0:00 These conversations aren't always easy, but nonetheless, they are important. So, every single year, Professor Ian Bremer, who's one of the world's leading political scientists, produces this risk report, and it highlights the top 10 biggest risks that everybody should be thinking about. And today, he's going to talk to me about the three that matter the most. So, he predicts that a US political revolution is on its way. the US has become the biggest driver of geopolitical uncertainty in the world and in my view Trump will fail. >> And he also says that the other thing everybody needs to be talking about and aware of is what's really playing out with AI behind the scenes. >> They created a model which is so powerful that they couldn't release it because it would have been an immediate
0:47 systemic risk to the global economy and our security and artificial intelligence is eating its users. and we can talk about that. >> And lastly, I want to end on a point of optimism. Can we take this craziness and turn it into a utopia with realistic solutions? This is super interesting to me. My team given me this report to show me how many of you that watch this show subscribe. And some of you have told us according to this that you are unsubscribed from the channel randomly. So, favor to ask all of you. Please could you check right now if you've hit the subscribe button if you are a regular viewer of the show and you like what we do here. We're approaching quite a significant landmark on this show in terms of a subscriber number. So, if there was one simple free thing that you could do to help us, my team, everyone here to keep this show free, to keep it improving year over
1:33 year and week over week, it is just to hit that subscribe button and to double check if you've hit it. Only thing I'll ever ask of you. Do we have a deal? If you do it, I'll tell you what I'll do. I'll make sure every single week, every single month, we fight harder and harder and harder and harder to bring you the guests and conversations that you want to hear. I've stayed true to that promise since the very beginning of the Dio and I will not let you down. Please help us. Really appreciate it. Let's get on with the show. Ian Bremer, what is this document that I have in front of me here? >> This is our top risk report. We put it out at the beginning of every year. try to help people around the world understand the risk environment
2:19 globally. >> So for the last 30 years your firm has been trying to understand the world to help make better decisions based on the big picture of what's happening geopolitically. >> Yeah. >> And every year your firm releases this top risk report. >> The 2026 one appears to be pretty prophetic because a lot of things that you list as the top risks are playing out before our eyes. For anyone that hasn't read this report, what are the most important subjects? You wrote this in January. We're now sat here in April, I believe. >> What are the most important subjects of the top 10 risks that you think we should talk about today? I think that there are three that are really big. Um, the first is that the United States has become the biggest driver of risk, the
3:06 biggest driver of geopolitical uncertainty in the world. And we see that with the tariffs. We see that with Venezuela. We see it with Greenland. We see it with Iran. I mean, if there was that level of uncertainty in a smaller political system, and that happens all the time, we wouldn't care as much because the global impact would not matter. But everyone out there is affected by even small changes in the United States. Suddenly, big changes in the United States. The Americans are saying, "We no longer want to play by the rules that we set up historically. We don't want the free trade system that we put together. We don't want to be the global policeman that is paying for the collective security. We don't want the
3:51 open borders that used to welcome so many people from around the world. We want a very different set of rules. It's the American system is not being challenged by the Chinese saying we don't want the Americans themselves and the leadership are saying we refuse to be the leader that we used to be. >> So that's number one. Yeah, that is number one. >> And this is a critical risk. >> That is a critical risk. That's but it's the most important without any question. >> And again, I say critical in terms of it is happening right now. It is overwhelmingly likely. It's overdetermined. Um and the impact is massive. So there's no way you could look at the geopolitical order today and not say this is the most important thing that is not just driving headlines but that's creating real movement in how the
4:36 global economy works, how global politics works, global security, everything is driven by this change. >> And what's the second one? >> The second one is the big question of how the second most powerful country in the world is responding to all of that. Now we in the top risks piece talked about overpowered. Overpowered being the global energy dynamic. How China has been working to build the most effective electric vehicles all over the world at scale and the batteries all over the world at scale and the critical minerals in rare earths for decades now. not just having access so they can exploit them,
5:21 but also so that they can reprocess them. >> For anyone that doesn't know what critical minerals are, >> Yeah. >> and how important they are to our everyday lives, could you give us some color there? >> Sure. We're talking about all of these things that you take out of the ground, whether it's lithium, antimony, >> which is in all these devices, >> in every device, in your car battery, it's in your missile systems and your advanced weaponry that keeps you safe at home or allows you to go to war against somebody. I mean, you can't have an advanced economy without critical minerals and rare earths. and and the Chinese have been investing at scale globally in that capability for decades
6:06 now, thinking long term. And a lot of the rest of us have not been thinking long term. We're like just in time, globalization. How do we make the most money now for our next quarterly return? And that reality is making China not a better economy today, but it's setting them up for a much stronger long-term trajectory. So, as a risk, you're going to ask me to do this. It is not as critical as the US political revolution because this is focusing on 2026 and China is playing out over a longer period of time. But it is absolutely severe because the Chinese understand that long-term as countries are saying the Americans
6:52 are less predictable and we're more vulnerable to their sudden changes in decisions. Many more countries are saying well we want to hedge and do more with the Chinese and those decisions really matter. If this continues, if this direction of travel continues, what happens next in terms of global order, in terms of the Middle East, in terms of all of these things we've talked about, >> Trump will fail. Um, and and I think that the level of policy incompetence and unwillingness to take on expertise is ensuring that it will fail. He's quite unpopular on so many issues right now. He's going to lose in a big way in the midterms coming up in November. And that will make him look like a lame duck. and Republicans will start to think about their own futures as opposed to holding on to this 80-year-old guy. Having said that, we will not have
