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#FinanceDaily: Threads v Twitter | Fed signals hikes | Yellen in China
Recorded: July 6, 2023 Duration: 1:46:13Space Recording
Short Summary
The conversation centers on the rapid growth and adoption of Threads as a competitor to Twitter, highlighting trends in social media platform usage, monetization strategies, and the need for sustainable business models. The discussion also touches on shifts in currency valuation and the evolving landscape of user engagement across multiple platforms.
Full Transcription
Yeah, everybody, we're just going to wait a couple of minutes and then bring everybody on.
For people that are listening right now, this is going to be a pretty contentious topic.
I think a lot of people are going to be quite triggered by this, and that we have something called a never-threaders, or never-threaders, which are essentially people that
think that meta's going to fail at this,
but I'm bringing receipts,
so I'm kind of interested in what people have to think.
We'll bring everybody on.
Please request if you're interested in coming up.
And then really, the best way to get up here
is to go into the bottom right, into the comments,
and then share what your thoughts are,
and then we're going to bring you all up.
Thanks, everybody.
Just give me maybe a minute or two,
and then we're going to get started.
Also, while we're waiting...
Give us some feedback on titles.
So we do things differently on our finance daily shows where we cover multiple topics.
But I'm really trying to figure out, should I just, like, put in one main topic on the titles?
And then we cover all the different topics or, you know, just some feedback for us.
We tried something last couple of weeks where what we did was we essentially didn't focus on, quote, unquote, the news.
we focused on one main topic
and then just did a deep dive.
Seemed like people really liked it,
but I don't know.
It's going to be very interesting
to see how we should deal with it.
But yeah, Jay, you just put something up.
Tell us about it.
Hey, good morning, guys.
We got some information from China last night.
The Hengsenghis Index was down almost 3%.
And the local property market has been an issue since 2006.
And we've been talking about it in depth.
Actually, in December 8th, I think I said that, well, it's tweeted that I didn't think the Chinese recovery was going to be nearly as robust, given the lack of government support.
And, you know, just a different savings mentality, longer lockdowns.
And that's been that, you know, that's been playing out along with their demographics peaking in this property bubble that has been deflating for a long time.
And yesterday, you know, China Von Kiko, which is the second largest housing developer in all of China, basically said that their...
expectations for the housing market are a lot worse than expected and that's not something that
chinese companies say they they rarely say negative things about the market or themselves so that
was interesting and then goldman came out
And basically said that they expect bankruptcies or the default rate in the Chinese high-yield property market to increase.
And the third thing was, the most important was that Shamou Group, which has a large land bank in Shenzhen, which is the tech center, one of the biggest cities in China, offered it at a discount, you know, essentially partially built project at a 20% discount to its appraisal value.
And this was from JD.com last night. They weren't able to sell it.
And it just goes to the point earlier that this property market issue is not going away.
And you just saw Chinese stock market tank overnight.
Maybe some of that's bleeding into U.S. futures, although it's not really correlated.
But it might be one of the reasons why things are weak this morning.
Just an interesting point that I think not a lot of people are focusing on last night.
Yeah, interestingly also...
China-U.S. relations in addition to this, I mean, the question really is, is a economically
viable China important for U.S. dominance? And it's something that I've been thinking a lot about,
which is, do we need China to be successful given how much we rely on them? Or is this an opportunity
for us to take a sputtering China and get them to...
heal and put them in a position where they are reliant on us right now.
And, you know, we're seeing a lot of activity between the U.S. and China right now,
obviously with Secretary of Blinken going to China, followed by now Janet Yellen going to China.
You know, do we think that there is, do you think that, do we think that the U.S. is seeing an opportunity
to get China on the right track, let's say?
Or...
Is it that the U.S. needs China to be successful for the U.S. to be successful?
Jay, your thoughts?
I mean, it's one of those weird situations.
You made two good points.
You made a great point.
I mean, we have a global interconnected economy.
Whether you like a government or you don't like a government, it doesn't matter.
Right.
We rely on China for cheap goods, right, which is obvious.
Europe relies on China for cheap goods, but Germany is also a big exporter to China at the same time.
So we have a global interconnected market.
In fact, if you look at Russia this morning, their auto sales came out.
They had about 400,000 sales.
The three out of the four top brands sold in Russia are Chinese auto brands, including Geely or Geely.
I hope I'm pronouncing that right.
And when you look at the data...
you know those three brands actually account for more than you know the russian auto brand so
we have a global interconnected economy especially when it comes to commodities china by 60
percent of the world's economies uh world's commodities so from my perspective listen we're never
going to change china we're never going to be able to really force them to think the way we do
it's just completely different culture we have to respect the cultural differences but what i will say is that
You know, we also need to have boundaries where there's IP theft.
We need to have boundaries in a lot of different areas for specific reasons.
Yelen, I think, is going there after, you know, I think the Chinese took what we said about protecting ourselves and they're viewing it as economic warfare.
And this comes from a defensive perspective where, you know, China, the Chinese are in a really tough spot.
I mean, Xi is an authoritarian dictator.
There's youth unemployment of 20% and economic growth.
In my opinion, I think it'll play out this way, is probably going to be under 5% for the next decade.
It's never going to go back to the heyday.
you know i think yelan's doing the right thing you know we need to be diplomatic and you know mature
and economic ties can't go to zero right um but at the same time you know chinese depend on the u.s
right whether people believe it or not they need u.s treasuries as part of their reserves because
they're the most liquid they need the u.s for specific exports as well and
You know, just like we depend on them.
They depend more on us than they have.
Their economy, yeah, their economy is not built for low growth.
Not at all.
It's all, and a lot of that growth has been based on property.
They haven't become a pure consumer economy.
They just can't.
It won't work that way.
So without manufacturing, you know, growth at the same rate and without property growth,
you know, this is going to be like a three, four, five percent growth economy.
especially with demographic speaking.
And we have to all remember that unlike the Western economies
where a three to five percent growth is not unusual for China,
which literally relies on growth,
as Jay was mentioning,
most of it coming from the real estate sector,
which is now underwater.
You know,
there's something,
you know,
for people that,
that know NBA,
Brian Winhorse,
before all the stuff that happened last year in terms of trades,
Brian Winhorse was on ESPN saying,
there's something going on in Utah, if people know that.
I'm going to say there's something going on in China
that none of us are talking about.
that none of us are thinking about.
And yesterday we were talking about Black Swan events.
Another Black Swan event is some form of major crash in China
that occurs because they're trying to hold it up with fake,
the one thing about an authoritarian government
is you don't actually know what's going on.
And there's something going on in China.
I'm doing the finger thing for people that know Brian Winhorst.
You know, there's something going on in China.
And I'm telling you that this is something that, you know, as we're talking about black swan events, that's another black swan event that potentially could really bring the global economy down if we don't get ahead of it.
Why, after all of the noise that the idiots on Twitter were talking about with bricks...
Jay, you remember after SVB?
Do you remember that?
Oh, yeah, I remember it very clearly.
I remember that.
Can we take another victory lap today to just say, you remember Bricks?
Yeah, you know, they were like, oh, you know, Ray Dalio is talking about China being the rising superpower.
Oh, Bricks is going to be the future.
Hey, everybody that's listening that was talking about Bricks, what happened, brough?
We're still here. There's no bricks. Anyways, you know, bricks is going to be the future. Everything's going to happen.
China is the right. It was very funny. At that same time, they were saying, you know, the U.S. banks were going to completely go kaput overnight.
I remember Kim.com saying that we had a three-month bet that J.P. Morgan would go bankrupt in three months.
By the way, we need to remind me of this.
Yeah, we need to remind me of this for spaces.
Somebody who, you know, Twitter Spaces team always listens to us.
We need a remind me of this for spaces.
Because people are just say all kinds of crazy things when things go down.
And we can't, you know, good thing is Jay has a great memory.
But Bricks was not a thing.
Yeah.
Just a reminder.
And it's probably not going to be a thing.
Again, who knows.
But, you know, if I was going to predict bricks,
it's not going to be a thing.
In fact, I think the opposite is more likely to be a thing,
which is I am more concerned about China
and their inability to live in a low-growth environment
than I am about the U.S. currency getting de-pegged
or, you know, taken over by the one.
It's just, it makes no sense.
And so...
This is, I'm again, raising my finger and saying there's something going on in China.
Why are we going there so much?
Why is everyone so, why is Janet Yellen going to China?
Like what, why?
Can anyone explain to me why Janet Yellen, who by the way, can't get diplomas done in the U.S. is going to China.
The official.
The Blinken meeting was a failure.
Sorry, go ahead, sir.
Sorry.
Well, the official verbiage is we hope to have a frank and productive conversations that will help play the groundwork for the future communications.
A.K., can we just be honest?
Janet Yellen is not the greatest diplomat in the world.
Nowhere near.
And I don't see that.
She's frankly very awkward.
Yeah, she's incredibly awkward.
But it's interesting.
It's interesting that they're selling Janet Yellen.
Doesn't that surprise anybody?
It seems like a small move, but it's a really big move to send the head of the treasury, the treasury guys, to China.
Why?
Why?
Has anybody thought maybe she's there to buy mortgage-backed securities from China?
Exactly.
There you go.
That's actually literally Trevor.
So what Trevor is referring to is that the Chinese need an investor right now.
The Chinese real estate market is in trouble.
But Yelen isn't going there to buy MBS.
I think what she's going to do there is to help the negotiation, help build a relationship.
Maybe BlackRock could go in there.
and by Chinese securities.
There's no way Yon can go in there.
Well, the point here is America doesn't invest directly.
America's invest through its capital arm.
And if we all remember, something really big happened a few months ago that we talked about on spaces,
which is that the Biden administration tapped Blackstone on the shoulders.
Do you guys remember this?
On the shoulder and said, hey, pull your money out.
And suddenly...
All that money started flooding out of China.
We keep talking about how powerful China is.
We keep forgetting that America is the financier of the world, either directly or through our private equity and other companies that we, and that's what's happening.
I'm telling you, there's something happening in China.
and we're not talking enough about it.
