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Tech titan Elon Musk is known for being a car guy, a rocket guy, a social media guy, and now he's also a super computer guy.

 And Elon Musk says Tesla will spend well over $1 billion by the end of 2024 on building an in-house supercomputer known as Project Dojo.

 SpaceX reportedly generated $1.

4 billion in revenue from Starlink in 2022.

 In early November 2023, SpaceX CEO Elon Musk announced that Starlink had achieved break even cash flow.

 One of the reasons that Elon Musk has grown so wealthy is not only because Tesla stock has gone up so rapidly, but also because the number of shares that he owns is growing rapidly.

 Over that five year period, from 2019 to 2024, that stock went up 1,300%.

 If that stock continues to go up 100% a year along with his wealth, he will get to trillionaire status by 2027.

 You can think what you want to think of Elon.

 All of the above is valid, but they are out ahead.

 And liftoff of the Falcon 9.

 Elon Musk's SpaceX is known for its frequent launches, which now dominate the space industry.

 But what many of these rockets are launching is just as important for the company as the launches themselves.

 Broadband Megaconstellation, Starlink.

 Starlink.

 And we saw this garland of little lights one after another, absolutely perfectly sequenced.

 And it was Starlink.

 Starlink is SpaceX's answer to providing global high speed internet coverage, using a network of thousands of satellites buzzing around the planet in a region known as low Earth orbit, about 342 miles above the Earth's surface.

 While Starlink may be a business unit within the broader SpaceX company, it's seen as crucial to its overall goals of making humanity multi-planetary and exploring bodies like the Moon and Mars.

 Because Starlink is seen as an economic engine for the company.

 SpaceX reportedly generated $1.

4 billion in revenue from Starlink in 2022.

 In early November 2023, SpaceX CEO Elon Musk announced that Starlink had achieved break even cash flow.

 Starlink is importance to SpaceX overall as a company is imperative.

 Euroconsult estimates that, optimistically, by the end of 2023, this business of Starlink could represent upwards of 40% of SpaceX's overall business.

 This total would be somewhere in excess of $3 billion generated from Starlink.

 SpaceX launched its first batch of Starlink satellites back in 2019, and since then, adoption of the service has ballooned.

 Starlink now has over 2 million active customers and is available on all seven continents and in over 60 countries.

 Starlink has been praised for its ability to connect remote parts of the world that would otherwise not have access to reliable internet.

 The service has also become indispensable in areas hit by natural disasters and more recently during times of war, particularly the Russia-Ukraine war.

 Elon Musk has also said, " SpaceX will support communication links with internationally recognized aid organizations in Gaza.

" Although Musk said in late October that no Starlink terminal has attempted to connect from Gaza yet, but Starlink's growing influence is garnering condemnation from some who say that Musk is meddling in geopolitics.

 A Ukrainian official says that you have enabled Vladimir Putin as an aggressor.

 What do you say to that? Meanwhile, the scientific community has its own concerns.

 The astronomical community got concerned because the projection of the full constellation of several, tens of thousands of satellites in low Earth orbit was immediately seen as an interference to both the optical observation and to radio observation.

 But none of this has slowed down SpaceX's ambitions to.

 Expand Starlink service even further.

 CNBC explores what has led to Starlink's rapid adoption and growing influence? With around 5,000 active satellites now in orbit.

 Starlink satellites account for the majority of all the world's active satellites.

 This growth is uncharacteristic in the sense of its magnitude.

 Whereas prior, satellite service providers have ramped up to anywhere at most between 500,000 t o a little bit over a million subscribers, and this is taking a ten year period.

 Starlink's race to 2 million subscribers, has taken only the better part of two years.

 Experts estimate that the global market for consumer satellite services, including TV, radio and broadband internet, was worth over $92 billion in 2022.

 And Starlink could be in a good position to capture a big piece of this market going forward.