7:39 resolved these underlying challenges for average Americans. So, there will still be a demand for a political revolution in the United States. The question will be will the next person that comes and captures that are they going to be focused on themselves or focused on the country? Right? that Trump actually identified the symptoms and was able to benefit as a political entrepreneur twice from getting elected in free and fair elections. Right. Mostly the reality is a future person. We we're in New York right now. Zoran Mdani, a democratic socialist, is the mayor of New York City, which is like the capital of global capitalism and finance in the world. What does that tell you? That
8:26 tells you that there's still a demand for something very different. And we don't know is it going to come from the left or the right, but we know that that level of uncertainty is growing. And it's not just growing in the United States. It's growing in the global order. Because if the Americans are no longer willing to act as the global leader, but no one else is capable of filling those shoes, you don't have a G7 or a G20 where governments come together and agree on the rules of the road. You have a G0, an absence of global leadership, where people, the powerful, make the rules that are useful to them and the weak have to accept that, have to find a way to live under that. That that's where we're heading. There was a Yale poll in April 2026 that said Camala
9:14 Harris is leading the overall Democratic field with 20% narrowly edging out Gavin Newsome at 19% and Pete Bhajed at 14% with AOC at 13%. Means literally nothing to me. You know, I think it was Jim Carville, the great um Democratic political strategist that was talking about November. He said, "You know what the Democrats need to do? They need to all get on a plane and go to Turks and Caos until after the election. Say nothing. be absent. Just do not be and allow it's it's like um you know the SunSu it's like when your when your opponent is making mistakes stay out of their way. >> When you say the election, do you mean the midterm election? >> Midterm election. Yeah. Yeah. So for now there there's nothing happening except Trump and the reaction to Trump. Then after that we have a two-year long god
10:01 god help us uh election in the United States. billions of dollars will be spent and people will have far too much information about far too many of these people. Then we can have a conversation. It is too early to talk about 2028 right now. >> I have to ask you then what on earth is going on? >> I wonder when we're going to get there. We got this big map in front of us here. We haven't even touched the Middle East. We literally haven't touched it. >> What is going on? Like really take me back to the beginning. What did Trump think was going to happen? How is this linked to Venezuela? Why would he do this after saying that he was the president that was going to stop all the wars? What is the big picture here? >> And literally one of the eight wars that he said that he had stopped was with Iran. >> This was not what he was voted in on. >> He was voted in, he ended the war in
10:46 Afghanistan. I mean, he cut the deal with the Taliban. Was it a great deal? Yeah, for the Taliban it was pretty good. But it got the Americans out. 20 years, a trillion dollars fought on the backs of the Afghan people and of Americans, not wealthy Americans, not people like Trump that could find a way out of service, but poor Americans >> and Europeans. >> Yeah. And Europeans who fought side by side with the Americans when the Americans asked them to. almost all of them sending troops and many of them wounded and dying in the same numbers, the same percentages, just as courageous as the Americans were, right? So, Americans wanted an end to that. Vietnam, Iraq, Afghanistan, what the hell are you guys doing? We're not
11:32 benefiting that. Stop it. Trump stopped it. So, why did he do this? >> Why did he do this? >> Why did he do this? I think there are three reasons why he did it. I'll take you through. First reason you said Venezuela, not on this map. Shouldn't be relevant to this map. Turns out it's relevant to this map. Trump had plans to take out Maduro. He's got a lot of people inside his administration that see this guy as a real problem. And by the way, a problem for the region. 8 million Venezuelan refugees destabilizing the region. Lots of drug export destabilizing the region. So he had been planning to do something. >> Was it also linked to oil? it was relevant. They have the world's largest oil reserves. It is going to take far more years than Trump will be in office
12:18 to make that meaningful. So, it sounds good from a branding perspective and you're going to see a few hundred thousand more barrels a day, but it's it's going to be years. If you saw that um testimony by the CEO of Exxon Mobile who said, you know, Venezuela is not investable today and Trump was angry at him and all the other energy CEOs like, "Thank you for saying that. We're not saying anything like him. Look at him. Look at him. Not much courage among those CEOs publicly. So the oil is a great headline for Trump. It doesn't matter much for Trump's presidency as we know. >> Just to get some color on that. Is that because they just can't they have to build up lots of infrastructure to be able to extract it? >> Oh yeah. And and because all their engineers are gone, most of them in the oil patch up in Canada, which has similar uh geology to it because they've
13:04 destroyed so much of their infrastructure. It's broken down because the governance structure isn't there yet. They don't have people that are capable of actually ensuring that there will be contracts that you would follow through on engage in people that still have huge lawsuits that need to be resolved. Right? So all of this stuff but to get to your I don't want to lose sight of your why did Trump do this in Iran. So the first point is beginning of the year Trump goes in to Venezuela, right? It is the most successful military operation you can possibly imagine. Not a single American serviceman or woman is killed. They go in, they take Maduro out. They don't kill him. They don't injure him. They bring him to a jail in Brooklyn, right
13:50 here in New York. Out of burrow, but still counts. New York City, right? Extraordinary. And he's facing justice. And meanwhile, Deli Rodriguez, right? Suddenly, vice president becomes acting president. It's like, "Sir, we want to work with you guys. We don't want any of that." Right? And so, you've got a new government that is has a different trajectory, but it's basically the same regime. And they say, "Whatever you want, we will work on. You want we'll open our oil sector. We'll open our mining sector. We'll have better rags. We'll we'll we'll try to improve the economy for the average Venezuelan. I mean, they're starting to become popular. In another year, if they had elections in Venezuela, it is not inconceivable that she would win in a democratic election, which is like blows
14:36 your mind, right? Whole bunch, hundreds of political prisoners, they've released. I talked to leaders all over South America. They all think this was a success. This is enormously popular among the populations in those countries because they care about security. That's what they've been voting on. Their elections have been about the economy and local security and Venezuela has been a problem for them, right? I mean, they're exporting people causing crime. Colombia, Peru, Brazil, this Chile, right? This has been a serious issue. Trump Trump is hugely feeling great, successful, and now he's like, I can do that in Iran. I can do it even bigger. That's the first reason. That's the I said three reasons. That's the first reason. Second reason, this is not Trump's first rodeo with the Iranians.
