China Hit with Chip Curbs, X and SpaceX Move to Texas | Bloomberg Technology
ANNOUNCER: THIS IS BLOOMBERG TECHNOLOGY. CAROLINE: LIVE FROM NEW YORK AND SAN FRANCISCO, COMING UP, TOUGHER TRADE CURBS ON CHIPS FROM CHINA. ED: ELON MUSK MOVES TO TEXAS. CAROLINE: WILL J.D. VANCE BE GOOD FOR BUSINESS? THE WORST DAY FOR THE NASDAQ AND NASDAQ 100 SINCE OCTOBER '23. CHIP STOCKS OFF BY 3.9%.
THE BIDEN ADMINISTRATION WANTING TO BE LIMITING SALES OF KEY AI SALES TO CHINA. ED: THE CHIP STOCKS IN THE U.S. ARE WEIGHING ON MARKETS. TOKYO ELECTRON DOWN AND JAPAN.
ASML, THE DUTCH EQUIPMENT MAKER DOWN ON TRACK FOR THE BIGGEST DROP SINCE MARCH '20. U.S. OFFICIALS ARE CONSIDERING TOUGHER CURBS ON THE ACCESS OF THAT TECH TO CHINA AND CHINESE COMPANIES. WE ARE TALKING ABOUT THE FOREIGN DIRECT PRODUCT RULE. SOURCES TELL US U.S. OFFICIALS ARE CONSIDERING IT. IAN: IT'S THE NUCLEAR OPTION IN TERMS OF TRADE ACTION THAT CAN BE TAKEN. IF SOMETHING HAS THE TINIEST BIT OF U.S. INPUT, THE U.S.
CAN EXERT CONTROL. IT IS BORN OUT OF FRUSTRATION WITH THE IMPACT WE HAVE HAD, WITH WHAT'S BEING PERCEIVED AS A LAGGING REACTION BY THE ALLIES IN TERMS OF GETTING ON BOARD WITH THE U.S. CAROLINE: ASML, DUTCH COMPANY HIT HARD. THEIR EARNINGS WERE GOOD. THE IMPACT ON THEIR CHINESE SALES ARE LIKELY TO BE TOUGH. >> THEY REPORTED SECOND-QUARTER BOOKINGS THAT BEAT ESTIMATES.
THERE IS TALK OF THIS BEING DRIVEN BY THE AI BOOM. THE MOST ADVANCED SEMICONDUCTORS, ALSO BEING DRIVEN BY THE DEMAND FOR HIGH-POWER CHIPS FOR AI APPLICATIONS. PEOPLE LOOKED TO HOW MUCH CHINA ACCOUNTED FOR IN TERMS OF COMPANY SALES.
CHINA ACCOUNTED FOR NEARLY HALF. THOSE INCREASING EXPORTS ENSURE THAT THE RISKS ARE RAMPING UP AND BECAUSE OF DIPLOMATIC TENSIONS BETWEEN THE U.S. TO PUSH FOR MORE EXPORT CURBS. CAROLINE: THIS ISSUE WILL BE IMPACTING U.S. COMPANIES. MICRON, SIGNIFICANT SALES TO CHINA. IS THIS SIGNALING MORE IS YET
TO COME? IAN: IT IS SIGNALING FRUSTRATION WITH THE WAY CURBS HAVE BEEN IMPLEMENTED AND THE IMPACT THEY HAVE HAD. THE CONCERN THAT CHINESE COMPANIES, THESE UPSTARTS THAT WERE SUPPOSED TO BE HELD BACK PERHAPS HAVEN'T BEEN. THAT IS THE TENSION GOING ON. THERE IS A CONSIDERATION OF WHAT THE MEASURES AND HOW WE MIGHT EXERT INCREASING CONTROL.
WE DON'T KNOW WHAT'S GOING TO HAPPEN. THE CURRENT ADMINISTRATION IS COMING TO THE END OF ITS TERM. WE WILL SEE. ED: THEREIN LIES THE POINT.
THE U.S. PRESIDENTIAL ELECTION. EARLIER WE SPOKE TO GLENN YOUNGKIN. >> CHINA IS NOT JUST A RIVAL. THEY ARE TRYING TO DOMINATE THE WORLD AT THE EXPENSE OF THE U.S. WE NEED TO PROTECT OURSELVES.
WE NEED TO FIGHT BACK. THE TARIFFS PRESIDENT TRUMP IMPOSED ON CHINA WERE CRITICAL IN ORDER TO REBALANCE AN UNBALANCED SITUATION WITH CHINA. ED: THE POINT RAISED IS THIS APPROACH BY THE BIDEN ADMINISTRATION MIGHT CHANGE DEPENDING ON THE OUTCOME OF THE ELECTION LATER THIS YEAR.
WHAT DOES THE U.S. WANT OF ITS ALLIES, NAMELY THE DUTCH? SARAH: BASICALLY EXTENDING THOSE CURBS, POTENTIALLY LOOKING AT HOW THEY CAN LIMIT THE COMPANIES, PARTICULARLY ASML'S ABILITY TO SERVICE GEAR IN CHINA. THERE ARE NEW CABINETS IN PLACE. WE HAVEN'T HEARD FROM THE NEW
CABINET, WHAT THEIR POLICY WILL BE. CAROLINE: THANK YOU, IAN AND SARAH ON ASML AND CHIPS. LET'S DWELL. I LOVED THE WAY YOU BROUGHT IN THE GOVERNOR. THIS IS NOT SOMETHING THAT CAN BE THOUGHT OF AS TALKING TOUGH. WE KNOW THAT THE ADMINISTRATION MIGHT BE PUSHING BACK HARD.
