132 – Healthcare’s Roughest Week Yet | Cuts, Crashes, and Critical Questions

Marcus: [00:00:00] If you enjoy this content, please take a moment to rate and review it. Your feedback will greatly impact our ability to reach more people. Thank you. Well have a show warm up. I'm back. Yep. 

Vic: Thanks for doing the show last week. It was great with Paul. I listened to it on the way back, dude. He's great. 

Marcus: He's so smart.

He's so smart. Uh, we are, we're lucky to have friends like him. Um. And, uh, I, I'm, I'm happy for him that he's, he's getting a break from having to be a day-to-day operator. Yeah. He's very good at it, but it's hard. 

Vic: Yeah. 

Marcus: It's really hard. So he can come here and fill in for you and not whatever he wants. Right, right.

Yeah, exactly. Uh, ton of stories this week. Yeah, we got, it's, 

Vic: it's like a whiplash week. I mean, we, we called it last week whiplash, but I feel like it's continuing. 

Marcus: I mean, there's literally things that we talked about last week that have been reversed that changed right this week. Yeah. So, so yeah. A ton, a ton of whiplash.

Um, and I don't know, I, I personally don't have much to talk about other than the stories, so, yeah. You ready? Yeah. Ready. Alright. Dig in.[00:01:00] 

Let's start with, uh, with the economy as always. Uh, trade tensions weigh down Nvidia tech stocks. Dow drops 700 points. Fed chair Jerome Powell warns of economic risk. This is Wall Street Journal. 

Vic: Yeah, I mean, the, the stock market does not like uncertainty and we have chaos. I mean, this, no one knows what to expect, and so it's down, it's gonna keep being down than up a little bit, but I think the trend is more down than up 

Marcus: zoning in on healthcare for a second.

Uh, we identified in the beginning of the year that healthcare last year was completely flat. The index s and p mm-hmm. Um, industrial sector of healthcare was completely flat. Uh, worst performing sector. Yeah. Sad, but yeah. Worst performing sector and off to a pretty rough start. Yeah. We're gonna dig into it later, but off to a pretty rough start.

[00:02:00] So, um, it feels like the whole story about sort of year over year growth and, and look, it's interesting, right? 'cause we, we talk, we would talk about it and we would complain about it. Uh, the fact that we've got, you know, runaway growth of healthcare mm-hmm. Eating away GDP, you know. 

Vic: Yeah. 

Marcus: It was 

Vic: 2 trillion, three and a half trillion, and we started 2 trillion, and then it's 3 trillion, and now it's four.

Now 4 trillion. Yeah. Four and a half. 

Marcus: Yeah. So, you know, to some degree it seems like it's time, but it, it's, it's very painful and very scary to the industry now that we're we're here and the way that it's actually happening. Yeah. 

Vic: I 

Marcus: think that's right. Alright, next story. Uh, Powell warns of challenging scenario is fed in trade war rages.

We, we talked about this a little bit before the show started. People seem to be at odds around the idea of whether or not the tariffs are inflationary or deflationary. And I think you've got some opinion on this, but Powell is, is, um, asserting that the tariffs are inflationary. [00:03:00] 

Vic: Yeah. Is that correct? Yeah.

So yeah, Powell spoke in New York, uh, I guess yesterday. New York fed on Wednesday. Yeah. Uh, no, it was, it was a, some lunch that they had. Oh, like an economic forum company. Economic, yeah. Okay. And his, his basic point was that tariffs are gonna drive inflation higher and he is dual mandate of keeping price stables and full employment is then gonna have, is gonna make it difficult for him to keep up with both those things.

Um, and I. I think that's, that's the discussion are, are the tariffs going to be inflationary and under what timeframe maybe? So I think if you add a tariff and nothing changes, I think it's clearly inflationary, but it's my expectation that there's gonna be a pretty significant reduction in the overall economy that is gonna actually make people, [00:04:00] you know, concerned about their jobs or lose their jobs and how the stock market is going down.

And I think people will, in general, buy fewer things. And that is, puts downward pressure on pricing. So I don't believe that in a timeframe, like three months or six months, inflation is a very big concern. But, but that's what he was talking about yesterday. 

Marcus: Yeah. It seems to me that that prices. Going up will happen faster than consumers adjusting their spending.

It's more likely they'll just go into more debt. They'll use more credit cards before they adjust businesses, uh, are going to be swift in increasing costs than passing those to the customer because they're more disciplined than consumers are and they have to move very quickly to keep their p and ls right side up.

So 

Vic: Yeah, that's correct. Until people lose their 

Marcus: jobs. Yes. Which [00:05:00] will, which will be after. 

Vic: Yeah. Yeah, that's right. It just depends on your timeframe and in, uh, in the next 30 days, I think prices are gonna be up. Right. But in the next three to four months, I think there's gonna be a lot of economic damage and which will then make inflation not high.

Yeah. But that's what Powell's talking about. 

Marcus: It's, it's, it's all just so, so complicated. Um, and. In, in the modern economy. We haven't, we've not been here. Yeah. Um, so it seems like there's a lot of different levers that are going on, especially as, you know, the, the tariffs are not, um, you know, one, they, they don't move in one direction, they're bidirectional.

Right. So, so there's all, there's the response to the tariffs Yeah. That are coming in just as hot as our tariffs are going out. And the impact of all of those things is very, very different. Difficult to price in. Right. 

Vic: Yeah. And I, I guess I wish that [00:06:00] the chairman of the Federal Reserve could be a little more, uh, forward-looking, try to help people by saying that he will do what's needed, as opposed to say, this is really bad and we're not gonna be able to fulfill both our mandates and how terrible it is.

But, but that's what he did. That's what he said. 

Marcus: Yeah. I mean, he, he's, he's probably acknowledging that he. Uh, will have to be reactionary because there's no world in which he can move as fast as Donald Trump moves. 

Vic: Yeah. I mean, he can't change policy until there's a meeting. That's right. And I, I think in the May meeting, he needs to cut rates, but, but he doesn't think that, or he didn't talk about that, so 

Marcus: we'll see.

We'll see. So, uh, you pulled this report, uh, business Leader report from the New York Fed. Uh, it's, uh, five pages, so very, very easy and we'll, we'll put a link in the [00:07:00] show notes to it. But on page four, there's forward looking indicators. These are all sort of, um, these are like sentiment, right? Yeah, yeah.

Vic: It's, it's business leaders, CEOs, the New York Fed polls, the people that run businesses in their, in their geography. They do it monthly and the forward looking statements. Um, some of 'em are the worst that it's ever been. The business climate I think is the worst that it has ever been. This in the last two months.

Uh, some of them are the worst since Covid, but it's real really bad from now. This, the New York Fed obviously rolls up to the overall fed. Yeah. So I mean, I mean, it's crazy. Chairman Powell certainly has this 

Marcus: data. I mean, the idea that the business climate is worse is worse than Covid. Right. That is just, uh, it's amazing.

Yeah. It's amazing. 

Vic: Well, it makes sense to me. I mean, in Covid you had this [00:08:00] outside factor Sure. Hit us, you know, on from outta the blue. Yeah. And all of the power of government corporations really, everyone was trying to figure out a solution. It was scary, but we were all trying to solve it. Yeah. And now it's not that.

No. I mean, you have. At least two, probably more than two different sides fighting at each other. 

Marcus: Yeah. No, I mean, uh, of these charts, there's four charts here for the listeners. One is business activity, two is business climate, three is number of employees, four is wages. Um, number of employees and wages when comparing this period we're in right now to covid, uh, kind of not even close.

Like Covid was much worse. Yes. In terms of the decline in employees and the decline in wages. Right. Yeah. Um, and it's, it's pretty on the nose when you're comparing business activity from Covid Right. To, to now. But the climate, the climate Yeah. Is worse way, way worse. Right. And we're [00:09:00] talking about the precipitate, the precipitating event in 2020, being an actual global pandemic that shut down the world economy.