And if you're gonna be looking for,
you know, as Mickle and Caleb and Robert Wolf,
who was here, said we're not gonna see the next one coming.
So I'm just looking everywhere now.
I'm looking at everything.
Everything is on the table in terms of potential Black Swan events.
Eugene?
Oh, Trevor, why don't you go and then Eugene?
Yeah, no, I was just going to say, I think one of the interesting things that happened over the last three months, I mean, if you're at all in the funding space outside of private equity venture capital is there's kind of been a very weird fluctuation of velocity of like money flow.
And obviously people look at like M2 and M8 and like different, you know, capitalization.
categorizations of where money is coming and going and at what speed and at what liquidity
rate. But I think one thing that's been kind of fascinating to watch has been lenders
oddball appetite. You're starting to see like banks have obviously tightened when it comes to
commercial or residential lending. And obviously as rates have gone up, I think it came out this
morning that mortgage applications dropped their lowest level, which is not really all that
surprising, right? There were a lot of people that refied and, you know, there were a lot of loans
that that were locked in at fixed rates at four, five percent instead of six point eight five percent
or whatever mortgage rates are going at now.
But I think one thing that's been kind of odd, at least in the industry, in construction financing, has been the speed at which lenders are releasing funds for developers or GCs.
And I think, you know, there's a lot of paperwork and, you know, red tape around in many cases, if you have a good lender who isn't just funding stupid projects and, you know, basically...
which does happen more than more than you'd think um but it has kind of
the excuse of paperwork, and I don't know if anybody else on the stage has this in their industry,
but I have seen kind of this weird shift of velocity and funding.
And, you know, it's kind of interesting to watch because if you think about the way that
Jay was talking about, you know, the liquidity issue is like, great, if you want to put a
CMBS or if you want to put, you know, a commercial building on the market in China,
I don't know well enough, but, you know, ear to the ground would be interesting if anybody has one about liquidity crunches for, you know, residential and commercial property.
Did I just lose Trevor or did everybody lose him?
It looks like it's a bug.
I can't hear.
Yeah.
Yeah.
So, Eugene, go ahead.
Yeah, sure. So I was appreciating what Trevor was saying. And also, Jay, I appreciated the kind of balanced the view of everyone needing each other, right? And this is a globalized economy. I will say, I think we're generally headed towards de-globalization. I think that's been a trend that's happened for over a decade. You know, there are various, you know, ways to measure that. And it's generally, for example, like, you know, a dollar-weighted trade over time between countries. But I'll say the thing about,
So there was a mention about Ray Dalio and others.
And I recommend people, so in his kind of epitaph to the changing world order,
he actually has this like country power index that gets updated.
And it presents a much more nuanced view about this whole like, you know,
what happens to the U.S. and the dollar and what happens over time.
Actually, also I think an even more interesting study is Harvard professor,
Ricardo Hausman has an atlas of countries' economic complexity.
And it's really fascinating.
It's got interactive graphs throughout.
And it shows, like, how, you know, for example, how, you know, how, you know, how,
bullish one might be on this particular economy. For example, like comparing Thailand to Ghana over
from the 1960s onwards to today and seeing how they start off in similar basis, but the economic
complexity, meaning how closely related certain industries are, right, going from textiles and then
eventually going to electronics, et cetera, and you can kind of see how these things evolve over time,
like year by year. So really great resource, highly recommended. But the reason I mentioned that is
You know, I think the China issue is so complex.
And, you know, if we remember, like 120 years ago, the turn of the century, before World War I, you know, people in Europe, the raining powers of the time.
Sorry to interrupt, my friend.
ADP barrels just came out.
Giant beat.
It was insane.
It's insane.
So that's why I had to cut you.
June ADP payrolls and somebody on the team, please get me the details.
Top line, 497,000 versus 220,000 estimated.
Holy crap, Jay.
Do you think that, and this is ADEP payrolls, this is not government data.
So this is one of the strongest friends.
It beat every single Wall Street estimate.
Yeah, just give me, just give me one second.
I'm going to run through the details.
I'll post the details.
I have the details.
Thank you.
Thank you.
So total private payrolls, $497,000, $220,000 estimated goods, $124,000 services.
Crazy beat.
373,000 up.
Non-farm payrolls estimate, 240,000 above.
Oh my goodness.
Holy moly.
Talk about a resilient market.
I mean, is anybody in the business of employing people, like, generally surprised that it beat, though, right?
I am. Not like this.
I mean, I just hired three people.
I mean, I just think that there's no immigrant, like, we don't have immigration policy in the United States.
And, I mean, what do you expect is going to happen?
Yeah.
but the well the people were saying that they're softening coming everybody even in the fed minutes
they were saying that they believed that softening was coming i said that i thought you know that we'll see
job weakness but uh
I mean, until you see a really sharp, you know, really sharp decline, you know,
which we still think we're going to have a decline in consumer spending and small business
growth in the second half the year, it's really hard to see unemployment above 5% for the next year.
I mean, unreal.
Any other reactions to this data?
Again, top line, ADP employment change was 497.
And the forecast was 225.
By the way, previous last month was 278.
So this is not like a small change.
And ADP service providing up to 300.
I mean, we know we're a services economy, but 373K addition is quite a lot.
And, you know, as a variance of the hospitality, like 232,000 of it.
Yeah, sorry, A.K., what are you saying?
I haven't seen a variance this high, you know, quite some time.
That's a pretty high variance.
Almost 200,000 difference.
Yeah, and again, this is not, this is not financial advice, but the market's going to be ripping today.
I mean, good news.
And as I said the other day, we're down.
Good news is bad news.
That's good news.
Oh, no, not again.
So when you have labor, you're not going to get industry.
When you have labor data this strong.
What is going to happen is the market's going to start pricing in higher for longer.
Exactly.
This is kind of the opposite of-
But Jay, higher for longer was still the plan.
What's changed?
Do you think they're going to do 50?
Yeah.
Dude, I mean, the market still had cuts priced in for next year.
Imagine if the market goes to no cuts and we have rates at 5% to 6% for the year.
Jay, I was so happy because I felt like the market was finally,
good news is good news and bad news is bad news.
We're switching again.
It's always like that when you have a Fed like good news.
Good news is still bad news if you look at the index is trading right now.
Oh, God. I hate that. I'm so unhappy again. I just don't, I don't want to be at the whims of a group of people. I just want to focus on the economy. Can we just go back to good news as good news and bad news? Good news has been bad news since 2009. No, no, I agree. But I felt like recently we started seeing a change.
It felt like there was a slight change in the market perception.
And I was getting excited, man.
I was getting excited that we were finally getting back to the point where good news was good news again.
But Yoni, you're telling me that we're back to good news is bad news or we stayed this in a way.
I think surprises are always a bit of bad news.
And now people are thinking, you know, everybody was hoping for the Fed to pivot next year.
But if jobs are higher and inflation is going to.
go higher or not settle down back to its historic 2% target,
then Fed's going to be more aggressive at continuing hiking rates,
and that's bad for a lot of industries.
So Caleb, I'm going to go to you.
You knew that I was going to come to you if there was any positive news.
So I'm going to come to Caleb for a second.
Caleb, are you changing your prediction for 2% this year?
No, not at all because, no, not at all.
This was a great report, and I think everyone's been on the edge of their seats for the past 12 to 15 months waiting for the labor market to crack.
Everyone's looking at initial unemployment claims and getting head faked by that, jumping at their own shadows.
But we continue to see a labor market that's resilient and dynamic, month after month after month after month.
And certainly we've seen some slight deterioration, but slight deterioration from historically resilient data.
Like, I just, I don't know.
So, I mean, I genuinely even feel like if we came in in like the mid-200,000s, that still would have been a great report.
Coming in at 497 is pretty interesting.
I think I saw something about one of the main sectors that contracted was manufacturing.
But hey, we're a service-based economy, so who cares?
I just think that when we think about wage inflation, when we think about the fact that people have jobs, which means that they have more income, I just can't see how we're going to continue to see disinflation at the same levels when services is so hot.
Because inflation is because inflation is multivariate. It's not just about wages.
Of course, but wages and consumer strength obviously affect the ability for somebody to pay, which then affects the demand side of the equation.
That's why those are the two sides of the coin.
Which is why, hold on one sec, Jay, hold on one second.
Which is why prices are still going to be going up.
They're just going to be going up at a slower pace than they were in 2022 and in the beginning of this year.
But, okay, so then, okay, go ahead, Jay.
So on the good side.
Right.
So there, I mean, there are points that are right about from what both you guys are saying.
So on the good side of things, you have a situation where we're in a global manufacturing
recession.
I mean, it's just in the data.
Whatever, pick any country, any developed country, look at the PMIs, look at the production
levels.
They're either decelerating or going negative year of year.
Now, in the services side, we're still very strong.
You can't deny that either.
You look at the same type of data, services is very strong.
In the U.S. were weighted toward services, so overall, the economy is doing okay for now.
And...
You know, when even in the second half of the year, right, when we do think that there's going to be less consumer spending, there's going to be more pressure on the retail sales side.
I mean, a lot of that's going to be pulling away from the good side.
It's going to be negative for China.
It's going to be negative for retail.
It's going to be negative for e-commerce.
But on the services side, that part of the economy might take longer to slow down.
So, you know, I think you guys are both right.
It's just that the timing of that is impossible to predict.
Does anyone think about the seasonal summer employment hires for summer jobs, for McDonald's jobs, for maintenance, lawnkeeping, summer pool cleaning, have any effect on this just monthly jump?
100% but the estimates take into account seasonality and so that's super off for a long time actually
so i'm not i'm not just going to give well the ADP payroll estimates were were much closer this variance
according to AK and what AKA was saying and also in general the beats haven't been this broad in a long time
And so, Matt, while you're right that when we're talking about the jobs estimates they're coming in from the government, it's a little bit different.
The ADP payroll estimates tend to be a little bit less variable.
But point to, no doubt.
I mean, I can follow ADP for 20 years.
I've been working on Wall Street.
I know what ADP's payroll suggestions are.
I just feel like the data that we've been using in the public reportings of a lot of these metrics have been –
one, super front run by all the hedge funds because they collect their own private payroll data as well.
