Prof G Markets
00:56:22 · Josh Brown, Scott Galloway, Ed Elson, Kara Swisher
And I'm not saying that's actionable today, but tuck that idea in the back of your head, because we only have two companies that can run their own compute and have the front end that touches the end user. [00:56:38] S0: You don't think AWS qualifies for that? First off, verticalization is inevitable in any company that wants to sustain. [00:56:43] S4: What's AWS's AI product, Rufus, that helps you find the cheaper product on the, I mean, I guess they have chatbots. [00:56:52] S3: I didn't even know what that is. So that says something. [00:56:55] S0: Yeah, that says something. [00:56:56] S4: It's not a large scale LLM. In fact, Amazon had Bedrock, which was the original bring your own model platform. And the big idea was that AWS does not discriminate. We don't care what kind of AI you wanna use, you can use it here. And that made a lot of sense in the early days. And I'm not saying it won't in the future, but just think about that we only have two end to end AI players today. That might become important at some point in the future. And then people might come back and revisit this conversation. [00:57:34] S3: We'll be right back. And for even more Markets content, sign up for our newsletter at profgmarkets.com. [00:57:49] S2: Minneapolis. It's Kara Swisher. This November, Scott Galloway and I are taking Pivot, our wildly entertaining and provocative podcast on the road, and we're coming to you. [00:57:58] S0: Provocative is Latin for chaos. Come see the chaos live on November 4 at the State Theater.
00:57:58 · Scott Galloway, Kara Swisher, S5, Ed Elson
[00:57:58] S0: Provocative is Latin for chaos. Come see the chaos live on November 4 at the State Theater. [00:58:05] S2: That's right. November 4, the day after the midterms. Will democrats ride a wave and take the senate? [00:58:11] S0: Or will republicans pull another survival act? Notice how they give me that line? [00:58:15] S2: Either way, we'll be yelling about it on stage right next to our very special surprise guest, someone you'll wanna hear from. [00:58:22] S0: We typically only go to the biggest cities, but this was an easy one for us. We definitely had to come back to Minneapolis. [00:58:28] S2: Grab your tickets at pivottour.com before they're gone. Again, that's pivottour.com. [00:58:34] S0: We'll see you on the fourth. [00:58:39] S5: Are you tired of hearing about business, tech, and finance from the bros? We are the Tiger Sisters, a top business podcast with the Vox Media Podcast Network. Tiger Sisters releases every Monday, and we decode money, power, and love. And who doesn't love all those things? We are the Internet's Wall Street and Silicon Valley big sisters. Tune in every Monday for late night sister talk meets boardroom strategy. Check out Tiger Sisters on YouTube, Spotify, or wherever you get your podcasts. Welcome to the Tiger fam. [00:59:15] S3: We're back with Prof G Markets.
00:59:15 · Ed Elson, Scott Galloway, Josh Brown
[00:59:15] S3: We're back with Prof G Markets. [00:59:17] S0: I just wanna put a footnote on your Amazon call. My big tech stock pick for '26 was Amazon. Ed likes Meta, but we pick Amazon for different reasons. While AWS, I agree with you, yeah, is gonna be a serious unlock. I think it's return or the empire strikes back around the retail unit because what I see is a collision between industrialized robots and AI. And Jassy is saying that he thinks they can double the size of their retail business by 2032, which by dollar volume is their biggest business without one single incremental hire. So all of a sudden, this large top line, low margin business is about to become a massive top line business with a... With reasonable margins. [00:59:57] S4: I like that idea. I think it's three years from now, but robots as a service, same way that AWS was initially conceived as being for internal use. Like we need our own cloud. Then the thing that got Sundar the top oh, job is we're gonna turn this outward and everyone's gonna utilize this. It's not impossible that what you just said, Scott, ends up being really important, which is, do you wanna own your own robot really? Or do you wanna utilize Amazon's by then fleet of millions of capable robots and rent them? And it could be big.
00:59:57 · Josh Brown, Scott Galloway
[00:59:57] S4: I like that idea. I think it's three years from now, but robots as a service, same way that AWS was initially conceived as being for internal use. Like we need our own cloud. Then the thing that got Sundar the top oh, job is we're gonna turn this outward and everyone's gonna utilize this. It's not impossible that what you just said, Scott, ends up being really important, which is, do you wanna own your own robot really? Or do you wanna utilize Amazon's by then fleet of millions of capable robots and rent them? And it could be big. [01:00:39] S0: 400,000 industrialized robots in America sounds Amazon. Amazon has a million. You said something before, Josh, that struck me that how... That what you think is bad for the markets actually is good for these guys. You said something that really struck me. You said recently that high interest rates and high oil prices turn out to be great for the market. What did you mean by that? [01:01:01] S4: We make this mistake. We talk about business or corporate America monolithically as though like it's all one thing. And what's good for business is good for business. [01:01:13] S0: Or good for people of the economy, right?
01:01:15 · Josh Brown
[01:01:15] S4: Yeah. So the reality is when you look at the S and P 500, those are not just businesses, those are literally the best one and two companies on the planet in their category. Almost by definition, the way you get into the S and P 500 these days, I think the minimum market cap is around $2,530,000,000,000. So these are obviously companies that have proven they can do billions of revenue. You have to be profitable. So this is not business. These are 500 Michael Jordans. People don't understand this. They think that there's some correlation between business, like all businesses, and there really isn't. When you have higher compliance costs, higher energy costs, difficult trading issues, and international law, and all of these things that are a huge headache for an average or a substandard business, those become moats for the biggest businesses because they are the only places that can appropriately staff with the experts that help them navigate, or they have the scale to almost circumvent. The Mag-seven, these are basically nation states with ticker symbols. So sometimes struggles in the economy actually end up being tailwinds for the largest companies in each sector because they actually take on a comparative advantage and they take market share from everyone else. And the only proof of that idea that you need to see is a fifteen year chart of the Russell 2,000 versus the S and P 500 or the NASDAQ 100 versus the Russell 3,000. Then you begin to understand, oh, you mean all these challenges along the way were actually showing up in the stock market in the form of regulatory capture, economies of scale, and all these things that benefited the S and P five hundred. So unlike Rocky, the investment class is not busy rooting for underdogs. We are reveling in the fact that we have these international champions that trade publicly here in The US. And the worse conditions get for most companies, the more of an advantage they find themselves squeezing out when you get to the other side.
01:03:47 · Ed Elson, Josh Brown, Scott Galloway
[01:03:47] S3: I think a lot of people hear that, Josh, and they're like, that's depressing, or that's a shame. It's like [01:03:54] S4: This is why you guys have me on the show, though, because I'm... I I say what it is, not what I [01:03:59] S3: would like do. Josh was [01:04:00] S0: the most uplifting person we speak to. [01:04:02] S3: But I guess my question for those [01:04:04] S0: Your guy's Zitrin makes me wanna find guns and butter. I mean, anyways, go ahead. [01:04:10] S3: For those who hear that and are like, okay. So the biggest companies continue to get bigger. The rich get richer. The winners win more than the losers.