Yeah. Versus what the admin, the current administration of the United States is, uh, is issuing as you, you know, economic executive policy. 

Vic: Right. Yeah. And people that are, um, Trump supporters will say, you have to break some eggs to make an on water or whatever. They'll say, there's a lot of damn eggs being break broken, but maybe, and then, you know, people on the democratic side will say, this is a, you know, unforced era.

You just like drove into this through the economy, into this field. Um, and I don't know which is Right, but it's, it's pretty painful to go through. 

Marcus: Yeah, yeah. Uh, speaking of, uh, reciprocity China halts critical exports as trade war intensifies, [00:10:00] so, um, it was interesting. It wasn't until I was sitting across from Paul that I heard anyone use the word war.

Mm-hmm. Uh, to reflect what's going on between the United States and China. Uh, and then immediately after that I was looking around and I seen. Yeah. Basically everybody is calling it an economic war. Yeah. Um, and, uh, and China, you know, I mean, they're not just playing the tariff game. They, they're finding other levers that they can, that they can pull.

Uh, just as a quick game where I probably should have sent you a link to include, but have you seen on social media, TikTok and Instagram in particular, uh, the reels wear, uh, or shorts, whatever you wanna call those things, uh, where there's a guy in a, um, in a factory in China and he's, uh, deconstructing a Birkin bag, you know, birken bag's, like five figures to buy, right?

Yeah, yeah, yeah. So he is deconstructing it. And the way that he's doing it is so clever because he's, [00:11:00] he's, he's talking about like what a high quality bag it is, and he is talking about all the different parts. So he's not disparaging the bag in any way, shape or form. Um, but when he tells you the price of each one of those very high quality components, right.

The final price is, I mean, it's like $500 right? For the, for the bag, you know what I mean? And then you're, you're paying Yeah. 30 x for the bag. Right. Right. You know what I mean? Yeah. You're paying 30 x the cost of it, and then he goes on to say, you can buy this bag from us and we'll only charge you seven 50.

Right, right. So, you know, I don't know what is that 50% above? Yeah. Above cost. Right. And, and he says the only difference between our bag and their bag is the logo. Right. And, and, and, you know, listen, like TikTok is in China, like Yeah. They're gonna disseminate that. Like, well, that's one of their strategies for war.

Vic: We had too many, um, stories today, so we cut it. But one of the stories that we had that got cut is Yeah, the biggest downloaded [00:12:00] app, I think in the world. It's either world or, or the us. I can't remember. Is this this app that's selling products made in China? Exactly the same. It's just, it's just taking this TikTok video and putting it on an app that you can order from.

And they literally are saying, every factory in China that makes any kind of branded goods, we now are gonna offer unbranded the exact same product. And they do it through this app, and it's the number one downloaded app. Because if my, you know, I don't have bags, but if my expensive phishing equipment is, can be half the price and it's the exact same quality, what do I care about the logo I and dude, if, even if the duty on that is 125%, but the price is, well, the duty on the expensive logo one is still the same, you have the same tariff on that.

Marcus: Or maybe you don't because you're buying it for through the EU instead of, but I, I, I guess my point is just like, yeah, if, if, if China's got the super, you [00:13:00] know, over the top 125% tariff, but their price is, you know. 10% of the original price, guess what? The consumer still wins buying from China. Right. Even with that tariff.

Yeah. Like you're gonna have to 500% the tariff to make it not work. 

Vic: Yes, that's right. And so, so, but this story is about them not sending all the rare earth materials Yes. That we need for automotive, everything for electric motors, for, for everything. Yeah. Pretty much everything. Yeah. And we don't have sources of that now.

We can, we could find it in the US I think, but it's very messy. I mean, there's also source, there's also sources 

Marcus: in Africa, but we're not being very nice to African countries Yeah. Right now either. So, 

Vic: and it's just, it's a. Mining's a dirty, difficult, dangerous thing that Yeah. I don't, I think it's gonna be hard to do in the us.

Yep. 

Marcus: Agree. Agree. Uh, and then this final story on the economy section is, uh, highlighting the, the weak dollar. Um, so, so many things went down last week. I [00:14:00] mean, gold went down, right? Uh, a lot of it was was people needed to make margin calls, right? Yeah. I think 

Vic: the gold was, was margin 

Marcus: call, right? You gotta sell something that has value.

Yeah. That, that was margin call stuff. But, but the bottom line is it went down, right? Yeah. I mean, 'cause the four sellers sort of everywhere and, uh, and with all of this, you know, part of the, the strength of the dollar is the faith of the United States government, and that is in decline. And, and, and, and of course it is.

I mean, no one can look at sort of the, the way we're carrying ourselves from a tariff perspective, um, in a foreign relationship perspective and, and think that would not impair the dollar. I mean, 

Vic: yeah. And, and the weak dollar is actually gonna be helpful for the economy. Mm-hmm. Um, I don't know how long it will last, but, but a little bit of weakness in the dollars will be beneficial in, and what I think is gonna be a really difficult year from an economy point of view.

Marcus: Yeah. For, for period. Yeah. Yeah. For period. But, but a weak dollar that allows other currencies to raise up, [00:15:00] and especially as they start creating net new networks. Yeah. Um, you know, there's, there's certainly a risk to that. All right, let's move into the VC world. So, uh, beryllium snags, 16.7 million series A to use AI on patient charts.

This is from Axios Pro. 

Vic: Yeah. So, so they, um, ingest the patient's chart in order to then make recommendations, which is, which I think is good. I mean, it's, it'd be good to have a human in the loop, which I think they, they have. Um, but humans, just looking at the chart, I mean, it, it's too much. You, you can't look through it all.

So. I think it's a good, good use case. 

Marcus: Uh, it says they, they saw their initial highest uptake among, uh, behavioral health entities and now they have customers across weight loss, home health, and chronic care management. So they're not selling into health systems initially. 

Vic: Yeah, that's 

Marcus: right. Yeah, I think that's smart.

Uh, policy me announces $30 million cad, what is it? No, it's Canadian. Canadian Dollar dollars. Yeah, it's just in Canada. So 30 [00:16:00] million is Yeah. Got it. Yeah. Canadian dollars. It's close to US dollars. Yeah. Yeah. Close enough. Uh, secured through multiple tranches, equity and debt financing, uh, from Blue Cross Life Insurance Company of Canada and Secur in Canada.

So, yeah, so this is 

Vic: a, a, an assurance, uh, new company. I, I was interested in it because they're combining life insurance and health insurance. That's cool. Which I've been. Thinking about and wondering about, and and they did it. They're in Canada. Yeah. Um, but I think it's pretty good because it, it, it would balance each simplifi.

Each other Simplifi. Yeah. Yeah, 

Marcus: yeah. Yeah. I think that's good. Alright. We'll keep, we'll keep an eye on that. This is local story, uh, deacon Health launches to bring tech enabled care coordination services to specialty care. So for those in Nashville, we have some, uh, some familiar names here. Herb fr, uh, former CEO of HealthSpring, Larry Cash, former CFO of Community Health Systems to David Van Water, former CEO of Ardent Health.

Our, uh, sort of key named investors in the $7 million seed funding round for, for this company. 

Vic: [00:17:00] Yeah. So it's a, it's a great group of really experienced healthcare folks in Nashville, and it's a hard space right now to enter, but, but they, they're connected. They're good operators. Yeah. Yeah. I mean, 

Marcus: good operators and, and all highly, highly, highly connected.

Yeah. So they, they, these are, these are gentlemen that can, you know, actually open doors and Yeah. And close deals. Uh, so we'll, we'll have to watch Deacon Health in the care navigation space. Alright, uh, TechCrunch chapter, a Medicare startup with links to Vance the, and Ram Swami just raised around at a $1.5 billion valuation.

Yeah, so Medicare advisory startup. 