 By design, LEO satellite constellations like Starlink are more flexible than geostationary satellite networks like those operated by legacy satellite internet service providers Viasat and HughesNet.

 These satellite service providers have been constrained on capacity.

 They launched large geostationary satellites the size of a minibus weighing multiple tons, and they last 15 years.

 So what ends up happening is they have more boom bust cycles than Starlink, who tends to introduce capacity so far, at an unrelenting pace.

 So they're able to onboard more and more subscribers by continually launching new satellites.

 For the incumbent players, they're kind of stuck with what they have.

 Although initially conceived for the consumer segment, Starlink's offerings have expanded to serve enterprise markets, including the maritime and aviation industries.

 Starlink is absolutely witnessing explosive growth in the maritime segment, having captured commitments for over 4,000 vessels.

 By our count, as of the third quarter of 2023, and now have confirmed commitments on over 400 commercial aircraft and business aviation aircraft.

 SpaceX has also announced plans to offer cellular satellite connectivity to unmodified smartphones.

 In partnership with several global telecom partners, including T-Mobile in the U.

S.

 It's a feature Apple introduced in the iPhone 14, in partnership with U.

S .

 satellite operator Globalstar.

 Your phone or mine? If they're compatible with the T-Mobile network, they will be compatible with Starlink's direct to cell service.

 So when you exit coverage areas on rural highways, national parks, or just areas of poor cellular coverage, you'll be able to automatically roam onto a space based network extension of T-Mobile's network, essentially.

 Another factor that's helped Starlink's rapid growth is the independence with which SpaceX is able to operate.

 Starlink is vertically integrated.

 It makes its own satellites.

 It launches them and its crafted its own service.

 So it's almost completely disintermediated in terms of suppliers and its distribution channels.

 It's a portable system.

 So when you think about how you connect to Starlink satellites, it's a small antenna or terminal, fairly inexpensive, and all you need to do is plug it into a power source.

 But making its equipment user friendly has not come cheap for SpaceX.

 Early on, the company faced steep costs to manufacture its consumer.

 Antenna production was initially estimated to be as high as $3,000 per unit.

 At the time, SpaceX charged consumers $499 for its equipment, meaning the company was eating a lot of the cost.

 Since SpaceX has cut the manufacturing cost of its antenna to under $600 and charges residential customers $599 to buy them.

 Starlink's ease of use and deployment has made it an indispensable tool in the Russia-Ukraine war.

 The big benefit of Starlink and how it's being used in Ukraine today it is communications.

 It's providing a pathway for the military, for civilians to stay connected to the outside world.

 It allows a pathway for the military to communicate with each other and to provide command and control direction to their forces.

 SpaceX began offering its Starlink service to Ukraine at the request of Ukraine's digital minister Mykhailo Fedorov, back in February 2022.

 Here's Musk reflecting on Starlink's importance at the 2023 Viva Technology conference in Paris.

 Russia had actually taken out all of the satellite communications and all of the ground communications, except for Starlink.

 It was the only one that was still operating.

 And even today, it is still the only one that is effective at the front lines.

 And Starlink today is the backbone of the Ukrainian military communications.

 One of the other benefits that we're seeing in Ukraine from the use of Starlink is its overall resilience.

 With thousands of satellites on orbit at any given time, it makes it a lot harder to jam all of those satellites or to target them all.

 The other benefit? Just how agile and quickly they can move.

 So as Russia has sought to jam Starlink, they've been able to make software updates on the fly to mitigate the effect of that jamming and to keep people connected.

 But SpaceX has expressed reservations about how its technology is being used by Ukraine offensively, specifically to coordinate drone strikes.

 During a conference in Washington, D.

C.

, in February 2023, SpaceX president and COO Gwynne Shotwell said that while the company had been, " really pleased to be able to provide Ukraine connectivity and help them in their fight for freedom," she emphasized that Starlink " was never intended to be weaponized.

