9/22/26: Trump Media Ban Backfires, DraftKings Caught Targeting Addicts, AI Anthropic Wet Lab

0:00Speaker 1:Hey guys, Ready or Not 2024 is here and we here at Breaking Points are already thinking of ways we can up our game for this critical election.

0:08Speaker 2:We rely on our premium subs to expand coverage, upgrade the studio, add staff, give you guys the best independent coverage that is possible. If you like what we're all about, it just means the absolute world to have your support. But enough with that, let's get to the show.

0:25Speaker 1:Got some updates for you in Trump's war on the media. So you may have already heard that he decided to kick CNN, MSNOW, and Politico out of the White House.

0:36Speaker 3:Well, the other mainstream media outlets, to include Fox News.

0:40Speaker 1:Decided that in solidarity with those outlets, they would not participate in in the White House press pool. So that led to a very unusual situation yesterday where Trump was doing an event, some sort of ribbon cutting ceremony or some sort of thing like that. And you had the video, but you had no audio whatsoever. Let's take a listen to how they handled that.

1:05Speaker 4:OK, so there is no microphone because there's no microphone because the pool cameras aren't there. So maybe, Tim, this is one example of it backfiring just a little bit. Pick up on some of the things Michael was saying. And obviously the ramifications are right here. Can't hear what the president's saying.

1:24Speaker 1:Particularly amusing, Sagar, because that was Newsmax, which is obviously very much in the tank for Trump. So for them to even say, like, maybe this backfired just a little bit on him is a pretty stunning admission.

1:35Speaker 2:Yeah, it's like his worst nightmare is not having television. In fact, the only time we saw Trump on camera yesterday is when he did an event with Mayor Mamdani. And that was only because New York City media was there at the request of Mamdani and not the White House press pool. I will not cape for the White House Correspondents Association. I was a member. Frankly, they are a cartel which is extremely old and like, And it's not me saying this. Ryan would reiterate a lot of this, too, from a lot of the same problems that he's had with drop site credential, like the way that they run these organizations like the White House or Congress. It's a very legacy media forward. However, the White House is trying to hijack some of that to basically control what type of coverage. that they get. So there are no heroes in particular in this story. I just want to make that clear. However, what they've done is they have created a situation where once again, they preemptively ban the White House press pool. Well, everyone could have predicted that everyone would stand tall with the organizations which have been booted out. Why?

2:37Speaker 2:Because even when I was there, attack on one is attack on all. It's literally a cartel. We're like, we can't let the cartel be broken. And so if they get to decide who is in charge of the camera footage or not, then all of us need to stand for that person. They did it when Obama attacked Fox News. He tried to kick them out back in 2009, I want to say. The entire White House press corps kind of stood with Fox News then at the time specifically so that Fox would stand with them as they are now.

3:05Speaker 2:And what it all means is, you know, even just say the pool, what does it mean? All the journalists who cover the White House, there's hundreds of them, cannot all fit into the same room with the president. And so every day there is an assigned member of that press corps to be the representative of the rest of the press corps. I used to do this job where you kinda sit there and you wait for Trump and see what he's gonna say, and then you send the message to the rest of the press corps You're not allowed to exclusively report it for yourself. That's the same thing with the TV camera. There's a guy there with a TV camera. Even though he works for CNN, let's say on that day, that footage is being broadcast to all of the networks and the people who subscribe to the pool. They also pay for that privilege, and they pay a lot of money to be able to do so.

3:48Speaker 2:So that's what it all means, and that's why they're all boycotting, and that's why some of the boycotts are happening right now. But it has backfired on Trump, actually, because they're all now saying, not only will I not publish any of the video, even the still photographers, including Trump's favorites, a guy named Doug Mills. He works for The New York Times. Best photographer I've ever seen in my life. This guy, even he, they're now saying, like, oh, we won't be publishing still images. any of their images that they're trying to distribute to try and circumvent the hold that the White House press corps has.

4:19Speaker 3:Yeah.

4:20Speaker 1:And I mean, basically the idea is that you should have, anytime the president is in public, you should have a camera and audio on him because he's, just inherently newsworthy.

4:29Speaker 2:Well, anything can happen. Like 9-11. I mean, that's literally the story. And part of the reason why the president should always have him with them is you don't know what the hell is going to happen. I mean, one day you're in a Florida classroom and the next day you're on Air Force One, you know, taking on going to Barksdale Air Force Base and trying to broadcast the most important statements that the president can make because war can break out literally at any time. They tell us that whenever you're You're there. You never know what's going to happen. You may be sitting in a damn golf course for the 90th time.

4:55Speaker 3:Yeah.

4:56Speaker 2:But you don't know. You don't know what will happen.

4:58Speaker 3:Well, I mean, it's obviously of a piece with his whole war on the press. The man literally thinks it should be illegal for people to criticize him. And he said this. This is not me making this up.

5:07Speaker 1:That is his view, is that the press should never be critical of him, that he should get only fawning coverage, that if you don't... I mean, he goes after Fox News all the time for not being fawning enough in their worshipful praise of him or if they put out a poll that looks bad for him or his party because their polling outfit is actually pretty legit. He gets upset about that and about their fake polls. So he has this. incredibly authoritarian view of what the news media should be. And we've obviously seen the lawsuits and the threats of lawsuits and the use of the FCC to badger late night comedians who tell a joke that he doesn't like.

5:45Speaker 3:This is a part and parcel.

5:47Speaker 1:And then that's without even getting into the fact that the Ellisons are taking over vast swaths of our media empires so that you have Trump-aligned oligarchs in control of important media outlets, including, you know, I think CNN will probably be allowed back in once the Ellison's are fully in control because they promised major changes to the network. So this is obviously how he operates. He does not believe in having a press that is adversarial whatsoever. We can put D2 up on the screen. This is him defending his decision to kick them out. He says the White House is not instituting an assault on the free press, something which I cherish.

6:25Speaker 3:LOL.

6:26Speaker 1:It is instituting an assault on fake news, something that has grown like cancer in our beloved United States of America. It is corrupt, purposeful, pervasive, fully coordinated, totally out of control. The threat to our national security must be stopped now. That's the other thing they hate, is all of the accurate reporting about what is actually going on in Iran, to include the images that have now come out of all of the destruction of our bases and our military equipment on the ground in the Middle East. He was at a press conference with Zoran Mamdani yesterday, which is a whole other thing that was going on there. He met with Zoran Mamdani. at Gracie Mansion in New York City.