And two, ADP is maybe no longer as large as what we should have, you know, remembered it to be.
And so I'm just questioning that.
That's a good point.
That's a good point.
That there might be, just to also clarify, Matt, you mean that there might be a variance because they're sampling a specific portion of the population.
Yeah, they're relying on legacy data to protect future data.
Well, and there are always revisions, right?
So last month's data was revised down slightly, almost as a matter, but from 278K to 267K.
Maybe this is revised down a little bit.
Yeah, but I mean, it's still a crazy deal.
Well, here's another...
Here's another metric.
The mortgage bankers association applications are actually down 4.4% versus 3% positive previously.
So this is a measure that does the weekly average on the mortgage applications.
Those are down.
So, you know, let's get to what this means in general.
Yesterday we had the meeting minutes.
I think we all kind of know what it means, but I want to get a little bit of a pulse check.
Actually, before we move on, Mickle, did you have a quick comment?
I was going to make a comment just kind of where you're going, and that was just, I think today is going to be really interesting and actually...
trying to make a determination on whether or not good news is bad news or good news is good news.
Now, I will say there was a couple economic releases over the past couple months.
And from my perspective, it did seem like the market was actually reacting favorably to good news,
kind of like you were saying, Donish.
So I'm going to be really curious just to see how the market digest this data,
because I think it's going to give us some good information on whether the market's more scared about future rate hikes or
or the market's more scared about a possible recession around the corner.
By the way, I never thought that we were going to get rate cuts in the short term.
Like, I don't think anybody that's actually paying attention really thought that rate cuts were happening this year.
I mean, there's no way that people thought that that was coming.
So if that was your base case, I think that was incorrect.
But, but, yeah.
Yoni, did you have something?
No, what I'm saying is, you know, look at the treasuries trading right now or futures on treasuries.
It's people expecting rate cuts next year.
And right now it's rising about the, I think, two-year treasury is rising about 5%.
So it's about how long does it take for the Fed to pivot over a medium term, right?
So the next 24 month.
And if rates...
basically sustain those high levels than some industries like commercial real estate, for example, are in for, for a tough ride during higher interest rates.
So the same for new mortgages. So it's, I think, every sort of change in surprise like that. The reason...
these good news or bad news is because it reflects directly on the Fed's ability to pivot
and whether they're able to fight inflation.
And that has an impact on different industries, different parts of the market.
The tech stocks are somewhat less sensitive, the big tech stocks to interest rates.
And some industries are very sensitive to it.
Yeah, it's interesting right now in terms of what happens next.
And so Fed meeting minutes came out yesterday, seemed very clear that they explained their reasoning behind the pause.
It was exactly what we all thought it was.
They wanted to wait for the lag in the data to go away.
And...
And now that the lag has gone away and data has come in hot, hotter than expected, I think in terms of the employment data and pretty much on track in terms of the disinflation data, I think we're going to see the Fed become more hawkish not only in its comments, but I think that the big question I have, and Alan, I saw your DM around 1030, uh,
the 10 year, 30 year curve now inverting.
Alan, can you tell us how that choreographs decision making,
not only the Fed, but in terms of what the market's thinking?
Well, clearly, you know, the pivot is, and I heard someone say 20, 24 or 24 months.
You know, people were talking about a pivot happening this month or whatever.
It's obvious that the Fed is not concentrating, it's concentrating on inflation.
and not on employment.
So what's happened in here,
people get obsessed with certain numbers
and whether the employment,
which I'm not a big fan of,
but I'll go with it, okay?
But now what we've had here
is the inversion of the 10,
2's 10s was an obsession,
but reality strikes when...
10 year gets higher than the 30 year.
I've only seen this happen a handful of times in my 40 years in the marketplace,
and that indicates significantly higher interest rates.
As you remember, about two weeks ago, I said a flat yield curve,
and that's what we were approaching,
indicates that all interest rates will go up.
There's another factor that maybe...
special, I keep
I'm forgetting what his name is, can talk about the
high yield market. The triple
C sector is showing some cracks
first time in a long time. It's
down and it's down significantly.
And there's more
the bank loans.
They're also showing stress.
So from my standpoint. Yeah, and the
question really then becomes, Alan,
Alan, you know, in general, what you're referring
to, I'm sorry.
No, basically the 10s 30 inversion
is just
doesn't is not something that happens it's there's something going on and the thing that you have
to look at is the next that excuse me I'm stumbling here three seven three 10s 30s auctions see how
many indirect buyers we get out of Europe right now the spread between the German tenure and
the US 10 years 143 that's stable but as interest rates move up you know we're going to have some
recessionary trends not I mean
Have you noticed what happens to the U.S. dollar when the –
Yeah, it gets stronger.
And I believe that the bottom is in on the U.S. dollar.
That's one of the things that everyone misses here.
As our interest rates get higher and spread widens between its contemporaries in Europe,
then the dollar gets stronger, which hurts our economy, right,
because it costs more for us to import goods.
Well, it's funny because no matter which way the dollar goes, people say it hurts our economy.
But I agree with you in principle that.
But remember, we are still a primarily services economy.
So it is interesting how we're thinking about the dollar now.
Again, as a reminder for my friends on bricks, the dollar is not losing its value.
Yoni, go ahead.
It's losing its value against Bitcoin.
No, look at the U.S. dollar index.
The U.S.
has been actually rising.
I'm not where Bitcoin is in the U.S.
dollar index.
I was just referring to Bitcoin dollar.
Bitcoin is not big enough to,
okay.
I mean,
we could have differences here on the Bitcoin on U.S.
Sounds like a debate for the next show.
Yeah.
Yeah.
But if you look at the US dollar index, you could see clearly that it's on the rise.
It had a low of 94 when the markets were at the topest, you know, 470 back in October of 21.
And, you know, we've had a major, major rise as the interest rates started to increase with the U.S. dollar.
And after hitting a top of 115, we've settled at 102, 103, and I believe this is the new bottom here off that 94.
You're going to see that inverse reaction occur again, based on my predictions.
US dollar will rise.
Markets will get weaker.
And that's where, you know, the...
I would say the variance between inflation and its tightening starts to occur.
How much do we think about real rates versus nominal rates, right?
Especially given inflation, you know, I mean, UK inflation above 10%.
So I feel like there's going to be, I mean, I feel like that's a big factor, right?
Yeah, it's a huge factor.
I mean, just think about if from a consumer perspective, real wages have been negative
3% for the last couple years.
Yeah.
You think about, you know, the cost of living increases versus nominal wage hikes and you
subtract that.
And the difference you get is that's why savings have been coming down, right?
Because the cost of living is higher.
You look at retail sales and you take out price, you know, the price increases.
And real sales in a number of categories are actually down.
So...
you know, our view on at least a lower end consumer hasn't really changed.
We will see how...
I mean, listen, the upper class are doing extremely well.
They generate a lot of wealth.
They're going to continue to spend.
They're going to continue to speculate in markets.
But, you know, like a gentleman on here was saying, like Alan was saying, you know,
you're starting to see small business defaults.
You're starting to see commercial property defaults.
Exactly.
And this thing doesn't happen overnight.
I was short in 2006.
You know, it took a long time for people to be right.
And the truth is, in the last seven, most of the Fed hikes have taken place in the last seven months.
And you're not going to see the effect of those, you know, until the end of the year.
And what we're seeing now is, and this is my opinion on what where we go from here,
we're going to see interest rate risk become credit risk.
And when that happens, that's when we really start seeing the market pivot.
That's when the actual actions start happening.
We're seeing, and by the way, this is not just the credit risk here in the U.S.
This is global credit risk.
That's really where we start seeing things really take form.
And I think that as people are watching, as you see the Fed really...
Really keep raising, raising, raising, raising, raising.
And people are like, oh, this is the fastest thing ever.
We've never seen something like this before.
Also remember that it's a blunt instrument and it's a giant cruise ship.
It takes a long time for this to flush through the system.
We are just at the beginning.
Just because it seems like things are going positively,
we are just at the beginning.
Don't expect things to really, shit to really hit the fan until next year.
That is why...
you know,
I'm very bearish on the concept that we're going to hit,
you know,
the target rate anytime soon and that we're going to have to cut and all of these things.
It just does not.
It takes a lot longer than people think.
TXMC yesterday had a really good,
I'll try to go find it,
but a really good,
visual on this, we are on the upside right now.
We're moving up and it's going to keep breaking and keep breaking and we're going to keep
raising and raising and raising and then we're going to start breaking.
And that's really when interest rate risk, which seems obvious, at least a credit risk,
which seems really not so obvious.
you won't know where the credit risk is going to take place and which system is going to break first.
You know, again, like Robert Wolfe said.
But, AK, you had your hand raised.
Go ahead.
I think, you know, the Fed had their gas on the pedal or their pedal, their gas on the gas.
And.
And they're going to be tightening and putting their feet on the brakes.
And I believe that that's what had occurred back in 2019 prior to COVID with the tightening occurring.
But because...
you know, COVID-19 occurred, we had a loose kind of two years of interest rate risk off.
So, you know, now we're at a tightening stage.
This tightening stage is going to hurt us.
And I think that's the breaks that the feds are finally putting in after a 10, you know,
now it's what, 12 year, you know, I would say, what many call it a bull run, an extended bull run.
I just don't see it going further.
Anybody think that there's a world in which you get a 50 basis point hike?
Anybody?
No, I don't think we're going to see, especially after this hokish pause, and we still need to refill the TGA.
I think that the majority of the Fed governors, you know,
They don't want to overdo.
I mean, Powell's job isn't to destroy the economy.
It's to, you know, slow things down so that he has room to cut the next time we have a crisis.
So I think that they will be measured in the approach.
They'll react to the data.
But what I found was very interesting today is that, you know, even the UK is moving in sympathy.
You're seeing the highest 10-year, the UK guilt since 2008.
And nobody knows when the next thing is going to break or where it's going to break.
But like, I could see UK property prices down 20%.
That would be catastrophic.
Like everyone in the world, right, invests in UK property.
And, you know, the thing is, all these markets move together.