Vic: Yeah. So they basically help seniors think about what Medicare Advantage program they should go into. Um, and then I think they get paid, they probably don't call it a commission, but a commission like incentive for that. [00:18:00] Um, and yes, very well connected in the, in the Republican circles, but then they have a, a new democratic, uh, leader that just joined the board.

Um, so they're. They're sort of gearing up for this, this political world that we're 

Marcus: in. Yep. And, and well positioned. Yeah, well positioned. Alright. Hello care.ai scores 47 million for AI enabled virtual care for smart Hospitals. Uh, it's the first time I feel like I've seen the word Spark Hospital in one of these VC uh, announcements.

Yeah. So that's, that's worth noting. Um, it's a AI company, so you know, credit to Bruce and Steve mm-hmm. Um, for getting the smart hospital Yeah. Brand out there. Uh, I hope they're benefiting from this. Uh, so hello Care AI offers AI enabled virtual care delivery for smart hospital rooms. Um, the round was, uh, contributed in by uc Health, Bon Secour, LRV Health and OSF Venture.

So a bunch of health systems around the table. 

Vic: Yeah. Yeah. And they're really, um, [00:19:00] focused on the inpatient hospital experience. Um, they. They will, and they do then extend past discharge to take care of the patient at home with remote patient monitoring and other services. But it's primarily trying to make the hospital room more, more intelligent.

Mm-hmm. 

Marcus: At Ovia Therapeutics raises 90 million to treat autoimmune diseases. Uh, so this is a C round. And, uh, who's contributing to this one? Deep track capital. Sanofi Ventures, Vita Ventures and Moray Asset Capital life science. 

Vic: Yeah. So I don't really know the science, but um, it is, I. Really focused on treating patients with chronic pertussis, which is an, it's like an eczema.

It's like a skin, uh, autoimmune. Yeah. Right. Yeah, exactly. Okay. 

Marcus: Alright. And they've, they've got a portfolio of, of, of assets that they're developing Right. All around. They've got five different assets they're building, so, okay. Some mono life sciences [00:20:00] side. Alright. We're going into policy now for Politico HHS funding slashed by 30% in budget proposal.

That's a, that's a big cut. 

Vic: Yeah, so that's a big cut. I mean, just at, at the highest level, and this was sort of leaked, so it's not fully approved by, by the department yet, but I think it's pretty close to what, uh, Robert Kennedy Jr. Is planning. So they're going from 120 billion last year to about 80 billion this year, which is a huge, that's a huge cut amount of cut in people and just entire departments.

Of C, DC and all, all the different departments have, are getting huge swaths, cut and reorganized. And I guess I'm hopeful that it comes out okay. But there's a lot of change really quickly going on. 

Marcus: Yep. That's the theme here. A lot of change really quickly. Yeah. Uh, so, you know, that is across [00:21:00] C-M-S-F-D-A-N-I-H, you know, on and on and on.

Yeah. Yeah. Um, yeah. A a lot of change. CMS proposes a 2.4% bump to inpatient pay in fiscal year 2026 calls for deregulation and maha, which is Make America healthy again. Suggestions. This is fierce, fierce healthcare. 

Vic: Yeah. So, um, this is not yet official, so it's the first, uh, the first, you know, salvo in the negotiation basically.

But they did 2.6 last year and that was really painful. On all the hospital systems. Mm-hmm. And so 2.4 is pretty low raise. Oh, yeah. Um, and gonna be, it's gonna put pressure on health systems as all these things. They're putting pressure on health systems. Yep. Yep. So real, not, not a good news story. 

Marcus: No. A much more favorable bump, more than two x, uh, bump for Medicare advantage.

Right, right, right. So that, that, if you're just comparing those two sort of, uh, [00:22:00] yeah. Rate increases. It, it's signaling more privatization, more com competition. Right. It is, I'm, I'm inferring here, but like, 

Vic: yeah. I mean, I think it's going to be really difficult on the health systems. Medicare Advantage is a good plan and, and giving them a, a bump.

I'm not opposed to, but yeah. It should be a, I'd rather it be also to the health system. Yeah. I'm, I'm, IM simply comparing the two. Yeah. Right. I mean, 

Marcus: look. Very, very low pay rates to the health systems. Three 40 B challenges. Yeah. Looking for deregulation, site of care, site of service, you know, is, is in scope.

It is a lot. Challeng. Supplemental payments, supplement. Supplemental payments. Yeah. It's a lot of challenges for health systems at one time, man. Yes. That's right's a lot. Is a lot. Uh, yeah. I mean, I don't know what to say. It's just, it's gotta be hard to run a health system right now. Yes. Oh, and then, and then, and then let's talk about the, you know, [00:23:00] if you're an academic, all the big cuts.

Yeah. All the, all the, all the funding cuts. Yeah. Yeah. All the grant cuts, right. It's just incredible. All right. Wall Street Journal, USDA is fast tracking requests to yank soda from food stamps program. So Snap, uh, continues to get a review from the MAHA perspective. Mm-hmm. And, uh, they're, they're very aggressively going after soda.

Vic: Yeah. And I, I think of all the things, I'm not that upset about this. I mean, people should be able to buy whatever they want to buy, but. Getting, uh, food from the government 'cause you are too poor. Or Ford food we should do, but I don't know if you have to be, you should be able to buy Coke and other sodas.

So, yeah. 

Marcus: I thi this, this feels pretty low on the controversy. Yeah. Pretty easy. Yeah. Yeah. On, on the controversy side of things. Um, and also true to form for what they were positioning. Yeah. Right. Uh, you know, in the campaign trail, uh, fierce Healthcare CMS to end federal match for state's Medicaid funding requests.

So we're gonna dig into this story a little bit. [00:24:00] Mm-hmm. Because it's, it's, it's a little bit in the weeds. Um, so there are, uh, specific. Uh, designated state health programs or DSPs and designated state investment programs, DSPs that are under section, uh, 1115 waiver authority. Yeah. And these programs have grown, uh, from 886 million in 2019 to nearly 2.7 billion in expenditures in 2025.

Many of these things, uh, I'm, I'm paraphrasing here, but generally sort of fit into the social determinants of health. Yeah. So they're the things that sort of are infrastructure, um, that you would layer healthcare services on top of. They're not directly healthcare services. 

Vic: Right. 

Marcus: Right. 

Vic: Yeah. So you and Paul were talking about, um, supplemental payments mm-hmm.

And Medicaid last week, and that was more about, uh, uncompensated care. There's some acronym, but which is in the same broad categories as [00:25:00] these waivers, but that is much more clinical, where these are the, as you say, the SDOH. Sort of, they, they affect healthcare, but, but they're not directly in care. 

Marcus: Yeah.

So for example, one of the, one of the, the types of things that these programs fund, um, would be rural broadband access. Right? Right. Um, which is kind of necessary when you're, if you're gonna do telehealth. If you're gonna do telehealth, you're gonna keep shutting down clinics and hospitals in rural America, you at least have to lay down, you know, uh, infrastructure for the internet.

Right. Yeah. Well, this actually is, is stripping away, um, at the funding authority for CMS to, to continue to back those programs. 

Vic: Yeah. Um, there's, there's some ride, some ride things that I think that are in this. There's the food, some states offer food. Yep. Any of those kind of related to health, but not directly clinical.

Not clinical. That, that's exactly right. I think this is under this category. Yeah. And it has grown from 800 million to 2.7 billion. Yes. Um, but all those things are [00:26:00] important too. They're, they're 

Marcus: important and they're related to health outcomes and, and I think. You know, it took us a long time to recognize that not all health is delivered via clinical services.

Yeah. In an operating room. Yeah. Right, right. You know, there's a lot of things on, on the periphery. I mean, they're not really in a periphery that they're, they're on the periphery to the healthcare system. They're core and central to the individual's life. Yes. Right. The clinical work is actually periphery to the individual's life.

It's, it's, it's, yeah. You know what I mean? Right. It's, it's kind of the reverse. And, and so now these, these programs are actually, uh, yeah. 

