

Facebook. So, you had to understand more.

>> Yeah. So, look, you would expect him to like, you know, spend hours talking to to Annie uh you know, for the SpaceX IPA.

>> For sure. For sure. Yeah, definitely. He

also actually drove for Uber before taking Uber public in 2018. And so, he likes to dig in. He also has just a very uh a very like perfectly aligned

background for tech and tech banking. So

he did the traditional investment banking thing. He was at Solen Brothers,

banking thing. He was at Solen Brothers, then Bear Sterns, then Morgan Stanley, but before that he studied electrical engineering and computer science at Berkeley. And so he was like never

Berkeley. And so he was like never really boxed in as this pure finance guy. And there's this interesting full

guy. And there's this interesting full circle moment where you know many people could comp Elon Musk to Howard Hughes who started uh Hughes aircraft and sort

of created like the aviation boom and Michael Grimes actually interned at Hughes aircraft in the space and communications group back in 1985. And

what is SpaceX? It's like a space and communications company. And so you have

communications company. And so you have this like very full circle moment which I thought was cool. He's like truly a deals legend. He did a brief stint with

deals legend. He did a brief stint with the commerce department and people were wondering like is he gonna be able to stay out of going back to deal land like there's so many good deals on the table right now. You got Anthropic, you got

right now. You got Anthropic, you got Open AI, SpaceX.

>> There's deals in the government but it's just a different environment. You know,

there's so much red tape and famously at Morgan Stanley, Michael Grimes was set up in a way that he at least reportedly was not really required to deal with all

like the firmwide strategy, what's going on with the rest of Morgan Stanley. They

were like, "Go hunt. Like, you're a killer. Just go do whatever you need to

killer. Just go do whatever you need to do. Go fish. Go fish." They sort of

do. Go fish. Go fish." They sort of cleared the agenda to just let him go do what he did best. And he obviously was extremely successful at that. He got

pulled back to Morgan Stanley and he got a promotion. So now he's the chairman of

a promotion. So now he's the chairman of investment banking, which is I guess higher than co-chair of global technology banking, which sounded like the top, but there there are levels and

he's even higher now. And it makes sense if SpaceX uh you know, they're on track to raise $40 billion in this IPO. You

know, nothing's really confirmed yet, but that feels reasonable in the range.

So what are the investment bankers going to have to do? They're going to have to talk to literally everyone with money, and the investment banking fees could be like $400 million. Right now, people are thinking those will be split across the

four lead banks. Morgan Stanley, Bank of America, JP Morgan, and Goldman. Either

way, you got to get ready for the road show of a century. It'll be interesting.

What will Michael Grimes do to prove that he's ready to go to space? Will he

go to space personally? I want to see some stunts. I want to see stunts

some stunts. I want to see stunts pre-road show.

>> Elon, I fell in love with Anie.

>> You think that's >> We're starting a family.

>> Put Michael Grimes in the rocket. Let's

do it. It's so much easier to underwrite the deal if you're like, I've been I've been to space. It works. Ive I've driven for Uber. I played Farmville. This is

for Uber. I played Farmville. This is

the best technology. Going to space is better than playing Farmville or driving.

>> What if he says put me in the mass driver?

>> Put me and this was sort of a surprise to people. People thought, okay, Elon

to people. People thought, okay, Elon has run the AB test. He took Tesla public. He kept SpaceX private. He had a

public. He kept SpaceX private. He had a much better time with SpaceX doing, you know, secondary sales and fundraises very easily. He could do whatever he

very easily. He could do whatever he wanted really like much more control.

Tesla, he's getting sued by shareholders. All these different things

shareholders. All these different things like regulations, SEC stuff, like it's a headache, but the stock's doing really well. And at a certain point, maybe you

well. And at a certain point, maybe you cap out what's possible in the private market. So, all of a sudden, Elon says,

market. So, all of a sudden, Elon says, "I'm going public. I'm merging

everything together. I'm going now. I've

made the decision." Uh, this week's Grimes put himself back in the middle of the action and in line to reap millions of dollars of fees. Morgan Stanley said Monday he was rejoining the bank as chairman of investment banking, a promotion from his previous role as head

of global technology investment banking.

