It's a scary time because we're talking about displacing 20% of the mid-40s to early 50s white-collar jobs in the country, and that's going to create a lot of economic anxiety and political tumult. I think there will be attacks on AI and AI services, and eventually there'll be some form of universal income. You mentioned UBI. That's going to be one way to curtail social unrest, but that's also one way to exercise tremendous, terrifying control over our population, especially if you bring in the idea of digital currencies where you can track and program transactions.
There's a lot to go through right now, and those are all the things we're going to have to go through. You don't want AI designing a cyber weapon or a bioweapon and figuring out a way to deploy it. The accident of the war has increased the world's reliance on the US dollar. If you were a naysayer on the US and a cynic, you'd say, 'Okay, we're at war and everyone's going to start migrating away from the dollar and that's going to weaken the dollar and topple the US economic empire.' That actually didn't happen. The reverse happened. We've strengthened the dollar, which has increased the flow of international funds into the US stock market, which is why the stock market did so well in the month of April. I own gold. I believe in gold as a long-term store of value. I think gold is going to be part of the future. There's a lot of scenarios that are great for the dollar where gold doesn't lose a lot of value because it's just a good store of value. And there's a lot of scenarios where the dollar is not doing well, where gold goes exponential.
What would you say then is the biggest risk to the US economy right now?
This is the real story with Michelle McCrory.
The United States has just crossed a historic threshold. For the first time since World War II, the national debt held by the public, over $31 trillion, now exceeds the size of the entire US economy. That is not even total debt. That is the money that the government owes to investors, foreign governments, and global markets through treasury securities. The real market-facing debt, more than $31 trillion, is now larger than GDP. And it is not slowing down. Debt is projected to rise faster than growth, reaching as high as 120% of GDP in the coming decade. And there is another warning. Fitch Ratings says that the US fiscal position is deteriorating, with deficits nearing 8% of GDP and a debt burden far above peers with similar credit ratings. All three major rating agencies have now moved the United States below triple-A. And at the same time, the geopolitical landscape remains very unstable and uncertain with no clear resolution to the conflict with Iran. And yet, markets are surging, hitting new record highs. Stocks have just posted their strongest run since the pandemic rebound. Record highs, relentless momentum. So, is there a disconnect between the roaring stock market and some of the realities of the macro environment? Is the system more fragile than it appears? And why is the market just choosing not to see any of this? Well, joining me now to give me his take on this and so much more is Anthony Scaramucci. Anthony operates at the highest levels of Wall Street, served inside the White House, albeit very briefly, and has become a prominent voice at the intersection of markets, politics, and media. He is the founder and managing partner of SkyBridge Capital and the founder of the SALT Conference, one of the world's leading forums bringing together investors, policymakers, and innovators. He is in constant conversation with the insiders shaping where the capital is actually going. Now, Anthony began his career at Goldman Sachs before going on to build and sell his own investment firm and later launching SkyBridge into a global alternative asset manager. And of course, many will remember his brief and highly public stint as White House communications director in the first Trump administration. He is also the author of several best-selling books and the host and co-host of several podcasts. Anthony, you are a very busy man. Thank you for making the time for us. It's good to see you again.
Michelle, you read that exactly the way my mom wrote it for you. So, I want to say thank you for that. I mean, it's very flattering, but should we talk about the economy and what the market sees versus what the data looks like? I think the market is actually seeing through the war, and I think the war has proven something once again to the world about America: that the world is transacting in dollars. And if you look at the dollar volume trades, whether it's the Eurodollar, the petrodollar, the Japanese yen trade, the world needs dollars. As a result, in this period of uncertainty, the dollar has actually gotten stronger. Even though the affordability crisis is there, people are seeing through it and they think that the war is going to end. Now, it didn't end on the timeline that Donald Trump or President Trump had suggested, but I don't think people think this war is going through the summer. And there's a couple of scenarios that could happen. One would be that the US Navy, maybe with some help of allies, goes in there and completely clears the strait. Remember, the Americans had to do that in the 1980s, and of course, the Royal Navy did that in 2019. So, it has been done before. It's a little bit different circumstance. You probably would see the Iranians, if we went to do that successfully, try to destroy as much of our Gulf ally oil infrastructure and natural gas, liquid natural gas infrastructure as possible. But again, I think the market sees through that, and you saw this week, as I did, impressive record profits. The market's also seeing that the AI capital investment cycle is quite real. It's unlikely to be a bubble, and in conjunction with that AI capital investment cycle, there will be a tremendous exponential increase in productivity. As a result, that's very deflationary. So, even though we're seeing this oil and energy crisis right now, short-term induction from the war, I think the market's looking long-term and saying, 'Wow, prices are going to be a lot lower, and this sort of productivity that's about to come online is going to make that achievable for all of us.'
