Giving kids equity can teach ownership at scale

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 25:21

   I think it's great. I think that this is really the better version of the giving pledge. And I think that this is the right way for most of us who want to contribute and don't have the infrastructure or the capacity to understand how to discern what is a good nonprofit from a bad nonprofit, from a good NGO, from a bad NGO. Direct contributions into the accounts of kids who can then be a participant in the experiment that is capitalism and democracy in the United States is a no-brainer.

2. 25:53

   I think it's unbelievably impressive and unbelievably generous, and I think that it has a lot of legs. Yeah, it's great. My kids, every dollar they earn, they split half of it into stocks. They've all put it into SpaceX. I wonder where they got influenced like that. And then savings and philanthropy and then their spending budget. Dave, I'm curious. 72 million people now own SpaceX shares at the end of this.

3. 26:23

   Is that a risk if they dump it? You know, what's that going to do to the stock? No, no, no. It's 1%. Like you said, it's not going to move the needle if they all dump it. But I think the reason this is brilliant is because we've all discussed on this pod before that the future of value comes through asset ownership and not through employment, not through paychecks, because what is AI not going to do two years from today, three years from today?

4. 26:46

   I was over at MIT actually yesterday talking to a bunch of undergraduates and said, like, your window of opportunity to tap your big MIT brain is about the next two years. But do you really think that AI can't outthink you in every conceivable way more than two years from today? I mean, that is your window of opportunity. You've got to move fast. But that doesn't mean wealth goes away. It all moves to asset value.

5. 27:08

   So teaching this entire generation to own equities is a really good move, I think. And yeah, if they dump it, well, then their friends will tell them they're idiots for dumping it when SpaceX, you know, Elon, you said a second ago that this doesn't move the needle on the needs of Americans. But Elon believes SpaceX is going to be bigger than their current total global economy. Yeah. One to ten quadrillion dollars was the estimate.

6. 27:32

   Yeah. So, you know, maybe he's right, maybe he's wrong, but that'll keep these kids engaged with each other. The ones that dump it will be talking to the ones who didn't. Something good is going to come out of that conversation. I think it's really cool. Salim, your thoughts, pal? Yeah, very quickly, just to build on what Dave said, I think the fact that you get all of these kids looking at, now you have broad participation in the appreciation of capital, I think is a really good thing. I think that's the conversation that's going to make the much, much bigger difference, like 100x compared to the actual dollar amount. Because now all these kids are thinking in that modality as they grow up, watching this, comparing it, seeing who sold, who didn't sell. It's awesome as a conversation.

7. 28:13

   I also think this might set a trend, you know, what if all other public, you know, newly public companies that want to be cool with the next generation just follow the same trend? Then, you know, you get 50, 100, 200 copycats, then it really does move the needle. It does move the needle. I don't know if you guys have worked in companies that have had ESPP plans, but employee share purchase plans where you contribute on a quarterly basis.

8. 28:38

   And at the end of the quarter, they buy you that defined amount of stock at the low point of the quarter. There's all of these mechanisms that induce you to buy the stock of the place that you work, to your point. So if all workers and employers embrace this, I think it's a big deal. I also think that this begins the very difficult conversation about moving from defined benefits to defined contributions.

9. 29:06

   And it shines a light on the fact that these defined benefit retirement programs are insufficient and they're poorly funded. And when you see on the other side, people will say, well, why can't we do more forms of defined contributions? And that'll be the right conversation. And I think you have to have a starting point. So I think that Trump accounts and, you know, Elon's gift, I think, starts that conversation, which is very important.

10. 29:30

    Alex, you know, Elon said this will be the first of many.