15:24 In his first presidency, the Iranians were engaging in strikes against the Americans directly and with proxies, uh, bases in Iraq, other places also were taking on strikes against the biggest refinery in the world in Saudi Arabia. Those drone strikes, you may remember, the Saudis and the Amiradis were telling the Americans, when are you going to do something? we need to take some action. Trump didn't want to do anything. They're getting angry, right? Finally, the end of his presidency, he orders, pretty bold move, the assassination of this incredibly charismatic military leader, Kasamsulammani, the head of the Kuds force as it was called in Iran. And Iran was so angry and they were going to destroy the United States. Death to America. What do they actually do?
16:10 Nothing. And then last June, Iranians are developing their ballistic missiles. They're developing their nuclear enrichment in radian enrichment. They're like stockpiling at higher levels 60% and the Israelis want to go in. Trump's providing intelligence. He doesn't want to go. Kind of dangerous. The Israelis go in. It's enormously popular. It's going well. Succeeding. Trump's like, I want a part of that. That's successful. So, he joins in. Second time Israel took casualties about 100 killed I think in the course of that 12-day war. The United States Iran talked big did not hit the Americans. They threw some missiles at that Alade base in Qatar, the biggest US base. They warned the Americans through Iraq before the missiles were launched. So it was
16:57 very clear the Iranians didn't want any part of that fight. So Trump is thinking to himself, "This is going to be awesome cuz I'm going to go in. I'm going to pull Venezuela in Iran. And I know they don't want to fight me. I kill the Supreme Leader, 86 years old. He's going to die anyway. He's not that popular among the Iranian, the Islamic Revolutionary Guards Corps, the IRGC, because they're the ones that really run the country. I'm going to have this huge military force that shows what I'm capable of doing. Then the rest of the Iranian leadership, they're going to want to work with me just like they did in Venezuela. That was reason number two. And then the most important reason, the most important reason is that unlike Trump's first term where he had people around him that were patriotic first and foremost to the country and when they had disagreements with Trump, they let
17:43 him know and they leaked and they also um were willing occasionally to do what they could to undermine an incompetent decision that would hurt the country. And we saw that whether it was with Mike Pompeo or or or Mad Dog Mattis, right? All of these people who were much more independent, strong actors. This time around, Trump has some really good adviserss, people like Marco Rubio and uh Scott Besson. He also has some staggeringly incompetent adviserss like Pete Hegath for example. But what they all share is that they are first and foremost loyal to the president and they will not tell him. They won't push back. And what he hears from them is shaded
18:30 towards how brilliant he is. And that makes him think that he will be more successful even when the military thinks this is a horrible idea. And we just saw this with the reporting from the head of the joint chiefs, Dan Kaine, who clearly thinks that this is a really bad idea and understands that the military um scenarios are super dangerous and that the Iranians will be able to shut down the straight. And every military in the US for the last 20, 30 years has gamed out how the Iranians could shut down the straight in a major conflict. And Trump hears very little of that and he's taking away. I'm incredible. I'm confident I'm going to make this happen. Those are the reasons he went in. >> And so he thought it would be take out the Supreme Leader, then they'll
19:15 negotiate. We'll get a better deal. We'll have a political system there or political leader there that is obedient to us. >> Yep. It'll be and it'll be maybe it won't be a day, but it's not going to be a month. >> And what actually happened? >> That did not happen. What actually happened is um the Americans took out well the Israelis took out the supreme leader and also took out a lot of the military leadership that the Americans had been speaking to which is why Trump came out and he said well a lot of the guys were talking to are dead now so we don't really know who to work with. He said that in the not even if it's true and it was you don't want the president saying that right he has no filter. Um so which is which is one of the more interesting things about this presidency. What happened is the Iranian leadership was taken out. The response
20:02 was immediately what they call this mosaic situation uh where they decentralized the um military decision-m to local commanders because they were worried that the high level commanders if they were on cell phones, if they were engaging with other commanders, the Israelis would know where they were and they'd be able to assassinate them. So then suddenly the Iranians were taking shots at other at Gulf states at critical infrastructure and stopping transit from the straight. >> This is one of the questions I had is in several interviews that Trump has done he alludes to the fact that he thinks he's talking to the right people. Do you really believe I know there was a meeting recently in Pakistan where they sent JD Vance in to negotiate with Iran. Do you think anyone is running Iran at
20:47 the moment? Is there leadership in Iran? Is it possible to negotiate and control all of these dispersed forces um at the moment? >> First, the honest answer is it's impossible to know because this is right now the the the internal decision-m of Iran is extremely buttoned up. Um and it they ain't talking to anyone uh about that. >> But it's very easy to assess two things. first um that their ability to make centralized decision plans and implement them is real. So when their biggest gas field is hit and they say we're going to hit you back in return, they are able to
21:33 implement on that in short order. So we've seen a number of occasions in the last five weeks where Iran has gone from statement made by the foreign ministry and by spokespeople to action taken by local commander in Iran which implies that there is a centralized structure. We also see toll taking on the strait by individuals that are being ordered by the central Iranian government to do that. They're not operating by themselves. So in that regard, the fact that the Iranians showed up in Islamabad in Pakistan with significant leadership with the foreign minister, also the speaker of the parliament, but also a team of experts who had briefs on negotiating on a number of different
22:19 points on the street and on ballistic missiles and on support of proxy actors and on the nuclear issue which proved the most divisive in those 21 hours of talks. shows that this regime is still very much functioning despite all of the Israeli and the American efforts to say that, you know, they've done all this incredible damage. This regime is still very much in place >> and they couldn't get a deal. So Trump announced that he's going to block the strait of Humuz himself >> just hours ago. I think that that is also overstated. You have 21 hours of talks led by the vice president of the United States. I assure you if these talks were a disaster, they don't last 24 hours. Two or three and then they're out. 21 hours