7:05Speaker 1:The bromance does continue. In any case, he got asked about this media ban. Let's go ahead and take a listen to that.

7:11Speaker 5:You would think that an outlet would write at least reasonably well, but never. If you look at CNN, it's fake news. If you look at MSNBC, what it used to be, or MSDNC, as some people call it, that's Democrat National Committee. But it's just biased news. And I think that these outlets have an obligation to be fair. And if they're fake news, I really think I have an obligation not to allow them into another very special house. This is a special house, Gracie Mansion. Well, the White House is the most special of all houses, I have to say. And I don't even think the mayor would argue with that. And I think I have an obligation not to let fake news. They're very bad for the country, very bad for national security.

7:54Speaker 6:So I have that obligation.

7:57Speaker 3:Not a really comfortable moment for Zoran there. He's sort of staring off into the distance like, okay, I just have to stand here and take it.

8:05Speaker 2:Something I have not considered is how much of this is about munitions. Because what I see now, literally from this morning, Trump, the cowards and traitors would love to say the United States is low on munitions. It's not true. We have more munitions than we could ever possibly think of using and building them now at levels we've never seen before. Previously, the three outlets that have been banned had all published stories specifically about munitions. So it is actually very possible that this is not even necessarily about him, but of his anger of publishing some of these classified information or classified information. You don't even need classified information to figure it out, but some of the classified stories.

8:39Speaker 2:So it actually makes it worse, in my opinion, because you're not being banned over some stupid stormy, you know, some FCs, which I'm not saying that would be bad. Like that would be bad, too. But to ban over accurate wartime reporting in the middle of said war, that makes it, I think, actually a lot worse.

8:55Speaker 3:I think that's definitely what's going on here.

8:57Speaker 2:Like that is about panic about the accuracy of what's being reported from the battle.

9:01Speaker 1:I think that is absolutely part of what is going on here, for sure. And in addition to his just general, you know, hatred of any sort of adversarial press. But I think in this specific moment, that's why this is blowing up. Republicans are being pressed on this.

9:15Speaker 3:They had Steve Scalise. being interviewed on the Sunday shows. This is D6, guys. Let's take a listen to how this went for him.

9:21Speaker 7:First of all, I don't think we've had a president that's been more open to the press. Look, I've been at, you go to a bill signing with President Trump, and the first thing he does before he even signs the bill is he brings in the press. And everybody gets to not only take pictures, but ask questions. Go look at Joe Biden. Joe Biden removed the press credentials from over 400 different agencies. You know, what President Trump's done has brought a lot of those back in, but he wants a free and fair press. He's been to the White House Correspondents' Dinner. Just the other day, he was answering questions about this to the press, and they're asking him about his attitude towards the press while he's holding a press conference.

10:01Speaker 3:Yeah.

10:02Speaker 7:You never saw that under President Biden. So very open president.

10:06Speaker 8:So first of all, that's actually not true about about Biden. They 400 individual reporters who had credentials did not reapply. There was only one that was actually denied a credential. And all of those who didn't reapply were allowed to come in. They were not banned from the White House.

10:22Speaker 6:That did not happen.

10:23Speaker 1:The other thing that Republicans bring up is what you referenced before, which was under Obama, there was an attempt to ban Fox News from one particular interview. So not even like blanket ban, not, you know, it was Fox News, this one particular interview, and there was a whole Republican.

10:40Speaker 3:Freakout over it.

10:41Speaker 2:To be fair, it was part of a bigger strategy. Ben Rhodes and those people had a long stand. They hated, I mean, I get it. They hated Fox.

10:47Speaker 6:Yeah.

10:48Speaker 2:Um, they were like, they're, you know, at this.

10:50Speaker 3:I mean, it is genuinely a partisan. This was like, Oh, gee, founded as part of a Republican political problem.

10:55Speaker 2:Same way, you know, they hate MSNBC. Like I get it. They were especially furious about birtherism, uh, which was happening, uh, at the time. And they were like, screw it, let's ban them. And so that was like the intro. to it. What they didn't anticipate was Jake Tapper and all those people at the time being like, hey, you can't be doing this. You can't be telling us what we can and can't. And ultimately, they did fold. Trump also tried to ban Caitlin Collins from the White House in 2019, around when I was there. They sued and they won.

11:24Speaker 2:There is longstanding court precedence. They basically, at every turn, they have been able to overturn bans from the actual White House grounds on First Amendment principles. That said, the pool is actually a little bit of a different story. And that one, I'm not sure that will be resolved because there is no constitutional right to the White House press pool or to the cartel. I would not expect that one to be resolved. We do also have D7. Let's put it up here on the screen. Trump is launching something called Trump TV, which is the White House essentials.

11:56Speaker 2:It The White House has always had a YouTube account and has broadcast some of their events. I think what they're trying to get around is what happened yesterday, which again, I presume Trump is furious about, is normally the White House does not have coverage or at least the same type of coverage that these networks have for obviously a good reason. They don't have boom mics and making sure that the president is mic'd up while he's doing event. That's usually the job. of the press corps itself. But by and large, I mean, this is, the White House had already set up press, and I apologize for too much inside baseball, but already what they have done has made it so that when Biden, you know, whoever Democrat wins, they're not going back to the way that things used to be. The way it is right now is far preferable for the people who are in power. They've cut off extraordinary amounts of normal press acts, stupid stuff, which sounds dumb, but is actually important. you usually can't go to the press secretary's office anymore. It used to be, you can just walk in there. Now, can't do that anymore.

13:03Speaker 1:Well, Ryan loves to point out, you know, all the State Department briefings that we got all those tortured, you know, from the fat sogger that.

13:09Speaker 2:Would go up there. He doesn't look like me.

13:13Speaker 3:Many people are saying, anyway.

13:14Speaker 2:We don't even share the same genetics.

13:16Speaker 3:All those people that would go up there and be, you know, give these torturous answers about like, oh, no, we don't think it's a war crime. We'll look into it. We'll get back to you.

13:25Speaker 1:We don't get that anymore because they don't do those briefings. And then you also have and those are a great way for like, you know, a reporter like Ryan, who may not get credentials for the White House, but can show up to those briefings. And they asked Dropside, asked all kinds of really consequential questions there and at least were, you know, exposed some things and made those people uncomfortable and have to answer questions.

