holy sh*t OpenAI **just** asked for a *Government* BAILOUT!

This is a screenshot, literally a

screenshot from our bank account this

morning. Holy smokes. I cannot believe

what the CFO of OpenAI just said. Keep

in mind, I'm going to play this for you.

She was the CEO of Nextoor. You know,

that like kind of annoying neighborhood

app that everybody gossips on. She also

worked as a CFO over at Square, now

known as Block. Anyway, uh and and now

she's at Open AI, so she gets around

corporate positions now. But what's

really wild is they're basically asking

for a bailout. They're kind of like,

"Yeah, you know, you know, if the

government gave us a bailout, you know,

we we wouldn't mind. Uh we're not saying

that the government is offering us a

bailout or even considering it. We're

just saying we wouldn't mind." AND I'M

LIKE, "WHAT?" NOW, you have to see it to

believe it because it's not just that,

but I'm also going to talk to you about

some crazy uh potential stock moves. Uh

and and I'm not talking about like day

trade move. I'm talking about like

long-term wise. There's something that I

saw that's kind of wild and it is

related to AI and you need to know about

it. Regarding more day trading, this was

insane, dude. This was absolutely

insane. This is a screenshot of a very

brief summary of our alpha report. Uh

because we make a little summary of our

alpha report and this morning I'm like,

guys, 6:27 today in another part of the

alpha report I wrote end of day 6:27. We

were at 6:18 when we wrote this. maybe

even 6:30 again by Friday. I wrote uh

and look at this, we made it within 42,

sorry, 52 cents to 627. We went from

618. The amount of people who printed

money on call options and like people

were donating in the live chat this

morning going, "Dude, I I just like 3x

paid for the alpha report." So, if you

don't have it yet, seriously, consider

getting it just for extra perspective,

right? Can't guarantee obviously, but

get it. Meet Kevin.com, you know? It's

it's awesome. I'd love to have you in

the alpha report. But listen to this.

This is just wild.

>> Open AI at our core are the model

company that needs always to be the

state-of-the-art. That's what we've done

time and time again.

>> We are so good at spending that we just

we have to keep spending because of our

turtlenecks that need the money.

>> GPD5 is no exception. But even in areas

like open source, we're attempting to

put the state-of-the-art model always

out into the world. it

>> and in order to do that we always want

to be on the frontier chip. So the

question is how long does a chip remain

on the frontier? Is it 3 years, four

years, 5 years or even longer? Now in a

world where we have that statement is a

reference to depreciation curves. Okay,

if you don't know what this means that

is totally understandable. Most people

don't and it's fine. I'm going to give

you like the fiveyear-old explanation

over the next 30 seconds here. Okay,

this isn't a pitch. It's an explanation.

If the chip equals 2year, then

worthless. Then when you buy it, you

spend 100 on chip,

$50 cost year 1, $50 cost year two, now

worth zero. Okay, understand that if a

chip has a 2-year depreciation schedule

that is after 2 years it's worthless.

