All-In E152: Real estate chaos, WeWork bankruptcy, Biden regulates AI, Ukraine's 'Cronkite Moment' & more
Episode 152 • 11/3/2023
Commercial Real Estate Crisis
- Major discussion about the $3 trillion in commercial real estate loans on bank balance sheets
- Example of 115 Samsung building in San Francisco being sold at massive discount - listed at $25M with $53M in debt
- Buildings selling for 20-30% of previous values ($200-300/sq ft vs $1000/sq ft previously)
- Banks holding loans at par value despite significant impairment
- Chamath discusses implications for market confidence and banking sector
WeWork Bankruptcy
- WSJ reports WeWork filing Chapter 11 next week
- $10B in lease obligations due 2023-2027, additional $15B after 2028
- 777 locations globally including 229 in US
- Sacks predicts PE firms will buy assets in bankruptcy and restructure into profitable business by:
- Closing worst locations
- Converting some to management contracts
- Renegotiating remaining leases at 60% of current rates
Biden's AI Executive Order
- 111-page order criticized as overreach and premature regulation
- Requires watermarking of "AI content" which raises First Amendment concerns
- Friedberg argues against regulating systems/methods vs outcomes
- Concerns about US competitiveness vs India/China if innovation is stifled
Silicon Valley's Political Shift
- Discussion of growing disillusionment with Democratic Party among tech leaders
- Chamath notes billions in Democratic donations being paused
- Israel-Hamas war cited as catalyst for many traditionally liberal donors reconsidering positions
- Sacks outlines 8 key issues driving shift from left to center including COVID policies, SF decline, and "woke" extremism
The episode concluded with discussion about the true nature and hype around AI technology, with hosts arguing current capabilities are more evolution than revolution in software development.