23:06 means very substantive conversations on the entire range of topics that were of importance to the Americans and the Iranians. Trump did not get the outcome he wanted. Ultimately, I'm not super surprised because the Iranians feel like they have more leverage right now than the United States thinks they do. And this frustrates Trump immensely. And so at the end, remember he's he's calling and talking with Vance more than 10 times over the course of this entire conversation. It's a they're they're in regular contact. At that point, Trump says, "Okay, I'm blockading the street." But just before markets open on Monday, you also see reporting that, well, these talks that were a disaster, we're we're going to engage in further talks. So
23:52 maybe it wasn't such a disaster. Maybe what's really going on here is Trump wants to show that he still has more leverage to use against the Iranians because he's lost a lot of his leverage. He gave a speech to the American people, one speech so far about Iran. Prime time speech. In that speech, he said, "War's almost over. Two to three weeks, Max. We're done. If I'm the Iranians and I hear that, I'm like, great. The Americans can't take this pain anymore. They can't take it." He keeps saying, "Straits, not my problem. Straits, let them take care of it." I hear that I'm the Iranians. Great. He can't take this economic pain. He knows he doesn't have a military solution. So, it's not that the Iranians are only hearing for Trump, I'm going to destroy your civilization. They're seeing what he's actually doing. >> And he seems to change his mind a lot or not follow through on some of the
24:38 threats that he makes. >> Right. Of course. >> And then they also will be aware that he's becoming increasingly unpopular >> on this issue specifically. on this issue >> on this issue specifically. He is underwater just like he was on Greenland where he eventually completely did a 180. He was going to put tariffs on all the Europeans that supported Denmark. He had to take Greenland. Those things went away. >> So you're sat there. You're going Trump's own people are pressurizing him to get the hell out of here. >> He's unpopular day by day. It's hurting his economy. Correct. His midterms elections that are coming up. He's going to be severely hurt and he's going to lose power in that regard. So actually the Iranian leaders, I mean they might be incentivized just to wait it out. >> That's right. Because they don't think they have to wait it out for months.
25:24 >> It's a democracy. So he's going to be unelected at some point in a couple years. >> They saw China. China did this right last year, Liberation Day as Trump called it where he puts tariffs on all these countries. He puts these high tariffs on China. They hit back. He does it again. They hit back again. He's like, "I'm going to do export controls." I said, "Well, we're going to shut down your critical minerals." Suddenly CEOs are going to Mara Lago. They say you got to deal with the Iranians or or we're going to shut down our factory lines. In red states, Trump has to back down. Right? So they've we've already seen that when a country has leverage over Trump and they can hit him, he has the most strong military in the world, but he also has a glass jaw. He can't take a hit the way that unelected non-democracies can. The Chinese and now the Iranians over the Strait. So what
26:09 Trump is doing with announcing the blockade, and by the way, he hasn't broken the ceasefire. So even though a blockade is an act of war, he still hasn't said, "Okay, you guys have to start hitting the Iranians again right now." So he this is still deescalated compared to a week ago. A week ago, this looked much more dangerous than it looks today. He's saying to the Iranians, hey, I'm willing to cut off your source of funds. I'm willing to stop you from exporting oil and making money off of it. same Trump that suspended those sanctions on Iran because he wanted to keep the prices down. So that's that's what's happening right here. >> Iran also, again, I'm trying to put myself in the the mind of, you know, the incentive structure of the Iranian leaders. They can't let it be seen or known that dropping bombs on us made us
26:57 pander to you. Because if they set that precedence, then for the next couple of decades, every American leader is going to know, okay, if you want Iran to play ball, all you do is take out their leadership, you drop loads of bombs on everything they have, and then they come and negotiate with you and give up their nuclear weapons and everything else. So, I imagine there's an element of an Iranians now going, if we buckle here, then for the rest of time, America are going to repeat this playbook. >> I I hear what you're saying. I I would put it slightly differently. I I think that after the 12-day war last June, the Iranians understood that their deterrent capacity had failed. They were incapable of preventing the Americans and the Israelis from hitting them and their proxies whenever they wanted. We've
27:42 talked a lot about Iran. We haven't talked at all about Lebanon. There's another war going on in Lebanon right now. The Israelis are hitting the Lebanese very hard. There's over a million displaced people in the last several weeks. >> Why? Why? What? What is this war? >> Well, Hezbollah, which is um a terrorist organization uh as recognized by Israel and the United States, though not everybody, continues to have the ability to engage in strikes against Israel. Nowhere close to the strength of the Israeli military. But le the Lebanese government promised to disarm them. They have not done that. And so Hezbollah has been able to continue to engage in missile strikes, relatively small numbers of missile strikes into the north of Israel where Israeli citizens live. There was a period of time after
28:28 the October 7th um attacks by Hamas where over a 100,000 Israelis had to evacuate from their homes and their schools and the rest for like a year because Hezbollah was making their lives hell. Right? So what Israel is now doing is they're going to take territory about 5 to 7 kilometers of Lebanese land. They're going to occupy it as a buffer zone to protect those Israeli civilians from Hezbollah being able to hit them with their weapons. That is the intention here. And so what Iran understands is that their ability to deter Israel from hitting Hezbollah, Hezbollah at the beginning in October 7th, Hezbollah was the most powerful
29:14 non-state military in the world. No one else was close. And today, Hezbollah has shown that their leadership gets targeted and destroyed, assassinated across the board by the Israelis, that their military is incapable, their critical infrastructure can be disrupted, and that Israel can also hit Beirut, the capital of Lebanon, and no one can do anything and return to Israel. >> There's lots of chaos going on in the world right now. >> Yes. Was there a way to have avoided all of this? Was there something that someone could have done further upstream to avoid all this chaos that we're seeing now in the Middle East? Like what was the first domino that fell >> in Iran? You do have an enormously repressive regime that has the ability um to take
30:00 action against their own people in a in in a incredibly brutal way as we saw play out in January. >> And it's also a regime that does not respect the right of Israel to exist. It's also a regime that has been sending weapons and money and military advice to other revolutionary actors around the region, undermining security in Yemen, undermining security um in Iraq, undermining security in Syria. So, I mean, the fact that at the core of the Middle East, you have a revolutionary regime that was exporting instability and violence is a serious problem. That's number one. Number two, Israel. America's top ally in the region.