You're going to have massive expenses

like you think the expenses are big

right now at Microsoft or Amazon or Meta

the expenses would be forex is expensive

is what we're seeing right now. Now, we

could see some of it in the cash flow

statement, right? But on the income

side, these companies EPS would be

getting destroyed. When you butter it

out like this, you actually only tell

the world, hey, we're only going to

charge that to our income statement. But

we're going to show both on our cash

flow statement, right? If you could

butter it out over four years, then it

would look like this, right? So, 25, 25,

that would be year four, year three,

right? So, you buy a chip today for

$100. you're only putting on your income

statement that it's costing you 25 this

year, 25 next, right? This is a basic

depreciation schedule. Now, if you're

going to lend against the chip, you want

to have some collateral. So, if you're

going to lend against the chip that only

has a 4-year life, you might want your

money back. You're 50% down. You might

want it back by year two, the end of

year two. Right? If the chip has a

10year life, you might be okay financing

out to 5 years, 50% of the collateral

value. Right. Right now, we're still

seeing old chips that actually have long

depreciation curves. But the question

is, how long will it last? The reason we

have these longer curves right now is

frankly because the supply is

constrained. It's not that Amazon

doesn't know how to make good

processors. I call them the trainy

process. They're train tranium

processors. I shouldn't say that. Uh

it's not that, you know, Google doesn't

know how to make good TPUs, the tensor

uh uh you know, core processors. Uh,

it's it's not that AMD doesn't know how

to make good chips. It's that Nvidia has

the freaking moat on the factory line.

Like literally, you're playing Mario

Party, okay? And Nvidia is taking all

the damn watermelons and you're like,

"Bro, let me have some." They're like,

"Nah, bro. I I got 80% of this contract,

man. Y'all could split the other 20%."

And then you're looking at the factory

owner going, "Bro, make other

manufacturing lines." And they're like,

"Bro, you realize it takes us like 3

years to make up another line of

watermelons." And it's like, well, damn,

this is how Nvidia gets the margins.

>> No compute. We're compute constrained.

We are absolutututely using chips that

have are like A100 equivalents that have

been around like maybe six, seven years

at this point in time. If that's the

case, financing chips gets a lot easier.

If the timeline on the chip stays short,

that gets harder. And so this is where

we're

>> keyword key word. If the timeline on the

chips stays short, if you actually

listen to that closely, you realize that

she didn't say if it becomes short,

we're screwed. She says it is short.

Listen to it again because it's really

important. I'll just go right here.

>> Like maybe six, seven years at this

point in time. If that's the case,

financing chips gets a lot easier. If

the timeline on the chip stays short,

that gets harder. And so this is where

we're looking for an ecosystem of banks,

private equity, maybe even um uh

governmental um uh the ways governments

can come to bear,

>> meaning like a federal subsidy or

something.

>> Um meaning like just first of all the

the backs stop, the guarantee that

allows the financing to happen.

>> Wait, wait, wait, wait, wait, wait.

Listen to that. You literally had the

Wall Street Journal going, "Wait, wait,

WAIT. SO YOU'RE ALL SAYING YOU WANT SOME

STEMI checks, which is fine. That would

that's what China does. You know,

companies are like, "Hey, we'll do

humanoid robots." And then China's like

I I don't know why they sound like

angry Germans, but whatever. We'll go

with it. Uh and then all of a sudden,

you know, China looks around and goes,

"What what are the Americans doing?" Oh,

damn. Look at that Optimus robot in the

distance.

Go make the robots now. [laughter]

We will shower you with subsidies.

Again, I don't know why my Chinese

accent is angry German, but whatever. So

that like that's how China operates with

subsidies. Like we will subsidize this.

We'll take an ownership stake. Whatever.

That's very much the communist way is we

will guide the means of production.

Cool. Now, that's not what she said. She

actually said, "Nah, we we don't want

stimulus. We want you to guarantee that

in the event we go bankrupt because we

suck at spending money and we just blow

it all because we have such a high ego

with our turtlenecks that we need to be

at the frontier of everything. So, in

the event that we go bankrupt uh or you

know the stock plummets, not unlike a

company that she used to work for or be

the CEO of like

choking on myself here, Next Door

Holdings, a $666

million market cap. Bro, you can't make

this up sometimes. You just can't

make it up. Down over 83%.

I'm sorry. I'm sorry. It's It was not my

stock. I I didn't make it go down. Yeah,

I She was the CEO. At least for some of

the Maybe it wasn't her fault. I don't

know. I don't know. Fine. Let's go to a

different company. Let's go to Block.

She was the CFO over there. How

[laughter]

[cough]

now I understand why the CFO of Open AI

wants a backs stop in case they go

bankrupt. that can really drop the the

cost of the financing but also increase

the the loan to value. So the amount of

debt that you can take on top of um an

equity

>> more debt, right? Because if you butter

out the collateral value, they'll

finance more for longer. What she's

saying, I understand why she's saying it

is the concern

>> portion for some federal backs stop for

chip investment.