TAIWAN IS CURRENTLY, SOMETHING THAT NEEDS TO BE CONSIDERED MORE. THAT HAD A BIG IMPACT ON U.S. STOCKS TODAY. ED: THE POINT MADE BY FORMER PRESIDENT TRUMP IS IF HE WOULD COME TO POWER, HE WOULD LOOK AT TAIWAN. PAYING FOR PROTECTION. A LOT OF THAT HAS BEEN EXTRAPOLATED.
THERE ARE NOTES OUT THERE SAYING THIS IS THE ONLY ALTERNATIVE. IF PRESIDENT TRUMP WINS POWER IN NOVEMBER AND TOOK OFFICE NEXT YEAR, ACTION COULD BE TAKEN ON TSMC. IN THE CONTEXT OF GLOBAL MANUFACTURING ON SEMICONDUCTORS, INTEL WOULD BE THE ONLY ALTERNATIVE FOR INVESTORS. I DON'T KNOW WHAT YOU MAKE OF THAT CORRELATION BUT THAT SEEMS TO BE WHAT THE MARKET IS SUGGESTING THIS MORNING. CAROLINE: THE CORRELATION IS CLEAR. LET'S SHOW HOW MUCH GLOBAL FOUNDRIES IS OUTPERFORMING THE REST OF THE MARKET TODAY.
EVERY OTHER COMPANY IS DOWN. GLOBAL FOUNDRIES WAS ECLIPSING 10% EARLIER. INTERESTING TO THINK ABOUT HOW THE ONSHORE NARRATIVE HAS BEEN ONE THE BIDEN ADMINISTRATION IS PUSHING YET MORE MONEY IS HANDED OUT WHEN IT COMES TO THE CHIPS ACT. ED: WE ARE JOINED BY CLINT FORREST, LET'S START WITH THE MOST RECENT POINT. THE MARKET SEES A MORE LIKELY OUTCOME THAT TRUMP BECOMES PRESIDENT AND BASED ON THE INTERVIEW, HE MAY LOOK AT TAIWAN AND THAT MAY BENEFIT GLOBAL FOUNDRIES AND INTEL. >> WITH THE BIDEN ADMINISTRATION GETTING TOUGHER, THIS IS A TOSSUP. THIS IS AN ISSUE FOR THE NEXT
FOUR YEARS REGARDLESS OF WHO COMES INTO POWER. ON SHORING NOT JUST IN THE U.S. BUT ALSO IN OTHER PARTS OF THE WORLD LIKE THE EU, THAT'S MORE OF A LONGER-TERM GOAL BECAUSE WE ALL KIND OF SEE THE ERROR IN OUR WAYS OF HAVING ONE GEOGRAPHY. EVEN LET'S FORGET ABOUT ITS A VERY SEISMICALLY ACTIVE AREA AND THEY GET A LOT OF DISRUPTION BECAUSE OF EARTHQUAKES AND IT IS NEAR A RISING CHINA. IT IS 68 MILES FROM MAINLAND CHINA. THERE ARE THREATS THERE. JUST THE BASICS OF HAVING ONE PLACE WHERE ALL THE CHIPS, THAT ARE THE HIGHEST TECHNOLOGY ARE MADE, IS REALLY KIND OF RIDICULOUS.
HAS A RISK REMEDIATOR IN MY BUSINESS, I DON'T SEE HOW WE GOT HERE BUT HERE WE ARE. CAROLINE: HAS THAT BEEN CHANGING? THE WAY IN WHICH YOU THINK PEOPLE SHOULD BE INVESTING IN THESE NAMES? TSMC HAS BEEN MAKING THE MOST OF THE ACTIVITY IN THE U.S. THERE HAVE BEEN HICCUPS IN ARIZONA. THESE ARE COMPANIES LOOKING TO ONSHORE.
TSMC, THE DEPOSITORY RECEIPTS HAVING THE WORST DAY SINCE OCTOBER '22 TODAY. KIM: THEY ARE TRYING TO MOVE THAT DIRECTION BUT IT IS SLOW. IT'S THE NATURE OF THE BEAST. THESE ARE NOT FACTORIES THAT CAN BE THROWN UP OVERNIGHT. IT TAKES A LONG TIME FOR EVEN
THE PHYSICAL BUILDING TO GO IN, LET ALONE THE EQUIPMENT. THAT TIES INTO ASML. THEY ARE PLAYING INTO THIS. YOU COULD ONLY MAKE THIS EXOTIC EQUIPMENT AS FAST AS YOU CAN MAKE IT. THAT'S PART OF THE DILEMMA.
HOW QUICKLY CAN PEOPLE MOVE? NOT VERY FAST. STOCKS ARE TRADING LOWER BECAUSE THEY SEE IF THE U.S. PUTS OF GAETZ TO SELL THE EQUIPMENT -- IF THE U.S. PUTS UP GATEWAYS TO SELL THE EQUIPMENT, THE TURNAROUND IS NOT QUICK. ED: THE NASDAQ 100, BIGGEST PERCENTAGE DECLINERS CHIPMAKERS.
THEY'RE FREE CLOSED DOWN 3%, THAT'S THE BIGGEST DROP SINCE OCTOBER. LAST NIGHT THE MARKET WAS LOOKING AT THE ELECTION MARKET AND NOW THINGS HAVE CHANGED. WHY THE SUDDEN ANXIETY? KIM: GEOPOLITICAL FOCUS ON SEMICONDUCTORS.