Vic: And I take the position that most people in Medicaid and Medicare are gonna be, their care is gonna be paid for by the federal government for a long time. Medicaid, you definitely might have people come off that and in and off, but in general, the government's gonna pay for a lot of these folks care for a long time.

And if you take away support for the social government of health, I think the [00:27:00] taxpayer's gonna pay more dollars. Later, just in a different category. Yep. So it's 

Marcus: shortsighted, but Yep. Agree. Alright, moving on to, to stat news. Trump targets healthcare costs with executive order on drug price negotiations and hospital payments.

Um, so this is, it's, it's an order, it's executive order. Mm-hmm. So, you know, it's ability to actually make any big, big impact still has to move through HHS and cms CMS specifically. But I mean, which, 

Vic: which it's going to happen. Kennedy controls. Yes. That's, yeah. Yeah. That's, they have to make, that's going happen to have, to do the rule making process, which takes a few months.

They're moving faster than normal, moving fast, so it takes a little while, but they, they don't need to get votes in Congress. They, they can do this and it's really attacking a three 40 B plan. 

Marcus: Yes, 

Vic: yes. And well, the. Maybe it needs to be redone. It's just, it's gonna put a lot of pressure on, [00:28:00] like the same, the same health systems are under the same pressure for all these changes, 

Marcus: multiple line items of revenue being attacked at the same time.

Right, right. Yeah. So, uh, eventually, you know, this is going to result and, uh, not just lower standards of care, but less accessibility of care, uh, you know, to our communities. Yeah. I mean, you know, th this is going to ultimately start affecting each and every one of us. 

Vic: Yeah. Now each and every one of us, now, we both have investments where maybe there can be innovations, telemedicine, AI devices, other things, but, but that's gonna be slow to sort of put together and taking the rural health system out of, out of the market.

I don't know that you can't replace that kind of infrastructure with the work we do. That's fast. 

Marcus: Not that fast. No. No, you can't replace that kind of infrastructure with the work we do. So Mark Cuban, who has [00:29:00] been a pretty consistent critic of, uh, what is happening in Washington. Mm-hmm. Uh, but I also think shoots fair and straight and does not lean too heavy to any particular side.

Yeah. 

Vic: And he understands the, the prescription medication space because of what he's doing very well with cost 

Marcus: plus. He had a post on X where he basically. He is saying that the, that the executive order on, on healthcare in a particular drug pricing, uh, could be very, very good for saving money. But then he lays out, you know, some key points, um, from his deep experience now Yeah.

And working on, on drug pricing. Uh, and you know, he seems to believe that, you know, between PBMs, um, and, uh, some of the specialty tiers that are in place, that these things do need to be addressed. And that if you can address those things, you, you can lower the cost both for the government but also for individuals.

Vic: Yeah, I mean, I agree with it. There's no question about [00:30:00] that. I agree with He is correct and this detail is what would be in the rulemaking and it is going to put pressure, I mean, if you get rid of three 40 b, I think there needs to be some way to get money to health, health systems. Either through supplemental payments or some new plan that's maybe less convoluted than that, but it's, the math is not gonna work.

And so I agree with Cuban, but the, the topic we were talking about, the last story is, is still in place that it will save money. There's no question it'll save money, but then you're gonna have pretty large areas of our country that have health systems that are gonna be really in trouble. We, another story we cut is Fitch is downgrading a whole bunch of, uh, nonprofit health systems.

Yeah. [00:31:00] Both because of these changes and also that they know that their stock portfolios have gone down. Just like at my stock, everyone's stock portfolios gone down. Have we gotten 

Marcus: Kevin scheduled yet? Um, I don't know. Okay. I I, I, we need, we need to check on that. It's time, it's time to get Kevin on the show.

Um, alright, so anyway, this, this is more, more of a good show note for people to read. Yeah. You know, marks, Mark's good. Thinking here on, on, uh, on, on pricing. Okay. Uh, what to know about Trump's antitrust efforts against the tech giants. So, uh, shifting away from healthcare a little bit, there's been a lot of big news around, uh, the FTC, um, and meta.

We're gonna, we're gonna dig into that a little bit here, but also just more broadly, uh, th this FTC in, in this one way, uh, is pretty aligned with Lena Khan's, ftc. Yeah. Um, and they are continuing the, the efforts, uh, against, you know, Google and Meta. 

Vic: Yeah. Yeah, I think that's right. And that is, um, I think needed and [00:32:00] how to do it is complicated, but having seven companies sort of dominate the stock market and dominate all of our lives is.

Is probably not useful or healthy in the long run. Yeah. But there needs to be some clarity of how, what are they allowed to buy and what they're not allowed to buy. Um, but yes, they're, they're, they're looking really, I mean, people thought if they just give a little money and go to Margo Yeah. Turns of that's 

Marcus: not happening so much.

No, no, no, no. You know, you, you needed to do what Elon did. Yeah. Yes. Uh, you know, to really, you know, get the, get the right position in place. Right. Uh, and so this next story from the Wall Street Journal, uh, you know, digs into Mark Zuckerberg's failed negotiations to end the antitrust case. The Ft C wanted 30 billion to drop his case.

Zuckerberg offered much less and hoped Trump would back him up. Trump did not. And so it's interesting, you know, mark tried to put Dana White on his board to sort of help with this [00:33:00] and, uh, Dana White's not enough. Not enough. Yeah. 

Vic: The seven stocks are maybe two powerful. And I think that it's, it's really difficult to, what they're trying to do is reverse the allowance of Facebook to buy Instagram 10, 12 years ago, I mean, a long time ago.

And one, it's a very competitive marketplace in my mind. I mean, there's a lot of social media companies and no real barrier for a new one starting up. And so I think it's a hard case to make. But, but this story goes through Zuckerberg's failed attempt, and then the, the head of the FTC, you know, went to visit Trump, who he reports to, and basically said, let, let me, let me finish this coach.

Like, I, I, I can, I can win. And, and Trump's backing him. Trump's backing him. 

Marcus: Trump's backing him. Yeah. 

Vic: Yeah. So, [00:34:00] 

Marcus: yeah, Zuckerberg didn't have the loyalty that, uh, he had hoped his last ditch efforts would, would provide. Yeah. You know? Yeah. All, all of his, uh, sucking up to Elon and, yeah. And the UFC not good enough buddy.

Uh, Japan regulator orders Google to stop anti-competitive practices. And so not just here in the US but abroad, Google facing, uh, some serious threats from, uh, from Japan and we'll, we'll talk shortly about the uk. 

Vic: Yeah, yeah. I don't, uh, I don't know much about this government body, but, but it is definitely, it depends.

FCC, right? Yeah. And it's, um, it's definitely a threat that they're gonna have to deal with. It's, it's sort of, I think in response to the terrorists, I mean, the US is basically saying we're going alone, and it's Amer, it's called America First, I mean, and so these other countries are no longer just gonna let our companies do whatever they want.

Which I think seems probably like a natural response. 

Marcus: Yeah. In this case, Japan [00:35:00] is accusing, uh, Google of not allowing other search engines to be, you know, reasonably positioned on Android devices. Um, I mean, sound sounds about right, which they I think they do. Yeah. Sounds about right. Yeah, sounds about right.

Uh, and then also Google Faces potential $6.6 billion UK antitrust lawsuit over search advertising. Um, the collective action says Google abused its dominant position to exclude competitors from searches. This is also Wall Street Journal. 

Vic: Yeah. And so go Google is hard for me because they have a monopoly on search, but I think they earned, they like earned their way to that monopoly, like one customer at a time by having the best product.

They didn't, unlike Meta, they didn't really buy up everyone, they just out competed. Now they did buy Android, but they've kept it open source. And then I also think search is becoming less and less valuable every day. So [00:36:00] I have less, um, feelings that Google should be broken up. 'cause I just don't, I don't see what would, what would you take out, take out of there Now maybe they should allow, I don't know, some other search engine to be installed on a phone, but I don't know.

I I have a harder time seeing the Google case. 

