All right, let's talk about Meta. The revenue for this third quarter was a complete, utter disaster for Meta, and the stock has plummeted since and been under $100 a share. 

So when you look at Apple versus Meta, there's this really interesting thing that comes up in 2016.

They were generating a ton of cash. It was sitting on the balance sheet. Facebook was doing the same thing. 

And what to do with all that cash? Well, they started giving away the dividends, making investors happy, and in return increasing the stock price. 

So they spent $396,000,000,000 since 2016 to buy back stock. In the same time, Facebook has spent almost 100 billion. 

So you would have said, well, shouldn't Facebook's stock have reacted in the same way? And for a very long time, it actually looked like it was, right until about September 2021. And then this thing fell off a cliff. 

And the reason why it started to fall off a cliff was somebody started to notice that even though you're buying back all these shares, you're leaking all of these shares to all of these new employees. 

And this is when people started to uncover what was happening at Facebook, Here's what's going on: Facebook in the last two years has spent $25 billion on the Metaverse, and they said that they're going to spend meaningfully more in 2023 and then sustain that investment for a while. 

So, they spend around 4 billion a quarter right now. 16 billion a year, that'll go to 25 billion in 2023, and then they'll sustain that. 

What that means is that these guys will have spent a quarter of a trillion dollars in total. And I just wanted to understand a quarter of a trillion dollars in the context of other major leaps in humanity. 

So Apple spent in its entirety, $3.6 billion to create the first iPhone. 

And what they did was they said every subsequent version of the iPhone would only be funded from the cash flow and profits of the generation before it, right? So they used consumer demand as their guiding principle. So it was a very incremental approach. 

But the point is, it took $3.6 billion to get that juggernaut off the ground. 

The Manhattan project would cost 23 billion in today's dollars to create the atomic bomb. 

Tesla, in its entire life spent 25 billion to get free cash flow profitability. And they took this incremental approach as well. We'll create the coupe, the roadster, then the model S. Then the model X. They iterated their way. They used customer demand and all of that revenue to fund future growth. 

And Google has spent $40 billion on innovation projects. 

The only thing that I could find in history that is comparable to what Meta will spend is the entire Apollo program, which costs in today's dollars a quarter of a trillion as well. 

They've created, I think, an enormous set of pressures for themselves. 

I think what people don't understand is where is this quarter of a trillion dollars going and is it going to be a leap in humanity at the scale of the Apollo program? 

Because it now is becoming the single largest capital allocation program in capitalism history. Nothing comes close. 

I think the problem is the amount of investment that they're making is so outsized and so abnormal and doesn't compare to anything anybody's ever seen. 

It's 4 billion a quarter right now. So 16 billion a year. And they said that they're going to significantly increase it to 2023. So I just assumed it was a 50% increase. Maybe significant means 100, but 16 goes to 25. And they said they're going to keep going at that pace. And so if you run that out until 2030, that's how you get to $250,000,000,000. 

I actually like the oculus products. I think it's a very cool product. The question is really just about the magnitude of the investment level, but I think there is a future in VR and AR. And if you've tried the Oculus headset before, you know it's a very magical experience with software. One of the most magical that I've had. The question is the investment magnitude and time frame and use case. 

I think that we should assume that VR and AR's going to be a really important part of our existence. 

I think investors reacted to how spending $25 billion a year needs to be measurable somehow. If Zuckerberg were spending 2 billion a year or 3 billion a year, I don't think people would have said anything. It's just a magnitude relative to the progress that's being demonstrated publicly. 

That's the thing that I think the Tesla program got right. The Apple iPhone program got right. The Boeing program, even the Apollo 13 program for that quantum of spend. So it's not to say that you can't spend a quarter trillion dollars over the next decade, but you got to eat what what you kill. 

Can you change the world if you lack accountability? 

They have an incredible core business, and they have decided, for whatever reason, to make an enormous bet. 

And that bet could be a very good bet. But the way that you make a bet, is you have to look at incremental progress, and you have to demonstrate that all of these bets makes sense. 

Tesla is reinventing an entire industry, trillions of dollars of energy, generation and transportation. But they did it on one year of Meta spend. 

Apple reinvented an entire compute platform on one quarter of meta's spend. 

That's not a judgment. That's just a numerical observation. 

So if you want to get people on your side, you just have to be able to say, here are all of these things that justify $25 billion a year. 

On top of that it seems that great leaps of progress in humanity are not correlated to dollars all the time. In fact, most examples are the exact opposite, showing it's more about small and extremely nimble and talented management teams that generate human progress. 

So the Meta spend on VR, in this quarter, is about 15% of all revenue. So 4 billion out of the 27 in revenue is about 15%. And Alphabet's last quarter revenue was 70 billion, and they spent about a billion dollars on "other bets". 

So on a relative basis, alphabet is spending one 10th of what Meta is per dollar earned. 

I'm torn. This past week, all these red flags have come up with how Meta is handling budgets. But at the same time, I am believer in VR. 

But what seems to make even more and more sense to me, is that maybe it just won't be the $250 Billion dollar company that creates the Metaverse. Maybe the leap for humanity is engineered in a garage somewhere.  

Why did Wall Street get mad at Facebook?

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