Insurance companies invests in UK guilds, you know, European,
ECB bonds, they invest in the treasuries, they invest all over the world.
So it's all tied together.
And just like this UK pension system almost took down our, we had treasury yields even
higher than they are today because of this UK pension crisis.
You don't know where the next, you know, the next thing is going to drop.
So, yeah.
I think prudence is kind of key in this type of environment.
So no 50 basis points,
and Jay, I agree with you,
but no 50 basis points.
But does anybody think, remember, like two weeks ago,
Amy, who's listening right now,
and I got roasted,
because we said there was a zero percent chance
that there would be another pause or there would be another miss.
And we said we will remind you all in July when you all were trying to hate on us
for saying that there will 100% be a hike.
I just want to remind everybody, because again, there's no remind me of this on spaces.
So I just try to remember it as much as I can.
Is there anybody that still thinks that there is not, oh, there comes Amy.
Amy always comes up to take her flowers and then she leaves.
But I was going to say, is there anyone that is willing to now say again that there will not be a hike in July?
I'm going to wait until someone says yes.
Oh, Cody, you still think there's not going to be a hike in July? Are you serious?
I have to stick to it. Oh, my God. All right. Well, interest rates are really starting to affect food prices at this stage, too. I mean, a lot of the agricultural sector is tied to the regional banks, and they're getting squeezed pretty hard. I mean, we're here in the Midwest and seeing it.
I think could you provide some more background please on that sure yeah so I was in a soybean trade I'm just interested in it yeah um so soybeans is a little bit different um but uh the the organic controlled by china yeah it's China and Brazil right I mean I think Brazil's 60% of the sector um
But the organic space in particular, which is more of the high-end space, works on a lot of revolving debt and has been consolidated by PE in a big way.
And it's capital intensive and they're very tied into the regional bank sector.
Yeah.
And so as rates are climbing, food prices are having to catch up because their infrastructure just hasn't built out in the same way that some of the broader markets have.
And so, you know, and J, I'd be happy to connect you in the back end and connect you with some of the larger commodity traders here in the Midwest.
But, you know, that's where we're seeing some serious stress.
And they're going back to, you know,
the markets that they're going into, you know, we have schnooks and Kroger's and vendors there,
and they're driving up the prices.
And that's what you're seeing on the consumer side happening now.
Thanks, Dakota.
That was really helpful.
That's kind of what I was trying to share on the small business front.
You're having a lot of these guys see their margins come down,
and some of them may have to pass it through in the form of prices,
according to what Dakota is saying on the agriculture side.
So I wanted to, we have some hands raised. Let's run through them really quick because I do need to get to the threads versus Twitter. And that is probably what everybody, unfortunately, is talking about. And I will go ahead and get to that as soon as I can. So Trevor, go ahead.
And I was just going to say, I think, you know, we've all been talking about the interest rate implications for small businesses.
And I think when when you look at risk on, right, what the fed's essentially trying to do and they've been successful with it is a lot of, and I think we talked about this a couple of weeks ago.
But, you know, we haven't really recognized the fact that there are a ton of people who are not necessarily your sophisticated investor that have been told to like go out and purchase.
a piece of property and turn it into an Airbnb.
And I think when you look at these types of speculative investments or asset classes
that people don't fully understand,
and they're being kind of pitched a full story where it's like,
yeah,
you know,
if your mortgage rates at 6.5 and you didn't buy it cash and,
you know,
you're going to have 31 days of occupancy and you're going to be able to charge $250
a night.
Yeah,
and that's the glamour story,
right?
But the reality is that as soon as consumer confidence starts coming back
down,
you're going to start to see like pretty major repercussions.
I will say the oddity here is even if it is, you know, cyclically, you know, impacted,
I think one of the biggest things that I've seen is that large successful business owners
that I know personally who have sold companies, et cetera, they were extraordinarily
bearish eight to ten months ago.
And I'm starting to wonder if we're seeing a rotation back into more confidence.
And.
And if so, I mean, obviously that's great.
But again, still, it doesn't change the fact that the cost of operating has gone from next to nil to, you know, six, seven percent for a lot of these businesses.
And if you have a business that, you know, operates on, you know, liquidity needs and as, you know,
Dakota was mentioning, especially with agriculture, when you're using these leveraged products and
you need cash quickly and you, you know, you start to get squeezed, you know, all these lenders are
reassessing risk rate on a day-to-day basis, if not, you know,
semi-day going into even weekends.
And I've never seen lenders trying to forecast interest rate hedging and risk in their
portfolio as much as they have been.
And I think that's just an indication of where we're going in terms of cost of capital
to operate a business.
But also, you know, it's a rotation out of flight of ease to flight of safety with most
people saying, okay, if I can get a, you know,
you know,
four to eight percent yield on something with a low risk,
why would I try to make,
you know,
14% on an investment into an Airbnb?
So I think there's just kind of this rotation of expectation
that's happening that's pretty interesting.
Yeah.
Trevor,
yeah.
Michael?
Michael.
Go ahead, Cody.
That's a really good point.
I mean, the regional banks aren't used to having to deal with some of these global headwinds and global risks, right?
I mean, a lot of potash and fertilizer usage comes from the Ukrainian market and from Russia, and a lot of that's been eliminated.
And, you know, people don't realize that and they buy them in these futures contracts, right?
And so the planting season that just happened, you know, they had the supply, but the season that's rotating into, you know, they get the lending from these regional banks.
And the regional banks are sure how to hedge some of that.
And on top of that, you know, we have the driest season on record happening here in the Midwest.
And so outputs are, the yields are looking...
pretty slim at this point at least.
You know, could we get more of a wet season?
We've had some rains coming in, but it's not looking bright.
And the agricultural sector is, you know, a massive export for us here in the United States.
And so we have to feed our people before we can feed others.
And it's a big deal.
Yeah.
Mickle?
Yeah, just two quick points on some stuff. Other speakers said. I thought Jay made a great point when he said the Fed is trying to break the economy. And I kind of wonder how much of Powell's reputation is kind of coming into his own head right now where he might be thinking, hey, we just had the fastest rate hike in history. Nothing has exploded yet. I wonder how much he's sitting there and saying, okay, well, maybe just based on how successful this has been thus far, and I guess you can argue success, but...
but he's sitting there and saying,
okay, maybe it is time to slow things down
a significant amount and try to achieve
this mythical soft landing.
And then the other thing I just wanted to quickly comment on
is I was also on the space with,
I think it's TXMC or something like that the other day.
And I think he made some really great points
about a recession coming next year.
I just wanted to point out that that's actually
in stark contract to something like Elon Musk was saying,
where he's actually saying, hey, I thought this quarter and next quarter was going to be the worst.
And then we were going to have an extremely bullish next year and things that were starting to look really good.
So I take both points and I think they both made interesting, put interesting thesis out there for why the reception might be earlier like Elon Musk was saying or later like TXMC was saying.
Just remember, thank you for the comment on Elon's perspective, right?
I mean, every CEO in America who is biased to say,
that we think that the economy is going to bottom this quarter.
Of course they're going to say that.
One, nobody has a predictive power to tell you what's going to happen next year.
Number two...
And I mean, you can just look at how their guidance has changed this year.
Number two, they all want this over with, right?
You want all the bad news behind you.
And the reality of, and it's sad, is that, you know, the majority of Wall Street has earnings,
the decline in earnings of 6.8% this quarter, and then flat earnings in the third quarter
and flat for the rest of the year and positive next year.
In reality, you're probably going to see earnings continue to fall on a year
on your basis in Q3, Q4, and they're going to get revised down.
It's.
It's almost bizarre how they're allowed to just assume we're going to have hockey stick results in the second half of the year
when you're seeing margin compression across several categories.
And it's funny how all of them are so choreographed.
I mean, it's just like everyone is choreographing the same exact way.
And I think, you know, again, surprises are bad usually,
but I do wonder how it's going to be taken in the second half this year.
I am very curious.
Amy, go ahead.
Okay, I'm not going to accept my flowers just yet.
I will wait until we actually get the hike in July.
But I just want to make a quick point on the housing front.
The spreads on the 10-year yesterday are indicating probably going back to like 7.2-ish mortgage rate on a 30-year again.
And I just wonder, you know, we had this sort of surge of housing activity this past spring,
and people were saying, you know, maybe housing's bottom, maybe housing's coming back.
How many people who bought in the last six months bought under the pretense that the Fed was going to pause and pivot?
And this was going to be the end.
And we were going to go back to low rates.
They were going to be able to refinance even though maybe their cap rate didn't make sense or their purchase price didn't make sense.
They thought.
oh, the Fed really isn't going to do this higher for longer.
They aren't really going to do it.
Well, you know, now we're showing this 93% chance of a hike in July.
We could get two more hikes.
The Fed could hold.
We don't know how long they're going to hold higher.
So...
how you know how many people sort of misread that and made these investments at these
really high prices and really high rates and they're going to kind of get slammed
when they discover that the Fed isn't going to do what they thought they were going to do
yeah I mean it's as if
And again, for people that don't realize the difference that occurs with higher interest rates, for a home, assuming you put 20% down, the equivalent monthly payment is the same for a $650,000 home that it was for a $350,000 home.
when the interest rates were low.
Just for people that don't realize
how much this affects actual people
and their decision making.
So if you're saying to yourself,
you know what,
I'm going to buy this $650,000 home.
By the way, $350,000 home
means nothing in the U.S.
Just so you guys know, it's incredibly challenging.
Unless you're living in Cincinnati, Ohio.
Fair, but like who wants to live in Cincinnati?
Sorry, I'm just kidding.
But I was going to say that, you know,
please don't kill me, Cincinnati.
Okay.
But I was going to say that, you know, ultimately what's happening is that people bought homes and Amy is one.
I know people personally.
I'm sure everybody here does too saying, you know, it's not a big deal.
Homes are going to be fine.
And you know, when the interest rates come down, I'll just refinance.
And then my payments will be fine.
And that was a con.
I've heard that at least from two people I know personally.
I have people in my own family doing that.
Exactly.
And so like what happened.
I have anything against them.
It's just that.
you know, they have to, they had to make a purchase, they have kids.