All right. I definitely want to dig into AI a little bit deeper, but let's focus on what you said right now, and that is that you think this war has in effect strengthened dollar demand. Does that mean to say that you think it has boosted the dollar's status on the global stage?
Yes, by accident. I mean, all of this, you know, when I was a little bit younger, we were told in 2007 that China was decoupling from the United States, and so if the US went into recession, it wouldn't be a big deal to the global economy. And then we went through one of the worst crises in my career, the global financial crisis of 2008. The world imploded. It was arguably one of the worst periods of time in my career, if not the career of many people. And what happened? There was no decoupling. Things were very much so conjoined, and the US went into a recession and the rest of the world went into this global quasi-depression. And so we were told that the BRIC nations, we were told that our adversarial nations around the world were going to team up and they were going to find other ways to transact other than the US dollar. But what happened here during this crisis? We're seeing more dollar transactions than anything else. And so this had an unintended effect. The media was saying one thing, but the realization of what was happening in the markets was completely opposite of that, and I think that's also buoyed the US stock market.
Well, you know, many have actually speculated that one of the agendas behind this conflict was in fact to do just that: to reassert dollar dominance on the world stage, to reclaim the petrodollar, which was waning as oil was being priced more and more in other currencies, to cut off China's supply to discounted cheap oil coming both from Venezuela—that was taken care of a lot more smoothly than Iran—and then Iran, and then effectively reassert American military might on the global stage and reassert pricing oil in dollars and therefore continue to maintain the dollar's status as the global reserve currency king. Are you saying that you think it appears as though that objective may be successful?
Well, I'm not saying necessarily that the war happened for that reason. I'll take the president at his word that it happened to eliminate the threat of nuclear weapons and see if he could get a more secularized Iran. And perhaps he was encouraged by what happened, as you said earlier, in Venezuela. He thought maybe he could go two for two here. We could create two secular regimes that were once unfriendly to the United States. I think that's probably the reason for the war more than the prop-up of the petrodollar. I understand the conspiracy theories and I understand the cynicism, and so I don't want to totally negate that, but I do think that the real reasons are the ones that the president stated. But I think if we were going to secure what you just said, meaning we were going to bolster the petrodollar, we would end up taking control of the oil in Iran, and we would end up, more or less, it would be like a monopoly board, if you will. We would have our Gulf allies, and we'd have some control of the Iranian oil. And, you know, remember, the Chinese don't have oil. They have to constantly build surplus oil because of their geopolitical and their geography, the footprint of their country. And so that would give us an enormous amount of power over China, and it would bolster, to your point, the petrodollar. But I don't think that is a realistic outcome even so. So I think the more realistic outcome, frankly, is that we get to some kind of negotiated peace with them and hopefully maybe even get China as a co-guarantor to examine closely the nuclear sites in Iran to make sure that they don't pose a threat to the rest of the world. And if that happens, I think that'll be very bullish. I'm just saying that the accident of the war has increased the world's reliance on the US dollar. It hasn't gone. And you know, if you were a naysayer on the US and you were a cynic, you'd say, 'Okay, we're at war and everyone's going to start migrating away from the dollar and that's going to weaken the dollar and topple the US economic empire.' And I'm just saying that actually didn't happen. The reverse happened. We've strengthened the dollar, which has increased the flow of international funds into the US stock market, which is why the stock market did so well in the month of April.
So you're saying, okay, the markets are looking past this. They do see a resolution on the horizon. That's on the geopolitical side. We do, of course, need to deal with the follow-on effects of inflation. That will come not only from higher oil prices, but fertilizer, all the other costs that are now being impacted as we've had this delay. So we're going to have this potential lagging inflation. On top of that, as I mentioned, the national debt is now larger than the entire US economy, more than $39 trillion in debt, now exceeding GDP. And we have rating agencies, which admittedly had very little credibility after the financial crisis, but rating agencies now all moving the US below triple-A. So reducing the status of the US debt. We've also got concerns about a recession as we're seeing this slower growth. But yet the markets again are not looking at these sort of structural issues. Do you see a problem with that?