SpaceX has long been considered a golden goose by IPO bankers. It skyrocketed to a 1.25.

>> Let's give it up for all the golden geese out there.

>> Golden geese. May they never be slayed.

They must just continue laying eggs.

Interesting. There's all this news about the the the XAI co-founders leaving. But

you're postacquisition. Of course the co-founders leave, right? That's pretty

normal.

>> Well, I think the reason that people care is because it it was happening for quite a while now. Do they need to just be near the frontier or do they actually need to be doing research to advance the

frontier if they wind up like should you think about XAI more like uh a Neo lab that's trying to solve continual learning or some you know unsolved problem in AI research or should you

think about them more like a hyperscaler like an AWS or like a core weave or like a lambda like a neocloud that's just like capacity and more of an engineering task and if they're able to build

Colossus and then build 10 more Colossus and then build a bunch of space data centers and they just have a lot of capacity like they who knows maybe they wind up working with anthrop.

>> I mean I forget at what point last year we started talking about that possibility. Yeah.

possibility. Yeah.

>> But as the consumer products and the enterprise products have kind of fallen behind or or failed to, you know, fully catch up.

>> I don't know. I'm seeing a breakout in Grock in the comedy category on Instagram reels. You can go check them

Instagram reels. You can go check them out. There's some funny funny

out. There's some funny funny interaction.

>> It is really wild. Yeah. You really have to find the different modes in the product, but finding the different characters, going to the unhinged setting, it is about five times more unhinged than I would expect.

>> Totally. Totally.

>> A product like this to be. So,

>> talk trash about Elon. It goes all over the place. Honestly, some of it is

the place. Honestly, some of it is genuinely funny though, which is like a high praise. It's a new benchmark for

high praise. It's a new benchmark for AI. It is sort of like doing it's a it's

AI. It is sort of like doing it's a it's a cheat code because no one else >> part of humor can be truth seeeking, right? Right. Truth seeking or just

right? Right. Truth seeking or just saying what no one else can say or be unexpected. You don't expect the

unexpected. You don't expect the computer to talk.

>> Sometimes people can't say that. You

know, there's certain topics you can't say the truth. The the unhinged mode is certainly truth seeeking. It's

>> certainly unhinged as well. Will Depw

shared a little hack for everyone who's in to Chipotle. Uh we reposted a clip that is truly evergreen.

Jordy quote, "I used to get 90% of my calories from Chipotle at certain times in my life. It was something I would look forward to. But the last time I pulled over to get Chipotle, it was like, "This is going to be rough. The

quality has degraded. I'd rather fast than eat Chipotle." Taking shots at Chipotle.

>> The couple of the the younger guys on the team like, "What's wrong with Chipotle?" And I started shedding tears

Chipotle?" And I started shedding tears explaining how you >> back in my day. It was the >> When I was a boy, >> it was more fresh than the farmers market.

>> Yeah. I love I love your >> But Will has a good hack. He says, "I bought a Chipotle hat on eBay once and I would walk to the Chipotle in Ann Arbor and wear it when I went and they would just give me the employee discount every time. I didn't even ask. It was a $2 hat

time. I didn't even ask. It was a $2 hat and I saved $7 on my $15 order every time."

time." >> This is thinking outside the box.

>> He says, "I used to be so into budgeting in Chipotle that I'd measure everything in Chipotle meals. Rent was four Chipotle meals a day. A nice hat was two Chipotle meals. I also groed it. And in

Chipotle meals. I also groed it. And in

case this is fraud, it was more than six years ago. So pass the statute of

years ago. So pass the statute of limitations can't get me. On second

thought, I need to atone for my sins and repay Chipotle the $21 I stole from them by purchasing $21 of their stock. I am

sorry, Chipotle. Another resignation has hit the timeline. The co-founder of XAI is out. You want to read through it?

is out. You want to read through it?