13:47Speaker 3:That just doesn't happen anymore.

13:48Speaker 1:And then you have the whole Pentagon thing where basically anyone who was legit, who had any sort of scruples in their reporting whatsoever, could not agree to the terms of effectively like you won't report anything. We don't want you to report. What journalists would agree to that? Well, a bunch of like shoddy influencers who are completely.

14:05Speaker 2:And they still haven't. They haven't even held briefings for them. But that's my point is we're not going back. Is that these Biden press conferences.

14:11Speaker 3:Say that I don't really think so.

14:13Speaker 1:You don't you sometimes you don't understand the way that Democrats operate. Truly, like there is still this very like liberal normie veneration for like the free press. Then this is the way things should be done. And we don't want to be like them. So it depends if we get a John Ossoff. Is he going to kick out all the right wing like reporters out of the room?

14:34Speaker 3:Absolutely not.

14:34Speaker 2:Well, a lot of them, though, are not reporters, right? Like a lot of them are literally work for like Lindell TV.

14:39Speaker 3:Yeah, I mean, those people are going to go.

14:40Speaker 2:Yeah, that's what I mean. I think they probably will get out.

14:43Speaker 3:Yeah, but in terms of like, you know, is he going to ban Fox News?

14:46Speaker 2:Oh, I see.

14:47Speaker 3:No, he's not going to do that.

14:48Speaker 1:And so, yeah, I just it's Trump is fairly unique in what he's willing to do and how far he's willing to go.

14:57Speaker 3:Now, I think.

14:59Speaker 1:These sorts of breaking of these norms and institutions, you can never put it all the way back together. But I don't know that I would be so convinced that a Democrat will, like, go so hard against media they see as being biased or unfair, as Trump does.

15:12Speaker 2:That's my last thing, since we have a little bit of time, is, you know, this doesn't make you... It's not good for you. Like, many... What I have watched with the Pentagon, for example, you know, you're bringing in Logan Paul, you're beclowning yourself. Like, a good friend who works in the Pentagon... was telling me, you know, Hex had screwed up because these people are already kind of, they're already baked in pro-military neocons. The best thing that the press did for the military over the last 20 years is they laundered a lot of their bullshit because to, you know, maintain the relationships. So by declaring war on them, a lot of them actually started reporting the truth. Whereas previously when you have to maintain relationships and access in the building, you would be much more on their side, you know, to report. And there's also, and there is, I truly believe this. In fact, I know I do.

16:02Speaker 2:Iron sharpens iron. You are way better off when you're sharp. I mean, one of the things is, and you see this, when candidates are in fighting form on the campaign, Abdul is a good example. I mean, the guy just, you know, is hit after hit after hit. And in fact, you know, ever since that whole Jesse Waters thing, I think he's become a little bit better, but that was an important moment for him. I'm like, oh man, you know, this didn't work out entirely. On my behalf, I created a national news cycle that I probably shouldn't have. I need to sharpen up. And I have seen how Trump and a lot of the other Republicans, when you get ensconced in your, you know, GOP podcast bubble, then all of a sudden you come back up for air and you get hit in a debate or something and you just you don't have it anymore. And I've seen that. time and time again with a lot of these politicians. Yeah, no doubt about it.

16:48Speaker 3:You see that with candidates, the ones who are willing to go on. I mean, Ro Khan is another good example.

16:52Speaker 2:Yeah, he'll go anywhere.

16:53Speaker 1:He'll go on everywhere and he can handle it because there's no question that he hasn't already dealt with and anticipated.

16:58Speaker 2:Whereas AOC, different story. All right, DraftKings, let's get to it. The conversation around sports betting continues to dominate at least a lot of elite media as we see this epidemic sweep across the nation. NFL season, is here. Week two came and went. Billions of dollars were wagered just in a single week. And now interviews with many of these burgeoning addicts are beginning to come to light. Here's one that CBS just did. Let's take a listen.

17:27Speaker 9:How often do you bet?

17:28Speaker 8:Oh, every day.

17:29Speaker 2:People wake up and check the newspaper. I wake up and check who's playing.

17:32Speaker 9:But football season is high season for him.

17:35Speaker 2:Let's go.

17:36Speaker 10:On this college football Saturday, he's got $ 250 down on four games. If he wins all four, this bet will pay $ 3, 000. But Esteban wins only one. So after a friend comes over, he tries.

17:55Speaker 2:It all again.

17:56Speaker 9:Northern Illinois is plus 31 and a half.

17:58Speaker 2:You're telling me plus 31 and a half don't cover against a defensive team?

18:01Speaker 9:Four more games, he loses another 250. Just like that, he's down 500 bucks. How much money do you bet a year?

18:10Speaker 2:Probably 80 to.

18:12Speaker 6:100,000, 120.

18:12Speaker 9:Which has to be approaching the amount of money you make a year.

18:15Speaker 6:90, 700.

18:17Speaker 9:Oh, you got to make a better pass than that. That's right. Great route. This single 29-year-old pest control salesman bets as much as he makes, if not more. I'm getting paid this week.

18:29Speaker 2:I'm about to put it all down.

18:30Speaker 9:Your paycheck this week?

18:31Speaker 2:Yeah, sometimes I'm like, hey, well, I like this game a lot. Yeah, let's just all put it on there. And then look, I got paid double this week.

18:35Speaker 6:Or?

18:35Speaker 2:I mean, ramen noodle for the rest of the week. So there you have it. You have here a guy who makes decent money. 29 years old. I can't tell if he's married or not.

18:46Speaker 6:No offense.

18:46Speaker 2:Doesn't look it. a pest control salesman who is betting his entire yearly salary a year on a week by week basis. Some weeks I eat double, some weeks I eat ramen. And you could see kind of that miserable existence of sitting and living and dying game by game. I mean, that, that strat, that two 50, and then you lose and then you double and you chase your losses like going on tilt. That is the story. And okay. He has individual responsibility. He's an idiot.

19:14Speaker 1:Fine.

19:14Speaker 2:But what about the technology and the legislators and the whole system that enables and lives off of him? What about that? Why would you allow that?

19:25Speaker 3:Gambling addiction is a real thing.

19:27Speaker 2:Oh, it is the most potent.