Well, again, you know, if you're telling me that we're in a permanent energy crisis and the oil is going to 175, 200 dollars a barrel, and 20% of the world's oil market is going to get shut down in the Strait of Hormuz, and this is a protracted one, two, three, four-year problem, the market's going to lose 40% of its value. So, I'm a realist. I understand that you can't just look at this in a Pollyannish way. But I think the collective wisdom of the market is saying to you that that's not going to happen. There'll be ways to bypass the energy constriction in the strait, the way the UAE is going to do it. There's going to be potentially an opening by the US Navy of the strait. There's a lot of things that can happen to help out the market. If you're talking about the deficit, different issue. You know, so you would think that the dollar would have gotten way weaker based on this reporting, right? So again, just for everybody to know, US economy is 31 trillion. So with the $39 trillion, or the debt, we're already over the 120% threshold. The measurement yesterday they were looking at was non-balance sheet debt. So debt owned by others, either US citizens or corporates or foreign national sovereign funds, etc., is now equal to the US GDP. Okay? So that's not the Fed's balance sheet or the US balance sheet of debt. It's just the debt that's outstanding in the marketplace. And so that would be problematic if you didn't bet on long-term growth in the United States. Now, the CBO is much more conservative than say SkyBridge or others or even Morgan Stanley or JP Morgan. If you believe in the technology productivity wave that's coming from AI, or you believe what Elon Musk said last week at a conference that we could see 6-7% GDP growth in the US, well, guess what would happen? You would outpace the spending. You know, and I think that's the big issue for political leadership. You've got to slow down the growth of spending so that it's below the growth of the GDP. If you do that, it'll take 15 years, but that safety that we had—and remember this happened, and I know everybody knows this, but it's worth repeating—this happened after World War II. We got to 122% of debt to GDP at the end of the Second World War. We basically borrowed a ton of money to win that war. And then we had explosive growth in the economy, and over time, even though we never pay back debt, which is not something that we do, we just happen to grow our GDP at a faster clip. So again, the market is telling you that that too is also going to happen. Now, markets have been wrong before. I'm not saying that, and I'm not smug about this. And let me tell you something, Michelle. I have been humbled by life. You know, you mentioned my White House firing earlier. I've gotten things wrong in the market. I've been humbled by life and markets. So, I'm not saying this with any level of overconfidence. I'm just making an observation as a 38-year market participant. I'm looking at the overall markets and telling you what the market thinks. Now, when the markets get things wrong, and I'll point people to 2007, they thought, we thought, and honest confession here, SkyBridge thought that the mortgage-backed debacle that was taking place in 2007 was going to be ring-fenced and contained by the Fed. And unfortunately, that did not happen. And then the dominoes started falling. And we thought there was a $90 billion problem. It turned into a $6 trillion problem. So, yes, we could be sitting here, you could invite me back in 3 months and we could be 30% lower in the stock market and that would be justified if the war gets out of control. But again, I'm making a prediction, making a bet, and I'm also positioned this way that that won't happen, that we'll get to some type of solution that's beneficial to the global economy and maybe even include some type of oversight on the nuclear capability or future nuclear capability of Iran.
Okay. So, you're positive and optimistic that the geopolitical issues get resolved relatively quickly. And you're seeing markets continue to rally then. But what is your outlook for the markets for the rest of the year?
Broadly speaking, listen, we're up a lot. We've already moved a lot. You know, we've had five weeks of gains, okay? And this is surprising to a lot of people. And guess what's going on? There's shorts in there. Remember, the market climbs a wall of worry. And so everything that you and I are talking about, there's a group of people that are saying this can't be right. This is going to be a colossally bad thing. And so they're short the market. So guess what happens? As the market's rising, they have to rush back into the market to cover their shorts, which creates even more market momentum. So I don't know, if the war gets resolved, we're probably going up another 10 or so percent from here. Some of the stuff will be overpriced for sure. The market is actually, you know, if you look at the metrics that Paul Tudor Jones uses or Warren Buffett, the market's at 250% of GDP, so that signals to us that it's overpriced. But yet if you look at the earnings, if you looked at the record earnings at Goldman Sachs, record earnings at some of the tech companies, record earnings at Bank of America, you would say, okay, the markets are delivering the earnings, and so this is the reason why the markets buoy. So I think it's two-thirds chance the market goes up 10% from here. We have a pretty strong positive back end to the year, and there's one-third of a chance that things go haywire and the Fed is put in a box due to the energy crisis and the fertilizer crisis, etc., and they can't cut rates. And if anything, the war goes on way longer than we all think, and the market has a 20 to potentially 30% decline. Those are the two outcomes here.