>> Yeah. So he says, I resigned from XAI today. This company and the family we

today. This company and the family we became will stay with me forever. I will

deeply miss the people, the war rooms, and all those battles we have fought together.

>> It's time for my next chapter.

It's an era with full possibilities. A

small team armed with AIS can move mountains and redefine what's possible.

Thank you to the entire XAI family. And

Elon, thank you for believing in the mission and for the ride of a lifetime.

Some of the executives at XAI were offered cash instead of staying around.

And so it's possible he just said, "Cool. Time to uh time to move on." This

"Cool. Time to uh time to move on." This

isn't looking good. And it's the original XAI co-founders. There was 1 2 3 4 5 6 7 8. There's three remaining.

Elon plus manuel and uh Toby >> Jack Clark here. He said, "People leaving regular companies. Time for a change. Excited for my next chapter.

change. Excited for my next chapter.

People leaving AI companies. I have

gazed into the endless night and there are shapes out there. We must be kind to one another. I am moving on to study

one another. I am moving on to study philosophy."

philosophy." >> Well, so so this was like in reference to uh there was an anthropic researcher that just left and it was like this whole essay and then he ends it with this this poem.

>> Yeah.

>> Yeah. People get deep at these companies.

>> Head of Anthropic Safeguards Research just quit and said the world is in peril and then he's moving to the UK to write poetry and quote become invisible. Other

safety researchers and senior staff left over the last two weeks as well.

Probably nothing. Yeah, there's multiple factors going on. You you you can't discount the fact that many of these people maybe made something in the range of hund00 million in the last two years.

And if you're AGI pilled enough, you believe that that that will be, you know, many many many many many many many lifetimes worth of wealth and so why not

go to the UK and write poetry. There's

obviously a more dystopian sci-fi vision where uh when when this period of our lives, you know, gets uh turned into Hollywood, you know, blockbuster movies,

>> this will be a moment where, you know, the the the safety researchers start peeling off and, you know, going all over the world to write poetry.

>> I just want one AI co-founder, researcher to leave and be like, "Look, I got I got an allocation of an F80. I

got a bus down coming. I'm I'm good. I'm

Gucci. I don't need I quit. I quit.

>> Moving on. Apollo says it avoided the pain of peers by steering clear of software holdings.

>> Software? I never heard of it.

>> What's that?

>> I don't touch it. You know, people are saying the SAS apocalypse or SAS magdon, but assassination was right there. And I

don't know why we're not just calling it the assassination. Isn't that better? I

the assassination. Isn't that better? I

would I think assassination would be like uh SAS is assassinating something else.

>> Oh, okay.

>> You know, it's like your fund got assassinated.

Assassin >> like it I would think it got killed by SAS.

>> Yeah, I guess you're right.

>> Apollo says fees rise as company reports record quarter for deployment of capital. The group's decision to avoid

capital. The group's decision to avoid heavily investing in software companies during an era of strong of soaring valuations will bolster its growth as investors move their money to firms that

avoided a sector now threatened by AI.

Private capital groups would see a dispersion of returns depending on their exposure to software companies following growing fears of AI disrupting many IT businesses that triggered a recent

sell-off. Apollo would benefit after

sell-off. Apollo would benefit after largely avoiding such deals within its private equity portfolio and curtailing leading to the industry over the past decade helping to bolster its

performance of versus many rivals. He

said during an earnings call, I expect that we will be along with a handful of other managers prettier than we have been historically. They cut its exposure

been historically. They cut its exposure to software loans as it grew increasingly bearish about the sector's prospects in the wake of rapid inroads made by AI. The decision appears to have been validated by a recent sell-off in

software stocks and the loans of many large IT companies amid rising AI fears.

Monday.com had earnings and the stock went down 21% after they flagged AI agents as a competitive threat on their earnings call issued weak guidance as it

grapples with rising concerns that artificial intelligence is disrupting software business models. I imagine it's seatbased right now. Monday.com and they have to transition to some sort of

consumption based some sort of usage based something outcomesbased I suppose.

