What if Jensen Huang Had the Same P/E and Ownership Share As Elon Musk?

What if Nvidia's Jensen Huang had the same deal as Elon Musk, or if Musk had the same deal as Huang? That is, what if the two men owned the same percentage of the company they founded and those companies had the same P/E ratio? The apples to apples comparison is kind of stunning. 

The inputs

Nvidia earned $192.88B on a ~$5.27T market cap, a P/E of about 27.5. Tesla sits at 380.61x  P/E on roughly $4B of earnings. Musk holds ~20% of Tesla and ~38% of SpaceX, which blends to about 30.6% weighted by value. Huang holds roughly 3.5% of Nvidia.

Extreme A — everyone gets Musk's ratios

Musk is already there, so he's unchanged at roughly $1 trillion.

Nvidia at Tesla's 380.61x: $192.88B × 380.61 = $73.4 trillion. That single company would exceed the entire US stock market by a comfortable margin and approach two-thirds of world GDP.

Huang at Musk's 30.6% of that: $22.5 trillion. That is, Huang would have a net worth greater than every country on earth except the US.

Extreme B — everyone gets Huang's ratios

Huang is already there, so he's unchanged at roughly $150–190 billion.

Tesla at 27.5x: about $110B. SpaceX has no earnings, so using Nvidia's price-to-sales of 17.4x on $23.04B revenue gives about $401B. Combined: roughly $511B.

Musk at Huang's 3.5%: $18 billion.

	Musk	Huang
Musk's rules	$1.07T	$22.5T
Huang's rules	$18B	$150–190B
Actual today	~$930B	~$150B

The punchline

Huang wins both extremes. Under Musk's generous rules he's worth 21 times Musk. Under his own stingy rules he's still worth about eight times Musk. There is no symmetric treatment — same multiple, same ownership share — under which Musk comes out ahead.

Which means Musk's position as the world's wealthiest person doesn't survive equal treatment in either direction. It exists entirely because the two men are being scored by different rules simultaneously: Musk gets a triple-digit multiple on negligible earnings and a thirty-percent ownership stake, while Huang gets a twenty-seven-times multiple on colossal earnings and a three-percent stake. Take either advantage away and the ranking inverts. Take both and it inverts by an order of magnitude.

Little Known Fact About Yale

Little known fact: Yale was originally called Y'all. Then they got all fancy and became exclusive.

How AI Could Affect the Election This November

I'm optimistic about how AI might change voting.

Roughly a third of Americans identify as Democrats and a third as Republicans. The remaining third — the independents who decide elections — have the most to gain from AI, because they're the ones party labels serve worst.

Google search let you type "November election" and find websites arguing for or against candidates and propositions. Useful, but it amounted to locating advocacy that already existed, written months earlier for someone other than you. More arranged marriage than courtship.

An AI conversation works differently. You can say: "I think wealthier people should pay more in taxes, but I'm unsure about the mechanism in Proposition 40.[California Proposition 40, One-Time Wealth Tax for State-Funded Healthcare, Education, and Food Assistance Programs Initiative, more popularly known as the billionaire tax.]

"What are the pros and cons?" Or: "Are there studies on how a billionaire tax might affect startup activity in California?" You bring your own bundle of values and half-formed theories about how the economy works, and the answers get built around them rather than around a position someone was already selling.

You might come away more committed to the billionaire tax than any group campaigning for it. You might find it violates something you care about and decide you can't support it. Either way, the conclusion is more likely to be yours. (And yes, one is vulnerable to manipulation from AI. The odds of that are never zero but my own experience of exploring AI's ability to parse arguments suggest they are at least as objective as policy wonks and professors - perhaps more so. And their responses - unlike found content on the internet - is a direct response to your specific inquiry. And one is hardly limited to a single AI for such queries.)

The shift is from finding a prerecorded message to having a conversation — one where you're heard before you listen.

If this works, political advertising should lose some of its grip. A voter who can say "this matters more to me than that" is harder to move with thirty seconds of television, and money in politics buys less.

Here's a way to test it: the share of ballots that include votes on propositions.

Down-ballot measures consistently draw fewer votes than races for president, senator, or governor. Propositions are confusing and time-consuming to understand, and voters who don't know how one aligns with their values often skip it rather than guess.

If people find a process that gives them confidence about an obscure measure, that drop-off should shrink. Rising proposition turnout wouldn't prove AI caused it, but it would be the first visible sign that voters have found a new way to decide what they actually want.

College Football 2040s - an Odd Prediction

College football, 2020s:

The transfer portal allows even star players to change teams from season to season.

College football, 2040s:
The transfer portal becomes a live bidding market, allowing even star players to change teams during the game, based on real-time offers from fans.

“Johnson was an Alabama receiver when this drive began, but Ohio State fans have really stepped up.”

