92. What AI, China, and Tariffs Mean for Real Estate in 2025 w Guest Robb Almy

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
I've been having camera issues
the last couple of weeks.
For some reason,
every time I go to Riverside.
It like it makes me reboot
and the first reboot doesn't do anything.
I have to reboot twice.
Hey, this is common with men
above the age of 50 J.
It's just I just
I can't get my camera up.
J, didn’t you work for Microsoft?

(00:20):
Yeah.
And what I learned working at Microsoft
is sometimes you have to reboot twice.
Welcome to Drunk Real Estate.
Grab a drink and.
Enjoy the show.
Hey, there.
Welcome to episode
92 of Drunk Real Estate.

(00:41):
I am Kyle Wilson,
Ashley Wilson's husband.
And tonight,
along with my two favorite co-hosts,
we have a very special guest with this.
And if you remember, we
there was this, I created intro.
We had the song a couple episodes ago,
and we found out
it was created by a fellow real estate
investor actually named Robb
Almy, who specializes in all things,

(01:03):
I, along with investing in single family
commercial stars,
Syndications
Rob is also an AI certified consultant,
so we are super excited to pick his brain
about all things I. How's it going? Rob?
It's going great.
Carl. It's great to be here.
I appreciate, the opportunity to be here.
I know you guys,
had a couple of different choices

(01:24):
when it came to,
getting somebody to fill in for Marissa,
and it came down to me
and, Kenny McElroy.
So I appreciate you guys picking me over
Kenny, but, you know, he'll be all right.
He's got,
a few properties to take care of and,
great conference tight puts on. So.
Hey, thanks for having me on.
I've heard of that guy before.
It's a good reminder
to all of our listeners
that we can be bribed.

(01:45):
So do do stuff for us.
Give us free stuff.
And who knows,
you may end up as a guest on the show.
We are not below it.
Yeah, let me let me just say
Rob has been for like a year now.
He just sends me some like AI tips.
So if if a new technology comes out
that I haven't tried like he
he sent me

(02:06):
something that helped with the newsletter
make the newsletter more, automated.
He sent me tips on ChatGPT
and how to use it.
And so he has been tremendously helpful
with to me with AI stuff.
So I know he's going to be
tremendously valuable
for our audience as well.
That's the idea
I've been
I've been slacking on the AI stuff.
I think we got into the,
the VA's pretty early,

(02:27):
so I keeps telling myself off
VA's like, that's, you know,
I can't be quite better than a VA,
but we'll see. We'll see.
Maybe Rob will prove me wrong.
AJ how's it going, man?
Oh wait.
Hold on, hold on, hold on.
That Rob
you drink it,
you bring it,
you bring something to drink for us.
Well, you know, I had thought about
I really thought about getting
the pisco out in honor of Mauricio, but,
I'm actually going to,

(02:48):
join with,
AJ and, be the designated driver today.
I have my, Heyo, which is a social tonic
filled with adaptogens, botanicals.
It is, 30 calories.
It's -80 proof. But my.
Let me ask you a question.
Does it have sugar or carbs?

(03:09):
For me. Look.
Either way, it's, No,
and it does have five grams of sugar.
Okay, so it's not quite as good as clear,
but but,
if you're looking
not for the nonalcoholic,
it looks like a close second.
And, hey, I'm I'm too in already,
so you guys better watch it.
Oh, we got it.
I got a catch up, boy.
And then apparently,
I get to drink twice as much

(03:29):
just to to even out the podcast.
Hey, AJ, how's it going, man?
It's going good.
As always, have my red
solo cup with Diet Coke as the,
Rob mentioned the designated driver here,
so it's nice to have you, Rob,
and I'm glad to have another
designated driver with me.

(03:50):
It's good. I'm not alone.
Red solo cup.
All right, I I've been waiting.
I've been holding off a little bit.
I thought about not even intro ING Jay,
today, because I don't want to hear it.
About six weeks ago,
Jay made this prediction
that last week the entire

(04:10):
the economy was going to blow up.
We're going to have a recession,
all this stuff.
And he made this prediction.
And sure as shit,
what happens
last week, all hell breaks loose.
The economy,
the the stock market drops by 10%.
Jay's just sitting there
grinning, making,
you know, comments all week about this.
So here you go Jay.
Here's here's your opportunity right now

(04:31):
to point out to everybody about go back
and listen to episode whatever.
When I said it and it did happen.
So here you go. Go go ahead.
No, I'm not going to gloat.
I actually,
the big prediction I made
was that
it was all going to culminate
in a really bad jobs report last Friday.
And so I was expecting that today.
I'd be doing an economic update

(04:52):
and talking about,
like, the, the, the February jobs
or, I'm sorry, the March jobs report
where like, we saw
hundreds of thousands
of federal layoffs and private lot.
It wasn't
it was actually a good jobs report.
And so I was right
about the market collapsing,
but it had nothing to do with the reason
why I thought it was
I guess I got a little bit lucky,

(05:13):
but I'm not going to admit that publicly.
Damage, like, you know, like,
I can't believe
you just went the humble route there
I had. No, we. Have nothing to argue.
We all had our arguments
ready to go on why it doesn't count.
And now it's like, okay, no, good job.
We can't like
you already took that away from us.
So now we can only congratulate you.
I just gloat for a little bit

(05:34):
so I can do my best.
We can jump in.
Yeah, I want I had prepared.
I want to hear you gloat
and say that you were right.
So let me. Let me gloat.
If anybody had listened to me
and taken every penny they had
and put it on like the bet
that I told you to make,
you'd be filthy rich right now.
Wait wait wait wait.
Hold that, hold that thought,
hold that thought.

(05:54):
Okay. Are our switchboards lighting up?
We got callers coming in left and right.
I feel like we have to.
We have to cut to one of our callers
right now.
Caller, caller, caller number one.
What do you,
what do you what do you want to say?
You're you're live on drunk real estate.
Oh my God, oh my God.
Oh my God.
Is this the drunk real estate pod?
The number one
real estate podcast on the planet.

(06:15):
Just wanted to call in to say that
Jay's
taking a victory lap is a crock of B.S..
You can't predict a recession
based on a terrible jobs
report on April 4th.
When the jobs report comes out
better than expected.
Yes, we are most likely in a recession.
I think we're actually in a recession,

(06:35):
but we've been talking about recessions
even before last weekend,
the Atlanta Fed obviously
has been giving us a negative GDP,
but hey, no victory laps. My friend.
Love you.
Great having lunch with you today.
But if the jobs report
is better than expected,
how in the world
can you take a victory lap?
Wow, great.
That is a great point, caller.
Thank you for coming in.

(06:55):
We, we appreciate the call.
Yeah, that was that was a great call.
It was is
it was first that,
you know, I got this whole new set up.
Now callers can call in.
I'm not giving out the phone
number, though.
It's only a special few people.
But anyway, you ruined that.
I had it all queued up.
That was going to be hilarious.
And you just. You just ruined it.
Sorry about that.
I did have lunch with Murray.
I had lunch with Mauricio
and his family today, so he's not here.

(07:16):
But, But I did get to see Mauricio,
and he.
He bought me a lot of sushi
for lunch, so, it was.
I'm not going to be mad at Mauricio.
Now, apparently,
lunch with you is a higher priority
than, the podcast.
Yeah, exactly.
We're a little hurt here.
Right?
Hitting a little shunned
where you get to go out

(07:36):
and get Mauricio and sushi.
Everything else like that.
Two hours later, he's too good for us.
We see how it is.
I'm actually a little bummed
that that Murray CEO is not here.
Because you haven't asked me
what I'm drinking yet, but I really.
Just about to do that.
I want to do my skit first.
What are you drinking, Jake?
I wanted to show it off to Mauricio.
It's something I didn't get at Costco.
I'm drinking a bottle of Pinot noir

(07:57):
from Jay Winery.
So Jay Pinot Noir, to 2015,
which you're probably thinking,
oh, ten years old.
Good vintage.
Actually, Pino
only lasts about five years,
so it's probably going to be crappy.
But,
but I'm drinking the Jay Pino tonight.
So.
And I'm sure you didn't
buy it for yourself either.
I did, I did, I bought it,

(08:18):
we went to California about, ten years
ago, and I bought,
a bunch of bottles of Jay.
I bought a bunch of bottles of Chase.
There's a Chase winery.
That's one of my sons.
And I bought a bunch of bottles of Cade,
which is the name of my other son.
And there's a Cade winery.
And, on the bright side,
the Jay winery is really cheap.

(08:38):
Chase and Cade
both make good wine,
and I think I spent way too much on
on those, but got the whole family.
Except for Carroll.
There's no Carroll winery.
So if anybody out
there wants to start a winery,
please call it Carol.
I'll spend a lot of money.
Well, the things we do for our
our kids, AJ.
All right,
we ready to get into this
talk some I let's do it.

(08:58):
Because, on previous shows
we've referenced how AI is changing
the way we do business
and shifting the economy,
but we've never really gone
deeper into how
AI is changing real estate investing.
Well, luckily
today we have Rob
with us to help us out sorts
through some of this
AI noise that everyone here
I was,
everyone was talking about AI
until I don't know what happened.
January is right around

(09:18):
the end of January,
something happened
that everyone stopped talking about it.
But luckily,
Rob's going to help us
figure out what we need to be paying
attention to.
So, Rob, welcome to the program.
Fill us in, buddy.
Yeah. Thanks, Kyle. Appreciate it.
Let's look at
November the 30th, 2022.
We woke up and the world changed.

(09:39):
Whether we knew the world had changed
or whether we didn't know
the world had changed.
The world had indeed changed
because that marked the,
opening of ChatGPT ChatGPT,
by OpenAI.
And that has had such a profound effect
on everything in our world,
not just real estate investing,
but every industry has been touched.

(10:00):
It's all,
been touched in a significant way.
It's been a seismic shift
in many different ways.
And so,
I want to just highlight two things.
I think two big implications of
AI and real estate investing.
And I think it's important
for us as real estate investors
to keep these things in mind.
The first thing with, real estate
investing in AI is that AI has the power

(10:23):
to be a strong deflationary force.
Now, I'm sure in the show
we're going to start
talking about, tariffs,
and there's going to be
a lot of conversation about how tariffs
are going to cause inflation.
For the past couple of years,
we've been having
these inflation conversations.
AI is actually going to be
a deflationary force.
What we have seen over a history is that

(10:44):
anytime there's,
a new technology that emerges,
it always has a deflationary effect.
So just. Just just a jump in.
And of course, when you say deflationary,
you're specifically referring
to the fact that it's
going to drive the price of stuff down.
What what stuff are you talking about?
Well,
you know,
I think it's kind of

(11:05):
drive the price of a lot of stuff down.
So let's talk about,
you know, any type of business
that it's using,
AI is going to be able to save
on, the employment side of the equation.
Okay.
That's going to allow them to then
lower prices of goods or services.
And so across the board,
it's going to drive,
different prices down

(11:25):
in terms of the deflation.
It's kind of like if you think about
that, to,
you know, laptops,
you know,
when the first laptops came out,
they cost $1,500 just for the basic one.
It weighed 22 pounds
and had to lug it around.
Now you can go to BestBuy
and get a laptop for $450.
That will do it for Costco
or Costco, right?