30:45 America first. But Trump still gives billions of dollars every year to Israel, even as he's cut off military aid and support for almost everyone, including for Ukraine. Right. This country is very capable of now attacking all of its enemies and creating outcomes that it wants whether or not it creates instability in those countries. We've seen that in Gaza and the West Bank, right? I mean reality is Israel is continuing to take more and more territory in the West Bank and no one can do anything about it. They hit Lebanon really hard. No one can respond to that. So that is creating a reality where Israel is able to determine outcomes and even attack Iran directly with the United States. They felt very confident about taking that on and that
31:30 there would not be backlash that would undermine Israel's own political survival. It wasn't an existential risk to Israel and even if Iran developed nukes which is everyone wants to prevent from happening but Israel has their own nukes right I mean they have like a 100 plus so those are two fundamental drivers of of conflict and instability in the region one aligned with the United States one a revolutionary theocracy there have been very positive developments in this region very positive developments first of all Syria Assad was a brutal dictator that was overthrown by his own people and his own military would not support and fight for him and the Russians proved that they couldn't support him in a significant
32:17 way. And so now you have an opportunity for Syria to become a representative government that can engage with others around the region and more broadly. That's a positive. You've got Saudi Arabia and the UAE and Qatar that are engaging in transformative domestic policies to attract investment from all over the world to build experiences that everyone would want to travel and engage in to create work opportunities that are far better remunerated than anything that foreign labor could get in their own home countries allowing them to bring money home. And in the case of Saudi Arabia specifically, they're taking 35 million people. Half of that economy used to be closed to women and
33:02 now they're bringing women into the economy. They're actually not just educating them, but they're giving them opportunities in every area of employment. That is one of the most extraordinary stories in the world today in terms of change and governance and that continues. Then final point here is that in the context of this Iran war we do and in the context of a United States which is doing less global leadership there are questions of how these countries that are aligned with the US want to ensure their own futures. And so we see increasingly two different blocks that are starting to form. You've got the United Arab Emirates together with Israel. You remember the Abraham Accords which was Trump's big foreign policy
33:49 success in his first term where he got these countries the UAE and others to recognize Israel and and start doing a lot more tourism and you know business and technology transfers and the rest. So UAE, Israel, the United States and India are increasingly aligning on national security and technology and they're becoming more of a international block based on this region. At the same time, Saudi Arabia and Pakistan long worked together on defense are now much more public about an alliance. Pakistan is nuclear, Saudi Arabia is not, but Pakistan would provide them nuclear weapons if they really wanted it. That's absolutely something to think about. They are increasingly becoming a regional defense quad. Four countries
34:36 together with Turkey and Egypt. Big countries, big populations aligning more diplomatically and on defense calling for a regional security architecture in the region, but that would not be easily aligned with the UAE, America, Israel, and with India. So that is also a significant tension. And in the context of all of that, 95 million people in Iran whose military has been substantially degraded, whose economy and industry have been substantially degraded and who were already running their economy into the ground before the war happened. These guys aren't winners. They're survivors,
35:21 right? They have influence over the strait, but they're not winning. And this is dangerous long term. >> Your firm makes a lot of predictions. So I I wanted to ask you to help me try and look forward as to how this conflict might end. Um we're in a position now where it seems that the US aren't going to give up the demand to Iran that they cease to develop and pursue nuclear enrichment. It appears that Iran have said that they want the right and they believe they have the right, they said this before this conflict started to enrich uranium and to have nuclear power plants and all these kinds of things. So how does this end? Like Trump's now he's blockaded the straight off news. >> Um we're in another standoff. >> Cease fires in place. >> The ceasefires in place which I think he said was 14 days
36:06 >> and we're now probably what got 9 10 days left of that. >> Yeah. >> He's thinking a lot about his legacy. He can't be reelected. He talks sometimes about, you know, winning the peace prize and want wanting to be on a Mount Rushmore of presidents and all this. So he he can't just leave. If he just leaves, then Iran carry on with their enrichment program. It goes down in history almost like a Bush failure, geopolitical failure. He can't just leave. He has to be seen to win. But also Iran can't let him be seen to win. So So how what happens? I think unlike almost anybody else you can imagine, if he decided that he wanted to end this, he could end this. He could just leave and he would say, "I won." He's already said this in different ways. I don't
36:53 even care about the nukes because we've already intumeded them. They're under all this rubble. We've got satellite coverage. If the Iranians try to get at them, we can hit them back. He's already said that there's already a regime change. It's already new people. We can work. We can talk with these people. He already said the strait isn't his problem, right? But of course, he's also said different things sometimes in the same tweet. Right. So he he's picking and choosing. But what I'm suggesting to you is that Trump has already moved towards deescalation. >> You're spot on when you say he's set the stage to back out. >> To back out. >> We won. Regime change. Straight is not my problem. We have our own oil. Blah blah blah blah blah. But then >> if you don't open that straight, I'm going to end civilization. >> Yeah. >> So which was which didn't seem to fit. It seemed like he was setting the stage to back out. And then suddenly the civilization tweet, I'm going to bum