Marcus: Yeah. I, I I mean you made an important point that, uh, that I hadn't quite thought about, but, uh, there's no question Search is becoming less, yeah. Less meaningful by the day. AI is absolutely eating into SEO. Yeah. Like big time. Uh, and go 

Vic: Google's cannibalizing itself as they need to.

Marcus: Well, I mean, to some degree, but I don't think Gemini has nearly the market share that chat g ti does. So I mean, the reality is, 

Vic: but they are. Cannibalizing their own Google search with ai. Yes, yes. Yeah. It's really affecting the downstream. Of course, websites of course. [00:37:00] Um, but they have to, no, they may lose the AI race, but they're, I think they're working on it.

Marcus: Yeah. They're, they're, they're doing their best. But, but yes, this is, uh, this is really tough check. California has taken Trump to court to stop his tariffs. So we've, we've seen quite a bit of Newsom in the news this week. Mm-hmm. It feels like Monday was like his big day to kind of come out and say internationally, Hey, you know, other countries you can do deals with us.

Yeah. California is its own country when it comes to the size and strength of its economy. And, you know, we're just gonna act independently. I mean, that's, that's a really, really big deal. But, uh, I mean, look it, what is it, the fifth largest economy. 

Vic: Yeah, I mean, it, it's, the size is not the question. It's plenty big enough.

Yeah, yeah, 

Marcus: yeah, yeah. I mean, so, you know, he's, he's, look, the problem is he doesn't have a military. So like, it's, I mean, I mean, I understand that, but, but if you're, if you're gonna pressure test, now is the time. Now. Now, now is the [00:38:00] time. Right. Now is the time. And, and so I, I think it's gonna be interesting to see how this plays out, even if it is just a stunt to, to elevate him as a presumptive, uh, challenge to, to whoever the GOP puts up in the next mm-hmm.

Uh, you know, in, in the next presidential candidacy. I, I think him starting to do these types of things makes a lot of sense. I think it makes a lot of sense politically. 

Vic: Yeah. And it's a step towards a, a. Destination. I don't want to go 

Marcus: so, well, if, if it actually plays out. If, if it, if it's more than political theater.

Vic: Yeah, 

Marcus: sure. 

Vic: Yeah, 

Marcus: yeah. It's not clear to me it's more than political theater. 

Vic: Yeah, that's fine. California cannot do a trade deal with Japan. No, of course not. So, and if they too, that's, that's why I call theater. Yeah. Right. 

Marcus: That's why I call it theater. 

Vic: Yeah. But I'm fearful that if the Trump strategy, whatever it [00:39:00] is, and I have friends that will tell me exactly what it is.

I'm not sure anyone really knows. If the strategy doesn't work and we have a really bad economy, which is certainly a possibility, these stories are gonna get more and more scary and important at the same time. And I would like to solve things through elections, not California going rogue. But, but who knows?

Marcus: I don't believe they're actually gonna go rogue. I, I view this as a foreign protest. Yeah. Well that, that's, you know, kinda like Cory Booker. Yeah. And what would he do? Yeah, yeah. You know, the, these are, they're symbolic because that's the amount of power that the Democrats have right now. Right. Right. They, they only have symbolic power and to not do anything Yeah.

Would be the worst thing you could possibly do. Right. To just be completely absent. So I, I just view this as Yeah. That's, that makes sense to me. Yeah. Remind, you know, it's, this is a great way to remind people of just how important California's economy is and how large it is. And that, [00:40:00] you know, uh, he has the audacity to match a Trump.

I, I, that's kind of how I view it. He's got equal opposite audacity. Yeah. That's kind of, kind of how I see it, so. Alright. Uh, okay. Bad news. Um, going into payers, UnitedHealth Group shares plunge, CEO calls out unusual and unacceptable Q1 results. This is fierce healthcare. Uh, this landed today. It's the first time, I believe, since we have been doing this show, but probably the first time in, in longer than that, um, that UHG has missed and has not only missed, but is, um, changing its outlook for the whole year, which resulted in, I'm not sure where things are right now, but you know, when I sent you the Wall Street Journal story on this, the sheriffs had gone down 20%.

Vic: Yeah. It was 20% down. Pretty close to immediately. Yeah. And then I don't know what's happened since then. Yeah. But it's bad. 

Marcus: Yeah. [00:41:00] Um, yeah. I mean, and, and, and, uh, G's uh, loss was, was larger than the other payers, but you know, of course UHG represents the sector in a pretty meaningful way. So everything else kind of got dragged down as well.

Elance was down 2%. Humana had their own bad news and they Right. And, and they tumbled 7%. Um, and CVS was down 2%. 

Vic: Yeah. And. If, uh, if United can't, can't deliver in this environment? I don't think anyone can. I mean, they, they have a lot of levers to pull. 

Marcus: Yes. And, but I, but I, you know, one of, one of their levers, um, is balance sheet and the markets are down.

Vic: Yeah. 

Marcus: You know what I mean? So it's like, yeah. They, they, they're, they're so well diversified, but when the whole economy comes down. Yeah. Yeah. It's like, where were they gonna run? They, you know, they couldn't run to [00:42:00] their, to their services side. They couldn't, you know, rely on, on the payer side. 'cause, 'cause MLR is gonna be a challenge.

Right. Increasing costs and then they couldn't even go to the balance sheet because everyone's portfolio's down. Right. I mean, it's just, where do you go? 

Vic: I mean, I was talking to a guy this morning who, who thought that maybe this would be good for the health systems. No, but I, I think it's not, I think that's not right.

I think because Optum is a pretty big provider itself. That's right. And everything is down. So HCA will announce next week. I think health systems, including the well run health systems are gonna have a, a hard time and it's just bad news all around. Yeah. So when the bellwether, big ship misses, it's not a good sign for anyone.

No, no. I mean, people who are it used to be that if payers did well. Yes, yes. The providers didn't do well and vice versa. That That's right. That's gone away though. Now I think that's, [00:43:00] yeah. No, 

Marcus: but both sectors are being Right. A sale. They're both right. Yeah. So. Alright. And then, um. Uh, you know, look, it all rolls downstream, right?

So Yeah. To your point, 

Vic: yeah. Uh, they need, they need to figure out how to get cash, 

Marcus: right. So we had the change healthcare incident last year. Um, UHG. Uh, issued loans to many of the providers who were waiting for backed up claims while the system was down. Yeah, right. It was down for like a month. Yeah. So, I mean, you know, they, they, they issued, you know, a bunch of loans to Yeah.

To support people. It might have been more than a month actually. Um, and now they are demanding repayments for those loans and threatening to garnish reimbursements, uh, if they don't get that, that, that capital in quickly. Now it's been a year, to be fair, to be fair, those, those loans were probably issued a year ago.

Um, there were 0% interest loans. 

Vic: Yeah. 

Marcus: Uh, and so it's probably time [00:44:00] to pay, you know, but at the same time, the, all of those providers have been struggling for that and other reasons, you know? Right. Not just the claims issues, but like other reasons. And so, uh, it, it, it all rolls downstream and that, as you said, that pressure's not gonna be better for necessarily anybody.

Right. 

Vic: Yeah. Yeah. That's right. I mean, we were talking before the show, UHG just had a really hard 12 months. I mean, brutal. Brutal. And it's unre kind of unrelated things, right? Oh, yes. Change healthcare, cybersecurity hack takes the whole system down. They have to make these loans. Everyone's mad, maybe rightly.

Um, then Brian Thompson's murdered. They miss earnings. I mean, it's just been a rough thing. So they do need to be paid back. And every physician group and health system that I know never has lots of money sitting around. And so they're gonna have to [00:45:00] demand it to be paid back, but it's, it's just hard all over.

Yep. 

Marcus: Agree. Agree. Uh, and Humana suffers to step back because they tried to challenge their star ratings for 2025 and, uh, they were denied the, uh, they were denied an administrative appeal. So, uh. They a that news, you know, hit, hit the stock price. Right. But also it's, it's gonna be a hit to the earnings.