THE SMALLEST EQUATION, WE'VE ALL BEEN TOLD MONEY MAKES THE WORLD GO AROUND. SEMICONDUCTORS MAKES THE MONEY GO AROUND. THEY ARE AT THE UNDERPINNING OF EVERY BUSINESS NOW. ENERGY IS IMPORTANT BUT SEMICONDUCTORS ARE NOW EQUALLY IMPORTANT. THE MORE EXOTIC THE CHIPS ARE FOR AI, WHICH EVERYONE SEEMS TO BELIEVE, BUT THAT IS THE THING THAT WILL BRING PRODUCTIVITY AND IS THE NEXT BIG THING, IT'S A MAJOR FOCUS.
DO WE LET ONE AREA OF THE WORLD BE THE ONLY MAKER OF IT? I WOULD SAY NO WE CANNOT. THIS IS ALL COUNTRIES, NOT JUST U.S. CAROLINE: KIM FORREST, GLOBAL PERSPECTIVE, BRILLIANT TO HAVE YOU. COMING UP ELON MUSK SAYING X AND SPACEX WILL CHANGE HEADQUARTERS. THEY ARE GOING TO TEXAS. THIS IS BLOOMBERG.
♪ ED: GLOBAL WAFERS WINS $400 MILLION FROM THE U.S. IT PLANS TO INVEST $4 BILLION INTO THEIR INITIATIVE CREATING 2500 JOBS. REVOLUT IN TALKS WITH TIGER. >> CONFIDENCE, EVERY TIME AN INVESTOR COMES ABOARD, IT'S INTERESTING, ESPECIALLY WHEN THERE IS ALSO A PRICE.
THIS IS A GOOD MOMENT OF TRUTH FOR ALL OF US. ED: TIGER WOULD BE LEADING A SECONDARY OFFERING. SHARES OF GET LAB -- GITLAB RISING TODAY. THEY ARE WORKING WITH INVESTMENT BANKERS. CAROLINE: LET'S TALK ABOUT ELON MUSK'S.
THE HEADQUARTERS OF X AND SPACE X WILL RELOCATE TO TEXAS WITH THE BILLIONAIRE CITING FRUSTRATION WITH THE LAWS IN CALIFORNIA. THE FRUSTRATION BEING A NEW LAW PASSED IN CALIFORNIA TO DO WITH TRANSGENDER CHILDREN IN PUBLIC SCHOOLS. POLITICS AFFECTING ELON MUSK ON WHERE TO BASIS COMPANIES.
>> THIS IS A PROGRESSION WE'VE SEEN THE LAST COUPLE YEARS AND WEEKS. HE'S COME OUT PUBLICLY IN SUPPORT OF DONALD TRUMP. HE'S DONATED TO HIS CAMPAIGN. WE'VE SEEN HIM COMPLAIN ABOUT THE LAWS IN CALIFORNIA, THE LIBERALS FOR YEARS.
WHILE IT FEELS LIKE A REACTIVE DECISION, THIS HAS BEEN A LONG TIME COMING. ANYONE WHO HAS FOLLOWED HIM CLOSELY COULD SEE THIS WAS BUILDING. ED: IT'S IMPORTANT THE FOUR OF US TALK ABOUT THE IMPACT THIS WILL HAVE. SPACEX IS IMPORTANT AS A LEADER IN COMMERCIAL SPACE. YOU'VE BEEN FOCUSED ON HIS
POLITICS AS WELL. YOU WILL HAVE SEEN THE BACK-AND-FORTH BETWEEN GOVERNOR NEWSOM, WHO SHARE THE IMAGE OF A TRUMP TRUTH SOCIAL POST, THE TIMING OF WHICH WE CAN DEBATE, THE PHOTO TAKEN DURING TRUMP'S FORMER TIME IN THE WHITE HOUSE, BUT THE POINT BEING MUSK HAS CHANGED HIS POLITICS AND IT HAS IMPACT TO HIS COMPANIES AND AT A MACROLEVEL. >> ELON MUSK IDENTIFYING HIMSELF AS A SUPPORTER OF THE FORMER PRESIDENT AND LIKELY A MAJOR DONOR, MAYBE THE BIGGEST, HE'S IN THE MIDDLE OF THIS DEBATE. WE ARE SEEING GAVIN NEWSOM AS A SURROGATE FOR THE BIDEN ADMINISTRATION DOING WHAT YOU WOULD EXPECT FROM A SURROGATE WHICH IS TO POINT OUT THE OBVIOUS APPARENT HYPOCRISY OF BEING AT ONE POINT OPPOSED TO THE FORMER PRESIDENT AND NOW BEING A SUPPORTER. LONG TIME COMING. ELON MUSK HIMSELF LIVES IN TEXAS. IT'S NOT SURPRISING HE'S DOING THIS.
IT HAS THE FEEL OF A POLITICAL STUNT MORE THAN ANYTHING. ED: NOT SURPRISING BUT IMPORTANT FOR CALIFORNIA AND ITS TECH INDUSTRY. SPACEX HAS 13,000 EMPLOYEES, MANY OF THEM IN HAWTHORNE. FALCON9 IS BUILT IN HAWTHORNE. THEY SHIP IT TO FLORIDA. THEN THERE IS X. WE ARE TALKING ABOUT THE FOOTPRINT LEAVING THE STATE.
KURT: THERE'S NO WAY TO SUGARCOAT THIS. IT LOOKS BAD FOR CALIFORNIA. THAT LOOKS LIKE YOU ARE TAKING THE SMARTEST TECHNOLOGISTS IN THE INDUSTRY AND MOVING THEM ELSEWHERE. THERE IS AN OPTICAL ISSUE. THE LOGISTICS ARE IMPORTANT. ELON HAS MOVED TESLA TO TEXAS SEVERAL YEARS AGO. THERE'S A HUGE OFFICE IN PALO ALTO.