I'm going to look further out. You mentioned 2007, and we recently had some comments from the guy who managed the 2008 crisis to a large extent, and that was former Treasury Secretary Henry Paulson. And he recently warned that US officials need to have a plan in place, what he called a 'break the glass in case of emergency' plan for the moment where demand for US treasuries breaks down, an event that he said could have vicious effects. An event that he says is coming. He can't say exactly when, but he does see a time where there will just not be enough demand for US treasuries. And that the Fed will have to come in as a buyer of last resort. He's warning of a sovereign debt crisis. I think we have that sound bite if we could play that. Now, this crisis is different, right? If I, when you hit the wall and you're trying to issue treasuries and the Fed is the only buyer and the prices of the treasuries are going down and interest rates are up, that's a dangerous thing. And so what I am talking about now is, we know people say when are you going to hit the wall, I obviously don't know, it's impossible to know, but the law of economic gravity, you're not going to know that. And when we hit it, it will be vicious. So, we have to prepare for that eventuality and I think we need an emergency break the glass plan which is targeted and short-term on the shelf so it's ready to go when we hit the wall.
How real is that risk to you as someone that has survived various points of crisis? Do you think that point is approaching? What do you make of those comments?
Well, first of all, I love him. I worked for him. He was the principal architect of bailing us out of the last crisis. And so I think we should heed him. We should listen to him. I think it's on point in the sense that the $38.9 trillion—I actually looked that up while he was speaking. So I just give you the total debt, right? So our GDP is 31 trillion. Okay. Debt outside the country, 31 trillion. But our total debt, 38.9 trillion, that is a very big number. And if the Fed is forced into being a buyer of last resort, you could see a scenario where you have to take their balance sheet up to 15 trillion. Okay? And so what I would have loved to have heard Hank say is yes, we need a break the glass strategy, but hello congressmen and hello people that are lobbying the congressmen for all the moola. Either you got to tax the people more, okay, or you got to spend less, or you got to slow down the spending. So, yes, we need a break the glass plan, but I would recommend that we need a 10 or 15-year plan to slow down the spending. And Michelle, I could take you back and probably don't have enough time in this interview, but viewers and listeners could Google 'pay-as-you-go' legislation which was put in place by George Walker Bush's dad, George Herbert Walker Bush. And Bill Clinton adhered to it and they ended up running a budget surplus at the end of the 1990s. And so what was pay-as-you-go? It was just guardrails. You can only grow the government budget this much. If you want to increase spending, you had to concomitantly have a tax increase. If you wanted a tax cut, no problem. Then you had to find something in the budget to cut to offset the tax cut. We don't do that anymore. We're running this thing on what's called a continuing resolution. We've never had—we don't have any formal budgets anymore. And these governmental agencies are growing 5-6%. If they grow at 2%, Michelle, they announce that they've had a 4% budget cut, and all it was was a slowdown in the growth. You know, these governmental agencies and these budgets never really get cut. So, to me, I think it's a combination of things. You know, and we've got the need for social security reform, closing some tax loopholes. There's a lot of things we need to do. It's not just, 'Hey, let's have a break the glass moment and figure out how the Fed can own more treasuries.' Guys, slow down the spending.
Well, that's a lovely sentiment, Anthony, but we know that never happens. Not if politicians want to stay in power, despite maybe some having the best intentions.