" Questions about Starlink's and Elon Musk's outsized influence on the war came to a head when it was revealed that in September 2022, the SpaceX CEO had refused a request by Ukrainian military officials to turn on Starlink service in Crimea, which would have allowed for a sneak drone attack on a Russian naval fleet.

 According to the author of a recent biography about the tech billionaire, Musk refused to cooperate because he was worried that a Ukrainian attack on Russian vessels would have provoked the Kremlin into launching a nuclear war.

 The magnitude of his influence is not lost on Musk.

 At one point, the SpaceX CEO wrote, " Between Tesla's Starlink and Twitter, I may have more real time global economic data in one head than anyone, ever.

" I think what's important to remember about the use of Starlink in Ukraine is there was not a contract signed with the government or with our U.

S.

 Department of Defense.

 So there weren't necessarily terms and conditions that Starlink had to meet for the government customer.

 In June 2023, the Department of Defense did sign a contract with SpaceX for its use of Starlink in Ukraine.

 SpaceX has also won a Department of Defense contract worth up to $70 million to make a military specific version of Starlink, called Starshield.

 Seeing the influence Musk's Starlink may have on geopolitical matters has prompted some countries to invest in their own satellite networks.

 The European Union has said that it will contribute €2.

4 billion to help build out a constellation that's expected to reach full capacity by 2027.

 China is building out its own low Earth orbit satellite internet network, after the country made it clear that it didn't want Starlink services being offered to its citizens.

 Taiwan, wary of Musk's ties to China through his other venture, Tesla, too, has expressed interest in a proprietary satellite network to help shield the country from a potential assault from China.

 SpacX has said that it eventually wants to launch as many as 42,000 Starlink satellites into orbit.

 Competitors including Amazon, Eutelsat, OneWeb and Telesat want to launch thousands more satellites.

 And that's not even counting the several nations planning their own megaconstellations.

 The concern of the astronomical community is mainly due to the fact that these satellites are very numerous.

 We are moving from the 2,200 satellites of 2 or 3 years ago in orbit, to something that will be 40,000 or even 100,000 satellites.

 So for most of the time, during the night, these satellites are illuminated by the sun.

 And so they are visible in the sky and they interfere with the observation, in particular with photographs that the astronomers take for their research.

 This image, taken from a telescope in Chile in November 2019, illustrates the concerns from astronomers.

 The telescope, meant to see images of distant stars and galaxies, instead captured the light trails of 19 Starlink satellites.

 Observations from the Hubble Space Telescope, long lauded as a vital research tool for astronomers, have also been affected.

 Benvenuti says SpaceX has been responsive to concerns from the scientific community.

 He points to several design changes SpaceX made to its satellites to reduce their brightness, but says more needs to be done.

 The final solution is to know exactly for every satellite, the precise position in the sky and at any time from any observer.

 And so we are working with the companies to have this information and create a service that can be used by any observer, and they will know when the satellite is crossing their field of view, and they can plan their observation in a way that this disturbance is avoided.

 Satellites also pose a threat to radio astronomy.

 The interference to the radio observation is a very serious one and a very difficult one, because this satellite are there to transmit information toward the ground in microwaves.

 So the only solution is to switch off the transmission when the satellite is in view of one of the large radio observatory.

 So, what we are trying to do now is to negotiate with the company, to have the switch off the transmission when they are over these facilities.

 The massive number of anticipated satellites has also led to fears of a proliferation of debris, which some experts worry may eventually render large parts of Earth's orbit unusable.

 And then there's the potential risk to people on Earth as satellites are deorbited.

 In the past, SpaceX has said the lifetime of a Starlink satellite is about five years, which means satellites must be frequently replaced to maintain service.

 A recent report by the Federal Aviation Administration, which is responsible for issuing launch licenses for satellites in the U.

S.

 A nonprofit research group, The Aerospace Corporation, predicted that by 2035, Starlink satellites would account for 85% of the risk to aviation and people on the ground from falling space junk.