>> Exactly. And I think we're seeing that.

I think the US government in particular

has been incredibly [snorts]

forwardleaning

um has really understood that AI has uh

is almost a national strategic asset

>> and that we really need to be thoughtful

when we think about competitive

competition with for example China. Are

we doing all the right things to grow

our AI ecosystem as fast as possible?

>> Are you talking to the White House about

how to further formalize that kind of

backs stop? We we're always being

brought in by the White House to give

our point of view as an expert on what's

happening in the sector for sure.

>> Mhm. Should we, you know, is there

something in the works that's tangible?

>> Nothing. No. No. I I love you, Sarah,

but nothing to announce. Nothing that's

going on right now.

>> If you wanted to, we're here to listen.

>> All right. Wow. Now, what else? Remember

how I talked to you about stons? Okay. A

couple other things. And you can follow

me at Realme Kevin. Just make sure like

I don't think you're going to see all my

tweets. I'm pretty sure Elon silences

me, but that it's fine. So, Microsoft is

now advertising co-pilot on Elon Musk's

X. I wrote this was not on my bingo

board. I feel like this opens up an

entirely new revenue stream for big

platforms. I want to talk about this. By

the way, this was insane as well. Have

you seen this? I wrote this is insane.

This is a screenshot, literally a

screenshot from our bank account this

morning. This is a screenshot of money

into one of our operating accounts. It

includes zero rent revenue because that

goes into a separate account,

QuickBooks. Uh, and this is almost all

fundraising. Almost all. Uh, A, I'm

insanely grateful, but B, holy smokes.

And this is before we launched the AI

product. Now, obviously, you know, this

is not a solicitation, but like look at

this. 4 days into November, $800,000.

Look at the moving average here. Last

3-month average, 1.1 mill. This is just

money going in to the house hack

account. That's the house hack bank

account. It's insane. Dear investors in

SEC, this is not a solicitation to

invest. Read the offering. Circular

investing comes with risk. Go to

househack.com or reinvest.co to learn

more about investing. You earn a 5%

yield upside in the stock. Uh we pay out

the yield monthly and you get that yield

through conversion. Okay, we get it. So

now the thing that was wild. I wanted to

say that especially on this AI topic,

but look at this cuz if you go to

reinvest.go, you see the AI thing that

they're working on which is amazing. I

was just looking at it again. Um, I feel

like this, by the way, with co-pilot

advertising on X kind of opens a whole

new form of revenues. We're going to

have to analyze this in our alpha

report, but this is actually totally

insane. Like Tik Tok, YouTube, Rumble,

Twitch, Netflix, Meta, Amazon Prime. The

the next logical step in AI might

actually be going from power and compute

and those constraints to being human

constrained. So, you start fighting for

users. I mean, Microsoft, why is

Microsoft literally begging for users on

X? because that's where the margins are,

man. Getting people to sign up for

co-pilot annual recurring revenue, baby.

A ARR

at the same time as Open AI is asking

for a freaking bailout. What the heck?

They're pre-asking for a bailout. It's a

pre- bailout. Not because they're going

bankrupt because but because their

lenders are starting to go, nah, nah,

nah, nah, too much risk. This is nuts.

Anyway, check out the alpha report at

me.com. Check out house hacker or

reinvest. It's just a DBA of the other

uh over at househack.com or reinvest.co.

We'll see you there.

>> Why not advertise [music] these things

that you told us here? I feel like

nobody else knows about this.

>> We'll we'll try a little advertising and

see how it goes.

>> Congratulations, man. You [music] have

done so much. People love you. People

look up to you.

>> Kevin Praath there, financial analyst

and YouTuber. Meet Kevin. Always great

to [music] get your take.