And they're like, hey, you know, we're going to buy down the mortgage.
And then, you know, in three to five years, you know, we'll refinance when rates are back at zero.
Everyone's assumption is just rates are going to be back at zero.
And it's, you know, I don't necessarily think that that's a reality.
We might see rates get cut at some point next year.
But at this point, it is very unclear if we're,
if we're going to if after what we saw happen post-COVID is not going to be on paula's mind
you know it's unclear whether we'll go back to that zero level again and we'll have q e again
in in the near future and so you know as we and i do want to move on quickly guys because i we have to
talk about what a lot of people here are waiting for us to speak about which is threads versus twitter but
Patrick, I know that you put something up there around wages.
Could you give us a sense of what's up in the nest and then we'll use that to move towards Elon and Zach?
Go ahead, Patrick.
Thanks. Yes, look, this ties up to everything like are the rates going back down to zero, what's happening.
But to understand what type of macro title wave you're in, you got to zoom out.
And I have the US wages, of course, have been going up like bottom, left, to top, right on any chart.
So that's not really telling you the story. What you got to look at is the rate of change.
The seven-year rate of change for U.S. wages right now,
look, it bottomed in 2016.
It broke out above its seven-year moving average.
In 2018, guess what else bottomed?
And that was also called.
It's been on the tear.
The seven-year rate of change for wages
has been going up and up and up.
So even if we had that
that COVID low in rates and they brought it down.
The Fed fund rates, the 10-year yields have been tracking upwards, breaking out.
This is the same angle of assent.
We haven't had this type of angle of assent in U.S. wages growth since the late 1960s, 1970s.
this is a whole paradigm shift.
So you're right,
the people are saying expecting zero,
they're not putting their probabilities in their favor.
When you start in 1980s and you get a mortgage
and then you could take variable
and you could write the wave down of that cycle of yields going down.
But now that's over.
Now we've bought them.
We've broken out.
So now there's higher chances that even if there's a cut
will be a higher low.
And then after that,
when they do a new cycle,
it'll be a higher high,
et cetera,
until that evaporates that cycle.
But right now it's definitely an up trend for yields,
for Fed,
fund rates and for commodities.
So just my petition said that in the UK, there are almost a million households.
So 850,000 households between June and December.
So this year that have locked in mortgages around 2% fixed rate that are, you know,
that are coming due and they'll have to reset to 5.5% to 6% by Christmas.
I mean, imagine the impact you're going to see on the UK housing market.
and the impact you've already seen in Australia, New Zealand, and Canada.
I mean, this is going to be a global thing.
So, sorry.
Go ahead, Patrick.
I just had a counter argument when I keep hearing that is I know here I live in Quebec.
I know there I saw the parents, the baby boomers, all the people who made a ton of money in the stock market from the 1980s all the way to today.
They're actually, nobody gave me my down payment from my first house when I bought it in 2000.
But now the down payments that the parents are giving off to their kids is huge.
It's records.
It's records.
So that offsets.
Everybody says the comparison, oh, the town payment's the same.
The rates are higher.
I can't afford the same house.
But it's not quite that that's happening.
People can, the parents can give a big chunk of their, of their cash to offset the increase in rates, the offset the increase in house prices.
So it's not always dire, dire, dire, right?
You got to think that there's other elements coming into play that could offset this.
That's true.
I agree.
But how many of us have wealthy parents?
Well, exactly. So this is where it sucks. If you do have the wealth parents, it's like a transfer of wealth, right? That's what's happening. Inflation is transferred wealth. Those who don't have down payments, it really, really sucks. But it doesn't mean prices are going to go down because they can't buy it. Because some people can buy and bid up because their parents are rich. So it's really, it hurts to see that happening. But the people have money, they'll be able to buy these expensive houses. And the people who don't, they'll have to be renters. That's terrible, right?
Yeah.
Yeah, I mean, it's it's how unfortunately how things pan out.
And that's why we always say that, you know, inflation is a tax on the poor.
It's the greatest tax on the poor.
And I know that people that are talking bydenomics are really excited about the fact that the market's looking the way it is.
And oh, we might have a soft lending.
Well, we might not have a soft landing, first of all.
Yeah.
We might have no landing.
But number two, along the way, how many poor people don't have enough money?
Because inflation, again, is the most regressive tax on society.
But I do want to move forward to Threads versus Twitter, because I will tell you that all I hear about
In the last 24 hours, it's as if the world has been,
the Twitter world has been flipped upside down.
Here's some numbers for you.
So I just put this up in the nest.
So Threads, I said, is eating Twitter.
Now, don't kill me.
Guys, don't kill me.
I'm about to get some messages on the back end.
Mario's about to be like, Donish, you can't say that.
But I can say it because it is.
Within seven hours of its launch,
Threads is already 3% the size of Twitter.
By tomorrow...
Let's quantify that in millions of users.
That's the big...
That's what's going to move people on here.
By tomorrow, the estimates are, and I believe these estimates,
I think these estimates are underestimating exponential growth.
By tomorrow, it will likely be at about 10%.
And based on meta's own estimates, and by the way, I will start talking about people they recruited.
Holy cow, some real big heavy hitters are leaving Twitter and moving to threads.
By tomorrow, it will likely be at 10%.
In a month, it will be approximately half the size.
I believe Zuck, when he says that it will be the first billion user user.
text-based platform,
I think we are going to see that
in months,
not years.
This is not a drill.
This is the real deal.
Now, I used it.
I checked it out.
Don't hate me.
Oh my God.
I'm about to get killed in the messages, in the DMs and in the comments.
Guys, it's just diversifying.
You have to be smart, okay?
This is not financial advice.
This is life advice.
Don't put all your eggs in one basket.
Don't do it.
It's stupidity.
You will always be late to the party.
I don't like being late to parties.
I'm usually the first one there, which is super awkward, but always useful.
Because I'm also the first one to leave.
So, Sileman, tell me, bro.
Tell me, are you, did you check out threads yet?
Bro, I already started a thread, basically.
And the reason for it is, is exactly what you said.
You need to be in it from the beginning.
It does seem like, obviously, it's brand new,
so there's a lot of issues with it.
For example, the search function is horrendous.
It's like, but the fact that you've got so many people who've joined it,
it clearly is...
It's clearly shown that it's not going to have the same issues as other alternative platforms like Blue Sky or Master Dernan, these other ones.
I mean, this, as you said, looks like it's going to be huge.
I think it was something like within the first four hours, there was five million users.
and it's going to be major, it's going to be gigantic.
It will be more left-leaning for sure.
There is going to be a huge amount of censorship.
But again, like, we need to talk about, obviously,
we're going to talk about these in other spaces later as well.
But like, what does that actually mean about censorship?
Because people are getting censored in this platform.
It's just not the type of people.
Yeah, every platform censors.
Yeah, yeah.
And Solomon, you're right.
I mean, by this morning, we were at,
20 million users. When chatGBT came out, they're only a million users in the first week.
And you're seeing 20 million users in less than 12 hours.
And the issue is this.
Obviously, it's just the first day.
So there is a lot of, like, problems with it in terms of, like, you know, usability.
Can't even DM.
Sorry?
You can't even send DMs.
Yeah, there's no DMs.
Even search.
You can't search anything other than, like, anything you put in the search profile is just searching other people's profiles.
So if you're in a search keywords, it doesn't have that.
But let's be clear.
All of Musk's boys are on there.
Like all these guys who were Musk's loyalists.
Like Ian, like I saw Ian replied to you, Darnish, just now.
Ian is on there, like, immediately, like, well before any of us.
Elon, he wakes up in the morning.
He looks to the West and he performs his prayer to Elon every day.
And he is on threads.
He's on threads.
Yes.
Yeah.
And so, yeah, look, if this is true that, and this is probably more for your space, this aspect of it, that if it's true that already Twitter was struggling, and now you've got this alternative platform that is going to have even, let's say even had 50% of the users as you are predicting in a month.
and possibly more within three to six months.
Like, what's going to happen to the advertisers on Twitter?
Will they move?
Will they diversify?
Like, this is going to significantly impact Twitter.
And so Musk's going to have to make some moves because...
it's and and with him making this like move what he made just recently where he basically
minimized the amount of posts that you can read like all of this coming together at the exact
same time this is probably the worst time possible for this to happen to musk i think it's
going to be a huge problem obviously you guys will probably talk more in detail about the financial
aspect of it because that is major like how much can he how much more hits can he take and i'll
let you guys answer that because you'll know about it yeah i mean and
Even beyond that, and I know that, you know, Yoni's here,
and Yoni, I know you have to be careful since you have a big partnership.
But I was going to say that, you know, ultimately, when we are talking about
Twitter, Twitter made a pretty concerted decision to become, quote, unquote, the free speech platform.
But then they pivoted because of the financial reasons, and that's just the truth of it, to freedom of speech versus freedom of reach, which, by the way, does not make any sense.
I will continue to say that. I think it's the most ridiculous commentary. And then now...
we see the biggest thing that they didn't solve
is for creators and people that are on this platform
to be able to monetize what they're doing.
There's only so much time and effort
you can put into a platform before you need analytics,
before you need access to some sort of opportunities.
The truth is, I still don't know who all comes to our spaces.
Somehow, you know, people keep coming back, which
which is great, but I don't know how to tailor content.
You know, when we think about sponsorships, you know, spaces is great because people are here
live. It's a captive audience. But when you go outside of spaces and you go into tweets,
you have no idea what the analytics look like. And there's no clear monetization strategy.
Has anybody looked at Facebook analytics?
Facebook analytics is more detailed than what many people are using to trade in the markets.
I mean, it's unreal.
It is the platform for analytics.
And so we are seeing that there is a huge shift.
And I hate to say this, but we are a capitalistic society.
So I am telling you, again, not financial advice, but I am bullish meta.
If I was going to bet on anybody to do this, look at what meta did to Snapchat.
Look at what's happening right now to Twitter.
This is what they do best.
This is how they break.
I am not only bearish Twitter,
and I love Twitter for people that know,
I absolutely adore this platform.
I am telling you,
go check out threads and you'll realize that they got,
they did 20% of the work to get 80% of the functionality.