ARE THESE EMPLOYEES GOING TO BE LEAVING CALIFORNIA, THE JOBS, OR IS THIS MORE OF A LOGISTICS THING? CAROLINE: ULTIMATELY THIS IS A PERSONAL ISSUE FOR ELON MUSK, THIS CURRENT LAW. ONE OF HIS ELDEST CHILDREN WENT TO COURT THE DAY AFTER THEY TURNED 18 AND CHANGE THEIR NAME CITING GENDER IDENTITY AND THAT THEY NO LONGER LIVE OR WISH TO BE RELATED TO MY BIOLOGICAL FATHER IN ANY WAY, SHAPE OR FORM. THIS IS PERSONAL. THAT MAKES THE CONSUMER FEEL PERSONALLY ABOUT THESE MOVES. ULTIMATELY, HOW MUCH WILL THIS
IMPACT THE BUSINESSES THAT ELON IS GETTING MORE POLITICAL HERE? MAX: I DON'T THINK THIS MOVE WILL HAVE A HUGE IMPACT ON THE WAY CONSUMERS FEEL ABOUT HIM OR HIS EMPLOYEES FEEL. IT'S NOT CLEAR MANY ARE GOING TO HAVE TO MOVE. IT'S THE LATEST SIGN IN A SERIES OF SIGNS OF ELON MUSK BECOMING THIS POLARIZING FIGURE. THAT'S A CHALLENGE FOR TESLA, WHICH HAS THIS ENORMOUS BASE OF CUSTOMERS MANY OF WHOM LIVE IN SUBURBS, MANY OF WHOM ARE NOT HARD-CORE TRUMP SUPPORTERS. HE HAS MADE HIS BET ON THIS THE LAST FEW YEARS. I DON'T THINK IT WILL HAVE A HUGE IMPACT. IT'S MORE A SYMPTOM OF THIS
ONGOING POLITICS OF BEING ELON MUSK. ED: KURT AND MAX, THANK YOU. COMING UP, WE ARE JOINED BY TECH WOLF CO-FOUNDER AND COO, MIKAEL WORNOO. THIS IS BLOOMBERG. ♪ CAROLINE: AI IN ACTION, TECHWOLF FOCUSED ON UTILIZING AI IN TALENT RETENTION.
MIKAEL, HOW IS THE MORE TARGETED LARGE LANGUAGE MODELS HELPING COMPANIES IDENTIFY THE TALENT THEY ALREADY HAVE? >> WE USE AI TO HELP EMPLOYEES AND EMPLOYERS MAKE SMARTER WORKFORCE DECISIONS. INSTEAD OF SAYING WE NEED TO HIRE 1000 ENGINEERS, RIA WILL SAY YOU ONLY NEED 500. ESSENTIALLY THAT CAN SAVE THE BUSINESS MILLIONS IN COSTS AND ATTRITION. TODAY WE HAVE 2 MILLION SKILLED PROFILES FOR EMPLOYEES. WE WORK WITH THE BEST HR LEADERS ON THE PLANET. ED: WHERE IN THE HIRING PROCESS DOES THIS COME IN? THERE IS ALREADY THE FILTERING OF CV'S. THEN YOU HAVE HR PEOPLE GOING
THROUGH PILES. WHERE DO YOU COME IN? MIKAEL: GOOD TO TAKE A STEP BACK. SKILL MANAGEMENT HAS BEEN AROUND SINCE THE 1980'S. THE FIRST THING WE DO IS SKILLED DATA FOR EVERYBODY. WE ARE THE FIRST COMPANY TO DO THIS.
THE SECOND STEP IS TO USE THAT DATA TO MAKE BETTER DECISIONS. MAYBE 25% OF EMPLOYEES DON'T HAVE THE SKILLS TO PERFORM IN THE JOB. IT'S A NEW WAY OF LOOKING AT THE WORKFORCE, FOCUSING ON IMPROVEMENT. IT'S A DATA PLATFORM FOR HR. CAROLINE:
THERE ARE SOME BIG HR PLAYERS OUT THERE. SOME OF THEM ARE BACKING YOU. PHOENIX CAPITAL LEADING A SERIES B. WHAT IS YOUR OUTLOOK? DO YOU REMAIN INDEPENDENT? MIKAEL: OF COURSE. WE TOOK A STEP BACK AND ASK OURSELVES, WHAT IS NEEDED TO BUILD A EUROPEAN GENERATIONAL AI COMPANY? THE THREE BIG INVESTOR GROUPS, IT'S THE FIRST TIME S.A.P.
AND WORKDAY ARE INVESTING TOGETHER. IT'S GIVING US THE OPPORTUNITY FOR US TO LEARN FROM PEOPLE WHO HAVE SKILL IN THE BUSINESS. SECONDLY, ENSURING WE HAVE THE BEST AI. WE HAVE PEOPLE JOINING TO ENSURE WE CAN KEEP OUR NEEDS IN THE SPACE. ED: THANK YOU SO MUCH. COMING UP, THE LAUNCH OF GETREAL LABS. STAY WITH US.