But you're saying I think we're in big trouble because of what you just—
But you see this trouble on the horizon. You think we've got some time for that? Not yet. And remember, you know, deeply analyze the debt. The United States owns 28% of the land, meaning the US government owns 28% of the physical geography of the 50 states. So underneath that is a tremendous amount of mineral resources, oil, etc. We have a balance sheet that's probably worth close to a hundred trillion dollars if you were to size up everything on the US balance sheet. So, the $38.9 trillion worth of debt is not a wipeout yet. But if you tell me we're 15 years from now and we haven't solved for any of the problems that you and I are discussing, I think you're in big trouble. I think guys like Hank Paulson and Ray Dalio will be looking around saying, 'Wow, we could be in a sovereign debt crisis that the US is not planning for.' And I don't know if you spend any time in Washington. I was in Washington for 11 days. I get fired. You know, every time I go to Washington, I like break out in hives. So, I'm not the best guy to go to Washington. But when I am in Washington and talking to these people, they don't care. A trillion dollars here, a trillion dollars there, a billion dollars here. The spending has gotten wildly out of control. And you know what happens? Milton Friedman said it better than me. So, let me just quote him on your show. Milton Friedman said, 'Deficit spending is unfunded tax liability.' And so, if you're not going to tax the people, you end up coming up with the most pernicious and most regressive form of taxation, and that's inflation. And so, they start to monetize the debt by weakening the purchasing power. And that hurts the people that don't have the assets. That's why we're seeing this big general unhappiness of the wealth effect. If I own the assets, my assets are going to go up in price on nominal dollars. But if I'm just a worker, Michelle, and I'm losing purchasing power, you're taking my time and energy away from me. You're stealing a portion of my life. And it gets people really upset.
And you know, to that point, you posted on X recently how the US dollar has lost roughly 28% of its purchasing power over the past five years since January of 2020.
Yep. Since January of 2020. That's correct.
But then so let's zoom out because it sounds like you're seeing this as a risk but not a near-term risk. Geopolitics, you're optimistic that that will get sorted out. GDP, you're optimistic will continue to grow. What would you say then is the biggest risk to the US economy right now?
I think the tribalism. I think the political quagmire that we're in where we can't come up with plans that make long-term sense for the United States. You know, the Chinese, which I would say is an economic competitive adversary at this point, has 10, 20, 30-year plans for their growth and their development. We don't. We need a 15-year infrastructure plan. We need a 15-year K through 12 public education equalization plan where people all over the country can get a good education. We need a deficit spending reduction plan over a 10 or 15-year period of time. And so what happens in the country? We have like two-minute plans or we have cable news segment plans where we bash each other or we're running for a two-year re-election or four, or if you're in the Senate, six. It's not workable anymore. We need transformative leadership where somebody gets to a microphone like the one I'm speaking to you on and saying, 'Look, here is the problem and here are practical solutions, but you're not going to like them.' You again, you said something five minutes ago which I unfortunately agree with. You're like, 'Yeah, Anthony, that sounds good, but that's not going to happen.' And I'm looking at you and saying, 'Michelle, you're right. That's not going to happen.' So, at some point though, maybe people will wake up. I would imagine...
If you met a politician or one that came on your show that articulated something that you agreed with, maybe we could create a groundswell or a movement of people that would say yes, we have to make these short-term sacrifices for the betterment of the country.
Well, to that point, you did post on April 1st, I believe, that you had some presidential aspirations. Should we be taking that a little bit more seriously?
I don't meet the height requirement, Michelle. Okay. I mean, I can barely get on the roller coaster, you know? I barely met the height requirement for my roller coaster.
I mean, you're saying we need a change of leadership. I don't think...
Listen, I think we need somebody...
I'm just curious if that is something that you was... I mean, I know it wasn't just, but something...
Listen, Michelle, my wife would probably cast rate me. I mean, I don't know if you want me to say that on your show, but I mean, I don't think I'm the right person because one of the things that happens when you go into politics, you got to start lying to everybody. I mean, I'm just not up for that. I got five kids and I don't want to be that congenital liar like these politicians. But I'm hoping there's a young man or woman out there that is looking at these problems strategically and is saying, 'Hey, here's a practical solution.' And you know, I think we can get there. And by the way, here's the great thing about America. We're so innovative and we're so entrepreneurial that we may be able to grow ourselves out of these problems even though our politicians are malpracticing. We have some great entrepreneurs and great innovators in this country that may pull us out of this.
So, let's talk about some of that innovation and let's circle back to AI. Now, read the politics as Hemingway said, isn't that pretty to think so? Hopefully we will have some future leadership that can tackle all of these challenges. But let's talk about AI. On the one hand, you're saying that this is what's driving the markets. We've got growth. We've got capex. On the other hand, there's the concern about what it means for the job market. And you recently did a very good podcast with Mike Novogratz and you both said how AI is replacing humans. In fact, I think the title was 'AI is replacing humans faster than we think and the markets like it.' And you both expressed concern about what this means for the labor market. I believe that the latest numbers show that just in the first part of this year, 60,000 jobs have been cut. Many of those layoffs tied at least in part to AI. Major companies are now openly restructuring for what they call the AI era. Amazon announced more than 30,000 job cuts. They're saying it's a strategic reset for a more automated future. Oracle reportedly cutting tens of thousands of roles. It's pivoting towards AI. Meta, Salesforce, the list goes on and on. How problematic do you see AI as a force in the labor market? How do you see that playing out?