And that's usually what,
that's usually a good sign of a good product team.
And, you know,
I sent this to a few people,
but there are certain people that I know that I believe are,
are really, really big and,
and really important for people that are known,
Jane Wong has been somebody that people follow quite a lot.
And she's been sort of like a,
Twitter critic slash supporter and she just joined meta.
She has millions of users on Twitter and she,
of millions of followers on Twitter and she just joined meta and she's working on the
Threads team.
You don't know what that means possibly,
but literally she was the resource that people went,
the Twitter team went to.
So Yoni, go ahead.
First of all, I'm a bit more skeptic of a new product a day after it's launched.
And obviously, Facebook has a huge reach to bring in that initial set of users joining in.
But it's very hard to build social networks. It's very hard to build a network effect. It's very hard to build communities like you have on you have the Fin Tweet community. You have the crypto Twitter community. You have the sports community in Twitter. You have a lot of the politics happening on Twitter that potentially are going to be somewhat more limited on threads.
And, you know, when we've seen in the past, you know, who remembers Google Plus, right? So we've seen very large companies try to compete with a, you know, similar product and not succeed. So, and lastly, which I think is important, I've learned never to bet against Elon Musk. Everybody told me how.
Tesla doesn't make any sense.
Five years ago, seven years ago, it's going to go bankrupt again and again and again.
And eventually it doesn't.
And I think if you look at Twitter, while there's a lot of naysayers on Twitter, again, due to some sort of politics and sort of divergence, but...
at the end, if I look at a lot of people's experience recently with Twitter, it actually got better.
So I think Twitter is in a better place probably today than it was a year ago or two years ago.
That doesn't mean that threads can succeed anymore.
but will it be able to bring in those large communities of where do you read on payroll
the real-time events or most of the real-time events people go to Twitter?
Will that change?
Right now my feed on threads is...
a lot of my friends
rather than these communities
and it's much more casual
than business oriented than my Twitter
feed. You know, it was an interesting
that you brought that up. Jay, one second.
I noticed that as well that it's not
as community driven. It's a lot
more personality and influencer
driven. But you know, Yoni, that
that's how it starts.
Because even when you go to Instagram in general,
you can just follow your friends
or you can start following some of these accounts
that talk about health and wellness
and about finance and about lifestyle.
Now, do I really care
what some influencer with
half a brain cell thinks about the economy?
Probably not.
But,
But, you know, just because you're good at posting selfies does not make you good at, you know, looking at the economy.
But I will say that it just takes a few of us to go and actually...
So, Dan, a quick question.
Who are these people that you mentioned earlier that exclusively move into threads?
So I'm not saying that they're exclusively moving to threads.
What I'm saying is I am seeing people move to threads at levels that are surprising.
Like the people, the first movers are actually people that, I mean, Yoni, you just said that you got on threads.
I'm just saying.
Why not? Why not?
You know, if I'm in the business, I have a social network, Kittor always a social network.
So why not experience with a new part of the question is this is a dialogue?
going to move there, not whether people are opening accounts, whether people are going to consume
information there and share the same information, or is it going to be more towards Facebook,
Instagram, which is more personal and less business oriented?
But, you and I both know that the ownership, right, right?
So meta owns Instagram, meta owns Facebook and meta owns WhatsApp.
And ultimately, when you start thinking about the different types of networks, I know you know Reed's law probably better than I do.
But the idea is that the small clustered network effects that come with things like Twitter, these small sort of niche communities that come with Twitter, that can be recreated.
And there is no one better to do cross-app networks.
communication today we saw it with instagram people were betting against that acquisition when it
happened i am old enough to remember and and people were betting against the what's that they said
nobody's going to believe this they thought facebook messenger was going to be a giant failure we have
seen that meta if they do anything right they do build and integration better than anybody else i think
that ultimately what we're going to see is people like me,
people like you are going to go there,
we're going to cross message.
So we're going to write a tweet,
we're going to take that same tweet and put it on threads.
And we're going to notice exactly what you said,
which is we're going to notice that there's different people
that are now responding to it.
There will be different levels of commentary.
And then over time, people on Twitter
will start saying, you know what, you only is on threads.
Maybe I should go check it out.
And they get on threads because the big accounts are moving on threads and getting ahead of it.
You know, they'll see, oh, Yoni's tweets are there.
Oh, interesting.
And also my college friend is on here.
Maybe I should connect with them.
And before you know it, it's literally the network effects have really –
remember, if you have an Instagram account, you can port your followers over.
That's a pretty big difference.
And so I do want to – I do want to remind everybody that Instagram is the biggest –
platform in the world.
And so, you know, it's something to remember.
In the Facebook ecosystem.
And the interesting thing to note is,
I was around when Google came out, right,
with a social media competitor.
Jay, your audio is a little soft.
Oh, sorry.
I was remember when Google came around with a competitor.
And in 2011, it was a much different scenario
where they didn't invest that much money behind it.
I was in the financial media space for a while.
I sold a company to Venrath.
And what we learned about Google is they staff new projects with very few people, very few capital resources and they wait for them to lift off.
It's another reason why Google Finance, why Yahoo was a terrible business, but Yahoo Finance was so much bigger than Google Finance for so many years because they had literally two product guys in the entirety of Google Finance.
I think this is going to be much different where Zuckerberg is going to put huge staff, huge resources behind it.
You're going to have them former Twitter employees going to work there.
And I will tell you that, I mean, I literally have an analyst that is that is going to be taking every single tweet that I have and putting it on threads.
And I'm already seeing 15%.
of the Fin2et community has created accounts on threads.
So I think it's different than Blue Sky.
I think it's different than Mastodon,
and I think it's very different than the experiment
that Google did in 2011, but only time we'll tell.
At least the cage fight is going to be more interesting now.
Exactly.
Maybe with the cage fight.
Well, Zuckerberg just psyched out Musk.
And the key thing that I learned from it is you don't need them to do a cage fight.
The cage fight has already started on life.
I mean, it's as if Musk got Siop by the Cyop King.
It's the, this is my favorite timeline.
Go ahead, Trevor.
Yeah, I was just going to say, I think with Facebook and Instagram, you're kind of seeing a more of a skewing demographic changes, right?
I mean, if we go on Facebook, I see every day people getting hacked and, you know, I...
the legitimacy factor, I think, of Facebook at a generational level is changing.
I mean, if you look at the vast majority of people,
they may still get on Facebook for, you know,
five or ten minutes a day if they're under the age of 40.
You know, but LinkedIn, Twitter, Instagram,
these are kind of where I feel like the vast majority of Gen Xers and millennials
are focusing time to build an audience and community.
And I think you said it earlier, right?
The quality over...
quantity, I think, with Facebook and the argument for Twitter is, yeah, of course you can get,
you know, whatever so-called influencer putting out some comments, whatever.
But the engagement and discussion that I think you have on Twitter is a little bit more raw
and a lot more concrete when people can call individuals out on bullshit.
And I think this is kind of a mainstream issue, obviously, you know, with the right and the left
kind of competing forces against, you know, freedom of speech, etc.,
but I think generationally and demographically, there are certain shifts that we're seeing in media that Twitter has, I feel like a more diversified kind of touchpoint where you get a lot more demographic diversity, whereas Instagram for the vast majority kind of has a...
interaction pretty limited. So I'd say, you know, just hindsight 2020, you know, if people
are looking for content and engagement, I think Twitter has become a pretty unique space to do
it in. And again, I think betting against Elon Musk and saying that, and of course, I think
the integration, I just actually did it while I was driving, but it's easy, you know, you pour
your users over, et cetera, and that's nice.
And that's a huge thing for people.
So adoption may be easy.
But again, it's going to take several months, I think, to see, you know, how the actual mechanism churns to where, you know, content or production actually makes something that's valuable.
But Trevor, you just, you just said something.
It's so interesting to hear, like, people saying it both ways.
You ported over your users.
Yoni ported over his users.
Jay's on it.
I'm on it.
Suleiman's on it.
Everybody here is building accounts.
And I know that you're saying that activity is different than porting over users.
But I will tell you, do you know what keeps users engaged more than anything else?
Capitalism.
And ultimately, Elon has failed the creators on this platform.
They have been.
And by the way.
It's not even a free speech platform anymore.
So the truth is that it has not,
I don't bet against Elon Musk when it comes to technical problems.
He is a great technical leader.
He has built technical.
technology that literally is going to change the future of society, but he has, social networks are
not about technical problems. There are some technical problems, but those technical problems
are not the problems, in my opinion, that that ail Twitter. The problem is that you need a business
model that works for the people that are involved, and that's what I'm betting with meta,
is that they're going to fix the business model.
And there's two points as well.
One,
first question,
I mean,
how long before they have
thread spaces?
And the second question is,
look,
it's what you just said now,
Darnish,
We thought Twitter was going to be a free speech platform.
And let's be clear, it's not.
Like, a lot of people I know are shadow band.
Even I was shadow band for a period of time.
So this idea of this being a free speech platform isn't the case.
What it is is a platform for people with specific ideologies.
And that's fine.
They will do well on this platform.
For example, people I know, for example, people I know who post, for example,
just an example, pro-Palestine stuff, their content, their shadow band.
People who post...
Basically, people like Yeh and Nick Fuentes were banned, which is fine because of alleged anti-Semitism.
But then people who have extreme Islamophobia are getting boosted by Elon Musk.
So again, this is a platform for a specific ideology.
And what will happen is when it comes to...
threads, it'll be the same thing.
It'll be a left-lean ideology.
So, yeah, some things will be banned.
So, like, for example, maybe a lot of my posts might be banned.
I'm not, I won't be allowed a post on there.
Maybe a post against, like, teaching, you know,
transgender in schools will be banned.
So, again, it'll have a...
specific ideology, and that's what's going to be the difference.
But the ideology that threads is going to allow is going to be more amiable to advertisers.
It's going to be more amiable to basically having, you know, celebrities on there because,
again, they're already within a certain system to ensure that they get advertising sponsors.
So from that perspective, you can only see that up growing financially and from a user-based
perspective.
But also, beyond that, they have the tools, Soleiman.