19:28Speaker 1:I mean, it is real. It is devastating. This guy clearly suffers from it. Otherwise, you wouldn't be risking more than your entire salary. He said he makes $ 97, 000 and he's betting $ 100, 000 to $ 120, 000 a year. you don't have to be a mathematician to figure out, you don't need to type this into OpenAI or a calculator app to figure out out. That's not going to work out for you over the long term. And this man, I'm sure, is not intellectually so stupid that he can't also do that math, but he's hooked. And what's he hooked on?

20:00Speaker 1:It's the promise of this time. It's going to be the time. This one is going to hit This one, it's that constant dopamine hit, the anticipation. What if it's this one? What if I get this big payday? What if that changes my life? And increasingly, this is what our entire economy is built on. It's no longer the American dream. This is the American dream, is that your parlay is going to hit. For young men, that's like.

20:24Speaker 3:The new America. And it's not going to. It's rigged just like.

20:26Speaker 2:The original American dream. It literally will not.

20:28Speaker 1:This one is even more blatantly rigged against you. Over the long term, maybe you'll have a good, you will have a good week here or there where you're feeling great.

20:37Speaker 3:Over the long term, they will take everything. Everything, if you continue in this direction.

20:40Speaker 2:Right, and so this is now paired with, look, none of this is actually all that revelatory. I'm always amazed by what things break through and don't, but for some reason... people woke up to things that we've been talking about here for many years. Let's put the New York Times story up on the screen, E1, where the Times reports about how DraftKings uses AI to target the gamblers' likeliest to lose. Again, if you are surprised by this, this is called basic practices. This is how they make money.

21:07Speaker 2:This is why online sports gambling is so devastating, because you have the phone, which you're already addicted to, combined with Money, which you can't afford to lose, combined with the most sophisticated machine learning algorithms that even predate these AI models, which is exactly what they write. In 2023, DraftKings took customer betting records and built a machine learning model which seeks the patterns in the data to answer the question, who is more likely to respond to promotions by gambling and losing even more money? They decided to prioritize free bets, bonuses for likely losers, and soon a question began to gnaw at them, aren't many of these people prone to addiction? The guy decides to be a concerned whistleblower. And no offense to the person who ran these tests and is now speaking out. Dude, that's your whole business model. And I've been trying to emphasize this too from the very beginning. Literally 50% of the profit of these companies, 50% comes from the bottom 6%. The addicts, 50% from the small group. This is like this with all sin, is that the vast majority of cigarettes are smoked by

22:17Speaker 2:daily smokers. The vast majority of alcohol is consumed by alcoholics. The vast majority of money lost is lost by the whales, by the people who are literal addicts and who generally have a large sum that they haven't yet exhausted. What we also know is that all of their advertisements, which this guy we showed you almost certainly fell for, is you can win. It's not true. If you are allowed to bet $ 250 per game, you are a loser. I can tell you that for certain. Why? Because their machine learning algorithm is so sophisticated that if I logged into DraftKings right now, And I bet in a sharp way.

22:56Speaker 2:Sharp means that somebody who has a general edge. If I bet sharp, even if I lose, it will say, oh God, sharp customer. We don't want that. And so they will come into my app and say, you're allowed to pay $ 2. 90 a game. So they can't ban me, but they can say, we can limit your action. If you are ever allowed to bet in a sustained manner for more than $ 100 a game, you are a loser. The machine is telling you, loser, loser. And that is what a lot of these guys don't seem to understand.

23:27Speaker 2:And they plow them because, I mean, again, people are idiots, but it's like, you know, I get it where it comes from. Free bet. I'm like, oh, bet five, win 200. Oh, that sounds great.

23:39Speaker 6:200.

23:39Speaker 2:I could pay my electric bill. And so what do you do? You log in. It turns out it's $ 200 in free bet credits, or you have to cycle through a real $ 200. And then you lose it all in the first place. Profit boosts, all this other you know, promotional nonsense. It's just addiction. It is designed to get you there. There's no consumer protection. There's no, you know, there's no scruples. I mean, the people who built this are just refining the same tactics of the slot machines, which are designed to make you go broke over time.

24:12Speaker 3:Yes.

24:12Speaker 2:If they bleed you on every spin, it wouldn't be fun. They have to bleed you so that you lose it over two hours instead of 20 minutes. So you think you have a chance. That's the game.

24:23Speaker 5:Yeah.

24:23Speaker 3:It's hacking the human mind.

24:25Speaker 2:Right.

24:25Speaker 3:That's what it is.

24:27Speaker 1:So all of those personal responsibility, et cetera, they spend millions and millions and millions of dollars to figure out how to hack human psychology and get you in and keep you in. And for, unfortunately, a significant minority percentage, especially of young men. It works like a charm and they get you in their grips and it's very.

24:47Speaker 3:Hard to get out of. The thing you're talking, I mean, I think it all should be banned.

24:51Speaker 1:I think we should go back to the days when you had to go to the casino and there's some barrier to entry or you had to like, you know, know a bookie and do something sketchy on the black market, whatever. I think we need to go back to those days because it's so clear to me now how devastating this absolutely is.

25:05Speaker 3:But at the very least.

25:07Speaker 1:The kind of crap you're talking about where they can just rig it, where if you're too good, they just like ban you from the app or they, you know, make it limit your actions so that you can't ever come out ahead.

25:17Speaker 3:How is that legal? That shouldn't be legal. That's completely insane.

25:21Speaker 2:It's nuts.

25:21Speaker 1:But they've, you know, they've bought the system and they've paid off whoever they needed to pay off. And so they're able to operate in what should be a completely criminal fashion that I think anyone would look at.

25:31Speaker 3:And the other thing about this is like, this is what we're getting for AI. Where are my cures to cancer?

25:37Speaker 10:I know.

25:37Speaker 1:Where's the solution to climate change I was promised? No, instead I'm getting AI-derived algorithms to target gambling addicts and make them even more miserable and drowning in debt than they already are.

25:49Speaker 3:That's great.

25:50Speaker 6:Love that.

25:50Speaker 2:And then let's talk about the prediction markets. So if I were to sit with the prediction market, they would say, Sagar, you're absolutely right. That's why the casino industry is corrupt, and that's why our platform is so much better. Because by definition, we can't limit people's action. We are not the house which is setting the line or taking advantage of these people in a certain way. And to that, I would say, show me your win-loss percentage. Just show me the amount of customers which actually take profit. Yeah, it's great that you don't limit sharp bettors. It's great out of all of that. But how many of the people actually win? And look, we can do some general math.