>> ON STARTUPS AND TECHNOLOGY, WE ARE EXPERTS. WE THINK DONALD TRUMP IS A BETTER CHOICE THAN JOE BIDEN ON THESE ISSUES. ED: THEN HORWITZ -- BEN PORRO IT'S -- BEN HOROWITZ PLANNING TO DONATE A SIGNIFICANT AMOUNT TO DONALD TRUMP'S CAMPAIGN. THEY WILL BE PERSONAL
CONTRIBUTIONS, NOT FROM THE FIRM ITSELF. YOU HAVE WRITTEN IN THE LAST 48 HOURS ABOUT SILICON VALLEY'S REACTION TO THE EVENTS OF THE PAST WEEK, THE RNC, J.D. VANCE BEING THE VP PICK, SUMMARIZE THE REPORTING FOR US. >> THERE'S BEEN A HUGE OUTPOURING OF SUPPORT FOR TRUMP AND HIS VP NOMINEE VANCE. NOT ONLY HAS ELON MUSK AND MARK AND RECENT AND DAVID SACHS, DOUG LEONE AND SEAN MAGUIRE FROM SEQUOIA CAPITAL, ALL THESE TECH AND VENTURE CAPITAL PROMINENT PEOPLE IN SILICON VALLEY HAVE ALL LINED UP TO SUPPORT TRUMP IN RECENT WEEKS WITH GAINING MOMENTUM AS MORE SEEM TO LIKE WHAT HE HAS TO SAY ABOUT TECH POLICY SPECIFICALLY. CAROLINE:
THEY REALIZE IN SOME WAYS THIS MIGHT BE CONTROVERSIAL, THAT PEOPLE WITHIN THEIR COMPANY TO TAKE SUCH AN OPENLY POLITICAL STANCE BUT WHAT IS IN IT FOR SMALL TECH? THE VP PICK DOESN'T LIKE TECH MUCH FROM WHAT WE UNDERSTAND. LIZETTE: ON SMALL TECH, SPECIFICALLY FOR STARTUPS, THERE'S A COUPLE AREAS THEY ARE HOPING TO BEND THE EARS OF TRUMP AND VANCE ON INCLUDING POTENTIALLY OPEN SOURCING AI, LOOSENING CRYPTO REGULATION AND POSSIBLY TAKING A LOOK AT THE FTC AND THE ANTITRUST REGULATIONS WE'VE SEEN COME DOWN. ONE OF THE REASONS FOR THAT, ALTHOUGH IT TARGETS BIG TECH COMPANIES BY PREVENTING THEM FROM ACQUIRING SMALLER STARTUPS, IT CLOSES DOWN THAT PATH AS AN EXIT FOR THEM AND THEY CAN ONLY IPO WHICH HASN'T BEEN AS STRONG IN RECENT YEARS. ED: WE MADE THE POINT WITH VISUAL REPRESENTATION OF WHO SUPPORTS TRUMP -- IT IS NOT ALL OF SILICON VALLEY. WHAT HAVE YOU LEARNED ABOUT ANY REMAINING SUPPORT IN THE INDUSTRY FOR THE DEMOCRATIC PARTY OR EVEN THOSE WHO HAVE CHANGED ALONG THE WAY? LIZETTE: EXCELLENT POINT.
THE REASON THIS IS SIGNIFICANT IN SOME WAYS IS IT IS A MAJOR DEPARTURE FOR MANY WHO HAVE LONGTIME VOTED DEMOCRAT. IT IS NOT ALL OF SILICON VALLEY. THESE ARE PROMINENT NAMES BUT THERE IS A LARGE CONTINGENT OF DEMOCRATIC VOTERS BACKING BIDEN, CERTAINLY, STEVE BALLMER, MARISSA MAYER, QUITE A FEW OTHERS. THE CONVERSATION IS MIXED.
IT IS NOT ALL TECH AND NOT ALL SILICON VALLEY. CAROLINE: IS THIS LIKELY TO GET LOUDER TOWARD NOVEMBER? A MOMENT IN TIME WHEN PEOPLE LAY THEIR CARDS OUT AND GET ON BOARD THE REST OF THOSE THEY WORK WITH AND THE PORTFOLIO COMPANIES UNDERSTANDING THEIR STAND> LIZETTE: I THINK IT WILL GET LOUDER AND MORE RAUCOUS AND POTENTIALLY MORE DIVISIVE IF YOU LOOK AT THE BEEFS PLAYING OUT ON THE X PLATFORM NOW. CAMPAIGNS GAINED STEAM CLOSER TO ELECTION DAY. I DON'T ANTICIPATE THIS RATCHETING DOWN ANYTIME SOON. THAT DOESN'T MEAN IT WON'T STAY CIVIL.
WE WILL LOOK AHEAD TO SEE HOW THINGS PROGRESS. CAROLINE: HERE'S HOPING ON THAT CIVILITY. THANK YOU. TALKING ABOUT THE BEEF ON SOCIAL. LET'S TALK ABOUT AI BECOMES MORE BALANCED, THERE IS GREATER RISK FOR IT TO BE USED MALICIOUSLY. THE RISE IN DEEPFAKES HAS PROVEN HARMFUL DURING ELECTION CYCLES. GITREAL LABS.