(11:46):
That's that's the one that Jay
definitely got.
Cause every time he tries to log
in, he's got to restart his computer.
You're right.
Same thing with, with televisions,
you know, used to used to cost $1,200 for
for a great TV.
Now you go to Walmart
or Costco and get get them for 350 bucks
and they'll do do well for you.
And so here's the thing with I is that I

(12:09):
right now as we talk,
it's the worst it's ever going to be.
It's only going to get faster.
It's only going to get cheaper.
It's only going to be more productive
as we go through.
And so this will have
that deflationary aspect,
which will be great
if we're fighting inflation
or God forbid, stagflation.

(12:31):
And it's going to be very.
And when you say worst,
you just mean like
and how it's able to do
not necessarily morally
the worst it's ever going to be.
Right.
I'm talking about the worst,
technologically in terms of,
what enslaves us.
I feel like that might be the worst.
It'll be.
Well, you know,
hopefully we'll put
some parameters around that as,

(12:52):
time goes by.
I think
we don't have to worry about that for,
a little while, but.
So, so so let me stop
before we jump into whatever the next is.
I don't know,
maybe you're
gonna talk more about deflationary,
but here's something that terrifies me
as a real estate investor.
As a as a consumer, we hate inflation.
Inflation means things
get more expensive,
our cars get more expensive,

(13:14):
our food gets more expensive.
College gets more expensive.
But as a real estate investor,
it also means that rents go up
and the value of assets go up.
And I often not I all of us
on this show
often talk about the fact that,
the nicest thing about real estate
is it's an inflation hedge.

(13:35):
It keeps up with inflation
as inflation goes up,
it pulls real estate values up with it.
If AI is going to be deflationary,
does that mean
that we're all screwed
as real estate investors
because it's going to drag down
real estate values
if real estate tends to
to kind of follow inflation?
You know,
I think you have to live on the
on the edge of that coin, you know.

(13:55):
So on one side of the inflation
coin, yeah, inflation is a positive thing
for real estate investors
in many respects.
I think both,
you know, inflation induced,
debt destruction
where whereby, you know,
if we're, borrowing at a rate
that's less than inflation, we can,
you know, pay back,
that money,
in cheaper
dollars as we go or,

(14:16):
or rents go up and that type of thing.
But on the other side of that coin
as well,
when, we're able to control inflation
while there's not,
a direct correlation
between,
the federal funds rate and
what we are paying for,
the cost to borrow money
in general, the cost of borrowing money
is going to be cheaper

(14:37):
when there's less inflation.
And so think about where leverage plays
a part in amplifying our returns,
keeping inflation in check.
And that particular part of I doing that
being deflationary,
I think will be a positive
aspect of that.
We've kind of seen like
when we say it's it's
going to lead to deflation.

(14:58):
I get the premise behind that.
But also it does seem that
in the beginning with a new technology,
like a lot of people
are spending a lot of money
on this stuff, right?
Like they're like,
if you just see the hard hardware race
that began kind of until deep seek,
slowed it down a little bit,
like people were spending
a lot of money on that.
And it was

(15:18):
it was creating a lot of jobs, too.
And it was driving up,
like like
at that
time, I wouldn't say
it's directly related to it, but the, the
how much people were getting for jobs
is, was a lot as well.
And like it was
I wouldn't say that was deflationary.
So I guess do we have to wait for this
to kind of become more

(15:40):
or less a stable technology
than a rapidly growing technology,
because we're still in the point
where, like, I will see something that
it'll get offered
for $5,000 for a service for AI,
and then eight weeks
later, it'll be a 10th of that.
Like, that's how quickly
some of these, these AI programs are

(16:01):
in, services are growing.
Or do we have to kind of
wait for that to, to play itself out
before we really see this trickle down
into a deflationary aspect,
or is it already happening?
Yeah, I think it
I would liken it more to kind of,
like cooking in a crock
pot versus cooking in a microwave
in terms of its effect.

(16:21):
Oh, I think it's going to take some time
to work through as
and we're really
at the very early adoption. I mean, even,
a lot of companies
have not adopted AI
in any significant manner.
And as they begin to adopt that,
as they begin to learn that,
then I think what you're going to see is,
more of that deflationary effect
across the board.
But I think it's going to be,

(16:42):
you know, a little while
I don't think it's going to be,
right away, but,
you know, take, tools
that are even available now.
For instance, there's a tool called,
hey, Jen out there, and, What?
Hey, Jen does you
you can record yourself for two minutes,
makes an avatar of you, and then you type
in what you want to say,
and your avatar says it now.

(17:03):
Used to take somebody's
three hours of filming to do that.
Now you just say
three hours of your time.
You saved the amount of money
that you're going to pay
a videographer to be there,
somebody to edit that, and bam,
you have that for your social media
for whatever.
That's just one small example of,
you know,
way to save money.
And to
cut costs
and ultimately be deflationary

(17:24):
in a real practical sense.
You're
you're reading through those terms
and conditions real, real closely.
The thing that scares me,
though, it's deflationary,
but it also takes away
a lot of competitive edge.
I mean, one of the things that that,
that gives businesses
a competitive edge is, is their IP,
their intellectual property,
and AI is making it

(17:45):
so that, like,
if anybody can create videos
or great videos,
if anybody can, can can write content
without actually writing
it themselves off,
they can just go to a tool
and have it right.
Great content
that that drives business to them.
It's going to be hard
to differentiate ourselves
so things get cheaper.
But it gets cheaper and easier

(18:06):
for everybody, not just us.
Sure.
There's definitely,
what I refer to as the democratization
that is happening where, you know,
I couldn't do any of this stuff before.
I wasn't capable of doing that.
I didn't have
either the funds or the knowledge
or the expertise to do it.
And now what AI is allowing it to.
It's it's leveling that playing field.

(18:28):
And so now for, for instance,
talking about real estate investing,
you know, if I want to
go explore a market,
I can use deep research
on ChatGPT to go and do that.
Whereas and,
you know,
what have been the big institutions
that were able to do that before
and not me,
you know,
mom and pop investor or,

(18:48):
you know, low level investor.
And so now I have that capability
to do that.
So there's that democratization
that has gone on
that has leveled
the playing field in some ways.
And so I see that as a positive.
Unless you're age, unless you're age
and who
who is not one of the big players.
But he's definitely
like right there midsize in the, in the,

(19:11):
in the self
storage world,
if not larger than midsize.
And so he's got a lot of people
below him.
So leveling
the playing field is actually bad
for for people like AJ who is again,
maybe not the
the Blackrock or Blackstone
whatever the one does real estate.
But certainly bigger than than
a whole lot of people out there.

(19:32):
AJ how is this going to like
impact your business
when smaller investors can come along
and basically
just play in your sandbox without,
without having the same experience
and IP that you've built
through your team?
You know, it's it's interesting
because it drops these barriers of entry
as far as operational.
It goes, like you saw the barriers

(19:53):
of capital, different things like that,
but it actually opened up
markets and segments of markets
that really
haven't been
extremely viable for investors.
Because if you look at like the smaller
the assets go on self-storage,
a smaller asset, let's say $100,000,
that may still be 100 doors.

(20:13):
So you still have a lot of things
going on,
but you can't employ
somebody to be going doing it
because that expense ratio doesn't
makes any sense to do it.
And so what we've seen is over
the last three years,
when you have a combination of,
hardware, software that integrate
and you tie in
AI to where I can do
the communications, the functionalities,

(20:34):
you can now actually run these things
and optimize them
where before you really couldn't,
not in a Significa way
because it was so prohibitive
on a cost basis.
So interesting enough, it's
it's allowing people to get into
the market
and participate in assets
that were cost prohibitive,

(20:55):
which I think that's a good thing.
That makes a more
vibrant part of the market down below.
I think that you can get
a lot of confusion, though. You're right.
So I think
the one thing you have is you don't know
the, the individual that's actually going
and doing this. Right.
I think we run into a problem.
Do they, do they have skills

(21:17):
or is it generated because
before it's like,
oh my ideas or what I'm saying
and I'm responding to an email, right.
That I'm expressing
my knowledge, things like that,
that may not even come from the person.
So literally,
they may not even know
what they're responding to
because I made it,
but it comes back
and it's a perfect response.

(21:37):
You look very knowledgeable.
You sound like
you know what you're talking about.
And I think that is very
that should be nerve
wracking to investors.
And I think that touches on trust, right?
Like like my biggest thing here is
I don't think we're quite at the level
where we can trust these AIS implicitly.

(21:58):
When you when you say, I read
a, I read an article the
other day about this where,
it's it's
talked about a lot in the, legal space.
So I, you know, I'm
sure Marissa will have
some comments on this,
but at some point he will talk about it
with his practice.
But, a lot of people are talking about
how it's going to change the legal space
and how

(22:19):
they're going to need
much less manpower for that.
But then at the same time,
there was a story about
a, someone who wrote a legal brief for,
oral arguments,
and they asked ChatGPT to come up with,
three examples of case
law to support this.
And then they just submitted it.

(22:39):
And, when the judge looked into it,
ChatGPT literally just made them up like,
literally like there
was those examples of case
law didn't even exist.
And we do see instance of
if you play with with ChatGPT
or DPC or Gemini
or any of these other things
for long enough,

(23:00):
you will see scenarios where it will.
It's kind of like that guy
who can't,
I have to say,
I don't know, like they
and they always just make something up.
They're going to have instances
where they hallucinate as they I think is
is the word that they use it,
for the, for these things.
And so I like
I guess
at some point
like how far do you trust these things?

(23:20):
Because,
there's a difference
between automation
and artificial intelligence.
And I feel like a lot of people,
when they're talking about AI,
they're actually just talking
about automation.
And automation
has been around for decades. Right.
Like we've been
we've been automating
a lot of our processes,
especially in property management
and all these things.
But the difference between

(23:41):
automating property management,
where we could just say,
okay, when someone calls this process
happens than this, than this, than this,
and then you can have it,
you know,
go through a computer process instead of
just being phone calls.
The difference
between that
and I would actually be taking the calls.
And then based on the responses,
it would be coming up
with its own responses

(24:02):
that aren't just prompt response.
If this then that
it would actually be
reasoning behind this.
And that's when I'm like,
I like I'm
still for a lot of these things.
I'm not quite there where I trusted
implicitly not to screw up,
especially something big.
Like if you're talking about proforma
rent projection,
you were talking about doing research

(24:23):
on markets and stuff like that.
Like I think it's
it's still not quite there in my mind
where we're trusting
those things for major decisions.
Until you got to remember,
like a perfect example of
this is the AI is subject to inputs.
So the AI is taking inputs
and then it is using right, more

(24:43):
of a thinking method
to decide how to analyze these inputs.
What to do with in out across.
But he doesn't necessarily know
that the inputs are correct.
So when you look,
if you go underwriting
and you're looking
at your competition in a market,
there's a lot of data
scrubbing software systems
that produce numbers.