Yeah, you'd think at least some would say like we actually love the seatbased model in the era of agents. Every agent

will require a seat. You know, again, you might have a hundred employees, but then a bunch more agents. Maybe you

can't charge nearly as much on a per seat basis, but uh we'll we'll see how this nets out.

>> Yeah, it seems pretty easy just to be like you have one agent that goes into the software and does everything that it needs to and then brings it out to your organization. It's like I need the I

organization. It's like I need the I need to use the tool. There's one agent whose sole job is to pull it.

>> Yeah. Everyone gets a prompt box and then that agent has one seat and uses the tool and brings you back the results.

>> Fukco Capital is out for blood. He's you

worried about stockbased comp. Me these

businesses only need half their employees.

>> Oh, so he's bullish. I believe he thinks that the the SAS apocalypse is overstated. Headcounts for assorted

overstated. Headcounts for assorted company. Salesforce is at 87,000.

company. Salesforce is at 87,000.

Service Now 32,000. Workday is at 23,000. Zoom's at 12,000. Docuine

23,000. Zoom's at 12,000. Docuine

famously large at 8,000, OpenAI's at seven, uh, Octa's at 7,000, UiPath at five, sprinklers at four, and Anthropics at 4,000. The flip side of this is that

at 4,000. The flip side of this is that the companies do need employees to go deploy AI.

>> Correct. Tabukco, I have a strange amount of conviction that they could cut up to 40% and not impact growth. Buco

says in fact, it would accelerate. Yeah,

KPMG is trying to force its auditor to accept less money since accounting work can be significantly automated by AI, but KPMG makes money from accounting.

So, this looks like a company accidentally announcing to the world that its business model is under attack.

Matt says auditing can basically be done by AI, so why should we pay for it? It's

not a crazy thing for most companies to think or to say to their auditors, but it's a crazy thing for an auditing firm to say to its auditor. That is uh that is wild. KPMG should be paying Grant

is wild. KPMG should be paying Grant Thornton more. In these crazy AI times,

Thornton more. In these crazy AI times, everyone needs to pay more for trusted human auditing will go first. I guess

that's what Grant Thornton said.

>> It seems like they'll have to switch to value based pricing too like everyone else. And the value even if it can be

else. And the value even if it can be one-shotted with a prompt by some, you know, super intelligence is nonzero.

Like it is very valuable to have an external party verifying your work and the numbers that you're reporting. So

the other dynamic is you have like basically legacy, you know, the big brands in the space.

>> They adopt maybe a more Coke and Pepsi model where like Coke and Pepsi both could, you've talked about this, get in an insane price war, cut down, compete on price so aggressively that there's

just no money to be made anymore, but they have sort of like somewhat of an equilibrium where it's not really in any group's interest to compete prices to zero. Coke and Pepsi, it's a duopoly,

zero. Coke and Pepsi, it's a duopoly, not an oligopoly. So there's no third player that can be, oh, we're 5% of the market, there's so much to gain. Let's

go be the bull in the china shop. Just

doesn't happen. And then also there's lock in around the brand. And then

there's also lock in around the distribution because Coke and Pepsi have trucks that go to every uh every store where it needs to be distributed.

Auditing might not be the same structure.

>> Let's uh pull up this clip of Gersonner.

M >> on CNBC >> this is happening to the degree it is as we've discussed on numerous occasions is it overdone at times you've said yes the last time we were together you said

something like 90% of the companies the software companies that were down the way they are deserve to be those I think were your your exact words >> words >> where are we here >> so so when you and I were together on

January 6 I said you have to understand the difference between earnings and revenue and stock price okay and what's happened in software is hard for people to get their head around because the stocks have been cut in half. But that's

not what the market is discounting, Scott. The market is looking into the

Scott. The market is looking into the future and saying in the past, three years ago, I could I could buy 35 years worth of of Salesforce's free free cash

flow into the future. Give them 35 times free cash flow because I had that level of predictability. It was like a

of predictability. It was like a government bond. It was a sure thing.

government bond. It was a sure thing.

You definitely were going to get those.