Vic: Yeah, yeah, that's right. And so it's the, the star rating was corrected for a couple other payers, but Humana was not in the same camp. Yeah. So 

Marcus: it's bad. Alright. Going to the health system. CHS is selling the majority stake in Texas Hospital to Ascension for $460 million. Uh, this is good for CHS to get some cash and get something off of their books and, and good for ascension.

And good for ascension. Yep. Good for ascension. So, uh, we've, we haven't seen that many [00:46:00] mergers and acquisitions happening. Um, the first quarter was down significantly from previous years. Uh, Paul and I were talking about that last week. Yeah. Uh, so kicking off the quarter with, with a deal like this is, is a good sign.

And hopefully more to come. 

Vic: Yeah. 

Marcus: Need to get these health systems p and l straight. Cindy Bayer, who was the CEO of Brookdale's senior living, uh, it was announced that she's no longer the CEO. Apparently she was pushed out, uh, of, of the role. At least that's how it was reported by the Nashville Business Journal.

Vic: Yeah. And I, I don't know any backstory to this, but it was a, it's a weird set of circumstances that maybe she got pushed out, but they have no one stepping in. So they, they don't have a CEO right now and they're gonna start a search. But, um, not clear to me what happened, but it was, it was fast and not that clearly not, the transition wasn't managed very well.

Marcus: Yeah, well, it was, it was just sudden, right? Yeah. I mean, so, so, so who knows what actually [00:47:00] happened there, but, but it's, you know, I mean, she was a celebrated CEO. Yeah. So that's, that's, you know, it's, uh, it's certainly. Eye raising for sure. Uh, DaVita says Ransomware attack is affecting some of their operations.

Uh, they became aware of it on Saturday of last week, and, uh, it's encrypted some elements of their, of their network. So yeah, they're probably still suffering from Yeah, they didn't it. Right. Nowt 

Vic: have, when this story went out, they didn't have it back online. 

Marcus: Yeah, yeah. Uh, cybersecurity continues to be a massive issue for the health systems.

Uh, and then Amazon has strategy to partner with digital health companies. Uh, this is our guy, Aaron Martin, uh, who's, who's here, here in Nashville. He actually rolls Juujitsu. Oh, nice. Um, yeah. Yeah. Good guy. Uh, and so they, they've been working on working with best of brand, um, uh, digital health companies, OMA Health, that recently Hinge Health was announced to be one of their, uh, key partners.

Uh, what'd you get from this article? 

Vic: So they are being very clear that they're going to [00:48:00] specialize in. A very small number of what they call first party solutions, which would be like one medical or so, something that they own. And then for everything else, they're gonna try to find best in breed. Third party.

Yeah. Which I think makes sense. It's, Amazon has tried for a long time to do lots of stuff in healthcare and it's a hard space. So they're, they do have some assets that are gonna continue to sell what they call first, first party. Um, but most things will be third party. And they're picking, you know, brands that are well established, which.

I think it makes sense. 

Marcus: Dealer's choice, man. You know, they got the distribution, they got the members, uh, a ton of leverage to offer to these companies. I'm sure they're getting very favorable economics in these deals. Yeah. Uh, so it just really, and it kind 

Vic: of, it makes 

Marcus: one medical better. Makes a thousand percent.

A thousand percent. And Amazon should pick a single partner because the Amazon buyer wants it to be simple and work. Yeah. Right, right. You know, so I, I think it's a really good [00:49:00] strategy. I think the other thing I like about it is it's been thoughtful and it hasn't rolled out all at one time. Yeah, that's right.

It's sort of been That's right. You know, one partnership at a time. Yeah. And I think trying to kind of actually get engagement and sell through and activity going with that partnership before they move to the next one. So again, you know, kudos Darren for what he is executing here, uh, into Pharma. Lilly Soars as study positions, weight loss, pill to pass Ozempic.

Yeah. 

Vic: So a pill. It's just gonna get much more adoption than we talked about this at the very beginning of this whole thing. Right. And Lily's done a great job sort of navigating their way to get, now it's not fully approved yet. No. But the study came back with great results. 

Marcus: Yep, yep. And uh, right. As of now, the stock is up 14% on the news today.

Yeah. So, I mean, that just tells you the power of these weight loss things. Right. You know what I mean? Just, it's just an incredible, uh, up, up update for them. And Novo is actually down 1%, probably because they didn't have news to match it. Right. You know, [00:50:00] uh, li Lilly continues to impress, whereas Pfizer is halting the development of their weight loss pill.

Uh, Pfizer continues to struggle. 

Vic: Yeah. They, they have lost their way a little bit. Their pill did not work, and they don't have a, they don't have an injectable, so they, they're kind of out the GLP one. They're right now, they're out, they're now out again. Right. Yeah. Right. You know, 

Marcus: um, 

Vic: yeah, they're, 

Marcus: they're really struggling overall.

Uh, whereas j and j is boosting their outlook despite incoming tariff costs, uh, I think we reported maybe three weeks ago that they were going to mm-hmm. Invest heavily in manufacturing here in America. Yeah. What was that number that, that they had quoted? 500 million, something like that. I, I think that's what I was gonna say too.

I think it's 500 million. 500 million. Um, they're projecting that the tariffs are going to, uh, add 400 million in costs today, but they still, in spite of that, are boosting their outlook. Mm-hmm. 

Vic: Yeah. So, I mean, unlike UHG, so I think of it like there are three, uh, kind of bell ringer bellwether stocks in healthcare.

[00:51:00] There's United he Coop, HCA and JJ Yep. They sort of cover the three different parts of healthcare and J j's were very well run and they're, they're gonna have these tariff expenses, but they're able to navigate it. 

Marcus: Yeah. And they're not dealing with all the direct assaults from HS. Yes. 

Vic: Right. And UHG and HCA Both have lots going on.

Marcus: Alright. Uh, health and us, there's a guest essay Opinion from The New York Times. There's a lesson to learn from Daniel Kahneman's death. So, uh, Daniel Kahneman professor who, um, is uh, very, very well known for his bestselling book, thinking Fast and Slow. Uh, he died and it was never really reported how he died because he's 90 years old.

Yeah. And you know, a lot of people die in 90 and it's not that weird of a thing. Right. Uh, well, we're finding out now that Professor Kahneman, uh. Died by choice. Um, and he headed to Switzerland, scheduled his, his death. He [00:52:00] was not just lucid, I mean he was still mentally very sharp. Yeah. He was still 

Vic: writing and emailing people and Yeah.

Kind of working. 

Marcus: Yeah. Yeah. But he decided, uh, that he wanted to die on March 27th, uh, of 2024, and that is what he did. And so that's, that's new news, I think, for many. Yeah. And so this, this, uh, this guest essay kind of gets into the ethics of it and just talks about what does it mean that someone so celebrated, so talented.

Who, you know, he, he talks about the fact that he, uh, his kidneys were starting to, you know, function was, was pretty low. Mm-hmm. That's a pretty typical thing. He's 90 years old. Yeah. It's pretty typical at 90 for your kidney function to, to kind of get pretty low. Um, but basically he just opted out of, of any of the, you know, as he framed it, miseries and indignities of the last years of life.

And he just said, you know, not doing it. And it, [00:53:00] it's, it's a pretty incredible story. 

Vic: Yeah. Yeah. I mean, I think it's a, it is an incredible story and I think our health system and you and I and the people listening, our audience, we will benefit from addressing end of life and helping our patients address end of life.

And we can always maybe try some new procedure or new medication. Maybe there's a clinical trial going on. And I think it's our job to offer these things, but it's also partly our job to, to help people understand what the costs and benefits are or how they can approach it. And it's so emotionally charged in the hospital room with like your family members around that it's difficult to get anything accomplished.