(25:04):
But in a lot of these markets,
even like mine,
a huge segment of those numbers
are not correct.
They're just wrong,
and they're wrong
for a lot of reasons, right?
They're wrong
because you have an operator
that just hasn't ever updated their site,
or they're wrong for whatever reason
it may be. Right.
And so you're making now decisions

(25:26):
or an AI is coming up talking about value
or something that may be completely off.
It's the literal premise
of that thought process.
So you
then you have an investor
who's making a thesis
of something
that they didn't really understand,
and so they defaulted it to ChatGPT
to come up with this investing thesis.

(25:48):
But they can't put those dots together.
That's why they had ChatGPT do it right.
And so all of a sudden
it starts to layer in where in some cases
it can actually
you can
layer in problems
like the problems get worse and worse
because you can keep asking AI,
oh, make this more, make this better.

(26:08):
Even though the premise was wrong, it'll
keep going, right? So,
you do need
to, I think be careful with that stuff.
You kind of have to trust but verify,
you know, it's still out that
that human element to it
that, you know, yeah.
You shouldn't
be relying on strictly AI to, you know.
Right.
Write up your contract

(26:28):
or review your contract.
But you can use it as a starting point.
You can use it as an opportunity to say,
you know,
upload a contract to it and say,
what are some things
that I should be aware
of moving forward into?
But like what
Rob just said to everybody,
he's controlling the input.
So and this is how a lot

(26:49):
like what we use AI for.
So when we're using AI to analyze
I'm giving data sets.
I'm giving numbers that we know.
We know where these numbers came from.
We know.
So what it's doing
then is it's analyzing.
It's showing trends, correlations, things
that we can't plot out.
We don't like.
We could
it would just take lots of people.
So then we're reducing that manual labor.

(27:10):
So we're more efficient
and we can see and get good ideas.
We know what's being put into it.
We also know how those are being drawn,
the conclusions.
We know how to get there.
But I don't want five people doing it.
So we are controlling those inputs.
Like Rob said, you give it a contract.
What in this contract
puts me at risk that I'm not seeing?
Great, you already have the contract.

(27:31):
You know it, right?
And so for
AI for that stuff is phenomenal.
And it makes people
that know what they're doing
very powerful and dangerous
because it's leveraging a skill
they already have.
And I think that's the difference.
Are you leveraging skills through
AI that you already have? Like my firm?
I don't know how many people

(27:52):
we haven't hired because of AI,
but I can tell you this, it's a lot
like the amount of people
we don't need to hire
because we have AI to we can not hire.
We don't need to anymore.
We we used to literally
to do the same transactions.
We would have had to probably double
some of our departments.
We don't need to anymore.
And that brings me to, to

(28:13):
you know, the second
implication, huge implication
that has to do with jobs
in real estate investing.
And so,
you know,
we always hear the refrain,
it's kind of become, you know,
is I going to take my job?
And the cliche
that we talk about in AI circles
is that AI is not going to take your job,
but somebody that can leverage
and use AI like

(28:33):
you were just talking about.
AJ is going to take your job.
And so what's that going to do
for our job market moving forward?
You know,
are we going to reskill
and retrain our workers
so that they're confident
at least
using some semblance of AI
to do these jobs?
Or are they just going to.
What do you think?
Because I'm actually more optimistic now

(28:55):
then, if you look at something
like Industrial Revolution
and stuff that the problem was,
is that it was replacing unskilled labor.
But in this case,
it seems like
AI is replacing
more and more skilled labor
than then unskilled.
The unskilled seem like that
they're the most
stable job market

(29:15):
for as far as AI is concerned.
Yeah, I think what's going to happen
is what we have
historically seen
as when we've had these
technological disruptions that,
the economy, the workforce has adapted.
There's been new new roles
that have come about.
There's been new jobs
that have been produced.
So I, too
am of the optimistic set

(29:35):
that says, you know,
I think we're going to be okay.
But you know what?
If the bots take over, so to speak,
and we get some crazy politician
that says,
now that we have unemployment so high,
we need to move to universal
basic income or something like that.
I mean, that's always,
always the possibility.
I think it's the opposite, I think.
And I made a video on this, how
I think AI is
the one thing that will save us.

(29:57):
So if you look at, our right now
we have a workforce problem.
And that's not the fact
that people don't have jobs.
And I mean, you see this in the numbers.
The economy's not booming yet jobs.
And you're like,
okay, well is the economy just doing so?
Well, we have high unemployment.
No, it's because we have every single day

(30:19):
tens of thousands of baby boomers.
And every single month,
millions of baby boomers
that are retiring.
And why do I right?
Baby boomers would be great using AI,
don't you think?
They don't want to work done.
And then the.
Young people
that are coming into the workforce
aren't. We don't have the population.
So we have more people

(30:40):
leaving the workforce than entering.
And that is, escalating.
So by 2030 or 33,
we have about a $10 million labor gap,
$10 million,
a 10 million person
labor gap in the United States.
And that is including the immigration

(31:01):
that we saw over the last few years,
because those numbers
were before it ended,
which was like the highest immigration
like we've ever had.
The baby boomers
retiring is such a major segment
of the population.
They're also like the really skilled
segment of the population
because they've just been in that job
for so long, right, or that industry.
So they just have all these skills.
And I think
AI is going to allow us

(31:22):
to have a vibrant workforce
and allow businesses to stay open
and that utilize the people in it,
because right now
we we have a workforce problem.
Unemployment is so astronomically low,
and it shouldn't be in during
these economic conditions. Right.
But you just can't get people.

(31:43):
You can't get workers.
I think it'll save us.
So what I hear you saying is that, I can
they are savior for employment problem.
And then on the other side,
as we were talking earlier,
I can potentially be our savior
for an inflation problem.
And as we talk about inflation
stabilizing prices
and as we talk about, on the other hand,

(32:05):
maximizing employment,
we're talking about
the dual mandate of the fed.
So Uncle Jerome Powell, all he needs is
I and he can do what he needs.
Well there's say
I going to start paying taxes
and paying into Social Security as well
though I guess.
I'll just turn the printing press on
and just print away. You.
We won't even know it's happening. Right.

(32:26):
It's going to print our taxes now.
So I guess is there
any so
as far as we are concerned,
as investors, any, any real
like we could see these shifts and we can
we can adapt our businesses to it.
But
I guess my biggest hold up so far,
I mentioned earlier that we,
we employ a lot of Vas

(32:46):
and it's, it's a easy
way for us to automate.
But I also trust them more. Right.
Like I, I trust them
even when they're data scraping
and they're that they're going to
they're pulling the right numbers.
And even if you want to be like
if it's something that's super sensitive,
something that we do is
we have Vas checking Vas, right.
Like like they just
they check each other.

(33:08):
And so like, is is it something
that's going to,
at this moment, the
level that we are,
is it making our processes better
or is it just making it
easier and cheaper.
Because, because the,
the major thing that I've seen is
it just made tools
easier and cheaper for us. Right.
Like it used to be. CoStar.

(33:29):
You had to pay, you know, $3,000
just to get your foot in the door
and costar and
and now there's there's
other options to costar.
They're giving you
similar amounts
of data for,
you know, half
or even a quarter of the price.
And like there's other like, softwares
for passing rent rolls
and for doing things
like this, there's we have

(33:49):
cheaper access.
And it's kind of like the 8020 thing.
Right.
You can get 80% of
of the functionality
of the big boys
that that used to be just run the show
for about 20% of the cost.
So is that really what we're seeing now,
or is there
real tools out there that are making our
our processes
better

(34:10):
not just cheaper and more efficient?
So how I look at a lot of it is unseen.
So if you take output
so you go any organization,
all of the individual
inputs that organization
has to do
to create a monetary output right point
zero ton, you know, 100.

(34:31):
There's all of these different points
and communication.
There's all of these different processes
and systems
that have to go into all of this stuff
to generate that outcome.
Every time you switch hands,
every time different
people need to look at things
and analyze things,
you have friction points, right?
So there's delays.

(34:51):
There's times one department
you have another.
Somebody has got to write an email.
There's all these little friction
points to get to the output.
A lot of what I see a AI doing
is it's taking
and it's streamlining things.
It's making everything easier to get done
quicker.
And it's looking at these processes
and saying, oh, we could do it this way,

(35:12):
or we could do it that way.
So I think it's a lot of little things
going into organizations
that are allowing them
to be more efficient and they're more.
Efficient and they're cheaper.
But I guess
I guess might like
that's to me,
that's just still
what we've been doing for decades
is we've just been automating.
We've been just making processes

(35:33):
more efficient. We've been doing that.
Is there something that AI is
is making better?
Because here,
I'll give you a great example.
People talk about like
the leasing process. Right?
We all have to go through.
It doesn't matter
what kind of real estate you're in.
You have to get people
into your property.
And with us,
whether it's apartments,
it's constant, right?
It's daily, daily.
We're having to get, you
know, dozens of people through the door

(35:54):
and people have really turned to
AI and automation for that,
for the whole process.
So you could
actually get somebody leasing
without even a person,
a single person talking to them.
They could set up an appointment.
You can have, you know,
codes on the door,
you can have facial recognition,
you can have all these different things.
You go through that.
But at the same time,

(36:15):
we actually found we were
we were pushing automation.
But then we found
when we called somebody,
when we had an actual person
call somebody to set up the appointment,
our conversion rate was like five x it,
as opposed to this automated process
that we were using with the, you know,

(36:35):
you can call it AI and stuff.
So like
it wasn't
making the actual process better,
it was just making it
more efficient and cheaper.
So but did it make it better
for the people that we're selling.
So we have sales teams out here.
We did the same thing.
We actually I want to call
first call right. Do it.
They're better at their job
because of those things.

(36:57):
So I think it it's like is it better?
Well first of all the individuals
and leveraging it right.
That actually makes you better.
Better data set better,
abilities to analyze.
And so if you're giving the right person
an a powerful tool,
the outcome is going to be better.
Now.

