Biden’s Bad Polls, Lessons Learned from SBF Trial, and Guest Kashmir Hill | Pivot

Intro

In this episode of the “Pivot” podcast, hosts Kara Swisher and Scott Galloway discuss a range of topics, including the appointment of a new British CEO at The Washington Post, the implications of Jeff Bezos’ move to Miami, the real estate industry’s inflated commissions, the trial of Sam Bankman-Fried, the launch of Elon Musk’s AI bot, and the challenges of facial recognition technology. They also touch on the potential presidential candidates for the next election and the importance of men expressing their emotions.

Main Takeaways

The Changing Leadership at The Washington Post

• William Lewis, previously CEO of Dow Jones and publisher of the Wall Street Journal, has been appointed as the new CEO of The Washington Post.
• Lewis was chosen for his love of journalism and passion for driving financial success.
• There is a trend of British executives being appointed as heads of major US media organizations.
• British accents are perceived as making people sound smarter and more reasonable.
• Lewis has a reputation for being good at talking to rich people.

Jeff Bezos’ Move to Miami and Tax Implications

• Jeff Bezos is leaving Seattle and moving to Miami to be closer to his parents and because Blue Origin operations are shifting to Cape Canaveral.
• Moving to Florida can result in a 13% swing in taxes, which can be a significant financial advantage for the wealthy.
• This transfer of income from the poor and middle class to the rich is a problem, as not everyone has the luxury and option to move to a low-income state.
• There is healthy competition between states with different tax structures, but it can also result in the wealthy avoiding taxes.
• Options are subject to taxes based on where they were when they vested, which can create tax advantages for those who move to a low-income state.

Inflated Commissions in the Real Estate Industry

• Major changes in the real estate industry are likely coming after a federal jury found the National Association of Realtors and several brokerages conspired to inflate commissions paid to real estate agents.
• The association and brokerages were ordered to pay damages of nearly 1.8 billion, and the chief executive of the national association of realtors resigned two days later.
• The National Real Tourist Association has figured out a way to hide costs, transaction fees, which has led to an ecosystem that is less competitive than most.
• Real estate commissions in the US are typically 5-6%, compared to 3-4% in the UK, and this can add up to thousands of dollars for homeowners.
• The real estate industry is the most tax-advantaged due to regulatory capture and wealthy people owning real estate.

The Trial of Sam Bankman-Fried and the Ethics of Investing

• Sam Bankman-Fried, founder of FTX, was found guilty on seven charges and faces a maximum sentence of 110 years.
• Bankman-Fried’s lawyer alluded to an appeal and maintains his innocence, but he has terrible judgment.
• VC firms like Sequoia did not do proper due diligence before investing in FTX.
• Investors may lower their standards when they see others making gains.
• People keep falling for charismatic characters like Adam Newman and Elizabeth Holmes who create an illusion of scarcity.

The Challenges of Facial Recognition Technology

• Captain Marvel’s sequel may fail at the box office due to lack of demand, despite Bri Larson’s popularity.
• Facial recognition startup Clearview AI scraped billions of photos from the public web, including social media sites, to build a facial recognition app that works with 98.6% accuracy.
• Clearview AI’s technology was not a scientific breakthrough, but ethical arbitrage, as they were willing to do what others hadn’t.
• Google and Facebook had built facial recognition technology but had withheld it largely for ethical reasons.
• Technology has made facial recognition more powerful, but the ethical concerns surrounding its use remain.

Summary

The Changing Leadership at The Washington Post

The appointment of William Lewis, a British executive, as the new CEO of The Washington Post highlights a trend of British leaders being chosen to head major US media organizations. Lewis’ reputation for being good at talking to rich people and the perception that British accents make people sound smarter and more reasonable may have contributed to his selection. This change in leadership could bring new perspectives and strategies to the renowned publication.

Jeff Bezos’ Move to Miami and Tax Implications

Jeff Bezos’ decision to move to Miami has raised concerns about the transfer of income from the poor and middle class to the rich. Moving to a low-income state like Florida can result in significant tax advantages for the wealthy, creating an imbalance in the tax system. The competition between states with different tax structures can lead to the wealthy avoiding taxes, further exacerbating income inequality. The tax advantages associated with options based on their vesting location also contribute to this issue.

Inflated Commissions in the Real Estate Industry

A federal jury’s ruling against the National Association of Realtors and several brokerages for conspiring to inflate commissions paid to real estate agents could lead to major changes in the industry. The high real estate commissions in the US compared to other countries, such as the UK, put a financial burden on homeowners. The real estate industry’s tax advantages, coupled with the hidden costs and transaction fees, create an ecosystem that is less competitive and less beneficial for consumers.

The Trial of Sam Bankman-Fried and the Ethics of Investing

The trial of Sam Bankman-Fried, founder of FTX, highlights the importance of proper due diligence in investing. The lack of proper due diligence by VC firms like Sequoia before investing in FTX raises concerns about investment practices. Investors may lower their standards when they see others making gains, leading to potential risks. The case of Bankman-Fried and other charismatic figures like Adam Newman and Elizabeth Holmes emphasizes the need for careful evaluation and skepticism in investment decisions.

The Challenges of Facial Recognition Technology

The use of facial recognition technology by companies like Clearview AI raises ethical concerns. While the technology has advanced, the potential for privacy invasion and tracking remains a significant issue. Legislation on a national level is needed to address the use of invasive data collection and racial bias in facial recognition technology. The development of tools like face blurring can help protect privacy, but there is still a need for comprehensive regulations to prevent misuse of this technology.

Conclusion

This episode of the “Pivot” podcast covers various topics, including changes in leadership at The Washington Post, the implications of Jeff Bezos’ move to Miami, the inflated commissions in the real estate industry, the trial of Sam Bankman-Fried, and the challenges of facial recognition technology. It highlights the importance of ethical practices in investing, the need for comprehensive regulations to protect privacy, and the potential impact of tax advantages on income inequality. The hosts also touch on potential presidential candidates and the importance of men expressing their emotions.