And then we have AI do what AI's done over the course of the last several months. And people just said something

months. And people just said something very rational. I can't see as far into

very rational. I can't see as far into the future. So, I'm going to pay less

the future. So, I'm going to pay less for the terminal value. I'm going to pay less for those future free cash flows.

So, the only way that reverses, Scott, is those companies have to accelerate their core revenues and show that they are beneficiaries of AI. I think the the

real SAS apocalypse might not start until you have some of the labs public >> and people can actually really rotate out of software fully and say I don't want to own this thing that I don't

fully understand how AI is going to impact it when I could own the disruptor the anthropics the open AI >> yeah people were asking like where where will the 50 billion come from where will the hundred billion of capital come from

and we see this in China too where one company will go public and you actually see a drop in the the previous buys or or or whoever the legacy company is because there just isn't that much liquidity in the market. So, it needs to

come from somewhere.

>> Yeah. I just don't know how the narrative around SAS flips positive because the models are not getting worse, right? They only get they only

worse, right? They only get they only get better. Yeah.

get better. Yeah.

>> We actually need to see some type of plat like SAS would benefit from a model plateau, right? It's like, hey, there's

plateau, right? It's like, hey, there's sort of a set of capabilities. Yeah,

>> SAS companies can deploy this, but if the models just keep getting better and better and better and agents get better and better and better, where's the bottom for SAS other than, you know, some type of like minimal free cash flow

multiple?

>> Well, it's it's like refocusing on a narrative that has durability even in a world where software R&D is essentially free. I guess I guess what I'm saying is

free. I guess I guess what I'm saying is like if you see a business actually really accelerating growth accelerating then it's possible to get excited about that one company but it's hard to get

excited at any point about SAS broadly because the models are just going to keep improving and that just seems to be more and more of a threat.

>> Yes. But within SAS there will be companies that reveal to the market and and and correctly message that they are in fact like AGI resistant because of ad

networks because of lockin effects because of uh regulatory modes. There

will be a number of categories that emerge like when we talk about the payment the payment rails those feel like yes you could maybe vibe code it but are you going to vibe code your bank charter and all these other things that

you need to do and get all the customers like the distribution the lock in so I think within SAS there will be things that are pretty easy to just rip out and replace with something directly like a

model and there will be other companies that are are old and are legacy but you're just like oh yeah that's actually that can't be assaulted by a model. It's

impenetrable because it's actually a different thing. And so those companies

different thing. And so those companies will wind up sort of rebounding, I would imagine.

>> This is one of the most underrated observations in tech right now. If AI

commoditizes software, what's actually safe, regulated, liability bearing businesses, someone has to be on the hook.

>> Oh, sure.

>> Uh anything touching the physical world, hardware manufacturing energy that's a kind of Tesla.

>> Yeah. These are the subcategories of things that are sort of SAS businesses now but will reveal themselves as being not actually that asset light.

>> Proprietary data sets AI makes your data more valuable not less. Marketplaces and

businesses with network effects operationally intense businesses the bad businesses become the best ones. And

cyber security and physical security more AI equals more attacks surface.

>> You know it's the famous Bezos quote, your margin is my opportunity. And so

small company comes in, sees high SAS margins, can actually go attack them now instead of needing to raise a billion dollars and do five years of R&D, they can raise 10 million and do one year of

R&D and have a competitor that's ready to go head-to-head on a battle card against an entrenched like public company SAS company and maybe they're only earning 30% margins instead of 60%

margins, but they're happy with that because hey, it's a new business and they're they they started it from nothing and if they make $10 million They get to take a lot of that home and stuff. And so

stuff. And so >> Sheiel says, "The greatest rebrand in enterprise software history is calling consulting revenue forward deployed engineering." I do wonder if a year or

engineering." I do wonder if a year or so from now we'll see companies that you know these companies that went from one to 10 or 1 to 20 million in revenue really quickly. It just turns out like

really quickly. It just turns out like they were just kind of like they were doing about $10 million worth of engineering work and it wasn't actually again a lot of them are setting it up where like hey we're going to come and build a bunch of software for you and