 The report went on to say that by 2035, if Starlink satellites did not fully burn up in the atmosphere before falling back to Earth as designed, the FAA expects one person on the planet to be killed or injured every two years, as a result of Starlink satellite debris.

 In a letter dated October 9th, 2023, SpaceX disputed the report, saying that the report relied on, " a deeply flawed analysis that falsely characterizes reentry disposal risks associated with Starlink.

" The letter went on to say that a lack of knowledge, a flawed methodology and an overreliance on outdated data contributed to, " distorted analysis that makes preposterous, unjustified and inaccurate claims regarding Starlink disposal risk to people on the ground and to aviation," and requested that the FAA, quote, correct its report to Congress.

 SpaceX's response to the FAA analysis really centered on the data that was underlying the report, and pointed to the fact that not only was the data from satellites that were not Starlink, but also that the company's own track record shows that Starlink satellites completely burn up when they enter the Earth's atmosphere.

 The FAA declined CNBC's request for an interview, and SpaceX did not respond to our request for an interview.

 Benvenuti says that while he doesn't believe that there is a risk of stray Starlink debris injuring anyone, he does have some environmental concerns.

 The chemical composition of these satellite that returned to Earth, they are burned into the higher atmosphere.

 What would be the effect of that is not known and is not completely fully studied.

 So the impact on the space environment should be fully studied before we continue to populate the low Earth orbit with such a large number of satellites.

 There's no question that Starlink has grown a tremendous amount in just a few short years, but whether SpaceX can keep up this pace remains to be seen.

 The pace of growth that Starlink has exhibited will be difficult for them to keep up going forward, and for a couple of reasons.

 On the first end, there's a certain degree of demand saturation that's happening, where after the service was introduced and now it's been two years in many markets, the lowest hanging fruit in terms of the subscribers who are most desperate for a better service, have likely already moved over to Starlink.

 We've also seen evidence that Starlink is having to spur demand in the market by reducing the cost of its user terminals.

 It's run promotions where its baseline costs in the U.

S .

 of about $600 for the equipment have been reduced to as low as $150 in Canada in rural areas, and the same has been done in Australia and Japan, for example in localized, targeted campaigns.

 Starlink's success, many believe, is closely tied to SpaceX's other major undertaking, Starship.

 SpaceX hopes to use the massive next generation reusable rocket to launch cargo people and a lot more satellites, but development of the rocket has hit a number of delays.

 In order for SpaceX to keep Starlink on that hockey stick like growth that it's seen so far, the company needs Starship to begin flying.

 Starship is a much larger and more powerful rocket than the current method that SpaceX uses to get its Starlink satellites into orbit, which are its Falcon 9 rockets.

 To meet both the expansion of the network by launching more and more satellites into orbit, as well as replace aging satellites over time, SpaceX needs Starship flying regularly to be able to meet that overall growth trajectory.

 Competition in the consumer satellite internet market has also been heating up.

 One service that's expected to be a big challenger is Amazon's Project Kuiper, which launched the first of its satellite prototypes in October.

 Amazon plans to begin beta testing its network with customers by the end of 2024.

 Amazon is adopting a similar approach in terms of its vertical integration, manufacturing the satellites to a certain extent, launching them themselves through an affiliated company, Blue Origin, and they'll be making their own user terminals and leveraging their e-commerce platform to deliver these pieces of equipment and services remotely to the same swath of users as Starlink.

 In the future, you will see much more of these types of LEO broadband internet systems.

 It provides a tremendous amount of flexibility and mobility, and that is tremendously powerful, not just for national security, but to connect disadvantaged populations, rural populations that don't have that kind of connectivity today.

 Tech titan Elon Musk is known for being a car guy, a rocket guy, a social media guy, and now he's also a super computer guy.

 And Elon Musk says Tesla will spend well over $1 billion by the end of 2024 on building an in-house supercomputer known as Project Dojo.