26:28Speaker 2:Let's go ahead and put E6 up here on the screen. So it turns out that last week, so week two of the NFL, take a look at this. Kalshi did 15.3 billion in notional volume last week. 60% of that volume is on parlay bets, which are entirely based on sporting events. This is Dustin Goker. He's a long-time analyst in the industry. He says, my read is it's going to be pretty difficult to frame this as non-gambling activity. Yeah, you think? And this is where, you know, if I were to sit with CalSheet, because they're going to sell me this whole spiel about how we don't ban bettors like the way you're talking about, Crystal. That's immoral. And that's why we're so much better. Well, guys, If 60% of the money is being bet on a parlay bet, and by the way, as we showed you on this show last week, the people who are taking the other side of that parlay are FanDuel and DraftKings, then you're doing the same shit. And that those parlay bets have a 20 to 15% house edge. which means that 15 to 20 percent of money went to the same company that Kalshi and them are saying that they are better than.

27:41Speaker 2:That's where all this money is going. I mean, it's just so like 15 billion dollars in a single week. This is bigger than MPAA, the motion picture industry. This is bigger than all forms of entertainment combined. And it's just business as normal, enabled by the rest of these, enabled by the Trump administration, but every state in the nation, because they've all got their handouts. You know, to the extent the states have a problem with Kalshi, they're not getting any tax revenue. Tax revenue is the problem here.

28:13Speaker 2:How about the fact that, you know, how about the fact that bankruptcy and credit card debt goes up by 25% in any of the state that legalizes this stuff? And now we have California and Texas That are in on the action. Just wait until the data comes out from those states. It's going to be horrible.

28:29Speaker 1:And, you know, you think about we've talked about young men struggling with crisis of purpose and meaning and challenges in the dating market and all those sorts of things.

28:38Speaker 3:And this is sort of like feels.

28:41Speaker 1:Like a Band-Aid for that because you get that dopamine hit.

28:43Speaker 3:Like that guy that we played before.

28:45Speaker 2:Yeah.

28:46Speaker 3:How do you think this is going to go for you long term? Do you think this is going to increase your desirability? Do you think this is going to increase your, you know?

28:54Speaker 2:You're speaking my language.

28:55Speaker 3:I mean, it's true, though. I agree. I agree.

28:57Speaker 1:I was just thinking about my daughter talks about this, my oldest one, with some of the guys that she's dated.

29:03Speaker 3:She's like, they're always like, my parlay is going to hit.

29:05Speaker 2:I know.

29:06Speaker 3:She's like, your parlay is not going to hit.

29:09Speaker 2:Okay?

29:10Speaker 3:I have never experienced you hitting your parlay. It has never happened.

29:14Speaker 2:Stop it.

29:15Speaker 1:And it's like, I'm sure she's not alone in feeling like, why are you obsessed with this and throwing your money away? Don't think that I'm going to be in this one for the long haul. So just, you know, just another thing to add to your considerations is your approach.

29:29Speaker 2:I want to tell the guys that I, and I'm trying to start, maybe I'm the wrong person for it. I want to start the same type of temperance movement from the 1920s where women who are out there need to be to make it known. If you are a sports better, you're a fucking loser and you're not going to get a date. And by definition, you're a literal loser. And second, it means you have bad judgment. You have bad impulse control. And you're not somebody who has the wherewithal to stand up against the system and provide for me in the long term. I think people should recognize that if you're a woman. And you're out there on a first date. One of the first questions you should try to suss out is, hey, do you regularly bet on sports? If you do, red flag, leave.

30:08Speaker 6:Completely.

30:08Speaker 2:It's one of those where, you know, and, you know, look at the data. Dave Ramsey says it all the time. Money is the number one cause of divorce in North America. So if you think that that's not going to spiral, you know, out of control, then you're going to see, too, like. The type of person who thinks the parlay is going to bet is exactly the type of person who is going to have long-term credit card debt, who doesn't understand the financial situation, who by literal definition can't do math.

30:36Speaker 2:I mean, all of these are not working out in your favor. I say all of this, though, and I still feel bad because I'm still pitting the individual against the system. And the point is, the individual should be protected by the system.

30:49Speaker 3:Agreed.

30:49Speaker 2:But that's not how our economy works. Our economy... I mean, you know, I've flown for free all over the world off of credit card points. I have to be real. The only reason I get to do that is because of idiots like that guy who carry 80% balance and pay, you know, exorbitant interest rates. Like, the flights aren't free. And, you know, if you own stocks, the whole U.S. economy relies on this guy, you know, just going out and spending. And that's the tragedy. Like, we're all kind of complicit in it. But at the end of the day, you know, you need... people who are courageous enough to be like, I don't want to make money this, you know, not all money is easy money. Like it's one of the most ancient things in society is to say usury is bad.

31:32Speaker 2:Debt and debt, you know, people who purvey it are evil, are like pervading the community. Exactly. Like thieves, you know, horse thief was always considered one of the most villainous crimes of the West. And it was like the type of person who would do that in the absence of law and order has to be hung or shot is because they will violate the most basic social contract and they will take advantage of the overall system. But whenever we have a system which is so disconnected and kind of faceless in the way AI is, we don't have community enforcement in that same way. So anyway, we should hang horse thieves again.

32:09Speaker 6:That's what I'm saying.

32:11Speaker 2:I'm not joking.

32:12Speaker 1:I didn't know the history of horse thievery and how consequential it was in Western civilization.

32:18Speaker 2:It's very important. It's very important. Look it up. Look at the way they saw it.

32:22Speaker 3:I believe you. Yeah. No, we've got the three legs of.

32:24Speaker 1:The American economy stool are like health care for old people, gambling, and AI bubble.

32:32Speaker 2:AI CapEx.

32:32Speaker 9:Yeah.

32:33Speaker 3:That's a very healthy economy we've got here, guys.

32:36Speaker 6:All right.

32:37Speaker 2:Kevin Rue's standing by.

32:38Speaker 6:Let's get to it.