37:38 bomb your bridges and your nuclear power plants. Which suddenly made me think, okay, so maybe he does really care. >> And wasn't plausible, by the way. I mean, there was no chance that he was actually going to do all that that evening. >> So why didn't he just back out? >> Well, I do not want to be Trump's psychologist, right? It is very clear that he is impulsive and that he does not have much impulse control. Nor does he create around him mechanisms that create impulse control that enforce impulse control. He's on his phone all the time. He watches the media relentlessly. People engage with him from all over the world on his cell phone and he has recency bias. The thing he heard and saw last, he frequently focuses on. >> But he also watches the markets. He seems obsessed with the stock stock market. >> That's why so many of the announcements
38:23 he makes are right before or right after the market opens. And obviously there's been a lot of insider trading concerns around that too. And people there's he's concerned about personal enrichment and people around him making billions of dollars. That plays in too. I I wish it didn't. It's it's horrible to talk about. But you can't avoid that topic. What happens? You want to know what happens? I don't have a crystal ball. No one does. But where I think this could be going on the basis of that, the most likely outcome is that the ceasefire is eventually extended. That we have those talks that were 21 hours that were substantive. There'll be more talks. Maybe not with the vice president, but there'll be more talks. They'll become more substantive. and that eventually I expect that the Iranians are more likely to give on the nuclear issue and on
39:10 enrichment if they're able to maintain a privileged position on transit through the straight because that will help provide them with money and with security. They get a level of deterrence if everybody knows these guys could shut down the straight in the future. That helps them. They never had nukes. They weren't going to get nukes. If they got nukes, they were going to get blown up. Like everyone knew that they were two weeks away if they had access to the material and they reprocessed the nuclear grade and they weren't stopped by the Americans and the Israelis. That's a lot of ifands, right? So, but here they've got influence over the strait. They have it. They've used it. They're using it. They're making money. Trump does not have a military plan to hit them back. So, I think that is the most likely outcome. If that is
39:55 the case, then over time the Iranians will cut more deals with more countries to get more oil out. And meanwhile, there will be after the ceasefire is in place and strong, then the Europeans and other countries, the Indians, other countries will come in and they will start escorting ships to create a more secure environment in the strait itself. That is the good scenario or it's the less bad scenario because all of this should have been avoided. I want to make sure I'm clear on this scenario. You're saying that they'll concede on the nuclear point Iran potentially >> at least somewhat. I think they will compromise on the nuclear point, >> but in turn they'll get more control over the straight. Yes. >> And what does that mean? That they'll be able to decide who goes through there. They'll get a toll. Oh, they'll get >> they'll be able to charge. And by the
40:42 way, you could define them charging the toll as part of the reconstruction money that they're going to need for the war that they just >> reparations for. >> I mean, they'll call it reparations. No one else will call it reparations, but that's fine. I think that is the good scenario again, the less bad scenario, and I would say it is more likely than not. There is another scenario, right? And the other scenario is that everything that Trump has been saying is because he doesn't yet have a military plan. Over the last days with all this ceasefire, there's still this new aircraft strike group that is motoring its way over to the Gulf. You got thousands more American troops that are heading into position, ground troops, right? They're going to have almost
41:28 15,000 total that will be deployed by Trump since this war started. They're going to be there in the next 2 weeks. Once Trump has them there, he can use them. And there are lots of things he might use them on. He keeps saying, I keep seeing him go back. Before I was talking about all the ways he was saying, we don't need to defend the strait. We don't need the nuclear. we can hit them. But he also has been saying we should take the oil. >> I've heard him say this on a number of occasions. I've also seen him say if just the American people were a little more patient, we can take the oil. What does he mean by taking the oil? That's not a block. B blockade isn't taking the oil. Blockade is stopping the Iranians from getting the oil out. Take the oil is control the export facility on Car
42:14 Island. Right. And and explain this for for anyone that doesn't know what Car Island is and the significance of it in the oil situation. >> This is this is a comparatively small island. It's about half the size of Manhattan. >> It's not incredibly fortified or defended. Um and it's very close to the Iranian shore and it is uh responsible for 90% of the export of Iranian oil. sentcom the central command say that you can take Car Island with 12 to 15,000 men relatively comfortably. >> So where is Car Island on here? >> Yeah. So Car Island is right about here. It's not in the straight itself, but it is this is it's right off of the Iranian coast and and we're talking about 90% of
43:00 Iranian oil export comes out through there. So if the Americans take it, obviously very easy for the Iranians to be engaged in strikes against them, but the Iranians will not be able to get any oil out. So suddenly the Americans have far more leverage over the Iranian economy, right? In a very direct way, in a very targeted way. And that is the way that you take the oil. >> Could Trump take the actually take it out of this region somehow? Is there like another passage through that doesn't involve Okay, so he could just stop the oil. >> He could stop the oil. Okay. >> But again, if he has control of Carg, the oil coming out of CarG, if you want to have bring it to market, the only ones that could do it would then be the Americans. Now, the Iranians at that point could still disrupt the strait. And there are other conversations, there
43:47 other military plans about how you might be able to take coastal regions, raids on the territory that would take out more ballistic missile sites, go after their drones. All of this takes more troops. All this takes more casualties, but would also give you more capacity to eventually enforce a navigable straight with escorts, which right now you can't do. Right now, the Iranians can prevent you from getting any ships out if they wish to. I I think that the likelihood that Trump is ultimately going to make that order is well below 50%. I think that the worst scenario is not the more likely one because he understands how unpopular it will be. But it does mean that he's going to have to sell a pretty