Joe Biden: We Know Our Future Is Bound to Yours

Joe Biden, just 3 years ago, speaking from a very different America to the UN.

As president of the United States, I understand the duty my country has to lead in this critical moment; to work with countries in every region linking them in common cause; to join together with partners who share a common vision of the future of the world, where our children do not go hungry and everyone has access quality healthcare, where workers are empowered and our environment is protected, where entrepreneurs and innovators everywhere can access opportunity everywhere, where conflicts are resolved peacefully and countries can chart their own course.

The United States seeks a more secure, more prosperous, more equitable world for all people because we know our future is bound to yours. Let me repeat that again: We know our future is bound to yours.

And no nation can meet the challenges of today alone.

The generations who precede us — preceded us organized this body, the United Nations, and built international financial institutions and multilateral and regional bodies to help take on the challenges of their time.

It isn’t always perfect — it wasn’t always perfect. But working together, the world made some remarkable and undeniable progress that improved the lives of all people.

We avoided the renewal of global conflict while lifting more than 1 billion people — 1 billion people — out of extreme poverty.

We together expanded access to education for millions of children.

We saved tens of millions of lives that would have otherwise have been lost to preventable and treatable diseases like measles, malaria, tuberculosis.

HIV/AIDS infections and deaths plummeted in no small part because of PEPFAR’s work in more than 55 countries, saving more than 25 million lives.

It’s a profound testament to what we can achieve when we act together when we take on tough challenges and an admonition for us to urgently accelerate our progress so that no one is left behind, because too many people are being left behind.

The institutions we built together at the end of the second world war are an enduring bedrock of our progress, and the United States is committed to sustaining them.

And this year, we’re proud to rejoin UNESCO. But we also recognize that to meet the new challenges of our decades-old institutions and approaches, they must be updated to keep pace with the world.

source:
https://china.usembassy-china.org.cn/remarks-by-president-biden-before-the-78th-session-of-the-united-nations-general-assembly-new-york-ny/

Genesis or Exodus

Genesis is a curious name for a car brand. If you're talking about getting somewhere, wouldn't Exodus be a more appropriate name?

National Intelligence to Integrate Popular Will, Expert Opinion and Constitutional Realities

Imagine a a national civic intelligence system — AI that understands the country, its institutions, its accumulated expertise and the continuously expressed preferences of its citizens, and helps government explore policies that reconcile them.

Popular will defines the values and desired outcomes; expertise maps the possibilities and consequences; entrepreneurship turns promising combinations into experiments from which society can learn.

Put differently ... Democracy tells us what matters. Expertise tells us what may work. Entrepreneurship helps us find out.

Each country will have its own AI and this will be as integral to the democratic process as its constitution, laws, policies and precedent, translating popular will into what is possible. It might look like this table:

Howard Gardner's Missing Intelligence

He'd always found Howard Gardner's theory of multiple intelligences—Logical-Mathematical Intelligence, Spatial-Visual Intelligence, Bodily-Kinesthetic Intelligence, etc.—alluring.

Then he spent time with Jerome.

After that, he began to wonder whether Gardner shouldn't have added at least one more: Conspiratorial Intelligence.

He was loath to call it intelligence, exactly, and yet there was a kind of mad genius to Jerome's spectacularly convoluted worldview.

Entrepreneurship is the Capacity to Move with the Constraints in Your Company, Market, and Even Economy

When intelligence becomes abundant, the scarce resource is the ability to turn possibility into reality. 

Progress doesn't abolish constraints. It moves them. 

Entrepreneurship is the capacity to move with them.

AI will increase intelligence. One way to describe intelligence is as a way to create possibilities through understanding. Use this tool. Adopt or improve this process. Manage your supplier like this. Intelligence understands how best to approach any number of problems and opportunities. 

But understanding has to be applied in order to create value. I can tell you how to change the production flow of your factory but you still have to do that to realize the potential. And you need to weigh that possibility against other changes you could make. Analysis that merely sits in a report does not change any outcomes. It has to be applied. And as we - and everyone with AI - are better able to generate more intelligence, more potentially useful changes, our ability to execute those plans, to exploit those possibilities will determine our success. 

As you make progress, limits to more success shift. At one stage you need startup capital. At another level you need to hire the right people. At the next you need to find the right suppliers. And so on. Each new resource or plan gives you insights into where to focus next, which limit you now face and need to overcome on Monday when you come back in to work.

An entrepreneur is not a specialist who continues to focus on the supplier management. Or optimizing the factory layout. Or motivating and managing employees. An entrepreneur is good enough at all of these to move forward and address the issue and - even more importantly - move to the next and the next and the next constraint.

Jensen Huang, Nvidia's CEO, has created the most valuable company in the world by systematically doing just this. He continually talks about constraints and how they are shifting or have shifted. And he moves his attention and company resources to the next constraint, to address that.