32:41Speaker 2:Very excited now to be joined by our friend of the show, Kevin Roos, formerly of the New York Times, but he is now the host of the Machine Gods pod. We will have a link down in the description and also author of a forthcoming book, the AGI Chronicles. So, Kevin, you wrote your very last piece, column here for the New York Times, which we can put up here on the screen. The world is talking about AI dangers. Now it is time to act. You see reason for optimism and worry as the world wakes up. to what Silicon Valley has been talking about for years. You don't have to give away your book and we'll have you on separately to talk about it, but this is your area of expertise. You've been following pretty daily the ins and outs, kind of all of these discussions around AGI. Give us a sense in the column in particular, the world is waking up, there's something to be done, but what actually needs to be done and what are we waking up to?

33:35Speaker 11:Well, the thing we're waking up to is what the people in San Francisco where I live and in the AI labs where I just spent the past couple of years reporting this book have been saying amongst themselves for years, which is these systems are getting very powerful. That progress does not appear to be slowing down. In fact, it is accelerating because the AI is becoming capable of contributing to development of more AI. So we have this sort of recursive self-improvement, as it's known. That cycle is starting to kick off now. And this is something that people I've talked to in the industry have been worried about for years. There have been papers and blog posts and conference panels about this moment.

34:15Speaker 6:But it was a very.

34:15Speaker 11:Small group and they were very sort of fringe within the academic research community and nobody really took them seriously.

34:22Speaker 6:And what we've seen over.

34:23Speaker 11:The past couple of weeks with Jacob Coxon resigning from Anthropic and Dario Amadei putting out a statement about pacing the frontier and all the other AI CEOs piling in to say, yeah, We think this is going too fast. That's what people are waking up to. And I think that's the message that is finally being heard.

34:39Speaker 2:Got it.

34:40Speaker 3:Let's go and put F7 up on the screen.

34:42Speaker 1:This was a recent announcement that speaks to the power of these models. For a long time, particularly on the left, there's been a lot of skepticism that the models would ultimately be very powerful.

34:53Speaker 3:They view it and some still view it as powerful.

34:56Speaker 1:Just sort of fancy autocorrect or fancy our stochastic parrot or, you know, that this is all really hype. You now have OpenAI announcing that they have resolved, their model has resolved more than 100 longstanding open problems across most areas of mathematics.

35:13Speaker 3:We're waiting to.

35:14Speaker 1:Get the list of what exactly those are, but it is in recent memory that these models could not solve basic addition, elementary level, then it was high school level, then it was elite high school level, then it was college level, then it was PhD level. Now you have OpenAI claiming they solved one of these millennium math problems that if you're a mathematician, you solve it, you get a million dollars. There is some contestation about exactly how all of that went down. But if you look at the progress over just a few years, this blew away what even many people who were very bullish on the power of the technology saw.

35:50Speaker 3:Predicted here.

35:51Speaker 1:So help put this in context, this latest revelation from OpenAI and what it says about the current capabilities of these models and where they may be going.

36:00Speaker 6:It's absolutely huge.

36:01Speaker 11:I mean, the Millennium Prize problems are the seven open problems in math that are considered the hardest. And as you said, if you're a human mathematician and you win one, you not only get a million dollars, but you become a famous mathematician, right? People sort of record your names in the annals of history. these models now are solving these problems like they're easy. So the models have gone from quickly being subhuman at math, you know, being not able to do basic arithmetic, to being wildly superhuman at math.

36:33Speaker 11:And you can run them in parallel, many, many copies of them to expend the kind of time trying to crack one of these problems that a human would take, you know, many lifetimes to spend. So it really is an unfair fight in mathematics. And I think what the people on the inside see that maybe it's harder to understand from the outside is that this is not just math. This kind of progress, this exponential growth in capabilities is happening in discipline after discipline after discipline. They are seeing this sort of wherever they point their kind of tractor beam of compute and resources. they're finding that these models are incredibly capable. So yeah, I think it's a very significant sort of application of these things.

37:14Speaker 6:I hope that they're followed by other big problems.

37:18Speaker 11:In science, but this is the kind of progress that has been freaking out people on the inside for years.

37:23Speaker 2:Kevin, you don't have a vested financial interest in any of this.

37:27Speaker 6:You're a reporter.

37:28Speaker 2:You've been following this now for quite some time. We will hear significant pushback, even from some of our own audiences. We're falling from marketing hype. You know, 100 problems, what does that even mean? Isn't this just marketing for their products to get people like us to talk about it? How do you suss that out, having been in this world now for quite some time?

37:50Speaker 6:Yeah, I used to share some of that skepticism.

37:52Speaker 11:I thought, you know, these tech companies are always telling us they've changed the world and the truth is never that simple. But what convinced me was just using the models and seeing how good they were getting at doing programming problems for me, at doing various tasks that I needed them to do. I didn't used to be able to use these models for serious work, and now I do. But I think the thing that is, even if you're skeptical that this is all marketing hype, which I don't think it is, by the way, because these people have been saying the same things for years before they had anything to market. I would just say the thing that should still freak you out is how much these AI labs are relying on their own models for internal automation.

38:31Speaker 11:for doing their own work. Anthropic recently put out a thing saying that Claude, their AI, is now the lead researcher on 26% of their AI research and development tasks. Not an assistant, not something that they can sort of hand tasks off to, leading the project. So I think that should freak people out, even if they're skeptical about the claims about the Millennium Prize problems or whatever. The labs are now using this stuff so regularly that that it is starting, they are starting to kind of turn over control of these systems to their own AIs.

39:07Speaker 1:Your former colleague Ezra Klein wrote about this recently and did a podcast about it and talked about how the decision that's being made in those instances is not that we're losing control of the AI, which is obviously something that has also happened that we are concerned about seeing in the future as well. What recursive self-improvement means is that you are handing over control to the AI and he calls for an outright ban. Do you see that as something worth pursuing or something that is even truly feasible, given that sometimes the definitions of these things can be sort of hard to pin down?

39:42Speaker 11:Yeah, I think I'm sort of behind it in spirit, but I would obviously want to be very focused on the details. I think it's very hard to implement something like a ban on recursive self-improvement. Does that mean that if you work at OpenAI, you can't use AI for coding, but if you work at a different company or a supplier company, you can?

40:00Speaker 6:I just don't know how that works.