44:33 ugly pig with lipstick on it. >> Mhm. >> It means that because this was the problem Trump has is he can't blame anyone else for this. >> Yeah. >> He's the decider. Like he did it. I mean, he's got his secretaries in the cabinet. They're all saying, "Well, the war, it's up to Trump. He's got the war goals. It'll be over when he says it. It's all about Trump. He can blame NATO for not want to join him. They're joining him. It was his war of choice. and he's never been responsible directly for an economic downturn. I mean, the the pandemic wasn't his fault, right? This is an economic downturn with oil prices shooting up, gas is over four bucks a gallon, diesel's over five, inflation's ticking up, food prices are going up, he's wildly underwater on affordability, and he is completely responsible for it. No one else is
45:19 responsible. And zooming out even further, when we think about this on a global scale, you've got Russia, who are at war with the Ukraine, that seems to have just completely vanished from the news cycle, by the way. >> It has not in in Europe, I promise you, but in the United States, they're talking a lot less about it. It's true. In Poland, this is a very big issue. In the Baltics, it is a very big issue. >> And then you've got China who must be laughing because it looks like the United States are just sort of selfharming themselves. >> Yep. And then you've got Europe, which is the last power, who seem to now just be sort of colluding with themselves and getting together and saying, "Listen, you know, we're not going to help the US anymore." I mean, we I grew up through all these little conflicts and wars, and the UK always seemed to come to the US. Yeah. >> And for the first time ever, I'm watching the UK go, "Actually, no, you
46:05 do this yourself. >> I'm going to meet with Macron in France, and we're going to we're going to uh huddle and um go it alone." >> What is that big picture? And which part of that big picture is most pertinent to talk about? Yeah, China is the most pertinent because it's the most powerful. Russia is the easiest to deal with. Um, which is that for the Russians, they don't have um much that they produce that's manufactured. They don't have very good technology, right? They're they're relying more on the Chinese. >> They've got oil there, haven't they? >> That they manufacture. They've got oil, they've got gas, they've got fertilizer, right? All the things with the prices have just spiked through the roof. That's what the Russians have. That's where their power is. And so they are making so much more money. Their economy was really getting squeezed with all the
46:51 sanctions. Now they're getting so much more for everything that they actually sell. And the Americans have reduced sanctions like they did on Iran against Russia because Trump cares about the markets as you say. So Russia's in a better position for that reason. And they're in a better position because all the weapons the Americans have been selling to the Europeans to get to Ukraine, America now needs to get to the Middle East. So the the Ukrainians are going to have a harder time defending their cities against Russian ballistic missiles, against Russian drones. So this clearly means that Putin will be much much less interested in a ceasefire, which let's face it, he wasn't really very interested in to begin with. Trump at the beginning of this term promised he would end this war. He was hugely frustrated. He goes
47:37 to Israel to announce the Gaza ceasefire. It's a big win. the Knesset, the Israeli parliament, their standing ovation. He's like, you know, I thought I was going to get the Russia war done and I failed it. They haven't been able to do that. I got this one instead. Like Trump never brings up his own failures. But this really bothers him. So here you've got yet more ability for the Russians to say, "We're going to persist." And it makes it more likely that Trump will eventually do a deal with the Russians over the heads of the Europeans. So that's that's the Russia issue kind of in a little box. Now Europe, we already talked about how Europe is having its problems economically. It doesn't have the productivity. It doesn't have the growth. >> What What did Europe do wrong in your view? Like how did I'm a European, I
48:24 guess. I was born in Botswana in Africa, but I moved to the UK when I was young, so I guess I'm I'm British. Um, >> what did the country do wrong? because the country was so strong and powerful and respected when I was younger and I love Britain. But it appears on a global stage that that perception has changed. The US are talking to us like a lap dog. >> Yeah. >> At Davos, I saw the talks. They're like, "You need to get your together and be stronger and stop being so woke blah blah blah blah." >> Yeah. Well, first, the the Americans talking to the Europeans that way has a lot more to do with the change in administration. Okay. I don't think any other Democratic or Republican president would do what Trump is doing to his closest allies. I think that's more unique. But but it is certainly true that over the last 30 years, there have
49:11 been two really big geopolitical shifts. Right? The United States has shifted its orientation, but not geopolitical power. But in terms of power shift, you've got the rise of China and the global south, India in particular after China, but China is the biggest piece of that. And then you have the decline of American allies. Europe, Canada, Japan, South Korea. These are countries most of which are contracting demographically, right? They're countries most of which that have much flatter growth and much more reduced productivity than the United States. They've not been investing in their own defense. They've not been investing in their own technology. So what you see is an asymmetry. At the
49:58 same time that the Americans are saying we're not interested in the rest of the world. We don't want to do all this stuff. Want don't want to fight the wars. Don't want free trade. You're also seeing a reality where those countries don't bring as much to the table in a conversation with the United States. So the the so-called draggy plan, the 800page plan by the former central bank head in Europe, the ECB, Mario Draghy, they called him Super Mario. He had this competitiveness report that all of these things that the Europeans needed to do and he would say the Brits as well to to address that to build entrepreneurship to spend in ways that would actually bring a return long-term to like invest in new technologies to reduce red tape. The plan is there. But unlike the United
50:45 States, unlike China, Europe is not a country. Europe is 27 countries in the EU and the United Kingdom which decided for Brexit. It's a lot harder when you don't have scale. It's just harder. And when you have elections every, you know, sort of couple every few years, it's just more challenging. You can't do the sort of stuff that the UAE or the Saudis or the Singaporeans or the Chinese can do at scale long term. So, as a consequence, what did Europe do wrong? Europe focused, Europe believed that the world after the wall came down in 1989, after the Soviet Union collapsed in 1991, they believed that the world was just going to be peaceful, that everyone was going to have a system like the Europeans did. So, they didn't need to invest in invest in defense. And it was