 Although supercomputers look a lot like data centers, they're designed to perform calculations and process data at extremely high speeds.

 Both of them are about scaling up to very large amounts of computation.

 However, like in a data center, you have a lot of small parallel tasks that are not necessarily connected to each other.

 Whereas for example, when you're training a very large AI model, those are not entirely independent computations.

 So you do need tighter interconnection between those computations, and the passing of data back and forth needs to be potentially at a much higher bandwidth and a much lower latency.

 Musk wants to use the supercomputing power to improve Tesla's autonomous driving capabilities, and finally deliver on the company's years long promise to bring robotaxis to market.

 Supercomputers are also needed to train Tesla's humanoid robot, Optimus, which the company plans to use in its factories starting next year.

 All in all, Musk says that Tesla plans to spend $10 billion this year on AI.

 Musk's new AI venture, xAI, also needs powerful supercomputers to train xAI chatbot, Grok, which directly competes with OpenAI's ChatGPT and Google's Gemini chatbots.

 Several of Musk's supercomputer projects are already in development.

 In August, Elon Musk teased Tesla's AI supercomputer cluster called Cortex on X.

 Cortex is being built at Tesla's Austin, Texas headquarters.

 Back in January, Tesla also announced that it planned to spend $500 million to build its dojo supercomputer in Buffalo, New York.

 Meanwhile, Musks just reveal that xAI Colossus supercomputer in Memphis, Tennessee was up and running.

 CNBC wanted to learn more about what Musk's bet on supercomputers might mean for the future of his companies, and the challenges he faces in the ultra competitive world of AI development.

 You had supercomputers, if you go to any of the national labs, they're used for everything from simulation materials to discovery to climate modeling to modeling nuclear reactions and so on and so forth.

 However, what's unique about AI supercomputers is that they are entirely optimized for AI.

 Musk launched xAI in 2023 to develop large language models and AI products like its chatbot Grok, as an alternative to AI tools being created by OpenAI, Microsoft and Google.

 Despite being one of its original founders, Elon Musk left OpenAI in 2018, and has since become one of the company's harshest critics.

 In June, it was announced that xAI would build a supercomputer in Memphis, Tennessee to carry out the task of training Grok.

 It would represent the city's largest multi-billion dollar capital investment by a new to market company in Memphis history.

 The announcement came at the heels of xAI securing $6 billion in series B funding, raising its valuation at the time from 18 to $24 billion.

 By early September, Musk announced that his training supercluster in Memphis, called Colossus, was online.

 The supercluster is powered by 100,000 Nvidia H100 graphics processing units, or GPUs, making it the most powerful AI training system in the world, according to Musk.

 He went on to say that the cluster would double in size in the next few months.

 These GPUs have been around for a while.

 They started off in laptops, in desktops to be able to offload graphics work from the core CPU.

 So this is an accelerator.

 If you go back sort of ten years or so, 15 years ago, online gaming was blowing up and people wanted to game at speed, and then they realized that having graphics and the general purpose of the game on the same processor just led to constraints.

 So it's a very specific task to train a large language model.

 And doing that on a classic CPU.

 You can.

 It works.

 But it's one of those examples where the particular architecture of a GPU plays well for that type of workload.

 In fact, GPUs became so popular that chip makers like Nvidia for a time had a hard time keeping up with demand.

 The fight for GPUs has even caused competition among Musk's own companies.

 Musk's social media company X, and xAI are closely intertwined, with X hosting xAI Grok chatbot on its site, and xAI using some capacity in X data centers to train the large language models that power Grok.

 In December 2023, Elon Musk ordered Nvidia to ship 12,000 of these very coveted AI chips, H100 GPUs from Nvidia, to X instead of to Tesla when they had been reserved for Tesla.

 So he effectively delayed Tesla's being able to continue building out data center and AI infrastructure by five six months.