then we're going to charge on an ongoing basis or based on usage but but still I'm sure there's some examples where it really is just like effectively consulting or you're running like a

software development in agencies. Yeah,

it's funny. Uh, thinking about OpenAI, I think they're at 8,000 employees. And

wasn't the report that they're hiring something like 800 Ford deployed engineers? So, you're going to have a

engineers? So, you're going to have a 10% of an AI lab that's focused on AI research curing cancer is going to be like four deployed engineers. And you

have to imagine that that was basically zero, you know, 5 years ago. I think the four deployed engineering is going to be important. Like the the AI diffusion

important. Like the the AI diffusion question, it's a lot of sticky systems. there's a lot of people that don't have time. The fact that we see these these

time. The fact that we see these these uh these like spikes in attention during long weekends and holidays, it's like that's when people have time to go do the new project and stop doing the the

the same system again and again and again and a Ford deployed engineer comes into your organization and just is able to do that hard work that you don't have the slack capacity for.

>> China is going all in to beat the US on humanoid robots. Beijing is showering

humanoid robots. Beijing is showering companies with support, but some fear a bubble >> and they're getting taller. Chinese

humanoid robots are getting taller very, very quickly. The Unit G1 is the robot

very quickly. The Unit G1 is the robot that most people think of when they think of Chinese humanoid robot. The

Unit G1 has 23 joints and it's 4'4 in tall. That's something you can drop kick

tall. That's something you can drop kick across the room. It's probably pretty safe, but they're getting taller. The

UniX AI Panther has 34 joints and he's 5 foot three. The UB Tech Walker S2, it

foot three. The UB Tech Walker S2, it has 52 joints and it's 5'9. We're

getting we're getting short king status now. Then now they're now the a the AI

now. Then now they're now the a the AI squared Robotics Alphabot 2 5'11.

>> Wait, that could be some regulation that I could get behind.

>> Yes.

>> All humanoids should be capped at a certain height.

>> Yeah. So that if if if any any people out there are a little bit on the shorter side, they get to feel tall.

Yeah.

>> And then uh but in general, a lot of the average person should mog the robot on on Doresh. Elon said the Optimus is 5'11

on Doresh. Elon said the Optimus is 5'11 as well.

>> 5'11. That's a very reasonable height.

China's going all in to beat the United States on humanoid robots. Of course,

they have a ton of industrial advantages. So Elon Musk has been

advantages. So Elon Musk has been telling investors for months that Tesla's optimist humanoid robot will revolutionize the world and create a new mega industry, but most of it could

belong to China, he has warned. China is

an ass kicker. Next level, Musk said in January, "To the best of our knowledge, we don't see any significant competitors outside of China. China is moving quickly.

>> Shots fired at at >> figure and 1x, but humanoid robotics companies are sprouting up from Shenzhen to Zuzo. There's 140 different

to Zuzo. There's 140 different companies. They got a market map over

companies. They got a market map over there. We have five and they have 140.

there. We have five and they have 140.

Uh they're tapping a vast ecosystem of parts suppliers and engineering talent.

They're starting to produce humanoid robots at scale and actively >> humanoid running a bit right now. That's

how you run.

>> They're actively introducing them into real life scenarios in factories, hotels, and offices.

>> Yes. Grock unhinged mo voice mode in an Optimus very hanging out around the office just running bit. It would

actually be hilarious.

>> It would actually be hilarious.

>> Get ready. I mean, you're going to be able to do that in like two years. Is

that like skin over a humanoid?

>> Not a fan of that. Since late 2024, Beijing, Shenzhen, and other cities have established investment funds totaling more than 26 billion. That's right.

That's a thousand times as much as France is investing. The moves closely track the way in which China built up other industries such as electric vehicles, which benefited from incentives from buyers to help stimulate

demand. Now, China has many of the

demand. Now, China has many of the world's most notable EV makers, including brands that are eating up the market shares of General Motors, Volkswagen, and other >> seen the the people doing the I'm outside in the BYD.