(37:17):
I mean, if you're talking like
just no people at all,
that it replaces a person, is it better?
I think that's a totally different way
of looking at it or or discussion.
Well, and I think too, with the,
you know, talking about sales calls
and things,
things like that,
you know, you can use the I
if I'm a sales agent
and I'm not sure
in a voice mode of ChatGPT

(37:38):
and I'm going to type
in there in the prompt.
Okay.
You are acting as a,
hard to sell customer
that is going to raise objections.
Let's have a conversation,
that I am trying to sell you and
and I want you to be a hard sell for me.
And that trained your sales person
to then do that. Now, another thing.

(37:58):
Kyle, talk to what you were talking about
in terms of,
you know, automation and processes
is the next big thing that I think
we're going to see on the horizon
with AI is what we call a genetic AI.
That's just a fancy way
of saying the rise of agents.
And so the rise of agents
would be doing things like,
you know, really practical.
I want to, book a trip to, to Nashville.

(38:20):
Okay.
And so the agent, you
tell the agent to do that.
Okay, they're going to explore your,
airline options, your
hotel options,
and it's going to make
all all of those bookings eventually.
Now, are
they had a place that
they can do that now.
Absolutely not. Right.
Who would want to
who would give you a credit card.
Something like that. Right.
But eventually

(38:40):
that is going to be where it is
and that is going to take that process
to a whole different level.
That's not
just, you know, making the easier
and all of that,
but it's also going to be,
you know,
saving time and money
in so many different ways.
So I don't know if it's going to be it's
an interesting time to be alive.
That's a good example to see.
Like it wasn't that long ago,

(39:01):
like in my lifetime
where that was
the only way you could book
flights and hotels was through an agent.
Right?
Like like
we didn't have access
to be able to just go
and look this stuff up ourselves.
You had to call up a travel agent
in order to to book your,
your flights and your,
and your hotels in your old,
your trips and, like,

(39:21):
just the process of,
of going through that now flight.
You know,
these travel agents
still exist, obviously, but,
they're they're few
and far between,
as in,
people are saying that real estate agents
are going to go that way now.
Yeah. My, my my thesis.
And we've talked about this on this show.
It was a long time
ago, was a year or two ago.
But my thesis is, that

(39:44):
oh, look at look at that.
Rob is drinking out of his drunk
real estate mug. I love it.
There you go.
Hold that up. Everybody that's watching.
There's there's the drunk
real estate mug.
If you if you
if you do an opening, song for us, I'm
saying that like,
so no, my, my thesis is,
that,
as we see a level, more level

(40:05):
playing field,
as AJ was saying earlier
and as Rob was saying earlier,
we're going to see the ability
for smaller teams, people with less
experience, people
who don't have the pedigree
coming in
and being able
to do the same thing
that the big boys do,
they're gonna have access
to the same information.
They're gonna have access
to the same research.
They can have access to the same tools

(40:26):
to do underwriting.
They're going to be able
to write the same offers.
And basically differentiating between,
a deal
that I'm trying to buy and
black Stone or again, black Rock.
I forget which one is real estate.
They want to go in and buy the same deal.
We're going to be competing.
It's going to boil down to one thing
cost to capital.
They're going to be able

(40:46):
to get the same research
for every market in the country
right now.
Probably the reason
I don't know this for certain
I'm making this up,
but I'm guessing the reason
they're not competing with me
in some of the small towns
where I buy real estate is because
it's just not worth it
for them
to have expertise on that small town.
But once you have a and agents going out,
being able
to do the research and and

(41:07):
determine automatically,
what offer makes
sense, they're going to be able
to make offers on the same thing I am.
And again,
the only thing that's going to determine
whether they get the deal or I get
the deal is
who has cheaper cost to capital.
And the big boys are going
to have cheaper cost to capital.
And so my concern is that moving forward,
this is actually going

(41:27):
to be a huge advantage
for the big players.
Yeah.
And you know
that's exactly right I think
because you know, for so long
for the mom
and pop real estate
investor, the fragmented
nature of real estate investing.
Exactly what you're talking about
J being in the small town, knowing,
you know, the ins
and outs of that community, you know,
one street over,
you know, the invitation homes and

(41:48):
and the big institutional investors
didn't have that.
And that was the advantage of the mom
and pop real estate investor.
And now they are going to have that
because they're going
to have the resources, both human and,
financial resources
to put that I and to play.
And I agree with you
that, you know, it's going to be,

(42:09):
competition now, more competition
for the mom and pop
or even for the mid-level investor
to compete
with the institutional investors.
So it'll be interesting to watch, to see.
I think to this what you guys bring up
is a really good point,
because first of all, technology
always does this.
Like it disrupts, it comes in

(42:29):
and it can actually fractionalized
industries at first.
But then what happens is the big boys,
they get those same advantages
and then they have the money
to buy the innovation.
And so what they do
is they buy out those competitors
and those people
that are doing really good
and then they utilize their leverage,

(42:50):
which is like Jay was saying,
that cost of capital to consolidate
efficiently ran businesses and shops,
and then it rolls up.
So technology, even if it disrupts
it first,
is always a point
that blends to consolidation.
It always does so like capital leverage
and capital right lends to consolidation

(43:10):
because like I was talking
about cost to money.
Same with technology
like the internet came in.
Oh now everybody can compete
online, right?
We can all start up our own stores.
We don't need Walmart.
Well, guess what happened.
All the mid-sized companies went away
and now you just have Amazon.
So it actually consolidated everything.
And Amazon,

(43:30):
even though there was some
fractional ization of sellers
and how they sell everything else,
it's still made one mega player
because what they do
is they turn it into infant structure
and the infrastructure of the technology
that is made in those industries
we all have to utilize.
And so I, I agree, I think at first

(43:51):
it disrupts
it empowers, it increases margins,
but then it moves to the next phase
and it goes through consolidating.
And then we don't get yield.
That's what the internet did right.
Like phase
one of the internet was amazing.
So the internet,
phase one,
especially through
the 90s, was optimization.
It made firms boom.

(44:12):
It made like a firm
like us in the brokerage firm.
We could compete with the big boys.
Then I started to do role models,
the smaller than us,
but it made access everything better.
Right then we all got bought up
and because then the companies
would pay so much for us,
well then internet 2.0,
all it was was consolidation.
All you did
was have these big tech companies

(44:33):
just buy everything.
So it didn't produce anything
except social media.
So all it did was produce
lots and lots of billionaires.
It consolidated
the internet amongst amongst five people.
So the actual thing
that created the productivity,
the fragmentation within the industries,
the startups,
the everything else ends up

(44:54):
maturing into a consolidation.
And it's a winner
takes all with technology.
And so I think that's
what you will see what they are.
It'll go that same normal course
because I a data game that's what it is.
It's a data game. That's it.
So whoever has the most data
AI is more powerful.
It's simple.
You, the bigger your data sets,

(45:16):
the more powerful of an AI
you have, right?
And so when you look at it,
I doing this functional part of process,
the systems,
everything else, that's great.
But then what happens
is even in a company like ours,
I'm literally
going out
and giving services for free,
and we're trying to buy up companies
just to pull data in
so that we can now
analyze it and make it more efficient.

(45:38):
I mean, we talked about that before
how like the the future of the
AI is actually just the, the data.
Right.
Like people have to
are going to have to start
owning their own data.
We're still in a stage where,
where a lot of these models
work on public data
and public access to data,
but then all of a sudden,
I've always said this.
And like
if any one of
the parties is paying attention,

(45:59):
I don't understand
why your
costar Acxiom metrics,
these big, big boys with all their data
like that's going to be their bread
and butter.
They're focusing on
all these other things right now.
Their focusing on like building
these little offshoot programs
and doing all this stuff.
Like you just have to focus on
like proprietary data.
And if you have access to that
and people are going to need it

(46:19):
in order to train their models
and have good models.
And to me, that's that,
you know, like
we we already discussed it before,
like that's that's
where the big business is going to be
is selling data.
And someone like Google is going to be
and invest in it.
We got to wrap this up.
We've got to move on to the next stage,
but I do
I feel like
we can't have a conversation
with AI without talking about doomsday
with a

(46:40):
someone who who spends a
lot of time with AI. So, Rob,
what what is the risk
and what is our
how many minutes to midnight
are we from this?
You know, general,
what's the the general AI intelligence?
What's the AIG or whatever it's called?
AGI. Yeah.
Superintelligence.

(47:00):
What what likelihood
are we at to that point?
And if that does happen,
are we just screwed or are we,
or is it something
we don't have to worry about as much?
Yeah.
Well, you know, in terms of AGI,
you know, first
they have trouble defining
what it is in the first place.
And secondly,
you have predictions all around,
when it's going to happen.

(47:20):
Some people are saying 2 or 3 years out,
I think they just did,
one of the latest models to come out past
what they call
the Turing test
was where they put the computer
in front of a bunch of people.
And can the people tell
the difference between
whether it's a computer or a human being?
And, most of the people
could not tell that it was a computer.
So, I think we're quickly going that way.
I think it's going to be, very quick.

(47:42):
I think, we'll reach
AGI here
in the next five years or so,
where the computers are smarter
than, say, a PhD level, person.
In terms of their knowledge
and their ability to reason.
When we get to superintelligence, that'll
be a whole new,
thing to think, to get into.
And another scary aspect of it.

(48:03):
You know, the real part is, you know,
if this gets into the hands of,
bad actors, you know,
I mean, what if,
you know, North Korea,
let's say,
gets this
and is able to do something with it and,
you know,
how do we prevent that, prevent that?
And, you know, that's for, people
a lot smarter than I am in terms of,
what we need to do to protect all that.
But, you know,
we see it already happening.

(48:25):
We have a,
you know, a chips race,
you know, going on between us and China.
And, you mentioned deep seek earlier,
you know,
deep sea,
came around
and, you know,
a lot of people have said
that deep seek
has been funded
by China itself as a, open model
and that it's, China's response to, the,
the chip,

(48:45):
restrictions that the United States
has put on in terms
of selling those to China.
And so,
you know, all this could end up in World
War three for all that we know.
So, I'm not,
sticking my head in the sand and saying,
you know, hey, there's no danger.
I think we got to be very careful.
We need to, tread carefully for sure.
Well, let me just add one thing.
You talked about the Turing test,
which is,
whether people can tell

(49:06):
if you're talking to a computer or not.
Everybody always wants to ask
the question,
how quickly are computers
getting smarter?
But we're not asking the question,
how quickly are people getting dumber?
Because isn't that going to play into it?
Also?
You already see all these guys
on these dating sites.
They're,
they're getting fooled by these bots.

(49:28):
That's exactly right.
That's exactly what I was thinking
when I said that. So funny.
All right, well,
you mentioned World War three there.
I think.
I feel like
it's a good segway into something else
that's been going on.
I don't know
if you've been paying attention at all,
but there's
this big, beautiful word
might be the best word in the dictionary,
called tariffs.