YOU'VE BEEN BUILDING THIS BUSINESS ALONGSIDE ACADEMIA TO TRY AND TARGET WHAT COULD BE AN ELECTION RISK BUT JUST AN ONGOING RISK. HOW MUCH IS THIS SOMETHING WE NEED TO BE WORRYING ABOUT? >> IT'S HARD TO LOOK AT THE LAST FEW YEARS IN GENERATIVE AI AND DEEPFAKES AND THINK THIS IS NOT A RISK TO INDIVIDUALS, FRAUD, INSTITUTIONS, FRAUD AND DEMOCRACIES, DISINFORMATION AND MISINFORMATION. WE ARE SEEING IT IN THE U.S., EUROPE, INDIA, AROUND THE WORLD. DISINFORMATION IS BEING POWERED BY THE LATEST TRENDS IN DEEPFAKES. WE ARE TRYING TO THINK HARD ABOUT HOW WE CAN DETECT AND STOP THAT. ED:
YOUR ROLE AT THE UNIVERSITY OF CALIFORNIA BERKELEY, THE WORK YOU ARE DOING THERE. YOU HAVE A NEW TOOL TO COMBAT AN ISSUE AND AT THE SAME TIME THE PROLIFERATION OF APPLICATIONS IS ALSO ON THE RISE. DO YOU PHONE UP COMPANIES AND SAY LET'S WORK TOGETHER? HARRY: WE DO. YOU CANNOT WORK IN CYBERSECURITY IF YOU ARE NOT
TALKING TO THE OTHER SIDE. YOU CANNOT DO DEFENSE IF YOU DO NOT UNDERSTAND OFFENSE. THEY ARE NOT BAD ACTORS. THEY ARE GENERATING TECHNOLOGY THAT HAS GOOD USES AND BAD USES. THEY ARE GENERALLY INCENTIVIZED TO WORK WITH THOUSAND CREATE DEFENSE. WE CAN DO THAT TOGETHER.
ED: HOW WOULD YOUR PLATFORM WORK IF THERE WERE A DEEPFAKE CIRCULATING? HARRY: ANYTIME AN IMAGE, AUDIO OR VIDEO BREAKS, AND YOU SAW IT THIS WEEKEND AT THE SHOOTING. THERE WAS IMMEDIATELY FAKE VIDEOS COMING OUT, MUDDYING THE LANDSCAPE. WE WORK WITH REPORTERS, FACT CHECKERS, ORGANIZATIONS, CAMPAIGNS. AS SOON AS SOMETHING COMES UP, YOU SEND IT TO US, WE RUN TESTS AND TRY TO GET AS MUCH INFORMATION AS WE CAN SO YOU CAN MAKE A DECISION DOWNSTREAM. CAROLINE: HAVE WE BECOME SO NUMB WE WONDER WHETHER ANYTHING IS REAL NOW? HARRY: THAT IS ALWAYS THE FEAR. WHAT WE DO IS NECESSARY BUT NOT
NECESSARILY SUFFICIENT. FIRST WE HAVE TO TELL YOU WHAT IS REAL AND WHAT IS FAKE. THERE'S ANOTHER BATTLE NOW. WE HAVE TO GET OUT OF OUR ECHO CHAMBERS, STOP HATING THE OTHER SIDE OF THE AISLE SO MUCH BECAUSE IF WE CANNOT HEAR FAX, I DON'T KNOW HOW WE MOVE FORWARD. CAROLINE:
I WANT TO KNOW MORE ABOUT HOW YOU CAME TO BE. THINK ABATED OVER THE PAST COUPLE YEARS WITH REALISTIC VENTURES AND UC BERKELEY AND YOURSELF REALLY. WHAT DOES IT LOOK LIKE NOW? HOW MANY PEOPLE ARE YOU ATTRACTING? HARRY: I STARTED WORKING IN THE FIELD 25 YEARS AGO. THIS IS A LONG ACADEMIC JOURNEY. TWO YEARS AGO I PARTNERED WITH BALLISTIC. THEY INCUBATED US.
OUR HEADCOUNT IS 30 NOW. WE WILL QUICKLY BE 50 BY THE END OF THE YEAR. WE HAVE A PRODUCT. WE ARE WORKING WITH CUSTOMERS. WE EXPECT TO HAVE TECH OUT BEFORE THE ELECTION PER THE POINT YOU WERE JUST MAKING. ED:
PROFESSOR FIELD, TIMELY CONVERSATION. CAROLINE: THE BROADER MARKETS NOW. THEY ARE UNDER PRESSURE. BEING HIT HARD. NASDAQ WERE STAY SINCE OCTOBER. WE ARE TRADING THE LOWEST SINCE JULY 1.
A 2% DIP IS A BIG ONE AND WE HAVE NOT SEEN IT IN A LONG TIME. WE ARE BEING DRAGGED DOWN BY THE CHIPS. WHY THIS CONCERN WE WILL SEE A RAMPED UP FOCUS ON CHINA ACCESSING CHIP MANUFACTURING BUT ALSO THAT EQUIPMENT COMING FROM EUROPE, FROM ASIA AS WELL. NVIDIA OFF 5%. THAT'S A BIG MOVE FOR A $3 TRILLION COMPANY. ASML ARE REALLY EXPOSED TO CHINA. INTEL IS UP. INCREDIBLY IMPORTANT STORY COMING WITH FORMER PRESIDENT TRUMP ON TAIWAN. WE HAVE A LOT COMING UP.
ED: MANY INDICES AT THEIR LOWEST SINCE EARLY JULY BUT BIG DROPS AT THE MOMENT. COMING UP, MATT MURPHY ON THE EXCLUSIVE PARTNERSHIP WITH ANTHROPIC AND THEIR NEW FUND NEXT. THIS IS BLOOMBERG. ♪ ED: MENLO VENTURES ANNOUNCED THE ANTHOLOGY FUND, A $100 MILLION INITIATIVE CREATED WITH ANTHROPIC TO PARTNER WITH INNOVATIVE FOUNDERS TO BUILD AI APPLICATIONS AND SOLUTIONS THAT LEVERAGE ANTHROPIC TECHNOLOGY AND AI MODELS. MATT MURPHY. MECHANICALLY, HOW DOES IT WORK? YOU SEE SOMETHING ON YOUR DESK. YOU PHONE UP. WE SHOULD DO A DEAL HERE.