>> Oh, yes. Is that a Drake line? China is

once again mobilizing state support, supply chain depth, and rapid commercialization to build a new strategic sector. Um, success will

strategic sector. Um, success will depend on who can best solve the myriad techn uh technical problems associated with humanoid robots. Skeptics say

humanoid robots are a bubble and may never find a true use case. What? It's

like the most obvious use case. They're

already >> Yeah, like anything a human can do.

>> I can't think of any good use.

>> Who said this?

>> Horse says cars may be a bubble.

>> Bad news. Uh, Chinese makers of humanoid robots, which include human like humanlike machines with wheels, as well as those with legs, announced orders worth more than 300 million in the

second half of 2025. So, the Chinese humanoid robotics industry is at a $600 million run. It's not bad. Like, that's

million run. It's not bad. Like, that's

pretty significant. That's not that that's more than just like demos. It's

hard to like, you know, take every Elon projection at full face value, but he's talking about being able to make up to a million humanoids in the in the X and S facilities in Fremont.

>> The run rate right now is $600 million.

Morgan Stanley is predicting up to a 100,000 humanoids shipped in 2026. If

there's not significant increases in price for these, that would be $6,000 per humanoid. It must be higher. Based

per humanoid. It must be higher. Based

on this Morgan Stanley prediction of a 100,000 humanoids shipped in 2026, you would expect revenue for the industry to be in the billions for sure because I I have to imagine that the average selling

price of a humanoid is like more like 20,000. It's more like a car. The firm's

20,000. It's more like a car. The firm's

general purpose humanoid called Alphabot is currently used in factories including LCD tele.

>> This implies there's a firm called Sigabot.

>> Sigabot. Yes.

>> Somewhat antisocial.

>> Doesn't actually like humans and looks out on a rainy day. It's just plotting, >> scheming.

>> Here's another wild story. Alphabet is

selling 100year debt. You can buy a bond from old Google. Sundar's paying you in 2126.

You'll be getting a payment from Sundar.

They did a big bond sale. They're

gearing up to sell bonds that won't come due for a century. You don't get your money back for a full century. Google

$1,000. They're going to pay you a little dollar every once in a while and then you get the full thousand back in 2126. Sorry. I don't know if this is

2126. Sorry. I don't know if this is fake news, but somebody was saying that uh out of the DAO 30 in like 1930, like none of those companies are publicly listed anymore.

>> Thinking in centuries, potentially underrated. You know, for a long time,

underrated. You know, for a long time, if you were worried about the AI bubble, the easy counter was, hey, it's just all this build that stuff, it's just being funded with cash flow from these super profitable companies that have been

around for decades. Worst case, they take a bath on some cash flow. It's like

what happened with Meta and Reality Labs. Mark Zuckerberg drew down a ton of

Labs. Mark Zuckerberg drew down a ton of the free cash flow from Meta's incredible advertising business.

Launched some VR headsets. Didn't really

get crazy traction. Went back to printing free cash flow, right? It was

no problem. Well, now the hyperscalers as a class are all going allin on AI and spending all of their free cash flow on AI and and that's where people start to get a little bit more worried. I'm sure

we will be hearing more about the potential fears of an AI bubble. People

are broadly very excited about this.

Like I I believe that this uh this $25 billion uh debt offering was massively oversubscribed. People are excited about

oversubscribed. People are excited about um you know buying these alphabet bonds.

It's such a robust business. It's been

around for a very long time. Yes.

>> Uh this is crazy.

>> Apparently there's a ATM in China that melts your gold.

>> Wow. Cash,

>> 1200 degrees Celsius and transfers money straight into your account.

>> I mean I've seen those ATMs where you where you put a bunch of change. Have

you ever done one of those? Have you

ever saved up a like a >> Oh, I used to do that when I was a kid.

>> Yeah, piggy bank. You you you put a coin.

>> Piggy banks really fell off, I think.

>> I mean, the death of the penny does not bode well for the piggy bank maxers of the world. Although the real alpha was

the world. Although the real alpha was not using those ATMs because they take a cut of the counting. So, you get the rules piggy banks. They are. Yeah. So,

you get praying on young pig.

>> Yeah. You get the