Byrne Hobart: belief

Transcript context

…That's really interesting. I'm just gonna do some rapid fire questions in the final few minutes. First, how can somebody be long AI but hedge for the possibility that Taiwan will be invaded? So, I don't know if I should put money into TSMC but I know that GPUs are going to be the next big thing or are going to be very important in the future. How do you make that position concrete? Oh man, that's really hard. I guess the next best thing would be looking at the Korean fabs because they're close but they don't produce the same chips. I guess the bet would be that Korea is the country most likely to catch up to Taiwan today if Taiwan is no longer an option. But if you're trying to make the AI bet conditional on Taiwan bet, I think a lot of what you want to do is actually think about how you underwrite the Taiwan invasion bet because that's probably the thing with the bigger long term impact. Maybe not. It gets tricky. Sometimes geopolitical changes can just lead to these permanent inflections. There's some kind of emissions that you can measure that are the result of copper mining and so we can see how much copper mining changes year to year throughout history and we do actually see it rising during the Roman Empire and then peaked and then went down and then didn't come back for a millennium. Sometimes there is a really unfortunate geopolitical inflection in underlying technology. But if you think about what that means in the real world, your big concern is not your portfolio in a world where we were an invasion is the reason AI does not happen. I would separate the invasion bet from the AI bet. And then I guess the sad answer is Intel and TSM are sort of America's last hopes on this. You can you can tell a story where invasion becomes more and more likely and the US does a sort of operation paperclip with no connotation about the the political views of the engineers of old but you know, operation paperclips all the best TSM engineers out to Arizona and has them all work on building those chips in the US in which case TSM is still you know, still a play although it's certainly lost some valuable assets. But that's a very tricky question. And it may be one of those things where it's kind of kind of hard to hit like. There are sufficiently bad things you know, there's not really a good meteor hedge in the minutes before the meteor hits us, maybe treasuries do outperform equities, but you don't really care. [Laughter] I'll definitely have to have you on again in a few weeks because we've gone through only a quarter of the questions. But it was really interesting. This is probably the most fun episode I've done so far.…

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