And so bringing it up in this setting or, you know, the New York Times [00:54:00] publishing it, I think it's good to talk about 

Marcus: Yeah. Especially with someone as prominent as Daniel Kaman, right? Yeah. I mean, um, I I, I didn't know about this until you, I didn't know about past, past couple days ago. Yeah. And, uh, I, I'm still kind of wrapping my head around the fact that this is, that's actually how he passed.

And it was by choice, and especially that he wasn't suffering from anything. Right. There was no dementia, there was no vertigo. You know, um, his body wasn't breaking down in any. Uh, sort of abnormal or disease ridden way. Yeah. It was just wear and tear. So that's, I think that's the part for me that is like, um, hard to really wrap my head around, I think.

Yeah. It's just hard to wrap my head around. Um, but anyway, yeah, 

Vic: but the health span, I mean, I wanna maximize my health span, not necessarily my lifespan. And how one measures that or when you decide when your years of healthy life is over is up is a personal decision. But, um, well, people would argue with that.

Marcus: Yeah. I, I mean, I think, I think that's, that's a, that's [00:55:00] that right there, what you just said is, is core to the ethical dilemma. 

Vic: Yes. In 10 states, you get to decide. Yeah. And in 40 

Marcus: states you don't, 

Vic: it's not universally held, but that is true. Right. So 

Marcus: I, I think that that's a, I can almost guarantee you I will die in a state where you have that option.

Yes. You, you've, you've made that clear Wall Street Journal autism rates ticked up in 2022. This is from federal data. One in 31 children aged eight years old, had autism that year. 

Vic: Yeah. This is in the 

Marcus: CDC. 

Vic: So it was one in 150 in 2000, and now it's roughly five times more common. Um, and, you know, there's a lot of controversy around what causes autism.

I don't know that anyone knows. But clearly there's more diagnosis of it. It could be that we are better at spotting it. I think we clearly are better than 50 years ago. Yeah. [00:56:00] Um, but at the same time, it's, whether it's growing in prevalence or we're noticing it more, it's a significant issue. 

Marcus: Yeah. For, for sure.

And, and I, and I think, I think it's an issue for which RFK Junior has, um, garnered significant sympathy because, you know, one in 31, well that's a whole lot of parents. Yeah. You know, and not to say that all those parents are backing him, but. Uh, it, it's, it's a, it's a challenging path to raise, uh, a child with autism in this world.

Um, you know, we, we've got a, we've got a portfolio company that mm-hmm. Uh, provides autism services in the tri-state area. Teamwork. Yeah. And, uh, you know, they, their work that they do is so important to give these, these families, um, a path forward to, to where, you know, their child can live as normal life as possible.

Um, and the parents as well are also Yeah. You know, well prepared to help their child navigate the world and, and, and deal with all the [00:57:00] challenges themselves, right? 

Vic: Yeah, that's right. It's, um, because it presents sort of in that three to five years old and we don't know the cause, it just is a really emotionally traumatic process to go through and, and scary and you need a lot of support.

And so yes, there's a lot of parents that are. I'm concerned about this as it should be. Yeah. Yeah. 

Marcus: Alright. AI time? Yes. MedStar Health Taps Reimagined care for virtual Cancer Care support pilot. Uh, did you read this one? Yeah. Alright, tell me about it. 

Vic: Yeah, so MedStar is in, is in the Maryland area and they are using AI now to sort of work with cancer patients.

Um, 24 7 sort of always available, um, which would be difficult with, you know, a full human staff. Um, and I think, I think it [00:58:00] seems good, I mean, adding, adding sort of that 24 7 care with a AI tool that provides, you know, accurate information is really good. 

Marcus: Yeah. And, and, uh, I mean I important for patients with cancer, um, the remote monitoring, uh, aspect of things think is helpful.

Yeah. 

Vic: And you might be, you might be sick from chemotherapy at a time when the office is not open. Right. And, and getting advice on what to do is, is great. 

Marcus: Yep. Alright. Now getting into real deal ai, uh, Nvidia to make ai super computers entirely in the us I mean, I think these kinds of moves are gonna be necessary to appease, um, to appease the, the, the Trump administration.

Uh, the company's working with Foxconn on a supercomputer plant in Houston, so still working with the Chinese company. Yeah. Uh, 'cause they're the, they're the masters of building these, these plants. Uh, but it will be made entirely in the us. 

Vic: Yeah. And I think this is great. I also think that all of these announcements, they just take a while to actually break [00:59:00] ground, build the facility.

And you don't hire people for a year, for, for a while. So. I wanna celebrate these things and I don't know if they will replace, you know, layoffs that happened this quarter 

Marcus: also last week. Yeah. Paul and I were reviewing a story on NPR that talked about the fact that Jensen Wang went to, uh, went to Mar-a-Lago, had a conversation, and got the whole ban on H 20 processors going to China reversed, and a week later.

No, um, Nvidia is gonna take a quarterly charge of 5.5 billion, uh, tied to those H 20 graphic, uh, GPUs, uh, that were going to be going to China. And as a result of that, the stocks slid 5% in trading. 

Vic: Yeah. So it turns out you, you have to live at Morgo Now. You 

Marcus: can't leave. You can't leave. Listen, listen, these, these last minute, uh, these last minute, you know, attempts.

No, no, no, no. Yeah. Long-term loyalty. Right, right. [01:00:00] Long term loyalty. You can't be dropping into Mar-a-Lago after the fact. Right? Yeah. That, that's, that's not gonna work. Uh, so, so yeah. Look, that's, that's a, that's a. That's a meaningful impairment. 5% of Nvidia? Yeah. Yeah. Like what does that do to the overall s and p 500?

Was it like a 1% hit to the whole thing basically? Yeah, probably. Yeah. So, uh, yeah, that's just pretty meaningful. Alright. Anthropics, Claude can now read your Gmail. So, uh, you know, Google Workplace has, uh, has the ability for other third party apps to integrate. Um, and so Anthropic Smartly is making itself competitive with Google's native, uh, yeah.

AI solution Gemini, by leveraging those API integrations. It's a Google workplace. And now if you use Claude, and Claude is your favorite, you know, uh, AI bot, you can also, you know, leverage all the data inside of your Google Workplace. 

Vic: Yeah. Which they could always do from a. Technology point of view. They just now have decided to add it in as a feature.

Yes. Which is great. I don't know why they waited this [01:01:00] long, but it's, it's a welcome edition because I'm on the, I'm on the G suite. 

Marcus: Yeah, exactly. And you like lot too, right? Yeah, 

Vic: yeah, yeah. 

Marcus: Alright. OpenAI has some, some updates. So OpenAI just gave chat GPTA much better memory. Here's what it means for you.

This is Tom's guide. Uh, basically they've increased the memory to be able to capture all of your previous chats. And now it's gotten much, much more context, which basically means it's more like your friend now it's less transactional and it, it, it learns about you over time. 

Vic: Yeah. I don't, I guess you could characterize it as more like your friend.

It, it, it learns about you over time and keeps track of everything you're asking about and it will remember things that you don't remember that you told it. Yeah. And for many people they, I, I think they overshare to AI tools. Because it's never gonna forget, and then it will end up making the responses much more accurate, but also it gives [01:02:00] OpenAI a pretty good window into, you think Meta has a lot of data on you that this is gonna have a lot more?

Marcus: Yeah. I mean we're, we're, we're about to move to, to some commentary from EA on, on X. Yeah. Um, one of my big holdups personally, uh, and why I wanna run local, uh, you know, LLMs mm-hmm. Uh, is because I, I'm just not willing to, to give that kind of information willingly to, uh, to an open ai Yeah. Or an anthropic or any of them.

Like, I'm not willing to give my deepest, darkest secrets. Right. Well, especially when 

Vic: you, when I think about using it in healthcare settings, like Yeah, I have, everyone has healthcare issues they're thinking about or wondering about. Sure. And I'm not willing to. Go down that path with any of the AI tools now, because they don't have a data, 

Marcus: and I don't think you'll have to because there will be open source alternatives that will be Yeah, you 

Vic: can, 

Marcus: you can put, that'll be fantastic for you to have your own pers truly personal, local, not [01:03:00] cloud based version that over time remembers you and you know, it does all these things.

