Nov 27, 2024 · 44m · bg2-pod
BG2 Thanksgiving Roundtable: DOGE, EV Tax Credit, Tariffs, Conspiracy Theories, Invest America · Bg2 Pod
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In this Thanksgiving roundtable episode of the BG2 Podcast, co-hosts Brad Gerstner and Bill Gurley share key topics of gratitude and analysis, spanning federal budget balancing, Chinese technology advancement, open-source AI, capital market structures, and financial literacy initiatives.
Statements from this episode (19)
Gurley: 35% of Chinese university grads study STEM versus under 10% in US
“The number of graduates in China's University system that are STEM is 35%, and that number is below 10 in the US.”
Gurley: Blocking ASML and AI tech to China is not working
“I don't think blocking ASML or blocking AI technology or blocking anything is working. It's just not working”
Gurley: Tariffs will only protect US industry for a very short window
“Tariffs and protectionism will only protect American industry for a very short window. It's actually going to deny them the competition they need to get their together.”
Gerstner: US federal revenues grew at 5.8% CAGR since 2017 tax cuts
“So since the tax cuts in 2009 and 17, we've grown our federal revenues at 5.8%.”
Gerstner: 3% annual spending cuts would balance US budget by 2029
“Even at three and a half percent growth for the next four years, you balance the budget in 2029 by simply reducing the size of government three percent a year back to trend line.”
Gurley: Argentina ETF ARGT is up 60% to 65% year-to-date
“If you look at the Argentinian ETF, ARGT, it's up 60% year to date, 65, which suggests the optimism around Argentina's economy has reversed, you know, from where it was.”
Gurley: Compounding IPO ratchets misalign cap tables against employees and early investors
“Now, the reason I hate these things is they create misalignment. So you have a bunch of investors on a cap chart and now they have differing incentives. The later stage investors that wrote this compounding ratchet term I actually want the IPO to be as low as …”
Gerstner: There is nothing wrong with taking a company public in a down round
“And there is nothing wrong with a down-round IPO. It's simply a price at a moment in time, and if the market in 20 and 21 was overheated, And prices were really high in the private markets. That's just a fact of life.”
Gurley: Tax negative externalities rather than subsidizing EV purchases
“If you want it sent moving to electric and getting rid of the big gas guzzlers, you know, tax what's negative rather than trying to pay people for what you think they want. It just creates more perverse behavior.”
Gerstner: Newsom's anti-business policies will cost Democrats future elections
“The stuff that Newsom's doing is just the same, same stuff that shrunk the party and cost Democrats future elections.”
Gurley: Brazil's PIX Reached 43% of All Payments Since Mid-2020 Launch
“This payment system, which is digital and immediate and which mirrors what has happened in the UK, India, China, Australia, all these other countries have done this is already up to, I think, 43% of all payments in Brazil. Wow. From mid-twenty-twenty.”
Gurley: Visa and Mastercard Have the Highest Operating Margins in North America
“There's another fact that you should know in North America, which is Visa and MasterCard have the two highest operating margin percentages in our markets total. Like they're over 60%.”
Gurley: Government-Run Instant Payment Rails Drive Broader Fintech Innovation
“It's clear in these other countries that letting the government do this one part and getting it right leads to all kinds of fintech innovation, because you can transfer money quickly.”
Gerstner: Trump will negotiate away tariffs only after achieving national objectives
“And so I think the right way to look at this tariffs debate is that, you know, it is a starting point. He's going to raise these tariffs in order to achieve national objectives. And then he's going to be willing to negotiate away from them, but only if he achi…”
Gurley: Anthropic and Eric Schmidt Pushed to Restrict Open-Source AI
“Anthropic and their investors like Eric Schmidt have been some of the people that have been encouraging, you know, more and more AI oversight and AI regulation and trying to make it such that open source AI would not be legal.”
Gurley: Anthropic Open-Sourcing MCP Matches Google's Kubernetes Strategy
“I think it is one of the most savvy competitive Weapons you can bring to the field. I'm sure they were worried that open AI would create proprietary data connectors and they want everyone to use this one very similar to what Google did with Kubernetes.”
Gurley: Dr. Jay Bhattacharya is the best candidate to head the NIH
“His name is now being floated as a potential head of the NIH, and I couldn't, I can't think of a better candidate, and I'm so hopeful that, that he ends up in that role.”
Gerstner: Uber, Dell, Oracle, and Nvidia pledge Invest America contributions
“Companies have already raised their hands from Uber to Dell, Oracle to Nvidia, and said they would contribute to the accounts of the kids of their employees, parents,”
Gerstner: Milken Institute research shows child investment accounts boost graduation and literacy
“In partnership with the Milken Institute, led by Kevin Hassett and Rob Shapiro, we know if we give these kids these accounts, they're more likely to graduate from high school, more likely to graduate from college, more likely to buy a home, more likely to star…”