Biggest LBO Ever, SPAC 2.0, Open Source AI Models, State AI Regulation Frenzy

If EA, under its new private ownership, successfully (1) cleans up its operating expense model, (2) adopts next‑generation AI tools, and (3) finds ways to distribute its games outside the Xbox/PlayStation gatekeepers, then Electronic Arts’ equity value will grow into the hundreds of billions of dollars (substantially above the $55B take‑private valuation) over the subsequent years.

“If you do those things, this is a multi hundred billion dollar asset. And in that I think it could be just an enormous win.” View on YouTube

Because of the massive inflow of capital into private equity, risk‑adjusted returns in the broad private equity asset class will trend down to roughly zero excess return over the next several years, similar to what has already happened in venture capital and hedge funds.

“when you see that kind of graph… the returns go to zero. And so we've seen this in venture capital. We've seen this in hedge funds, and we're now going to see this in private equity.” View on YouTube

Over the coming years, investor capital will increasingly leave the broad private equity category and become concentrated in a small number of top‑performing private equity firms (such as Silver Lake), while a significant portion of the capital will shift into private credit, creating a major speculative bubble in private credit.

“I think what's going to happen is that the money is going to come out of private equity, and it's going to get concentrated into the few companies that know what they're doing… Where does the money go? The money's already leaked into private credit, which is the next big bubble that's building.” View on YouTube

Within the next iteration of SPAC structures (what he calls "Raptor 3"), SPACs will evolve into vehicles where the sponsor pre‑arranges a large, flexible pool of common equity capital (on the order of $1–3B) from the outset, so that de‑SPAC transactions function as fully pre‑baked IPOs with no redemption risk and all money rolling over as common stock.

“I think that the future may be just prognosticating and guessing… I think the Raptor three will look like where somebody, a sponsor like me, rolls everything up into one thing so that it's already pre-wired from the beginning… so that it's a totally pre-baked IPO at a very fair price. I think that I think that that's what the Raptor three version of a Spac will look like.” View on YouTube

Consumer video‑generation apps like the Sora‑based "Slop" app will improve rapidly so that within about 1–2 years from this October 2025 discussion, their quality and usability will be "legitimately excellent" for mainstream users, significantly better than the current version.

“The thing that I keep in mind whenever I try these apps for the first time is today is the worst it'll ever be. It only gets better from here. And so if you look at the starting point, it won't take but a year where this thing I think, or maybe two years where this thing is legitimately excellent.” View on YouTube

Absent major new solutions (such as cross‑subsidies or widespread behind‑the‑meter storage), average retail electricity prices will roughly double over the five years following this October 2025 conversation, driven largely by AI‑related data center demand.

“what this energy CEO told me is, look, the next five years are baked and if we don't find some compelling solves… electricity rates will double in the next five years.” View on YouTube

Absent major new solutions to electricity supply or cost structure, average consumer electricity rates in the United States will be roughly twice their current level within five years of this 2025 discussion (by around 2030).

“if we don't find some compelling solves, electricity rates will double in the next five years.” View on YouTube

Between 2025 and 2035, deployment and use of AI systems will drive a very large increase in electrical power demand in the United States (materially above current levels attributable to non‑AI uses).

“there's no question that AI is going to create a huge need for power over the next 5 or 10 years.” View on YouTube

In the United States, additional electricity generation capacity added to meet AI‑driven demand over the next five years (through ~2030) will be predominantly natural gas–fired, while over the subsequent 5–10 years (through ~2035) nuclear power will become a major component of new capacity serving that demand.

“I think on a 5 to 10 year time frame, the answer is probably nuclear, or at least that's a big part of it. But nuclear takes at least five years. Within the next five years, it's probably gas, natural gas.” View on YouTube

To comply with Colorado SB 24-205, commercial AI model developers serving Colorado will implement additional fairness or DEI-oriented constraints that suppress or alter outputs which could create disparate impact on protected classes, resulting in so‑called 'woke AI' behavior in deployed systems within that jurisdiction.

“The only way that I see for model developers to comply with this law is to build in a new Di layer into the models, to basically somehow prevent models from giving outputs that might have a disparate impact on protected groups. So we're back to woke AI again, and I think that's the whole point of this Colorado law.” View on YouTube

If the current trend toward divergent AI regulations in all 50 U.S. states persists (with no federal preemption) over the coming years, the U.S. AI industry as a whole will fail to generate significant net positive economic output and will fall far short of its potential contribution to national productivity and GDP.

“If you have 50 sets of rules, what you will have are some conservative versions of AI. You'll have some progressive leaning versions of laws. These 50 series of laws will essentially just render this industry impotent and incapable of maximizing itself, and actually doing what's necessary to drive productivity and GDP on behalf of the country... Can you imagine? Instead of two sets of rules, you have 50. I think you know what the economic consequences will be. You'll render this entire category incapable of being able to generate any positive economic output.” View on YouTube

Over the next few years, Democratic‑leaning U.S. states will enact and enforce AI regulations targeting 'algorithmic discrimination,' which will cause major AI providers to deploy state‑specific versions of their models with DEI‑oriented constraints ('woke AI') for use in those jurisdictions.

“what you're going to see is that the blue states will drive this ban on quote unquote, algorithmic discrimination, which will lead to Di being promoted in models, which is what the Biden administration wanted. You will see the return of woke AI at the state level.” View on YouTube

During the Trump administration beginning in 2025, the White House will publicly support, and a growing number of Republican legislators will eventually back, federal legislation to preempt state‑level AI regulations and establish a single national AI regulatory standard.

“So the feds preempted that. And I think we should do the same thing on AI. That's what the president basically said in his speech. So I think the administration ultimately will support this. And I think I think more Republicans will come on board as they realize what the blue states are doing here is not helpful for conservatives.” View on YouTube