(49:48):
And we would be remiss
not to talk about the elephant
in the room at this point
because,
the United States imposed wide sweeping
tariffs across the world from 54% tariffs
on China to the minimum of 10%.
That's that's the minimum.
So it did.
Everybody was the minimum of 10%.
Even on an uninhabited island country
full of penguins as well.

(50:10):
So, they're debates
as to what
the end result of these tariffs will be.
But there's no denying
what the immediate reactions
were with countries
implementing counter tariffs
and the stock market plunging nearly 10%.
With nothing to do with the jobs report.
So, AJ,
why don't you just give us a little
a quick perspective of what's going on?
We'll try and keep this relatively quick.

(50:32):
Yeah.
So we talked was that last week
where we were like, well,
we're going to announce this, right?
The big thing is going to be
tariffs are okay.
So it it came out.
It's changing all the time.
So by the time this comes out
it's already going to be different.
We have
how many countries have already
now we've we've got
lumber has been taken out.

(50:54):
We've gotten
I mean it's
like they're making exceptions.
I mean he didn't
he didn't
impose any new tariffs
on Canada or Mexico.
And that was like the only two countries
because our he's like,
I won't worry about them.
And now we've got
they've met with six countries as of now.
And Europe came back and said zero,

(51:15):
we want to actually go and do no tariffs
at all.
With you.
So this is changing so fast
by the time it comes out.
Right.
Well, but essentially broad sweeping,
tariffs against everybody.
The only one
that's really dug in hard
besides the Penguins was China.
And,

(51:36):
then Trump just came back immediately.
I was like,
all right, well, up to 50 something.
But the Chinese tariffs
as of today are like 100%
or something crazy.
Like I think that's their their wait
until the ninth.
So they were
recording this on the eighth.
So it might be as of tomorrow
they might be up to 100, 104%.
But actually I read
something very interesting

(51:57):
because here's the thing.
The reason
the tariffs
can be very effective for the U.S.
is because we do run a deficit
with most countries.
I when I say
like most countries that matter,
if you look at that sweeping list,
all of those 10% countries,
it's funny
because the way they calculated
that tariff thing,

(52:17):
they weren't actually tariffs.
They were just factoring in our deficit.
All of the ones that were 10%,
were actually countries
that we are the opposite.
We they run a deficit to us.
And we
couldn't put negative
that they had negative tariffs
against us.
So he just put 10% is kind of
if that's why
if you look at their their list

(52:38):
you're like why there's so many 10%
that they actually have
by their calculation
would have been
negative tariffs against us.
So they put 10%.
But anyway,
so the point is, is that if we put a 54%
tariff on China,
if they want to put a reciprocal 54%
tariff on us,
it doesn't really matter
because we import, you know, five x

(52:58):
as much from them as they import from
from us.
So like they're going to feel it
a lot more than not.
So but
but what you're seeing though
is actually
what China started doing
is they realized that they're
they're not going to win that race.
So they're starting to do
kind of a little bit
more guerrilla warfare, right?
So they're doing stuff
like what is what is China

(53:19):
have that the U.S. needs
and what does China have
that the rest of the world
doesn't really have as much.
And that's
rare, rare earth minerals, right.
Like that's the big
one of the big buzzwords these days.
Rare earth minerals.
So electric cars,
silicone chips,
all these different things,
they all need these rare earth minerals.
Well, China does like 90% of them.

(53:41):
And so they've actually
started doing things like,
they didn't
Strato block the US from acquiring these.
But what they did is they
put on the list of you must get a license
in order
to import these rare earth minerals,
from China for the all these U.S.

(54:01):
firms.
So in essence, it's blocking them.
And so they're starting
to do these kind of other tactics
because they realize
they can't win a straight
up trade war with the U.S.
And so I just thought
that was interesting
that like someone like China,
where everyone else
is going to run to the table
and they're just going to try
and negotiate something.
But he's been he's

(54:22):
been really tough with China
and they're having to turn
to new tactics on this one. Yeah.
This is a direct attack
against two competing world powers.
That's what this is. The top. Two.
Yes. Yes.
When you look at all the other countries
you have negotiations.
There's
some specific things are going after
they're doing that.
And China though
is the one where it's like meant to hurt,

(54:45):
like it is our competitor.
And I believe that's
just kind of how they look at it.
Like it's no.
And then China doesn't
want to show weakness.
That's a big problem
because they're the
competing world power.
So you can't show weakness.
And so they're kind of doing this whole
and they also dumped our bonds
or a huge amount, of bonds.

(55:06):
And that's a big.
Flip to like
if you remember the first time,
like when we just did those 10% tariffs
and we talked about this on the pod,
like China was very meek
in their response. Right.
Like they were
they were kind of like, oh we're going to
well what did Jay say.
We're going to
we're going to tariff chicken feet.
And like it was like
it was kind of like a,
like a few like things
that were not that significant.

(55:27):
And oil exports
and like
it was an energy and chicken feet
and but now so
now they're like really like,
okay, I guess this is war.
But the problem China has is,
for all intents and purposes,
China is like almost in a depression.
I mean, they have a literal housing,
the equivalent of 2008 crisis.
Their deficits have been skyrocketing

(55:48):
as they try to jumpstart their economy.
Their growth has been cut like in half.
And they have
you've seen as that's been going
on, they've invested a lot more into,
military. Right.
And so they're doing all the traditional
things that are maturing economy
that's slowing down.
They're they're, you know, are is doing.

(56:09):
So the point is though,
they're in the middle of this
like they're in a
their economy is moving
from this old economy
to a maturing economy
that's more on par with the big boys.
Right? When this is happening.
And they're finance, like,
you look at their currency,
what's happening with their currency
and everything else.
So China is in a

(56:29):
like if you're playing chicken
with us, it's
they are in a much worse position.
So it makes me wonder
how like how much are they going to dig
their heels in like,
and can they and how much can they do.
I guess,
I guess that
when it comes down to a country
like China,
like if you look back at their

(56:50):
even like relatively recent history,
like they're kind of
used to going through tough times,
like their, their society and like it's
not like
they have a democracy where like, okay,
if their administration doesn't do well,
they're gone in three years.
Yeah. Don't just let the people suffer.
Right.
And and they're used to suffering
verses like, we are not.

(57:11):
And not only that, like
they also have the message of like
they're the oppressed
and we're the oppressor.
We don't have that message.
And so like I feel like
in these situations
you're saying I keep bringing up
Canada, obviously,
because being you know,
I had my whole families talks about it.
But like the Canada's treating
like they're under attack
and like they're you

(57:32):
can you can withstand
a lot more suffering
as a country
if you're banding together and, and in,
in, you know, a solace of like,
we are under attack, right now
versus the U.S. right now.
If we start seeing our eggs
go back up another,
you know, double in price again,
we're going to revolt.
So I like I don't like I don't know,
like when
when you say

(57:52):
like a game of chicken, I don't
I don't know who. Would win that.
But the problem is
that commodities are dropping
because of that.
Like, it's one thing
if you slap a 10% tariff on growth,
nothing else changes.
You're putting tariffs on
and you're
contracting the worldwide GDPs.
So like everything from lumber to feed to

(58:14):
eggs to right, we've got
what else do we got up here.
Steel prices too like I mean
going down.
So all of a sudden you're like yes
tariffs are inflationary.
But you know what's deflationary.
Recessions.
And depressions.
So all of a sudden
if you're saying if he's saying this

(58:35):
but yet Americans are like okay,
we may have 1 or 2,
but overall
things are actually getting cheaper
because of not good reasons.
Like, it's not that they're good reasons,
they're getting cheaper,
but if they're still getting cheaper,
demand right.
Demand like that.
What? Like I mean, you brought up lumber.
Like the reason we've been
obviously we were in the middle
of doing a development and like

(58:56):
so we're really sensitive
to lumber and lumber actually went down
because to your point, people
are fearing a recession.
A demand is good.
Prices are a fraction of what
they were just two years ago.
Like, I mean, the commodities have gone
so far down and they're getting cheaper.
The reversal
in the last four months has been big.

(59:17):
Here's here's
what I'm still trying to figure out, and
I feel like I've got a pretty good handle
on the economic stuff.
But when it comes
to the geopolitical stuff,
I'm just an idiot.
So I'm I'm making stuff up
just like everybody else.
I'm not pretending I know anything.
But trying to figure out what
the endgame is here,

(59:39):
because we're hearing
lots of different things. We're hearing.
Okay, this is
this is an opportunity
to bring manufacturing back to the US.
We're hearing
this is an opportunity
to increase revenue
so we can get rid of the income tax.
We're hearing
this is a way to drop bond rates
so we can refinance our debt
more cheaply.
And so but the.

(01:00:00):
New world order J all.
Three.
Our national security.
Of our national security.
That's a great good point.
Rather Rob
like that's that I to me
that is one of the best reasons for this.
But I feel like we could accomplish,
well, but okay, separate from
that not knowing if

(01:00:21):
it really is all three,
unfortunately, they're somewhat at odds.
So let's take, the manufacturer thing.
So we want to bring manufacturing
certain manufacturing back to the US.
But here's the problem.
To do that,
we need to keep tariffs
and in place long term,
because the reason for tariffs is it

(01:00:43):
makes it cheaper
to manufacture in the US.
If we get rid of tariffs
at any point in the future,
it now becomes cheaper to import again
and we just revert back
to what we were doing.
So the only way to do
this is actually keeping
tariffs in place.
Which is the whole reason
that there's no oil refineries anymore
because the U.S is trying
and all these countries are saying
we're going away from oil
and oil refineries are a 30 year,

(01:01:05):
cycle of of making money
and no one's going to build them. Right.
So like it's the same thing.
To your point,
no one's going to build in the U.S
if they think the tariffs are going to
just go away. Yeah.
And so I it's hard for me
to buy that argument
that it's
going to bring manufacturing back.
I love the argument
or not even love the argument,
but I love the idea of using tariffs
to bring the important stuff back.
Pharmaceuticals, weapons,

(01:01:26):
electronics, chips
those are the things that are important
to national security.
But to to put a tariff on,
on cheap plastic crap from China,
as I like to refer to it,
I just see no value there
because we're never going to make
that less expensive than China does,
and there's no reason for us to even try.
And so we're basically just building

(01:01:48):
trade barriers
and creating trade wars for no reason.
The whole idea, I.
Think they're pushing it though,
because you're right. And China.
But Mexico, they can do it.
So like
I think
that's a lot of it
is like literally once again,
just to hurt China.
It's like we may not even take it on.
We want it to go elsewhere.