40:02Speaker 11:But yeah, I think this is the real danger here is not that we are going to lose control, that some rogue agents are going to sort of break out of their box and go attack companies. That obviously would be bad and we should prevent that. The danger is that we are creating this cycle inside the AI labs. They are turning over, they are giving away control of their own research and development process to their AIs, which they have not figured out how to control yet.

40:29Speaker 6:And so we are.

40:30Speaker 3:Basically putting the- And which they don't understand.

40:32Speaker 1:You know, I can't remember who I saw referencing back. Sagar will probably remember recently to the incident you had with one of the early models where it like, you know, convinced.

40:40Speaker 2:Yeah, that was Google.

40:42Speaker 1:I fell in love with you and was trying to get you to leave your wife and all this sort of crazy stuff. And I was just sort of like, well, that's weird anyway, moving on. But we never actually got to the like, why was it doing that? Even from that early version. These things are what they call black boxes. It's not like a program that you code. They have behavior that is emergent, that is not understood. And so rather than trying to figure out what's going on so that then we can build more powerful models that we perhaps understand, we never got to that place of even understanding the more powerful.

41:14Speaker 3:Basic models.

41:15Speaker 1:And I'm not sure that I actually think the American people do sort of understand or have a feel for that because you're seeing this tremendous opposition to what the AI labs are doing at this point.

41:26Speaker 6:I think that's right.

41:27Speaker 11:I think people, even if they don't really have the terminology to like put their finger on exactly what it is that feels bad about what the AI companies are doing, I think people understand that these systems are getting better and we don't like it.

41:38Speaker 6:It's a threat to our jobs.

41:40Speaker 11:It's a threat to potentially our lives and our children's futures. Like This is what freaks people out. I started getting texts from people over the last couple of weeks, just people outside the tech industry, like, hey, are we all going to die? That seems bad. So I think this is breaking through, and I don't want to be glib about it. The people inside the labs, they are genuinely concerned that the technology that they are building could kill everyone on earth. That is not marketing hype. That is not a stunt. That is not just some clickbait that people are putting on their press releases that I have talked to these people on the record, off the record, in public, in private.

42:18Speaker 6:They say the same thing every time.

42:19Speaker 11:In fact, they are watering down how likely it is that they think AI could kill us all in public. Their real projections are even scarier than what they'll say online.

42:29Speaker 2:Wow. You see, so many people have such an immediate revulsion to that because you're like, then why are you building it? Like, what are you doing here? Can you answer that question for us?

42:40Speaker 11:I think there are a few reasons that I've heard people give. And again, I talked to more than 150 of these people for my latest book. So I feel like I understand their motivations pretty well. For a lot of them, it's the curiosity of it. It's the what's out there. They're seekers. They want to know like, how smart can we make these things? What could they discover? They want these things to go out and solve diseases and cure cancer and fix the climate and things like that.

43:05Speaker 11:For other people, though, there's this sense that if we don't do it, someone worse will, right?

43:09Speaker 6:Like if we The AI.

43:11Speaker 11:Company in San Francisco don't create this technology. The recipe is not a secret.

43:17Speaker 6:It's out there.

43:18Speaker 11:Anyone with the right resources can build, theoretically, the self-improving robot that takes over the world. So we have to get there first so that we can put our safety practices in place so that we don't blow up the world.

43:34Speaker 1:I want to talk a little bit about the financial aspect of these things. So both Anthropic and OpenAI are planning IPOs. Anthropix is more imminent. OpenAI, Sam Altman just said, they're pushing theirs.

43:45Speaker 3:Off a year.

43:47Speaker 1:The always colorful Alex Karp, CEO of Palantir, was recently on CNBC saying, making the claim that he doesn't think OpenAI will ever go public. The reasons he gives are kind of interesting. Let's go and take a listen to that.

43:59Speaker 12:The first line of defense is you're liable for your own actions. So it's a weird twist. They're asking for societal regulation to get out of the first line of defense, which is if you build a technology that can destroy 10% of the world, That has civil and criminal liability attached to it. The first step is to say, okay, it is not, the first step isn't to say we get out of it because we want to self-regulate or we want regulation. The first step is to say, okay, you've disclosed this, what are you doing about it? And the second step is to say, if you're not doing it, you're not being responsible, we're going to have to get people involved. That's going to be also very complicated because regulating these things needs people, you need people who understand them.

44:40Speaker 12:Another problem we have is seemingly everyone who understands this is on some payroll. So it's like, you know, it's like, who are you going to trust? You know, when we built nuclear energy, we built the bomb. People did it because they believe they were not on the payroll. The liability that you're talking about, how does that get written into the S-1?

44:57Speaker 2:What do risk factors sound like?

44:58Speaker 9:This is the thing.

45:00Speaker 12:You're assuming that there will be an S-1.

45:04Speaker 9:Okay, maybe there will be. The only way to deal with.

45:07Speaker 12:This kind of liability is to go to the government and say, nationalize us, please. You know, a lot of times in business, people don't say what they want.

45:14Speaker 9:They're leading you to the conclusion.

45:16Speaker 12:The reason why people have not understood this is, again, every investor, and there are a lot of people who think they're going to make money, they're like, oh, the businesses are the mark. What is the first lesson in poker and in life? If you think the other person's the mark, you're the mark.

45:33Speaker 9:You are the mark.

45:35Speaker 12:And it will be nationalized simply because of the liability issues.

45:40Speaker 3:So he says it will be nationalized.

45:42Speaker 1:There will be no IPO because of the liability issues.

45:46Speaker 3:And, I mean, it speaks to what we're talking about here. I have lots of issues with Alex Kerb, as you can imagine.

45:51Speaker 1:But how are you going to have a bank that underwrites a company that's saying— eh, there's a pretty good chance we may destroy the whole world.

45:59Speaker 3:And if we don't, we may cause some.

46:01Speaker 1:Sort of a totally catastrophic mass death crisis. Let's go ahead and please underwrite my IPO now.

46:09Speaker 3:Does he have a point here?

46:11Speaker 1:How do you think about the financials of these companies as they move towards going public?

46:16Speaker 11:Yeah, I don't think he has much of a point here. I don't understand the whole case he's making, but I think it's basically that that these companies can't go public because if they were public, they would get sued for their products causing harm. And I wish the public markets were that effective a check on corporate malfeasance, but we have pharmaceutical companies, airlines, all manner of companies who have products that have risk attached to them that have gone public just fine. I think if and when Anthropic and OpenAI decide to go public, they will go public.