WE SHOULD COINVEST. WE CAN HELP? MATT: IT'S A LITTLE DEEPER THAN THAT. IT'S A COLLABORATIVE INITIATIVE. WE GET A PROGRAM BUILT FOR ENTREPRENEURS. QUARTERLY MEETINGS, BIANNUAL DEMO DAYS, BACK-AND-FORTH INTERACTION. WE EXPECT A TREMENDOUS AMOUNT OF THE DEAL FLOW TO COME FROM THEM. THINGS THAT THEY ARE INTERESTED
IN. LIGHTHOUSE EXAMPLES OF AI. A LOT OF ALIGNMENT ABOUNDS. THE FIRST WAVE HAS HAPPENED SO QUICKLY. THE BIGGEST TECH WHERE THE CURVE IS THE BIGGEST WE HAVE EVER SEEN. IT'S STILL THE WILD WEST. THERE
IS AN AMATEUR ECOSYSTEM. THE IDEA IS TO BRING TOGETHER THE BEST DEVELOPERS AND PLATFORM TO BUILD COMMUNITY AND PUSH BOUNDARIES TOGETHER TO LEARN TOGETHER AND MATURE THE ECOSYSTEM AND THINK ABOUT SPECIAL AREAS THAT HAVEN'T BEEN CONQUERED YET. CAROLINE: THIS ISN'T THE FIRST TIME YOU'VE DONE ONE OF THESE. THE FUND YOU LAUNCHED IN 2008 WAS ABOUT APPLE, TO FIND APPLICATIONS ON THEIR IOS. HOW MUCH SKIN IN THE GAME WILL
ANTHROPIC HAVE? VISIT MORE ABOUT -- IS IT MORE ABOUT THE USE? MATT: IT IS MENLO'S CAPITAL BUT ANTHROPIC'S SPONSORSHIP, ADVICE, MENTORING. IT'S A WIN-WIN. ANTHROPIC HAS A COHORT THAT WILL HAVE RECOMMENDED A NUMBER AND BE INVOLVED IN HELPING THEM IF DEVELOPERS ARE STUCK. THEY CAN UNDERSTAND WHAT NEEDS DEVELOPERS HAVE AND MAKE SURE WE HAVE SPECIFIC AREAS WE ARE INTERESTED IN SEEING APPLICATIONS EXIST. FOR ENTREPRENEURS, GIVEN THE WILD
WEST, THEY NOW KNOW THERE IS A PLACE TO GO TO GET SOME WORK FROM ANTHROPIC. EVERY DEVELOPER SHOULD BE LOOKING AT ANTHROPIC. IT'S THE BEST MODEL RIGHT NOW. WE HAVE GREAT CONFIDENCE IT'S THE BEST TEAM. ANTHROPIC IS TRYING TO GET CLOSER TO THE DEVELOPER COMMUNITY. THAT'S WHAT WE DO ON A DAILY BASIS. DEVELOPERS CAN TAKE AND MANAGE. ED: THERE IS DISCUSSION ABOUT VENTURE FIRMS ADVERTISING THEY BUILT OFF THEIR OWN CLUSTER. IN REALITY, IT'S PROBABLY
THROUGH AWS. ANTHROPIC HAS A GREAT RELATIONSHIP WITH AWS. DO YOU MARKET IT THAT WAY? THIS IS THE SUPPORT OPERATIONALLY WE CAN GIVE YOU? MATT: I THINK THIS IS MORE ABOUT CREATING A COMMUNITY OF FOUNDERS THAT CAN LEARN FROM EACH OTHER AND TALK ABOUT HOW THEY ARE SOLVING PROBLEMS, GET ADVICE FROM ANTHROPIC ON THEIR ROADMAP, EARLY ACCESS TO THINGS, REALLY KIND OF MORE OF LIKE A HOTLINE TO TALK TO THEM IF THEY HAVE ISSUES. THE NOTION OF BUILDING OUT CAPABILITY, CAPACITY FOR THEM IS NOT PART OF THIS PROGRAM NOR DO I THINK IT IS NECESSARY. THEY GET FREE CREDITS. THERE WILL BE CAPACITY ON ANTHROPIC. I WAS WITH JENSEN LAST NIGHT.
I HAVE CONFIDENCE NVIDIA WILL CONTINUE TO SOLVE THE CAPACITY PROBLEM, THE BIG CLOUD PROVIDERS, LIKE AWS AND GOOGLE. YOU MIGHT HAVE A SHORT-TERM CAPACITY CONSTRAINT BUT I AM NOT WORRIED OVER THE LONG HAUL. CAROLINE: I AM A FOUNDER WANTING TO GET MORE USE OUT OF ANTHROPIC. I HAVE AN IDEA. WHAT PROBLEMS DO YOU WANT TO SEE SOLVED? THERE ARE A LOT OF AREAS VALUE CAN BE ATTRIBUTED TO IN THE SUPPLY CHAIN OF AI NOW. MATT: THERE ARE CERTAIN AREAS WE HAVE CALLED OUT.
BIG INTEREST AROUND DIGITAL HEALTH. WE KNOW HOW MESSED UP THE SYSTEM IS. ALL THE CAPABILITIES TO AUTOMATE, BETTER DIAGNOSIS, ACCELERATE CARE PROGRAMS, THINGS LIKE THAT. THE LEGAL VERTICAL HAS BEEN ONE OF THE FIRST MOVERS. HELPING PEOPLE OPTIMIZE TRUST AND SAFETY BECAUSE THOSE CAN BE A BARRIER TO ADOPTION IF PEOPLE FEEL THE MODELS WILL HALLUCINATE OR PRODUCE RESULTS THAT ARE INCONSISTENT WITH A BRAND MESSAGE. THERE IS INFRASTRUCTURE, THE MODEL IS ONE PART OF IT BUT FOR ANY DEVELOPER ECOSYSTEM TO THRIVE, YOU NEED A DEVELOPER EXPERIENCE.