(01:02:08):
Yeah.
And so
and then you look at the,
the whole as a, as an opportunity
to, to lower yields
so that we can refinance our debt.
The problem is,
I mean, we can take the very simplistic
view of you crash
the stock market and bonds come down.
That's great, except
that's not the reality.
The reality is,
if you crash the stock market on purpose,

(01:02:30):
people don't buy bonds.
We had the first Treasury
sale of bonds today,
since tariffs went into place
and it was a very weak auction.
Nobody wanted to buy bonds
because everybody's,
like, scared to buy U.S debt.
Then you have.
And the
ten year treasury
went all the way back up to
we were down below four there guys.
We just China sold off the bonds.
So China

(01:02:51):
China sold off all the bonds
and flooded the market.
Well that's part of it.
It's that people aren't buying bonds.
The currency
our currency is, is is being developed.
It was being devalue.
Our currency is dropping,
the value of the dollar is dropping,
which is going to make it
less incentivized to buy U.S debt.
The other thing
is that normally the reason why we see

(01:03:11):
you take money out of the stock market,
you put it into bonds and bonds go down
is because we normally see
large investors
moving money
out of the stock market first,
and large investors
are going to take that money
and they're going to put it into bonds.
The problem is small investors.
Kyle, I'm
not saying you're a small investor,
but if you have a 401 K
and you're taking $2,000

(01:03:32):
out of your 401 K
out of the stock
market,
you're not going to go out of your way
to move that into bonds.
You're just going to leave it
sitting in cash.
And these days,
we have so many mom and pop investors
that are moving small amounts of money
out of the stock market,
that they're just doing the
the easiest thing they don't understand
putting money into bonds, how bonds work.
So they just leave it in cash.
And so we're not getting that,

(01:03:54):
that, that demand for bonds
because money's
moving out of the stock market.
And so I think the whole idea
that that crash in the stock
market to reduce bond
rates just isn't viable.
The whole idea of, of
we're doing it to raise revenue.
So I know I think it was
let Nick, the Commerce secretary,

(01:04:15):
who was saying that
we're going to raise $700
billion a year in new
income from tariffs.
Well,
are we really going to do that long term?
That's a tax hike.
It's businesses and U.S.
consumers
that are paying that $700 billion.
And so do
we really want to put a $700
billion tax hike on U.S.
businesses and consumers long term?

(01:04:36):
If the answer is yes, that's great.
But let's just
let's just do a tax hike
and not start a global trade war.
I mean, there are easier ways to to
to put a tax hike on businesses
if the goal is just to raise revenue.
And so my,
my long story short is
I keep hearing all these reasons
why we're doing this.
None of them
kind of makes sense to me on their face.
Maybe there's something I'm missing,

(01:04:56):
but I just feel like
it'd be so much better
if the administration would come out
and say, here's our endgame,
and if it's secret, great.
Then say, look, it's secret.
We're not telling you.
But they they've been very open.
I had a whole interview
where he talked with,
Fox News and he went through
and it was the three categories.

(01:05:16):
He's like, we're
we're using tariffs to raise money.
Right?
We're using, to try to protectionism.
We want to protect our industries, right.
All that kind of stuff.
And then he was very open about it.
We're using it to,
To negotiate better deals.
Negotiate better deals and like.

(01:05:38):
But but I feel like they're okay.
Maybe they're telling us,
but they're also lying to us
about a lot of things we kept.
We've been hearing for months.
It's all about we don't.
We're being treated unfairly
and we want the same tariffs on us
as we have against them. Vice versa.
We want whatever it is.
But over the last couple of days,
what we keep hearing is

(01:05:58):
it's not about tariffs at all.
It's about trade imbalances and,
and and I think it was bezzant
that went on on Fox News today
or yesterday and said,
or no,
it was Peter Navarro who went on Fox News
and who said no,
zero tariffs were both sides.
That's not enough.
We need equal trade.
We need to get rid

(01:06:18):
of the trade imbalance.
And so suddenly we've gone from
it's about tariffs to now
it's about
we can't have a trade
deficit with these other countries.
And so it.
Gets about both though I don't
I don't think those are exclusionary.
I think because one
doesn't mean you don't.
There's a lot of reasons
to do these things.
And I don't think because we have one,
that doesn't mean

(01:06:38):
the other one doesn't exist.
I'm not saying I'm for it.
I'm saying what they've stated, though,
and their approach to it,
is kind of that multi-tiered thing
where they've been very open.
They talked about it,
which I think some short sighted at best.
But really,
I think to the overall revenues

(01:06:59):
they can drive,
which first, to be honest,
I was like,
that is ridiculous because of the cost.
Now I'm actually going, well,
I guess all the prices are going down.
So because you're tanking the economy,
so all of a sudden
if prices are going down
yet they're getting tariffs from it,
the consumers aren't getting hurt.
In fact, they're it's helping them.

(01:07:20):
And we're raising capital that's well,
that's interesting.
The yields on the bonds went up today.
We'll see if they come back down though.
But overall slow economic growth
will drive people to bonds.
So I think, you know, if we look at it
and say, okay, maybe that'll work,
maybe it'll not,
we'll see what the market will do.
But then the negotiation part,
which that's clearly working,

(01:07:42):
because people are reaching out to them,
which I think that's more of a driver
for Trump than it is
other people in the administration.
Because that's how he does things,
like, I'm just going to nuke you,
and then
if you don't want it,
then come back to me
now, beg for mercy
and I'll get what I want kind of thing.
So the bully approach, and, so
I think it's, it's a mix of those,

(01:08:03):
which I agree with you,
like some of them are very short.
We're not going to compete
in some areas.
We're just not.
And we don't want to
we don't want to do, by the way,
a deficit. Okay.
It's not bad that we have deficits.
That's not a bad thing.
It sounds bad because we say deficit,
but it's not a bad thing
if we're getting what we want.

(01:08:24):
What Warren Buffett has,
Warren Buffett has the best quote
I have a deficit.
I run a deficit with my dentist,
I pay, I pay him lots of money.
He never pays me anything. Yeah.
Now there's other things that is like,
okay, manufacturing stuff
could come back.
I mean, we have steel and aluminum.
So until this, I didn't realize
we have these plants

(01:08:44):
that we're really not utilizing.
So as of right now,
we can increase in the United States
our steel and aluminum production
massively, but yet we're buying it
cheaper overseas
that are literally discounted.
And yet automotive parts,
aerospace and defense,
industrial equipment and some textiles.

(01:09:06):
We have infrastructure,
things like consumer electronics,
pharmacy, semiconductors,
solar batteries.
We don't have infrastructure for that.
So even if we wanted that, if we said,
all right,
we want solar batteries
or consumer electronics
to be built in the United States,
we actually have to
build the infrastructure to get that.
You don't slip on a light switch.
It doesn't work that way. Right.

(01:09:28):
But there's other industries
that actually
they're literally sitting around
not at full capacity.
So it seems like
that should have been obviously
done more.
What if we're getting too
granular on this?
And I think it's more along the lines
of like
someone like Trump will look at
the entire world and,
probably as a,

(01:09:48):
you know, like a stoplight system
where we have like green or our friends
where we're very
we do a lot of trade with them.
We like them.
They're,
you know,
NATO members, all these people
yellow where they're kind of just like,
okay, maybe the third world countries,
we do some trade, we don't really care.
And then red, we have like China,
we have like,
you know, North Korea and Russia and like
and then things like that

(01:10:09):
where we're, we're
probably would be considered
adversaries, with
and but if you look in general like,
what do we provide the world
and what does the world give back to us.
Right.
And we basically as a country,
we keep the entire world economy afloat.
We keep it running.
We provided liquidity.
We have all the systems

(01:10:30):
we run, all the systems
we make sure all of that's you,
we all the repos reverse, reverse.
We make sure that everything in the world
economy is running.
And we also world
police that to everything
that's shipped around.
We provide military support for all that
we do
all of these things
for all of the countries
all over the world,

(01:10:50):
and all they do is sell shit to us.
And our taxpayers want the cost of that.
There's not a single country
on the planet
that wouldn't trade places with us
if they could have the reserve currency.
Don't.
I mean, you talk about
we have to do all this stuff,
but we we we get the greatest benefit.
The benefits
we get so far outweigh

(01:11:10):
those things that you just mentioned
that any country on
the planet would trade places with us
if they could have the world, if they're.
Not us
and they can't, that's
not even an option. So it doesn't matter.
And that's
my I'm
just talking about the fact
that we are
in a better position than they are.
Just because there are these negatives,
we make the.
Cost our taxpayers

(01:11:31):
astronomical amounts
to have these things.
I mean, this that
the world defense, US policing, the
the literal world and this is not free.
And I think it worked
when we were a growing
economy
where our economy was just booming
and we could just get cheaper,
more productive,
we had a full labor force

(01:11:52):
and we could discount
and we could pay for all of these things.
We went to other countries and took out.
That made perfect sense, right?
And it was like, okay,
it was better, but we're not.
That's not our country anymore.
We're not a country
that was back in the 60s,
70s, 80s and 90s.
We were just not there.
So that cost now
with our debt, everything else.

(01:12:12):
The problem
is that that mode of operating
is not only not working
for the United States,
because the consumers aren't
benefiting anymore from it.
They're not getting more today.
Yet our cost are still rising.
And I think that's the problem.
Here's my biggest fear from all of this.
And again,

(01:12:32):
I'm not a geopolitical strategist.
I'm making this shit up.
But my biggest fear is that
the damage has already been done,
that we may have every country
on the planet
come back to us,
willing to negotiate,
willing to give whatever we ask to, to
to give in to every demand
we have, short term,

(01:12:55):
but at the same time,
they know that we are erratic.
We know that, that
we may do crazy stuff in the future.
And so short term,
they're going to tell us,
yeah, whatever you want,
we'll give it to you.
But at the same time, they have started
or they will start negotiating
lateral and regional trade agreements
with others
and start to reduce their reliance

(01:13:16):
on the US for exports,
start
reducing reliance
on, on, on the US for their imports
and start trading with each other.
And if they're going to start
to cut us out
eventually, that's going to be much,
much more painful for us
than it will be for them.
And everybody says the U.S.
has the biggest economy in the world.
There's nobody that's even close.
That's true.

(01:13:37):
But when you put everybody else together,
their economies are more than three times
the size of ours.
And so we can beat any other country,
but we can't.
It's the bully that, yeah,
nobody can beat up the bully,
but everybody can get together
and together they can build up the bulk.
But the problem with that
analysis is you're assuming
that the other countries
aren't being sold to.
They already are.