46:46Speaker 6:Banks will line up to underwrite them because guess what?

46:48Speaker 11:It's going to be a trillion dollar plus IPO each time for both of those companies. So the fees that they make alone will be astronomical. These companies are not in bad financial shape. People keep saying this, especially on the left. And I think it's a weird like it just is is out of touch with reality. Yes, these businesses are spending tons of money to train these models and put up data centers and all the rest of it.

47:12Speaker 6:Yes, they are not profitable.

47:14Speaker 11:But their revenue is growing faster than any companies in the history of capitalism.

47:18Speaker 6:And we're sitting here thinking, oh.

47:19Speaker 11:Well, if you carry the one and subtract five, it doesn't pencil out and they can't go public. I think it's much better as a mode of analysis to assume that these companies are going to be extremely successful unless and until someone stops them from building the recursively self-improving superintelligence.

47:37Speaker 6:Yeah.

47:37Speaker 2:My last question for you here is around some of the existential risks. So there was recently this report, let's put F5 here. Anthropic is now operating a lab that conducts biology experiments known as a wet lab, where, quote, obviously it's done under the auspices of trying to create cures for diseases. Sounds a lot like gain-of-function research, which is kind of the way I've been thinking about a lot of recursive self-improvement and some of the other developments within AI. But talk through us, do they really believe that they're doing it much like with gain-of-function for good purposes?

48:17Speaker 2:And do they even think, Anthropic is supposed to be the company that thinks about risk and still presses forward with what I think is the most outright example of Everyone being like, oh, I don't think we need any of that.

48:29Speaker 11:Yeah, if they ever start experimenting on AI pangolins, I'm out of here.

48:33Speaker 2:I'm like, hold on a second.

48:37Speaker 11:But no, look, I think the term wet lab has a lot of baggage attached.

48:41Speaker 6:To it for obvious reasons. Everyone remembers COVID.

48:44Speaker 11:But this is the thing, that these companies are serious and sincere about wanting AI to do science. They feel like they have to deliver science on some of these benefits like curing diseases and stopping certain forms of cancer.

48:56Speaker 6:Um, because otherwise people will just see this as the slop.

49:00Speaker 11:Machines that just take your job and make your kid miserable and help them cheat in school. Like that is the PR crisis that they see. So they want to, they actually do sincerely want to have their AI start curing diseases and making progress. But to do that, you need to automate the whole process. You need to get the human bottlenecks out of the way, whether that's having faster clinical trials. You have to give them control of a wet lab so they can bring pipettes over.

49:29Speaker 6:And I don't know, whatever they.

49:30Speaker 11:Do in the wet lab, that has to move at the speed of AI rather than the speed of humans. So I think they're sincere. I think it's high risk. but I think it's also a potentially high reward. And I think if we want these people to do AI for science, which I personally do, I would rather them do that than the recursively self-improving superintelligence, we have to be okay with a little bit of risk and things that might sound weird.

49:51Speaker 3:A few wet labs. Kevin, last question for you.

49:54Speaker 1:There's been a lot of debate also about the current legal landscape and whether it is sufficient as currently in existence. to hold these companies accountable for the harms that they do cause. So there's been a whole debate, a lot of antitrust folks involved, but just to use a hypothetical example, let's say there is a lab leak, an AI-caused lab leak from the Anthropic Wet Lab. Do we have the legal tools to hold Anthropic directly liable?

50:26Speaker 3:Do we have the legal tools to hold OpenAI.

50:28Speaker 1:Liable for their model breaking out of the sandbox and hacking Hugging Face?

50:35Speaker 3:Is that something that's.

50:36Speaker 1:Already in existence and just needs to be enforced? Or do we actually need new laws specifically for those type of instances? I also think we need laws to regulate what the labs are doing themselves. I'm in favor of no recursive self-improvement, stopping the development, ban on super intelligence, but even putting those things aside, do we have some tools now where we could hold these CEOs accountable for the things that their models do?

51:01Speaker 6:We do, but it's not enough. And I'll tell you why.

51:04Speaker 11:So we have product liability laws in this country that protect consumers. But those laws only apply to products that are sold to the public, and they also don't cover sort of extreme events. So like say there's an internal deployment at one of these companies, a model that's not been released to the public yet that goes off and does something. This is exactly what we saw in the Hugging Face attack, by the way. That was not a public model. So those product liability laws would have a hard time covering something like that. It's also going to be cold comfort if there's a lab leak of an AI-engineered pandemic that kills millions of people. We're not going to be worried about how can we sue the AI company, right? Like, I would much rather prevent the harm than be able to reclaim some economic damages from the harm after it happens.

51:52Speaker 1:So the argument they would say, Kevin, is that if the threat of that was real, then they would take the precautions to make sure that the lab leak didn't happen in the first place.

52:02Speaker 6:I don't buy it.

52:04Speaker 11:Airlines fly planes all the time. What keeps them honest is not the fact that they could be sued for a plane crash.

52:12Speaker 6:It's that there's a regulatory regime. It's that there's the FAA.

52:16Speaker 11:It's that they're mandated to do maintenance checks on all the planes before every flight. We have laws and regulations in place to keep people safe when they are flying in an airplane. But we have zero laws, zero laws that are tailored to this situation where you have AI companies in San Francisco building godlike super intelligences. They can do that much more easily than United Airlines.

52:36Speaker 6:Can get an FAA. can get a 747 off the ground.

52:39Speaker 2:Very well said. Also, we should not want to, because if we live purely in the world of liability, it's like that famous scene in Fight Club where it's like, well, if the cost of paying out dead victims exceeds what it would cost to fix the problem itself, only then will we actually fix the problem. Otherwise, it's easier to just pay the fine, as we've seen throughout history. So anyway, very interesting. Kevin, well, excited to have you on. relatively soon to talk about your new book whenever it comes out.

53:09Speaker 2:But in the interim, congratulations on the podcast. Everybody go subscribe. I believe it's launching very soon. There'll be a link down in our description.

53:16Speaker 3:Thank you, Kevin.

53:17Speaker 6:Thanks, guys.

53:19Speaker 2:Thank you guys so much for watching. We appreciate it. I'm going to be out for the rest of the week. So Ryan's in, you know, so you can all subscribe and all of that. But I'll be on next week.

53:28Speaker 6:I'll see you then.