You just, I'm fine 

Vic: with it remembering me as long as all the data is in my study and is not connected to the internet. 

Marcus: Agree, agree. So, ej, who's, you know, um, in the crypto world, but very, very focused and knowledgeable about ai. Yeah. Someone 

Vic: we listen to 

Marcus: about ai. Exactly. Um, his, his take is, is that, you know.

What we said, people will absolutely tell this ai mm-hmm. Everything about it. Yeah. Um, and, and you know, if you think about how do these, you know, how does Meta know about us? Well, because of how we click on things. Yeah. Right. You know, it, it doesn't really know us because we tell it things. Yeah. How does Google know about us?

Because we click on things, not because we tell it things or, or what we type into search engines. Right. Yeah. That's not the same as like talking to it about yourself. Yeah. What OpenAI is about to know about us or any of these different chat bots. It's not just OpenAI. Yeah. Um, because of this is, is gonna be really significant.

So, I mean, [01:04:00] I, I very intentionally use the word friend because, uh. I think this is a necessary feature. I've been frustrated by the lack of long-term context that these things have had for a while. I'm like, why can't you remember what I said to you yesterday and incorporate that in what I'm asking you today?

It's, it's frustrating. It puts the responsibility on me to build these elaborate prompts. Yes. Right. You know, of giving you all the context. Every single time I talk to you, it's like, that's not, it's just not natural. Right. It's, it's, it's more work than it feels like it's worth for what the outcome is gonna be.

Now, taking that away is going to be a dramatic, dramatic increase in the usability. This is a usability issue and it's a dramatic increase in the usability. And EAS is just making that point clear, like OpenAI is going, have an amazing amount of data. 

Vic: Yes. It's much more useful or usable, and it's going to create huge, uh, sticking costs, switching costs, like it's gonna be much more sticky.

People are not gonna want to jump to another, another algorithm, another ai. Yeah. [01:05:00] Once they have. Kind of invested all this time, and not effort, but just chatting with it. But, but time building up all the context that then this friend knows me very well, where this Claude guy doesn't know me at all. That's right.

Or Claude knows me and, and 

Marcus: that doesn't know me. That's, that's right. That's right. Yeah. Alright. Open eyes and talks to buy Windsurf for about $3 billion. So this is one of these vibe coating tools. Um, artificial intelligence assisted coating tools. Uh, it was formerly known as Coded. Um, and Windsurf has really sort of, uh, swept up and taken a lot of the mm-hmm.

Uh, the, the momentum that Cursor initially had, uh, a way and, you know, I think there's gonna continue to be really, really strong tools in this space. But Windsurf has enough momentum for open AI to say, Hey, we need, we need you in-house. 

Vic: Yeah. I mean, uh, I've used both Cursor and Windsurf. I think Windsurf is incrementally better and half the price.

Well, there you go. [01:06:00] Now. Will there be another one that comes out and it is slightly better and half that price? I think. I think there will be. I think it also, OpenAI is just building this walled garden with all the toys you wanna play with, so you never have to leave to, and that's really smart. They 

Marcus: need to, they need, they need to.

They need to. They need to. They, they, they can't, they can't let any other player, um, have an angle on AI that they don't have. Yeah. And they shouldn't. Yeah, they shouldn't. It's their brand to lose. Yes. Right. Their brand of loose Google was synonymous with search chat. GPT is synonymous with ai. Yes. Right.

So they, they should continue to make those kinds of acquisitions. Right. I think it's, it's very smart. Uh, and to that end, they're looking at building a social network. Yeah. Because they have realized that, you know, the third party data thing is, is insufficient. Right. You know, they, uh, when you look at Google, Google has all of the Google workspace stuff.

They have Gmail and they also have YouTube. It's an incredible set of data. Right. Plus, plus they also have all the search data Yeah. That they get to [01:07:00] leverage. Um, you know, yeah. I mean Google has, has, has x. 

Vic: Right. Grock is where I think really I noticed and it was just apparent that they were able to leverage the x Oh yeah.

Data feed in real time. Yeah. And get better results. Yeah. So if I need, if I need something that is real time, I'm going to grow. 'cause it, 'cause it's. Ingesting all the Twitter feed all the time. Yeah. Google has that potential, but they're just, we talked about this a couple weeks ago. They're slow. Yes. They haven't really leveraged it like, like X did.

Yeah. Um, and so I think it's smart for them to try to build a social network. They've got enough money. Yeah. It's, it's, it's hard to get the network kind of going, but they, yeah, they have enough money, they have a lot of power. 

Marcus: They've got 

Vic: a strong enough brand, they've got strong enough to push out ball.

There's enough, uh, image based memes that come in off AI that I think there's, there's a starting place there. Yeah. Yeah. So 

Marcus: that's their focus. Uh, okay. Then the [01:08:00] final story, and this is sort of a theory, an MIT economics professor, uh, is basically saying that, you know, humans. Have an opportunity to ensure that AI does not take all of our jobs, but we have to act quickly.

Um, I think this is, this is something to some degree you and I agree with. Um, I think the acting quickly is gonna be very unevenly distributed. I think very few will act quickly in the way he's referring to here. Mm-hmm. And that will give those few an unbelievable advantage over the rest of the humans.

Uh, but I think many, many humans will just lose that. That's, that's my, that's my sort of on the ground assertion about this. You know, it's okay for an MIT economics professor who's in MIT Yeah. Sort of come up with this. But that's not necessarily the, the, the real world. I don't mean to knock him or anything like that.

I just don't know that, uh, the majority of humans will. Um, [01:09:00] I just dunno. The majority of humans will act as quickly as he's hoping. 

Vic: Yeah. I, I would even go further, I think. The majority of humans could not take this strategy because it really is about learning to use AI tools to give yourself an advantage as a orthopedic surgeon or as a nurse, or as a home care worker or payer, so that you can be the best in your field and sort of keep up with AI in the sense that you know how to apply it in your, in your domain.

I think that could work for 10% of any, any kind of professional group, but then I think it's over after that. And so he, I think he is giving a, a perspective that says it's not just like completely over for humans and we're just gonna be put out to pasture [01:10:00] and, and fed, you know. Videos on TikTok to watch, but it, but it, it's not a path that every human could follow.

No. By definition, no. He's 

Marcus: acar, he's a MacArthur genius. The guy is a genius, right? Yeah. For him, it could work out. Right. I, I think that's kind of the point, man. Yeah. You gotta be a little bit more on the ground. Yeah. Um, with, with real people. And, and, and listen, I don't, I'm not talking about blue collar workers.

I'm talking about on the ground with like everyday knowledge workers. Yeah. You know? Yeah. To just kind of know like how difficult it is for people emotionally to, to work with AI today. You know, like by the time these things get good enough, it, they're, it's just moving too quickly. It's just moving too quickly.

Yes. So, I, 

Vic: I don't, uh, yeah. I mean, we have been working on this for a year and a half. 

Marcus: Yeah. And we're nowhere. And we're nowhere. Yeah. Yeah. We're no, I mean we we're, we're nowhere relative to the progress that AI has made. I, I don't think we can say we're actually nowhere. 'cause we do use AI in, in aspects of our business today.

Yeah. This is a question. [01:11:00] Um, you know, we use it for analysis, we use it for content generation. Like, you know, we use it, but like, compared to how fast AI has evolved Yeah, 

Vic: that's right. And I think there were, there's a decent number of months where it wasn't really ready to be fully turned on. And now I think it is ready.

Yeah. The, the technology is ready. It's more me and you, the integration and the, and the transformation. Getting the Yeah. The integration and the user interface and how it fits into our, our existing business models. Yep. That we have to figure out. Agree. Agree. Alright man. Another great show. Yeah. We're back again next week to cover another a hundred shows.

Marcus: Alright, man.