51:30 okay if they didn't invest in lots of technology because they had friends that they could work with and maybe their growth wouldn't be as big, but their quality of life would be so high. And they were completely wrong. China did not. They got wealthier, but they didn't suddenly align with the United States and Europe. China didn't become a free market economy. China didn't become a democracy. China is a consolidated dictatorship under Xihinping with no term limits and with control of the economy, state control of the economy. And that that's a not an easy environment for the Europeans to be comfortable being non-competitive. >> A lot of this come down to energy and productivity. >> The cost of energy, >> the cost of energy. So a lot of these countries decided to carry on drilling oil and pursuing nuclear and a lot of
52:18 the European countries decided to go for net zero where they tried to focus more on sort of sustainable energy sources >> whereas China didn't seem to give a quite frankly the US didn't really seem to care much um and then also on this point of entrepreneurship and innovation these the US and China have both really aggressively pursued entrepreneurship and innovation and new technologies whereas one could make the case that the European environment has been less friendly ly to new technologies and innovation. >> So the the Chinese, you said the Chinese didn't really give a Not true. The Chinese have invested in everything. So the Chinese know that they still need lots of dirty coal in order to power um their industry, but they also have invested like nobody else in green technologies at scale,
53:03 >> solar and things like that. >> Solar and wind and their their car companies are the electric vehicle leaders in the world. and batteries that are the best batteries, the most efficient batteries at scale in the world and all of the the the materials, the raw materials that go into producing those. The Chinese have invested in this for decades now. And nuclear, right? While the while the Europeans have, with the exception of France, France is, you know, has heavy nuclear and that's helped them in this crisis, most of the Europeans have turned away from nuclear, the Europeans have not done an allforall approach. The Europeans have done a let's lean into green but let's make other technologies more challenging including nuclear which should be seen as a green technology. So yeah there's no question that that has inhibited growth in Europe. The United States has
53:52 been on again off again. You've got one administration that's leaning into green, the next one that's not when America should be doing America today is the world's leading oil producer by a long margin and fracking natural gas as well by a long margin doing incredible work there. Yet the United States is actively undermining the ability to also produce clean technologies for energy. Texas produces more sustainable energy than any other state in the United States. Red Texas. So I mean it's not like this is these energy technologies are not Republican or Democrat. They are at scale becoming cheaper. You need all of them. And so the Europeans made a mistake in not recognizing that you need
54:37 everything. >> Everybody says that the United States is the world's leading superpower and that has been the case. You know hard to argue against that for a long time. Is that set to change? Is China set to become the world's leading superpower? not soon. Um but the trae the present trajectory if it continues clearly would challenge America's dominant position clearly. I mean the US has the dollar is the global reserve currency right now. Nothing else is close. And transacting in the dollar is a huge advantage for the Americans who can continue to print money with reckless abandon and run massive deficits and have lower interest rates as a consequence. China does not have a
55:22 convertible currency. They don't have rule of law. If they opened their currency to become convertible, there'd be massive capital flight and political instability. That's what they worry about. So, they don't compete with the US there. China's military is still a fraction of the capabilities of the US. They're watching what's happening in Venezuela, in Iran. They don't have that capacity. They're not close. They're building their nuclear weapons out. They're building their conventional weapons out. They have never fought a naval war. They have It's decades since they fought a ground war. U they're not capable of doing these things. >> So, is there any concern with China? >> Yes. >> What is that concern? The concern with China is that the most the world changing new technologies out there, the Chinese are investing at scale and the Chinese are now either at parody or
56:08 ahead of the Americans and everyone else by a long margin in many of the core technologies that matter most in the world. >> And what does that potentially mean that is worth paying attention to? Why does that matter? >> It means that they can set the rules. They can set the standards. They can sell the products that you need them. that if they determine that they're going to shut you off, you're dead, right? I mean, think about what happened. The Europeans were so dependent on Russia for gas and for oil. And the Russians invade Ukraine, they want to shut it down, and it destroys the European economy. The Americans are doing just fine. The Americans are building and get so many of their semiconductors from TSMC in Taiwan. I'm sure you've talked about that before in your show. Well, what happens if China decides that they want to cut that off?
56:53 If they have that capacity, the Americans are really screwed. So you don't want to be in a position where one country, an adversarial country that you don't trust, have a good relationship with suddenly produces all this stuff that you desperately need or your economy will fall apart. And yet that is the the the the trajectory where president if China if China had elections coming up in November, I'd be worried, right? Because, you know, you can just imagine a situation where the Chinese being more short-term would say, "Well, look, the Americans are distracted with Iran and the Europeans are distracted with Ukraine. Now is our time for Taiwan because we really want to get like all that support. So, let's jin it up." Chinese aren't doing short- term at all. They're doing long-term. The Chinese are thinking for 10 years down the road, 20 years down the road,
57:39 and they're investing that way. They're taking very little risk. They're making no regret moves to set themselves up long term while the Americans are doing all this short-term stuff, all this electoral cycle stuff. That's the worry. If the the Americans the biggest danger to the United States, not China, it's America. It's America getting in its own way and not investing in having the best products, the most competitiveness, the most attractive place to study, the most attractive place to live, the most attractive place to work. This has had probably the single biggest impact on my office. Of all the products that I've tried that have given me productivity gains or cognitive boosts, I would say that exogenous ketones are in the top three most pivotal things that have
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