Well, I'll say a couple things and I want people to really think about this long term. I see it as a short-term problem as Mike and I discussed. You know, you saw a 10% drop in jobs at Meta, as an example, meaningful drop. Some of these companies are using it as an excuse to lay people off. Even though they haven't really put into practice the AI productivity reforms that they were suggesting, they're still laying the people off in order to save money. So I see it as a short-term thing. But I see the productivity that AI is going to unleash as a positive. And as I mentioned on that podcast, I do think there'll be a robot tax and I think there will be a tax on AI and AI services and I think there'll eventually be some form of universal income. I do think that that will happen and it will cause a buffer zone. There could also be, which people are looking at, Michelle, wage insurance. So let's say I lose my job, there's supplemental wage insurance that kicks in while I'm looking for another job to sort of buffer the transition. So I will say this, it's a scary time because we're talking about displacing 20% of the mid-40s, early 50s white collar jobs in the country. And so, that's going to create a lot of economic anxiety and it's going to create a lot of political tumult because you want to watch politicians get beaten up, you know, just get these soccer moms angry at them, okay? Watch how they handle it, you know. So, for me, I'm worried about it, but I think it's going to be offset by the gains. And so I think this is sort of short-term stuff, you know, and I'm old enough to remember when the phone companies were going out of business. You know, long distance phone was $3 a minute in the 80s, $2 a minute in the 90s, 50 cents a minute in the early 2000s. Now it's no cents a minute. And people said, well, the phone companies were going to go out of business. But what did they do? They continued to innovate and they continued to find ways to make money whether it was in cable subscriptions, Wi-Fi subscriptions, data transmission hubs and highway systems, information highway systems. And I don't want to bet against human ingenuity by suggesting that everybody's going to get displaced. I think the first piece of this is learn how to use the AI to make yourself more productive. You know there was a great saying, I think it was from the dean from the Yale School of Management, Jeff Sonnenfeld, he said, you know, the AI may not replace you but you know who could replace you is the person that knows how to use the AI. So let's get into that. Let's make people aware. Let's give them some job training and make them less intimidated about this new technological wave that's hitting us.
Look, you mentioned how the phone companies went out of business with replacements and every generation has faced technological disruption. You know, industrial revolution displaced workers. The automobiles replaced the horse economy. The internet wiped out entire business models and created new ones. So yes, to your point, arguably every generation has had change and had to deal with it. You could say that your generation in the 60s, so years that you've been around, even though, as we said earlier, you look like you could have barely been around for 48 years. But...
You could add that to my introduction.
No, your mom asked me to work that in there as well.
She said your secret is hydration.
But you could even say that there hasn't been that much change in the last 60 years, that there's been so much change for this particular generation. But you have AI and many say it feels different on so many levels. Not just because it's replacing physical labor. It's coming for cognitive work, creative work, writing, coding, legal, research, analysis, customer service, parts of finance, parts of medicine. Again, even creative singing, songwriting, AI influencers, avatars, movies, movie actors. It's just so pervasive. It's not just animation. I mean, the list goes on and on. It's not just one industry. I mean, people are making, you know, news anchor avatars and having them read out scripts and are programming them to ask questions. It just doesn't stop the way it can impact everyone. So, you could say that it's different. I mean, sure, this time it's different, but it's really different this time. What do you think, and I'm asking you to prognosticate here, but what do you think the world looks like in five years time with AI?
Well, Dario from Anthropic, Dario Amodei had a great 15... I guess it was a little longer than that, probably a 30 minute speech. He also put it in an essay. Maybe it was a 1500 to 2000 word essay describing all of this that if the AI, which I predict goes exponential in the next three years, you're going to have an improvement in drug discovery. You're going to have an improvement in education. And you're going to have digitized individual tutors for students that are digitally fingerprinted to them. So if I have attention deficit, the tutor is going to teach me in a way that will get me interested in the subject material despite my attention deficit and it'll conform to students that have different deficits potentially or different strengths, if you will. There'll be medicine. There'll be business strategy, fitness strategy. There'll be reams and reams and reams of different ideas that come from AI that will solve a lot of our problems. And that will unleash productivity. And I would say to you if it's five years from today, this is an aggressive statement to make, but I'll make it. I bet you we're in a four day work week five years from now. And I bet you that extra day of leisure is a whole new job creation business because there'll have to be people at hotels and there'll have to be people at the, you know...