Intelligence creates more possibilities. You know so much of what you might do. AI will amplify that. And then the limit shifts to your ability to move with the constraints within your company, your industry, the economy. A specialist, a knowledge worker, may be an expert in dealing with one issue, like factory flow or materials design. An entrepreneur moves like water through the various elements of the system, identifying the next place where the flow is halted or diverted and addressing that. The ultimate goal? To create a clear stream from possibility to outcomes, a flow of interlocking pieces of the system that can translate possibility into value the customer experiences. 

Follow That Dress!

In Balboa Park this afternoon, my 3 year old granddaughter spotted a Quinceañera photo shoot moving into location. She announced, "We have to follow that dress!"

[And no. This was not the dress and I did not take this photo but this is the style of dress we're talking about. When you're 3, it's like spotting Cinderella in real life.]

In The Future ...

In the future, dogs will have last names. Often those last names will be preceded by "the." 

Trump's Approval Ratings Continue to Fall

Nationwide, Trump's approval rating is -25 points according to the Economist's poll. He has a positive net approval in only 3 states: Idaho, Wyoming, and West Virginia - 3 states whose combined population makes up less than 1.3% of the nation's population. (To put that in context, with 50 states, the average state has a population that is 2% of the total country's. The 3 states that still like him don't even have a combined population equal to the average American state.)

You don't like him? The polls suggest that makes you very American.

Kevin Kelly on Optimism

"The future will be shaped by optimists."

"If you look around you, the world is a museum of passion projects by optimists. Everything that we like was made by some crazy, optimistic person."
- Kevin Kelly

The Most Limiting Belief?

It was amazing when Neil Armstrong became the first human to walk on the moon.

It would have been even more impressive if he had done it without the help of the 400,000 people—including NASA employees, contractors, engineers, scientists, and support staff - who got him there.

Possibly the most limiting belief is "I can do this myself."

Elf Improvement - a Ray of Hope in Dark Days

These are dark times at the North Pole. The sun has stopped coming up. This is particularly hard on the elves. But you don't think about them, do you?

All year they labor to make toys. And kids nowadays are not happy with just one. Production quotas have shot through the roof over the last generation. And the elves get no recognition. It's all Santa all the time when it comes to praise and wonder. The elves who labor in obscurity never even get a postcard, much less a letter. Santa shouts out "ho ho!" Elves just mutter "oh no."

That's why this time of year the elf improvement seminars are so popular. A little ray of hope in an otherwise dark and demanding time.

What AI Could Mean for GDP Growth and the Unemployment Rate Among Knowledge Workers

Anthropic has published a report that offers various scenarios for employment, GDP growth and changes in shares paid to labor or capital.

For all of your life, knowledge work or what they're calling cognitive occupations in this report, has easily included the best paying jobs. Those jobs are likely to wane in importance, pay and demand. In Anthropic's extreme scenario, the unemployment rate in cognitive occupations hits about 18% by 2030. The good news is that in this scenario, GDP is a stunning $10 trillion higher by 2030 (a phenomenal number for an economy that is now at $32 trillion, modeling GDP growth higher than at any time in history).

You might find their scenarios interesting. You are likely already living in one of them.

https://www.anthropic.com/institute/econ-scenarios

Karl Rove Calls Out "Raw, Uncut Bigotry" in a Texan Republican Candidate

Karl Rove — George W. Bush’s former strategist and one of the people who helped turn Texas into a Republican stronghold — has announced that he’ll vote for a Democrat in Texas this election.

Why?

Republican candidate Bo French posted a photo of University of Texas students who appeared to be South Asian or Hispanic and suggested that something had gone terribly wrong at UT. He later said his concern was that there were too many “foreigners.”

Rove called it “raw, uncut bigotry.”

And decided this was one Republican he would vote against.

I Used to be Somebody

I used to be somebody. People went out of their way to wish me well. Treated me a bit like a celebrity.

Now? Now I'm just like everyone else. Slipped back into the crowd. Anonymous again for another 364 days until the next birthday arrives. And what a price to pay for ephemeral fame: getting another year older.

Ageing is such a dubious project.

Her Father Wrote Fortune Cookies

Her father wrote fortune cookies for a living.

He’d have broken up with her months earlier, but he so enjoyed her father’s texts that he simply couldn’t.

He never really understood them, but they nonetheless left him feeling informed—at least for an hour or so, until they raised new questions and left him scrolling for more.

Texts like:

“You will find the item you need on a desert aisle.”

Which raised so many questions.

Was it a typo? Dessert aisle? Desert island?

Was it a shopping list? A prophecy? An attempt to send him to the grocery store—or out to sea?

He could never tell.

So, naturally, he kept reading.