THERE'S A BUNCH OF THINGS WE WILL BE WORKING ON TOGETHER THAT WILL BE EXCITING. ED: THE TOP STORY THIS WEEK ON OUR SHOW HAS BEEN J.D. VANCE. YOU WERE QUOTED IN A STORY WEIGHING IN FOR THE SILICON VALLEY REACTION. I WONDER IF YOU WOULD EXPLAIN YOUR VIEW ON A FORMER SILICON VALLEY NAME POTENTIALLY GOING TO THE WHITE HOUSE IN NOVEMBER? MATT: MY POINT WAS IRRESPECTIVE OF PARTY, THE MORE WE HAVE PEOPLE IN THE WHITE HOUSE WHO ARE AROUND WASHINGTON, WHO UNDERSTAND TECH, IT'S THE BIGGEST DRIVER OF INNOVATION AND JOB GROWTH IN THE ECONOMY AND WE NEED PEOPLE WHO UNDERSTAND. HAVING SOMEONE WHO HAS BEEN
PART OF A FUND, WHO HAS SEEN HOW INNOVATION WORKS, I THINK IT'S A UNIQUE EXPERIENCE AND OPPORTUNITY THAT CAN BE HELPFUL. WE HAVE SOME RESISTANCE NOW AROUND THE M&A MARKET, ANTITRUST HAS BEEN BLOCKING IMPORTANT DEALS. THE WAY THE VENTURE ECONOMY CAN FLOURISH IS WHERE STRATEGIC BUYERS CAN PURCHASE THE COMPANIES THAT MAY NOT BE ABLE TO GET ALL THE WAY TO IPO ON THEIR OWN. WE HAVE OTHER PATHS. OBVIOUSLY, IPO HAS BEEN SUPER IMPORTANT. THERE'S A VIBRANT M&A
ENVIRONMENT. ANYONE IN WASHINGTON SHOULD BE CONSCIOUS OF THAT TO ENHANCE. IT'S AMAZING GROWTH FOR THE COUNTRY. CAROLINE: THANKS FOR COMING ON AND TALKING ANTHOLOGY FUND AND A LITTLE POLITICS. LET'S WRAP UP EUROPE. ASML, WORST DROP SINCE MARCH '20. THE EQUIPMENT MAKER SEEING
RESTRICTIONS FROM THE U.S. ON CHINA. CAROLINE: THE GOOD THE BAD AND THE UGLY. THE LAST 24 HOURS AT AMAZON. PRIME DAY GETTING OFF TO A FAST START. FAST-FORWARD TUESDAY NIGHT, THE ADVERTISING PORTAL CRASHES, LEADING BRANDS IN THE DARK. A BIT OF A SOUR ENDING.
CERTAINLY WEIGHING ON THE SHARES THIS MORNING. YOU WATCH AS PEOPLE WERE LEFT BAFFLED? >> THERE WAS A LOT OF PANIC LAST EVENING AND WE STARTED WORKING THE STORY WHEN THERE WERE SIGNS OF TROUBLE. THE ADVERTISING PORTAL WAS DOWN. THIS IS A CRITICAL TOOL. MANAGE SPENDING. IT WENT DARK FOR SELLERS. IT DID SEEM TO BE SHORT-LIVED. THAT'S THE TROUBLE WITH THESE
GLITCHES. YOU DON'T KNOW WHEN THEY WILL SPIRAL OUT OF CONTROL OR BE CONTAINED. THIS ONE WAS CONTAINED WITHOUT A CRAZY AMOUNT OF DAMAGE. ED: THE BAD AND THE UGLY. THE GOOD WAS MONEY LEFT ON THE
TABLE FOR AMAZON. SEEMS LIKE GROWTH FOR PRIME DAY. GOOD SHOWCASE FOR THE PLATFORM? SPENCER: ALL OTHER INDICATORS ARE THAT PRIME DAY WAS DOING FINE. EVEN THE GLITCH DOESN'T HURT AMAZON. IT HURTS THE PEOPLE WHO SELL ON AMAZON, WHO ARE MONITORING REAL-TIME AND WANT TO MAKE ADJUSTMENTS. THEY GOT HAMSTRUNG FOR A BIT. THEY WEREN'T ABLE TO MAKE CHANGES.
PRIME DAY SO FAR IS DOING QUITE WELL, TRACKING 11% GROWTH FROM THE SAME EVENT LAST YEAR. EVERYTHING SEEMS TO BE ON TRACK. ANOTHER THING, PRIME DAY HAS SEEN A SURGE IN THE INITIAL HOURS. MORNING OF THAT FIRST DAY, WHEN ALL THE SPENDING OCCURS, IT WAS FORTUNATE THAT THE ADVERTISING BUDGET CAME ON THE EVENING OF THE FIRST DAY BECAUSE CONSUMERS WEREN'T AS BUSY AT THAT TIME.
CAROLINE: APPRECIATE IT. ALL THINGS AMAZON PRIME DAY. LET'S CHECK IN. EXTRAORDINARY DAY. ASML HAVING ITS WORST THEY SINCE MARCH '20.
EARNINGS WERE GOOD BUT NOT GOOD ENOUGH TO OFFSET GEOPOLITICAL RISK. ED: THE CHIP STOCKS IS WHERE THE PAIN IS MOST FELT. CAROLINE: THAT DOES IT FOR THIS EDITION.
2024-07-21 18:50
