Liberation Day, Tariffs, US v China Open Source, OpenAI, $CRWV, TikTok | BG2

Summary

• Liberation Day landed at the big end: headline tariffs jump from $77B last year to ~$750B — above even hawk Peter Navarro’s $600B — with China at a combined 54%, a 10% floor on every country, and 25% on autos, though pharma and semiconductors were exempted (Brad’s hunch: effective number “right around 600 billion”). S&P/NASDAQ futures swung 600bps lower during the presentation, on top of indices already down 8-15% YTD.
• Brad’s tradeable call: the plane lands at $300-400B, “not 6 or 700 and certainly not a trillion” — Trump “can’t afford to lose a single Republican vote” on reconciliation and senators are hearing it from constituent CEOs. No clearing event for 30-60 days, and the key one is Xi-Trump: there’s “no way that lands at 54%.” Meanwhile, “the best opportunities to buy something are when people are a little fearful.”
• Gurley’s core objection isn’t the rate, it’s the ambiguity: reshoring a factory might take ~3 years at higher cost — “I don’t think our labor is globally competitive, nor do I think it wants to be” — and not knowing policy 3-12 months out “makes it very hard to allocate capex in any meaningful way whatsoever.” The Montana CEOs, “almost to a one,” said February and March slowed; one had four contracts cancelled by angry foreign counterparties.
• China’s open-source push is longstanding, not a Xi directive — the perfect answer to 40-50 years of IP-theft accusations — and DeepSeek (1,500+ Hugging Face forks) is prolific. DC may move to limit it, opening a short window for a US player to “go left of DeepSeek in terms of openness”; Gurley: “the next 3 to 6 months could dictate who’s standing on top of the hill 5, 10 years from now.”
• OpenAI’s open-weight model with reasoning — one of its first since GPT-2, explicitly without Meta’s 700M-user license cap — reads to Gurley as a Kubernetes-style deft move that “wipes out the business opportunity for other models on the API side.” Llama 4 is rumored this month: 400B-parameter MoE, ~10M context window. Washington’s motive per Brad: no “Huawei-DeepSeek Belt and Road.”
• OpenAI’s $40B SoftBank-led round at ~$260B pre ≈ 20x forward run-rate revenue vs Anthropic ~50x and X/xAI ~80x — the leader priced at a discount to peers. Gurley: headline “smells of being promotional,” it’s a “sport of kings” where unit economics get postponed ($5-7B losses, ~$15-20/yr per free user); Brad’s rebuttal: Uber was “never going to be profitable” in 2020 and does $6B FCF this year — and demand is throttled at 1M new users/hour, 500M WAU, 20M paid.
• Agent economics break Google’s LTV math: Booking.com pays Google $50 on a $20 hotel take using lifetime-value logic; a white-label service under an agent can share at most $10 — all upside for OpenAI, a major replacement risk for Google (already $200→$150). The antitrust irony: “finally in 2025, the first time we’ve actually had competition for Google… now we get around to breaking up their search monopoly.”
• $CRWV broke issue at ~$37, then rallied to ~$60 on a Google/Nvidia Grace Blackwell deal that answered the Microsoft-concentration critique; Brad argues GPUs retain value beyond two years (A100s still working in year five, V100s ran seven), while Gurley questions whether depreciation should be accelerated — “the answer may lie somewhere in between.” And the proposed TikTok fix: a NewCo licensing the algorithm with ByteDance under 20%, unlocking ~$600B of trapped US venture value — unless China, freshly hit with 54% tariffs, blocks it.

Deep dive

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