They give you the analytics.
They have people that have done Instagram stuff,
like where they've built audience,
build and monetize their audiences on Instagram.
They know.
Amy, I mean, I know you have a giant Instagram following,
but, you know, my point, it still remains
that ultimately, you know, Twitter is not built
with a good business model, right?
Amy, you got to unmute.
Oh, sorry. No, I didn't realize you're asking that,
Frederick, to me. No, I so, no, in full disclosure,
I did used to have a fitness account on Instagram,
and I actually left for several reasons,
but I do not have a thread account.
I have not started one yet. I'm maybe the only person up here on this panel right now.
Oh, my God, Amy, you're so far behind.
I know. I'm always last to the party, but I do leave a really good.
You know what, Amy's going to have more followers than everyone on here
in like a week when she says her stuff.
Well, the thing is, I think there is
Originally, I think there's a reason that people migrated from Facebook and Instagram to Twitter.
And I think Twitter has a different audience.
I think Twitter tended to, at least in the early days, to attract a little bit more of an educated, more intellectual group because it's not as visual a medium as Instagram is blaringly a visual medium.
It's going to obviously draw a lot of influencers that are under 35.
You know, good-looking people are going to rise to the top.
It's going to have more of a celebrity punch.
And Twitter offers an anonymity for people who want it.
It offers it, you know, originally, now it has video and all this stuff.
But originally it was just words.
It was just words.
And it was a simple platform and a way to communicate simple ideas.
And it'll be interesting to see how threads evolves with that.
And just if the user demographics are different for threads, then it's possible that it could coexist alongside Twitter.
And they could both.
be reasonably successful without necessarily totally like one eating the other it's it's just it's
really early to tell right now and this early surge of adoption we're seeing is it's simply people with
an instagram account clicking a button or two and voila they've got you know it's just it's they've made
it so accommodative for you to set it up that it's going to come out of the gate looking like
much better than mastodon or blue sky or one of these other ones and
But, you know, only time will tell how the platform functions and if people are using the monetization.
And another thing with the ease of monetization that you have to think about and the influencer status and the celebrity thing is that sort of always is going to come to a head a little bit against free speech.
Because any time you're rolling out.
you know, a monetary aspect, then you're going to have people sort of starting to tailor
content towards sponsors. And it almost is like the money itself kind of choke holds the free speech
a little bit. And it's not explicit. It's not the platform saying you can't say this or that.
It's the person that wants to make money saying, oh, my sponsor might not want me to say this or that.
And that three sort of see the free speech pull back. And yes, while Twitter has not to this
point done a good job monetizing itself as a platformer or making content creators giving them
the ability to monetize that also has sort of protected the free speech element to a certain
extent and made Twitter thrive in that aspect so we'll see time that time
I do want to say that there are sponsors, they're open across the spectrum.
Look at the Daily Wire.
There's a bunch of people, you know, there are people that have been able to monetize
different types of content on a multitude of different types of platforms.
I'm not trying to say one way or the other.
As people know, I'm always in the middle, which is why everybody hates me.
But, but, but,
But that's okay.
That's the price we pay for being moderates.
But I was going to say that, you know, ultimately,
the big thing that's quite challenging,
if we're talking about the financial aspects of it,
this is going to only, again, going back to meta as a stock,
as a play, and this is not financial advice.
But as we look beyond this,
this is only going to increase Dow mouths over time.
The daily active users over monthly active users, they're only going to spend more time reading.
They're going to spend more time interacting.
They're only going to even it's just and the question is, is it going to be synergistic or is it going to be additive?
And I'm convinced it's going to be synergistic.
A good example of this is you saw Twitter trying to move towards more video.
And we have seen, come on, can we just admit that that rollout has been incredibly slow?
Like, incredibly slow.
The tools are not there.
The system is not there.
The ability is not there.
When I watch videos on Twitter,
The quality is crap.
Like half the time it starts buffering and going in and out and it's just not great.
Facebook video works well.
I hate Facebook.
I don't use Facebook, but Instagram video.
Look at what they did with Reels.
Look what they're doing.
You know, first we started with stories, then with Reels.
And they're going after TikTok and people are like, oh, that's not going to work.
It worked.
You know, with stories, they said they're going after Snapchat.
People said that that wasn't going to work.
It worked.
And again...
I believe that we do need a Twitter to exist.
We need a place where people can be free.
But this BS that they put out where it's actually not free anymore,
that's what kills.
This is the funny part.
When you go after the money...
You have to make compromises like Amy was saying.
As they're making compromises, they're literally losing their base.
This is the funniest issue of all time.
And I don't know what they can do to fix this.
It is just the natural progression of things.
Yoni, go ahead.
Sure. I think there's first, let's bet some 10,000 doge on this in 12 months. We just need to figure out the criteria. But I think eventually it comes down to also where is Twitter going, which is a big question, right, because Twitter is basically now X.
And is Elon going to push Twitter to have, you know, a wallet within it to do more stuff than just being Twitter, which is in theory what his vision of X is?
And if he is able to take it there, then it's something very different than what threads it is, right?
So threads is a competitor with 20% of the features of what Twitter is today.
What is Twitter going to be 12 months from today, 18 months from today?
And is the audience a bit of a different audience?
So the question of...
Is threads going to be successful or disappear?
Is one question?
I'm not sure it's going to disappear as Google Plus.
The other question is, how do you measure basically which one is better 12 months from today?
And to whom, right?
So if I'm searching, you know, hashtag Apple or hashtag Doge...
I expect to see significantly more activity 12 months from today on Twitter than on threads.
Right?
So when I'm searching cash tags, that's finance oriented.
We can think of similar stuff for sports, for politics, etc.
If we're thinking of how many, you know, a significant celebrity...
how many followers do they have?
They'll probably have more followers on threads
because they're just picking up directly from Instagram.
But this is the challenge about social networks, right?
Like, this is my issue, is that ultimately,
the way I think about businesses in the social network world
is I always think about, okay,
I visualize all the people that I went to high school with,
most of whom I'm still surprised they're alive.
And...
and, you know, because their brain cells were so small.
And so then I think about, okay, how many of them in my class,
I close my eyes and I think about my class and I say,
okay, what percentage of them would be on Twitter
and engaging on a daily basis versus how many of them will be on threads
engaging on an hourly basis?
And you start realizing that social networks work for,
for the commoners, for the peasants, for people like me and, for people like me that are idiots.
And I think that that's really how it all works out. So we have to be honest about the fact that we can be
highbrow, we can be talking about cash tags, which again, I think are important, Yoni. I'm not saying
they're not. But,
Cash tags don't rule the world.
Influencers do.
That's the honest truth right now.
That in reality, people go where people are.
And people go where people are sharing information.
And by the way, those people are sharing information
because they want to make money.
And ultimately, we just have to admit
that we're in a capitalistic society
and it's great to live in our...
We can't at the same time hate on the elites while we think of ourselves as intellectual elites.
This is a crazy sort of back and forth in my mind that people are saying that Twitter right now has better content.
Of course it does until it doesn't.
Until everybody moves off because they can actually monetize and you're right.
So let's look forward.
You should be more thankful for Elon retweeting your spaces.
What does that mean?
That means you've got a big boost.
It'll be interesting if we see suddenly Mark doing the same on threads, right?
But Elon is also very active himself on Twitter, whether it's himself or an actual AI doing it for him.
I don't know.
But that's a big boost.
He's boosting a lot of.
spaces a lot of people on Twitter by commenting and being super active on Twitter.
It'll be interesting to see whether Mark does the same on threads.
But the funny thing is that him boosting, and I know that Mario and the team were excited about
that and everybody's excited, all of the people that follow us and that listen to us every day,
see the work we put in, we were all excited.
But to what end?
I could do less on Instagram and do less.
And that this is actually a good example of why, you know,
we're doing this is because we don't care about the money, really.
But that doesn't mean that the average person doesn't.
Because if I cared about money, I would not be on this platform.
I'll tell you that.
This is the worst platform for money.
You know, you can't, I get more Bluetooth ads than anything else.
And I'm, what the hell are they talking about?
Amy gets bluechew ads.
She doesn't need Bluetooth's.
Yeah.
You know what I mean?
Like, this is like the weirdest platform that has the worst systems.
I'm just being honest.
I come on spaces every day.
We run these spaces.
We have thousands of people in the room and it still takes me five minutes to get on.
I mean, this is like simple example.
Yes, do I like where Twitter is going?
Do I like the concept of the Everything app?
Sure.
But you know what the real Everything app is?
Meta.
That is the real everything app.
They're really doing it, and they're doing it at scale.
And I'm a little bit concerned.
I want Twitter to win.
Twitter needs to exist.
I have people that come here that listen to us that are happy that we're here.
And by the way, I, just so everybody knows,
I'm the one that gets hated the most because I'm in the middle.
So the left hates me and the right hates me, and that's okay.
And by the way, I would do great on Facebook and Instagram because I'm so moderate.
But ultimately, I still think that the left and the right needs to exist and needs a place where they can talk trash.
Because if, you know, because if you can't talk, you scream.
And if you can't scream, you revolt.
And that's why we need that.
That's why we need a Twitter to exist.
But the execution has been incredibly poor.
And we have to admit that.
So one point is, though, Danish.
I mean...
Although I did say, and I still hold to that point in terms of ideology, like Facebook, sorry, Twitter, Instagram,
sorry, Instagram has a different ideology compared to Twitter and they're both censored.
But despite that being the case, if you look at its breadth of what it allows, Twitter allows a lot more.
Whereas when it comes to Instagram, the censorship is extremely excessive.
So even though, yeah, they're both ideologically driven, the censorship is excessive.
And so we know when we go onto that platform, there's going to be a huge amount of censorship.
So as an example, already people are complaining that they're getting censored.
I think DC Drano, I think he posted and within minutes he was basically, his post was blocked.
A few other people I know that posts are...
Sorry?
Yeah.
What was the post?
I really don't.
I really don't know.
I really don't know.
We'll probably have him on tonight and we'll ask him.
But my point is there is,
and we know that because I know many of people
who are banned on Instagram,
you know, for example,
Tates are not allowed on Instagram.