Or robots at the hotels, charming robots with...
Can be charming robots, personalities. But my sense is that the interpersonal human experience will come in a higher premium. You know, if you're going to get the massage from a robot, which we're now doing, if you see that on social media, the robotic massages or the massage from the human, my guess is that there'll be a premium on human contact. You know, I don't think that'll be one of the more unique things that happens.
So, you're seeing a potential four-day work week. Is this to say that people are earning more money? Is this to say people are earning less money? Who's paying for that fifth day human contact leisure activity?
So again I think the productivity will be coming from the AI. So the AI I think, like as I said, you'll have a robot tax. You'll have, okay we've got AI working here. How much AI is here? What is the throughput of the productivity of the AI? Okay, here's the tax associated with it and the corporations will gladly pay it because they don't want social unrest. Like all that music that's coming from Midtown Manhattan right now, I don't really know what's going on out there. But, you know, my point is they're not going to want social unrest.
I think those are probably Mayday protests happening in downtown New York, but that's a whole other conversation. You mentioned UBI and that's going to be one way to curtail social unrest, but that's also one way to exercise tremendous terrifying control over our population, especially if you bring in the idea of digital currencies where you can track transactions, program transactions, if people are dependent on UBI, and then it's also digital. There's a lot to go through right now, you know, and those are all the things we're going to have to go through. And who knows, maybe that will also be computer-generated so that it looks like there's less governmental control over something, you know, I mean, maybe that'll be more formulaic.
Well, we're talking, you know, about AI as a productivity tool, what it means for the economy. There's also what it means for Bitcoin, for banking, for hacking, for quantum computing. There's that whole other conversation, but I want to take this into a slightly different direction while I have you here. And that is the conversation about ultimate AI control and the concept of the singularity. And that's the point at which artificial intelligence in fact surpasses human intelligence begins improving itself potentially triggering an exponential acceleration and change. So AI doesn't just get smarter, it becomes self-improving, and then it can improve itself. The robots can super improve themselves, potentially autonomous, they don't need humans anymore, becomes better and smarter than humans and they can control us. We have a futurist Ray Kurzweil, he's put a specific timeline on this, he says human level AI by around 2029, it's right around the corner and the singularity itself by roughly 2045. And again the concern is AI becomes autonomous, self-improving, it doesn't need controlled by humans. It doesn't necessarily even need to be hostile, but it operates on its own objectives and that reshapes markets, economies, power structures. I mean, that is a whole new world. Now, you've had a front row seat to major technological, financial, geopolitical inflection points. Now granted, this is out there, but when you hear those timelines and you hear 2045, the singularity, 2029, three years from now, AI having human intelligence, what do you make of that? I mean, you have young kids. How do you begin to reconcile that future?
Well, I guess the thing that we have to be concerned about is let's say we're good actors and so let's say we put controls in place to prevent some of that dystopian stuff that we're all fearing and let's say we have really good checks and balances in place that curb the potential bad effects of AI. Maybe we're willing and capable of doing that. And then the real question is, is that going to happen around the world? And I think the short answer to that is no. And so one of the things that I would certainly want is not a concentration of power in five or six elite technology firms. I would want there to be more dispersion and more empowerment of the overall population. I also would want there to be human oversight everywhere because I do think that as you get the AI past what they're calling artificial super intelligence and as you referenced it starts learning on itself, you have the potential for catastrophic misuse. You know, you don't want AI designing a cyber weapon or designing a bioweapon and figuring out a way to deploy it. And so I think most technologies, however, allow for iteration after we've made some mistakes. And I think sufficiently advanced AI we can build in some self-corrective features that allows for this containment. And so you know, you have these beneficial uses that we're talking about, medicine, science, general productivity. I'm wondering if we can put enough safety features in this stuff to get us the best parts of it without having to be worried about the worst parts of it. And so it's unclear, but if you talk to people smarter than me like Elon Musk, Elon's of the opinion that he's less worried about it than he once was.