(01:13:58):
So if you take a country like,
Canada,
they're already
selling to other countries
and we still make up 75%.
So like
if we leave,
they just lose 75% of their economy.
They don't make it up selling to others
because they're already are.
Let me use an example.
So up until three weeks ago,
it would have been absolutely unheard of

(01:14:19):
for China, Japan and South Korea
because of their
their political contentions,
because of their geopolitical issues.
For them to be discussing
a trade agreement,
the three countries just don't get along.
And they've never discussed,
regional trade amongst themselves.
Two weeks ago, three weeks ago,
they started talking about
how they were going to put together

(01:14:41):
a trade agreement,
lateral trade agreement
between the three countries.
That's huge.
I mean, that's $200 billion worth of GDP,
not just GDP, but of trade
between those three countries.
We're basically helping
other countries
that never would have worked together
form alliances
because they are scared of working
with us.
Canada and China is another great example

(01:15:03):
kind of in China,
having historically worked together
because the Canada Canada
has had the U.S.
but with all this happening,
Canada is now working with China.
And so all of these countries
I agree with you
that that in the old world order,
that there isn't enough trade
to make up for what we have in the US.
But if countries that weren't
previously working together

(01:15:24):
decide that they're willing
to put aside their political differences
for for economic benefit,
we could get marginalized.
And again, I'm making this up.
I'm not
I don't have any data that supports that.
But I mean, that's that's
what I would be concerned about
if I were running this country.
So it's a little bit like with the moth,
with the monetary, with the dollar.
We had the BRICs, the BRICs nations.

(01:15:44):
And so what you're suggesting
is that there will be something
better than that
with even more cooperation.
The BRICs nations
really haven't amounted to much,
besides a lot of bluster about,
you know, attacking the dollar.
But, you know, here with these nations,
that typically weren't our partners
before maybe partnering.
But, you know, as I've listened,
Jay, I'm
a little surprised that you haven't been

(01:16:05):
a little bit harder
on these tariffs and
particularly with, inflation.
Last Friday,
Jerome Powell
was here in Virginia
up in Arlington, and, he mentioned that,
with these tariffs
that they were going to be,
when it comes to inflation,
immediate and persistent.
Yeah.
And, as you just hear the media, it's

(01:16:28):
almost like a foregone conclusion
that inflation is going to go, sky high
and that,
we're going to be in a, in a tough spot
because of this.
So I'm just
wondering what you guys
are thinking about,
what all this is going to do,
to inflation in the near term.
You know,
I kind of think, Jerome Powell
talked about in the Biden administration
that the inflation after, Covid

(01:16:50):
and feeding
all, the money into the monetary system
was going to be transitory.
My belief is that these tariffs,
if any inflation comes,
it's going to be transitory
because it's a it's
a one and done type thing.
You know, the.
Power to use used up that word.
Yeah.
He can never say that word again.
He's never allowed to say it again
because yeah yeah.
He's saying it's being persistent.

(01:17:11):
I'm saying it's going to be transitory.
Right.
But when it does come back
with a, with a vengeance, which it will,
if we, if these,
if these tariffs persist,
I don't think, I,
I don't think there's anybody who argues
other than maybe
the administration themselves,
that it will lead to higher inflation
and Powell is kind of

(01:17:32):
kind of up a creek in that situation.
Because what do you do.
Like he would
he would probably if
if it weren't for the inflation for this,
we would be for sure
dropping into a doing a quarter
point at least in June.
But can he do that if
all of a sudden we start getting,
you know, 3 or 4 handles on inflation?

(01:17:54):
I don't I don't know if he can so easily
the other.
Side of it like they are inflationary.
So tariffs are that's just what they do.
Right.
So by the way the
the the market
has priced in a 5050 chance
right about 50 5051, 49 right now
that that we'll see a, a

(01:18:16):
a rate cut in 28 days
the next, the next time, just.
Jay, did you did you check out,
last week for a short, brief moment?
That was in the 90s. Yeah.
And then it came all the way.
It seemed like. Now this is like this.
This new week is kind of,
you know, leveled.
Leveled off a little bit.
But that was up in the 90s.
Everyone was panicking that

(01:18:37):
recession is here.
And and now
as you could see, like everything
the the ten year bumped back up
the chances of a
of a of a cut went way back down.
But.
I think though
if we see continue what we see.
So there's two arguments here.
First of all it tariffs are inflationary
but they're still basic

(01:18:59):
supply and demand.
So at the same time
when you see
commodities dropping
because demand is evaporate
if they're outpacing anything that's
you know that impact especially on core,
then you don't get that effect right.
So it's true they're inflationary.

(01:19:19):
Unless you destroy the world's
economy in aggregate
demand drops
and then everything is so cheap
it's not inflationary at all.
In fact, it's a deflationary event. Why?
Because what you're doing
is you're destroying demand.
And so it can be very deflationary.
If you say, I'm going
to put a tariff on something
and everybody's like, I can't buy it now.

(01:19:41):
And the countries are like,
we're not going to trade.
That gets deflationary quick.
Because all of a sudden, if you.
Pray for that,
because that will probably be
reflected in rents as well.
And I don't I'm not saying
it's a good thing.
It's a good thing.
Our banks aren't going
to deflate our mortgage payments.
I'll, I'll I'll go way either.
So, yeah,

(01:20:01):
I just just to put a finer point on it,
I think Paul is going to be in.
No really potentially.
Not necessarily,
but potentially in a really tough spot
over the next couple of months because,
I mean, the fed has two jobs.
One is to keep inflation down
and two is to keep employment up.
And so if we see inflation going up,
what you would normally do

(01:20:21):
is you raise interest rates.
But raising interest rates
is going to be really bad
for employment and vice versa.
So the fed.
Has been sneaking.
It's been sneaking it.
Well and not just employment.
I mean if GDP comes in bad
at the end of this month,
I think I mean,
Powell seems to have enough
animosity towards Trump
that if Powell has to choose between,

(01:20:43):
what's happening with tariffs
like just the inflation from tariffs
or unemployment,
he would choose unemployment.
Well he could always just blame tariffs.
Right.
Like that's they could just be like
you could just.
You just say this is Trump's fault.
And I'm not going to take.
A try and say transitory again.
We'll see how we'll see how that goes.
Me here.
I was going to say the problem is

(01:21:05):
if it becomes clear
that this is no longer
just Trump's
fault, if GDP is down
and unemployment is up
and all these things are happening
independent of the stock
market going down,
I mean, the stock
market is not the best point.
It's still not Trump's fall.
This is this is just Biden's
economy just working its way through.
We have a recipe for,
the here in the s-word

(01:21:25):
thrown around from time to time.
You know,
we're going to have stagflation.
Well, you have a,
you know,
you have two administrations
now that are working against the fed.
Biden was spending, you know,
4 trillion a quarter, you know, over
and you had fed the polls literally like,
what am I supposed to do here?

(01:21:45):
Like I'm literally rising interest rates.
We're reducing the money supply.
And you're exactly making up for it
with government spending.
Then he's like, okay, now we got Trump.
The markets are like, yay!
We're going to cut out
government spending.
And he's like, I'm
going to give a 50% tariff on everything.
Now we're increasing
all the price of goods and everything.
And he's sitting here going,

(01:22:07):
you guys are fighting against me.
Like.
Hey, at least he's not.
He's probably thinking
it's been a nice reprieve
for the last month and a half,
that he's not in the news
every single day because, like, that's
we were
we were going through every single day.
Like every like it was like
the lead up into.
And Paul's face
every single day you would see an article
with Paul's face on it
and he's, he's not seeing yet, but he

(01:22:28):
we will like that's
I guess that's the thing.
It's, it's it's coming on less.
So I'm going to wrap this up with,
I think Jay's been jonesing a bit
to talk about this,
and I think we're going to talk about it
next episode.
Unless this administration
is just smart, like a fox,
and they're not playing their hand,

(01:22:50):
and they have a couple
aces up their sleeve.
And this is just a ploy
to get a new Bretton Woods agreement.
I've seen a lot of people
talking about this right now,
that this is just a
you have to do this to everybody
so that everyone will come to the table
and everyone come to the same table,
and we're

(01:23:10):
we're basically going to be like,
are you with us or are you against us?
And people are going to have to,
you know, I don't want to get into it.
But in the case of this to happen,
we need to devalue our dollar. Dollar.
There's a few things
that have to happen,
and they're lining up right now.
So maybe we'll talk about that next week.
But there is a chance that like these,

(01:23:30):
we already know that
some of these tariffs
are just a negotiation tactic.
And they could just go away.
And in that case
we don't really have to worry about it.
It was just kind of a temporary thing.
But
I think it's worth exploring
the fact that maybe the end game is more
of a, a total end game than just as Jay
was mentioning.
Okay, the end game is different

(01:23:51):
for China than it is for Canada,
than it is for Europe,
than it is for their different tactics
for each one.
Good agreement. Jay.
Yeah, I'm
I'm I've wanted to talk
about that for a few weeks and
so let's do it. Cool.
You know what the best part.
Of waking.
Up not having Mauricio here

(01:24:12):
is that I can just do this top ten.
And and I don't have to feel
any animosity against it.
And so I could just do
whatever one I want.
And I did think about saying the top
ten episodes that,
of our podcast
and then just listing
the ones that Mauricio wasn't in.
But I'm not
going to be spiteful like that

(01:24:32):
because I did see a pretty funny article.
I want to talk about it.
Hold on one second.
Kyle, I have a caller that is coming in,
that wants to talk.
Just, you know, I agree.
I wouldn't put that past Mauricio.
Did you do that? Like.
Oh, I'm not let that go.
That would have been hilarious.
That would have been.
That would be great

(01:24:53):
if he played both sides on it.
But, there in
history, there have been scenarios
where people had to get around
things like,
tariffs and trade embargoes and,
sanctions and things like that.
And so trade didn't stop.
Trade just got a little bit weird.

(01:25:13):
And so I went through a list
and I'm going to say
the top
five weirdest trade deals in history.
So I'll, I'll start this off by saying
I'll start this off
with a lighthearted one.
Lighthearted one is zoos in the U.S,
how are.
Getting traded to Hershey from outside?

(01:25:34):
Actually, I think it traded
quite a few times.
The, the only the good one actually was
when I was playing,
I was playing Syracuse, New York,
and I got traded to Anaheim,
the weather wise.
All right, zoos in
the U.S are prohibited.
From.
Buying zoos like a zoo.
Oh, zoos. Okay.
I thought you were just being derogatory

(01:25:55):
towards Jews there for a second.
I was about to be insulted
by Jay.
Jay turns off his Jay's okay.
He's got a pile canceled here.
Really, really quick.
Okay?
He becomes a Jew when he
wants to be offended. Yeah.
So zoos in the U.S are prohibited
from buying
and selling endangered animals

(01:26:15):
without a hard to obtain permit.
It's it's
it's apparently a big thing,
but a loophole that they found is
there's nothing
prohibiting them from trading
endangered animals.
So apparently they do it
all the time, to the point
where the last one that I saw,
the one zoo, traded 800 mackerel
for 12 puffins.