So there's many people who, again,
Instagram or it's ilk have,
extreme levels of censorship compared to
and so Twitter does have censorship
but the level of censorship is much more usual.
So there is definitely going to be a scenario
where there is a need,
a huge need for Twitter.
The issue becomes for me
and this is what I think your space is more about
is will they be able to financially
survive the impact that
Instagram has on the immediate impact and the long-term impact has.
Because if it's right that Elon was already struggling and he was close to hitting,
you know,
the blacks many,
sorry,
read many a times and you,
you know,
it was almost capitulating.
This,
I mean,
I assume that this is going to have a major impact on just the financial,
just the advertising sponsors.
And remember,
the moves he made recently in terms of getting Linda on board was,
possibly linked to that
or if it wasn't, there was some kind of connection
to ensure that that happens where he gets
sponsors on board, but now as sponsors
may think, am I going to pay
X to Twitter? Am I going to
pay X to
threads or am I going to
you know,
you know,
Maybe do 50-50.
And if they're going to do that, still, that's Twitter losing out.
Like in every scenario, this is Twitter losing out.
Even if they only lose 20% of sponsors that now go to.
So the social media managers will have one less thing to do.
They will literally just port over their ads that they're already putting on Instagram to threads.
This is to your point, again, if they don't fix, if there's no additional benefit to Twitter, I'm sorry, the whole business model here is still ads.
I know I know that people are paying $8 for check marks, but guys, can we just be honest?
It's still an ad.
It's a couple hundred million bucks.
On last year, Twitter did $5.25 billion in sales.
Exactly.
The estimate is less than half that.
And even with the $8 check marks, they're only making a couple hundred million off.
There's a reason why Elon is not paying rent.
And there's also a reason why he sifted Google on the cloud contract and they're still in negotiation.
100%. And so, you know, I, look, do I...
But this is the richest person on Earth, so I'm not sure you have the ability to finance this company with, you know...
Just because, sir, just because he's the richest person on Earth doesn't mean he's going to be willing to put up another 10 billion of Tesla shares in order to finance this.
At some point, you know, he's going to have to look for external capital to come in.
that that's true, but I do think he could probably find finance options.
I mean, I don't think it's impossible.
It'll just be, you know, remember interest going on.
There's a low valuation, which he's not going to like.
There were two big costs for Twitter.
One was...
I think there were 8,000 people at peak.
I think they're now under 2,000.
And the second is server costs, which they seem to be right now negotiating.
And by the way, that is very much related to his capabilities of being technical.
So it's not a huge operation to keep on running, whether it's a successful business or not.
I do agree.
But then the real competitor is actually, it's not meta.
It's Google because Google's eating advertising dollars for everyone.
Yeah, I mean, the real question now is, where do we go from here?
So the concept was that we were going to get an everything app.
And it was going to be embedded with the Web3 world.
Well, Web 3 has not panned out exactly as planned.
Right.
that's a euphemism,
but I don't want to get killed
by all the token people
in our comments.
We'll be on Web 4 soon enough, don't worry.
Yeah, we'll be on Web 4 soon enough.
I guess Web 2 was strong
to begin with,
but I was going to...
How about this?
Web 3 is as likely to be a reality
as Bricks.
So if you believe in one,
you probably believe in the other.
Okay, all right.
Eugene, go ahead.
Oh, man. Fire your words to kick it off.
Before getting into the Web 3 part, or maybe that's another space, threads on Twitter.
So, you know...
You know, being a former Meta employee, I guess Facebook, we called it Facebook back then.
You know, when they acquired, so I was at Oculus before.
And when they acquired Oculus, remember Zuck came in, you know, to her little kitchen.
And he basically was like, I mean, he said what I think he still believes is like,
the reason we bought Oculus is because we want to get a billion people in VR.
And it was like, we don't do anything unless we want a billion people in it, right?
Now, there are a variety of successes that has had.
There are some failures. But generally speaking, I'd say when it comes to creating things on mobile social spaces, meta is actually great.
Actually, when it comes to creating VR social spaces, they're actually not great, right?
So they spend phenomenal amounts of money on Meta Horizon World, et cetera, and that's their fourth iteration, and they're trying to copy VR chat and Rec Room.
And they're just failing, despite the fact of having a lot more money, a lot more people.
But that's because I think...
think those things are disruptive innovations, right? Meaning, I truly do. In the whole classic Clay Christian
sort of thing, it's really hard to build VR apps in general and Metaverse, you know, apps socially,
it's just a different thing. But when it comes to copying like Clubhouse, like Twitter, choking
clubhouse, you know, that wasn't what they call an incremental innovation, easy to do. The question
you have to ask yourself is, what does Twitter have? It's got this, you know, amazing, you know,
network effects because it's got a lot of users on it.
But so does Instagram.
And how portable is that, right?
And, you know, meta, company formerly known as Facebook, is relentless and ruthless, right?
They squelch to Zinga.
They, you know, look at Snap's market cap, right?
Snapchat's parent company.
You know, look where it is versus the IPO versus the ties.
Much lower is the answer.
And, yeah, you worry a bit, right?
I mean, the numbers growth that you start off with, Donish are incredible, right?
3% going to 10%.
of Twitter's users. So yeah, I would say, yeah, this is not a drill. I think this is really in meta's
core wheelhouse and I think there should be some concerns around you know Twitter versus
threads here and I would not underestimate meta in a game like this any day of the week.
Yeah, I will say that for people, so I'm looking at the comments,
Thank you for all the hate and the love.
I feel like I've really triggered half the people,
and half the people agree with me very strongly,
and the other half really disagree with me,
which means I'm doing a good job.
But I was going to say that it's not me betting against Elon.
It's me betting for capitalism.
And those are two very different things,
that even Elon...
can't fight capitalism, this intellectual socialism that we're talking about, which is what I'm
going to call this. I'm trademarking that. The intellectual socialism of Twitter can only go so far.
We know that socialism doesn't work at scale. And in reality, until you infuse this platform
with some form of true business model, this is what happens.
Ultimately, Instagram has figured out a lot of these things for themselves.
Instagram has figured out approaches towards monetization, approaches towards multimedia,
approaches towards getting eyeballs.
Remember, there's nobody that gets attention like meta.
They can catch your attention, like Eugene said.
The reality is that this is their business.
They are good at it.
They're better at it than Twitter.
They're better at it than anybody else.
The numbers prove it.
The numbers prove it.
And the reality is that as we look ahead,
For everybody that's listening, remember that if you believe that the future of news is outside of corporate media, it doesn't have to be Twitter.
It does not have to be this. No one has just earned our loyalty.
No one just deserves it.
Just like we saw across political parties,
we see this everywhere.
The tribalism is not earned.
People go where the opportunity is.
People go where the new ideas are.
And if we start seeing threads,
if we start seeing people that are listening to us,
we have some incredible people that listen to us every single day.
We start seeing them posting on threads,
following people on threads.
We see threads maybe introducing a space as competitor
with better monetization.
This is not, I have no loyalties here and nobody here does. Don't let them lie to you. Elon doesn't win just because he's Elon. Elon wins because he's better. I think we need them to be better. That's all I'm saying. Mickle, go ahead.
Yeah, no. I was just going to make a quick comment on kind of my thoughts about that.
For me, the biggest thing is probably just trying to figure out whether or not it's going to foster the dialogue that I see here.
I mean, I tried to make an account on Instagram just to,
recreate my own kind of persona that I have here.
And it just kind of failed miserably.
I mean, I didn't get any engagement.
There was no discussion.
There wasn't the right people following me.
So, you know, like as much as I kind of wanted to start something up there, it just really
wasn't working.
So I think we can all agree that Elon's, I mean, Zuck's going to build a pretty good platform.
And I don't think there's much debate around whether or not it's going to work and
whether or not he's going to get users.
I just think it's going to depend on what kind of audience he actually ends up attracting
to that platform.
And I think it might actually...
be a scenario where both could kind of win in the long run. I mean, right now, it seems like most of us
who are here already have pretty big network effects with our followers. And until I see a serious
amount of people actually porting those followers over, my base assumption is that there will
kind of be a different audience over on threads, people who are going more about their personal
life and Twitter might be able to,
keep this FinTwick, FinTwit community kind of active here.
Yeah, that's kind of how I see things going.
And until Twitter makes a massive mistake, I would assume most of the financial Twitter would probably stay in this place.
For now. Sure. Until they cross post, cross thread, perhaps. Go ahead, Dakota.
Yeah, I was just going to say, you know, there's a time that I just love to sit back and listen to the individuals that are far more intelligent than I share their opinions.
And I think there's a lot of people like that in our listening group, right?
I mean, I think what Twitter has built is really unique and what Elon is building is really unique.
And people are going to stay for that, right?
And Mark Zuckerberg obviously realized that there's a big opportunity here.
And so that means that what Elon is doing is the right thing.
And so, you know, if they're going to attempt to build the same thing
and the same community that we have here on Twitter, I think it'll be tough to do.
It'll be a lot more influencers and selfie picks like you said.
But I think Amy made a really good point earlier that, you know, the lack of monetization really does foster a great community of contributors that provide a lot of value.
I know I get it and I hope that our listeners do as well.
So, you know, I think it'll be tough to compete with.
So this topic, by the way, apparently has been so potent that I just got a message in the back end that tonight's main space now is going to be Twitter versus threads.
So we are going to be talking about this tonight at 6 p.m. Eastern. I may or may not be able to make it, but ultimately...
I am telling you, Cody, I agree with you.
But again, I'm going to trademark this.
I got to go do this immediately.
Just kidding.
Intellectual socialism can't last.
It can't sustain.
In reality, this is the best system that we have.
And until this...
this whole promise of an everything app
where you get access to everything
that only matters
if it's infused with a business model
that's actually sustainable.
That is what the underlying issue is.
So, you know, on that note,
I've got to get back to my day job,
so I got to go.
But we will see everybody
at 6 p.m. Eastern tonight.
You know, it's going to be a crazy space.
We're going to have a lot of people
from a lot of different places.
So thank you, everybody.
Thank you, everybody.
and have a wonderful day.
