Fed Hesitates on Tariffs, The New Mag 7, Death of VC, Google's Value in a Post-Search World

Philippe Lafont sees Google as facing a classic innovator's dilemma — possibly becoming the next IBM with slow growth rather than a high-growth compounder — but acknowledges its cash position, Waymo, YouTube, and Cloud as significant assets, and has not formed a firm opinion.

“I haven't made an opinion on Google, is like, hey, is this the next IBM? You're going to stick around for a really, really long time, but you're just not going to be like a company growing as fast as you used to.”▶ Listen · 41:05 ⚑

JasonCommentarytracking with the call

Jason is bullish on Google's ability to navigate the AI transition, citing deep product integration across billions of users, a data advantage, and the potential for AI-enhanced advertising revenue to exceed even traditional search.

“I think Google's going to figure this out, and if they cut their team size down, the earnings are going to go massively up.”▶ Listen · 44:57 ⚑

ChamathCommentarytracking against the call

Chamath argues Google is losing search share to ChatGPT and faces a strategic error by waiting for data rather than aggressively integrating Gemini as the front-facing product, warning the market will begin pricing in this decay.

“The market will now start to price this decay in.”▶ Listen · 54:24 ⚑

FriedbergCommentarytracking with the call

Friedberg is broadly positive on Google's ability to navigate the AI search transition, citing competitive models, existing products, and a culture of incremental testing, while noting the transition will be slow and complex.

“I'm pretty positive on their ability to respond to the shift if there is one underway.”▶ Listen · 36:30 ⚑

ChamathCommentary

Chamath highlights OpenAI's accelerating talent concentration — including the hire of Fiji Simo as CEO of apps — as evidence it is pulling away as the dominant consumer AI platform, drawing a parallel to Facebook's unstoppable talent magnet era.

“You're seeing a level of talent concentrate that I have not seen since I was at Facebook. There was nobody we couldn't get when we thought we were building a model that was totally orthogonal to Google.”▶ Listen · 49:38 ⚑

ChamathCommentary

Chamath argues SpaceX belongs in the optimal basket of companies to own for the future and that ignoring it simply because it is private would be a mistake.

“SpaceX would be in the basket. It's private. Correct. Stripe would be in the basket. To be long some rando public company because it's public and ignore SpaceX and Stripe would just be stupid.”▶ Listen · 1:29:52 ⚑

Philippe Lafont cites Microsoft's Q1 report of 100 trillion AI tokens processed — going 'basically vertical' — as a decisive signal that AI demand is real and accelerating, which was a turning point in his own market outlook.

“Microsoft said that in their Q1, they processed 100 trillion tokens, 50 trillion alone in March... the tokens are really going basically vertical... that was a really big deal.”▶ Listen · 29:06 ⚑

ChamathCommentary

Chamath argues Stripe belongs in the optimal basket of companies to own for the future and that ignoring it simply because it is private would be a mistake.

“Stripe would be in the basket. To be long some rando public company because it's public and ignore SpaceX and Stripe would just be stupid.”▶ Listen · 1:29:55 ⚑

Philippe Lafont argues that AI-driven rapid change signals the end of the Mag 7 as a monolithic index concept, as correlations break down and a new set of leaders — some private, some public — will replace it.

“I think what AI is showing is that at a time of great change... it's a little bit like the end of the Mac 7. And what we should do is almost think like, hey, what is the next?”▶ Listen · 42:42 ⚑

Philippe Lafont's explicit investment north star for his new Coatue interval fund is to identify and build a basket of the next 25 dominant companies — a new Mag 7 — spanning both public and private markets including SpaceX and Stripe.

“To me, it's a little bit like the end of the Mac 7. And what we should do is almost think like, hey, what is the next?… there's going to be a new index that comes up and I think we should think about like who's going to be on the new index,”▶ Listen · 42:51 ⚑

ChamathCommentary

Chamath argues that at current course — with IPOs suppressed and M&A blocked — venture capital returns are insufficient to justify the illiquidity premium, making the asset class unjustifiable unless treated almost philanthropically.

“I think at current course and speed, with the lack of IPOs and with the lack of M&A, you can't justify that asset class on its own, in my opinion, unless you think about it as something that you're doing almost philanthropically.”▶ Listen · 1:12:36 ⚑