(01:26:38):
So apparently that's just a thing that.
They they
got the better side of that deal.
Yeah, they they
they they deal in endangered animals.
As far as, trade things.
Another great one
between the,
Thai government and Lockheed Martin.
And and you think this is back in like,
you know, the 1930s or something?
No, this is in 2005, 2005,

(01:27:01):
Lockheed Martin, the Thai
government made a deal
for fighter jets
in exchange for frozen chicken.
The quote from the,
the Thai government
was, they both have wings
and they can both fly
when they were asked to comment.
So that was an interesting one.
Sticky rice from Thailand.
This is back in 1996,

(01:27:21):
the Indonesian aviation company,
they traded two cargo planes for 110,000
metric tons of sticky rice
and sticky rice.
Pretty good though. Okay.
That gets there's something different
about that sticky rice
than just white rice.
It makes everything a little bit better.
All right, we'll go down.
The last one's awesome.
So let's get I'm going to

(01:27:42):
leave that one to the last one.
If you can guess it, after one
Zimbabwe, we,
one of the world's leading
tobacco producers.
It in
1987, it traded, cash crop for computers.
So it did a swap for tobacco

(01:28:03):
and a crop of computers.
That's how
they got their computers there.
And then the final one.
You want to make a bet, AJ.
Is that France sold a carrier to Brazil
for coffee beans.
That that wasn't
I didn't put that on the list
because I already had carriers.
Like I didn't want to do too
many of the same, like, yeah,
I mean like stuff for for basically

(01:28:24):
large weapons.
It's not only aircraft carrier
that they ever had.
They traded for, coffee beans.
So this one,
it was the apparently like
the largest deal,
PepsiCo 1990
did a $3 billion deal
with the USSR to swap Pepsi.
So Pepsi,
Pepsi concentrate
for a combination of vodka, 17

(01:28:47):
submarines, a cruiser,
a frigate and a destroyer.
So maybe, maybe, maybe the
U.S government
should have Pepsi, like, defending us.
And apparently.
So. So it was.
It was the USSR.
A lot of these were on the list
were the USSR
because like
like sanctions and stuff like that

(01:29:08):
and they had to get around them.
And Pepsi
apparently like Pepsi did a lot of deals,
a lot of different ones.
I could have
Pepsi could have had the whole top
five there.
They're very there.
They'll take anything, apparently,
in exchange for Pepsi.
So there you go.
Jay, you got any hypothetical situations?
If not, I have one.
I have one that I just thought of. Okay.

(01:29:30):
And it's going to be a little different
for the three of you.
AJ 200, 200 million.
But you and your family
have to move to France,
and you can never leave the country.
No. France.
Oh, the French. Oh,
that's.
That's why
I picked French for a trip down there.
Okay, Kyle, why do you do it?

(01:29:52):
50, 50,000,050. Ooh.
Okay. 50 million.
There's a catch here.
You and your family
have to move to Greenland.
You can never leave the country, but
if Greenland becomes part of the U.S.,
you can come back.
That's true.
I wouldn't subject my family to that.
I'll subject things like we're.

(01:30:12):
I'll take it on the chin for myself.
But 50 million is not enough to me.
To me?
In order to move somewhere
like Greenland,
you need enough money to create,
like, your own little city.
But again, my trust.
If you trust Trump that it's
going to become a U.S.
territory, you just.
You can come back to the U.S.
Yeah, I don't
I would take the 200 million
to live in France though

(01:30:33):
as your part and put a trust.
That's why I didn't give you that one.
Okay.
Rob 50 million Australia.
All right. Oh, yeah. Might.
I ask for a couple million.
That's right.
Australia is beautiful.
I mean, I've never been there,
but I've been told
I, I had this other one, so

(01:30:54):
I'll put it to Jay first.
What is, what is something that, like
you've had the same person
do for you for a super long time.
So I'm thinking like hairdresser,
haircut, haircut,
like you've had the same person
do that
for the same for the long, pretty.
Pretty, pretty sad,
given how it looks, right?
Hey, Jay, do you have someone like that?
Like you?
The same mechanic done in your car?

(01:31:14):
Like something who's done the same?
I assume you have.
Yeah, I eat at the same place,
you know, pretty consistently we get.
So what would
what would you say
would be the toughest one
for you to switch?
Oh, man,
that's a good question
because I have a lot of those things.
It's like,
Jay, would it be tough for you
to switch hair like a haircut place?

(01:31:35):
There have been times in my life
where I have.
I used to fly from California
back to Maryland to get my haircut.
Rob, what about you? You got some.
You got one of those.
You got a mechanic or something?
Might be my mechanic, for sure. Yeah.
So here's the question, Jay.
If you found out that the owner
of your haircutting place was racist,

(01:31:55):
would you stop going?
The person that cuts my hair
or the owner of the place?
Well, think the person who cut your hair.
Would you stop going?
No, I would not.
That's that's where it comes.
They.
How are we talking about?
Yeah, yeah.
Why is this?
Like, Texas got a racist?

(01:32:17):
Are we talking, like, real racist?
As long as I don't. As long as it never.
I have to.
As long as I don't have to hear it.
Like, I just know it's there,
but I never hear it.
I mean, just so.
So I would say it comes.
It comes out like grandpa racist.
Or is this like, it's not.
That they're like talking about it all
the time, but like,
they make random comments

(01:32:38):
when you're
in that conversation with them
and you're like, geez,
I didn't realize that my
my hairdresser is racist.
I'm saying you're saying,
yeah, Rob, what about you?
Would you would you leave your mechanic?
Oh, that's a hard one. That's a hard one.
But I think I'm going to say.
Kyle Kyle's like
I'd give him a bigger tip.
Pay raise.

(01:32:59):
I'd invite him to poker.
You know,
it's funny because,
I saw this as a post
that I immediately thought of.
I would go to the same hairdresser
for a long time.
And it's not like
I wouldn't ever leave her.
But she's.
If you've ever heard of the phrase
Delco,
like, she's such a Delco, like, it's
a, it's a Philly thing

(01:33:20):
where, like,
I would say, Delco is kind of like your,
you're a real, like,
rough Italian kind of ideas,
you know what I mean?
Like, they're they're like,
when you think of someone
who's, like, a rough Italian
that's kind of like, similar the Delco.
My my hairdresser is the same way
where she's real Delco, real principled,
real like,

(01:33:41):
you know,
if she told told me
that she killed somebody
on the way to work
and that she called her cousin
and he buried the body for, like,
I would believe it.
And so then I thought about it.
I was like, there's a chance.
Like there's a chance she might be.
And we just never come up in
in conversation.
But I don't
I feel like everyone's got skeletons.
Everyone's.
If you dig far enough on everybody,

(01:34:02):
it's just people are hiding
better than others.
And like, I like, I love like AJ like.
But at some point, like,
if I dug far enough,
I would find something
that I hated about him and just I,
I just choose to dig
and you're going over.
Like,
so, so, so I hate to
to bring out AJ skeletons,
but I've heard him say

(01:34:23):
really negative things about Canadians.
Right. And all. The time.
And also the Canadian
shows are my favorite.
And I also heard that he
when he was younger,
he did some smoking
and broke his his Mormon religion.
Oh.
It wasn't a thing, unfortunately.
Back on.
Oh no.

(01:34:43):
Yeah, you would have anyway. Right.
All right, let's do some plugs.
Let's finish this up.
It's been long enough, Jay,
what do you got?
You got any plugs for us?
I'm going to let Rob go first.
He's our guest.
Well,
I don't want to put him on the spot.
I want to give him some time
in case you wanted to think about it, I.
Guess I was
I was going to, like, reiterate
whatever he said.
So I was just going to I was going to.
You ready? You ready, Rob with a plug.

(01:35:05):
I'm ready.
So, I'm gonna plug, my blog,
a real estate
navigator.com
AI real estate navigator.com.
Navigated like Eddie on the. End.
Navigator. Navigator.
Got it.
I real estate navigator. Dot com.
Can you subscribe to that?
Can I get an email?
I don't have it set to email.

(01:35:26):
You have an RSS feed.
You can set it up on RSS.
Yeah, I do have an RSS feeds. Actually.
I am relatively tech savvy.
I can do that.
Nice.
Jay, you're going to reiterate
that you got something else.
Yeah.
I'm gonna I'm going to go with,
if you guys have never heard of
AI Real Estate navigator.com,
that's awesome.
Yeah, it's I heard. About that recently.

(01:35:46):
Yeah. Yeah.
So I have real estate navigator.com.
Check it out.
Oh nice. Cool.
Look at website two.
Just pulled it up very
very I am robot got going on there
AJ what do you got for plug.
Still the YouTube channel.
It's still cooking.
Go check it out.
Got, a whole bunch of stuff on there.

(01:36:09):
Alex, I didn't realize
you were cooking on there, too.
I did. I'm I gotta go check it out again.
That's that's
that'll be interesting, right?
What's what's the name?
Throw it out again.
AJ Osborne, I think that's what it was.
AJ Osborne.
On YouTube. So, yeah, go check that out.
It's, channel stuff,
maybe self storage income,
but it's under I think it's AJ yeah.

(01:36:30):
It's AJ I was born okay. Yeah.
If you Google it
it comes up as one of the top results.
I should probably.
Learn the name to my own YouTube channel
if I'm going to you.
I mean, you know your name, right?
It's not under Austin, right?
No, I'm not going to plug conference
connects.
I'm going to go back to plug in my wife.

(01:36:51):
I think I just heard her
walk in the door, so it's perfect timing.
Plug my wife.
Check her out.
Badass investor on YouTube.
Badass investor on Instagram.
And follow AJ.
Hopefully very soon.
We'll have something for you guys.
If you're into investing in real estate,
which I hope you are,
if you're listening to this podcast.
So follow follow. Jake.

(01:37:12):
Hopefully we got something
got going on soon.
That's all I got wrong dude.
Appreciate it man. Thanks.
We've been trying to get a,
an AI real estate podcast
going for a while.
You kind of just fell into our lap.
Well,
you kind of jumped into our lap, but,
we we recognized you were there,
got excited and, Yeah.

(01:37:36):
You real excited or decided.
You know,
I don't know what that has
to do with lap dancing,
but I just get you out of there.
But, hey, thanks for having me, guys,
I appreciate it. It's been.
It was great.
We appreciate you coming out.
We had a lot of fun,
even though you didn't drink.
But you're still better than still.
But much better than Mauricio.
So, any time. We'd love to have you back.

(01:37:57):
Good looking mug.
Yeah.
Great episode. Guys. Appreciate it.
We will have,
Mauricio back,
I think next week
we're going to have him back,
to the gang's
going to be back together,
and we will see you next Thursday.

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