 The incident was one example that shareholders used in a lawsuit against Musk and Tesla's board of directors that accused them of breach of fiduciary duty.

 They argued that after founding xAI, Musk began diverting scarce talent and resources from Tesla to his new company.

 Musk defended his decision on X, saying that Tesla was not ready to utilize the chips and that they would have just sat in a warehouse had he not diverted them.

 Musk has gone as far as to suggest that Tesla should invest $5 billion into xAI.

 Still, Musk has big plans on how artificial intelligence can transform Tesla.

 In January, he wrote on X that Tesla should be viewed as an AI robotics company rather than a car company.

 Key to this transformation is Tesla's custom built supercomputer called Dojo, details of which the company first publicly announced during Tesla's AI day presentation in 2021.

 There's an insatiable demand for speed, as well as capacity for neural network training, and Elon prefetched this, and a few years back he asked us to design a super fast training computer, and that's how we started Project Dojo.

 During the company's Q2 earnings call last year, Musk told investors that Tesla would spend over $1 billion on Dojo by the end of 2024.

 A few months later, Morgan Stanley predicted that Dojo could boost Tesla's value by $500 billion.

 Dojo's main job is to process and train AI models using the huge amounts of video and data captured by Tesla vehicles.

 The goal is to improve Tesla's suite of driver assistance features, which the company calls autopilot, as well as its more robust full Self-Driving, or FSD system.

 They've sold what is it, 5 million plus cars? Each one of those cars typically has eight cameras plus in it.

 They're streaming all of that video back to Tesla.

 So what can they do with that training set? Obviously they can develop full self-driving and they're getting close to that.

 Despite their names, neither autopilot nor FSD make Tesla vehicles autonomous and require active driver supervision.

 As Tesla states on its website, the company has garnered scrutiny from regulators who say that Tesla falsely advertised the capabilities of its autopilot and FSD systems.

 A 2024 report by the National Highway Traffic Safety Administration also found that out of the 956 Tesla crashes, the agency reviewed, 467 of those could be linked to autopilot, but reaching full autonomy is critical for Tesla, whose sky high valuation is largely dependent on bringing robotaxis to market, analysts say.

 The company reported lackluster results in its latest earnings report and has fallen behind other automakers working on autonomous vehicle technology.

 These include Alphabet owned Waymo, which is already operating fully autonomous taxis commercially in several U.

S.

 cities.

 GM's CruISE and Amazon's Zoox.

 In China, competitors include Didi and Baidu.

 Tesla hopes Dojo will change that, according to Musk.

 Dojo has been running tasks for Tesla since 2023, and since Dojo has a very specific task, to train Tesla's self-driving systems, the company decided that it's best to design its own chip, called the D1.

 This chip is manufactured in seven nanometer technology.

 It packs 50 billion transistors in a miserly six 45mm square.

 One thing you'll notice, 100% of the area out here is going towards machine learning, training and bandwidth.

 This is a pure machine learning machine.

 For high performance computing.

 It is very common to have supercomputers that have CPUs and GPUs.

 However, increasingly AI supercomputers also contain specialized chips that are specially designed for AI workloads, and the Dojo D1 is an example of that.

 One of the key things that came through when I was looking at D1 is latency.

 It's training on a video feed that's coming from cameras in cars.

 So the big thing is kind of, how do you move those big files around and how do you handle for latency? Aside from the D1, which is being manufactured by Taiwanese chip maker TSMC, Tesla is also designing the entire infrastructure of its supercomputer from the ground up.

 Designing a custom supercomputer.

 Gives them the opportunity to optimize the entire stack, right? Go from the algorithms and the hardware.

 Make sure that they are designed to work perfectly in concert with each other.

 It's not just Tesla, but if you see a lot of the hyperscalers, the Googles of the world, the Metas, the Microsofts, the Amazons, they all have their own custom chips and systems designed for AI.

 In the case of Dojo, the design looks something like this.

 25 D1 chips make up what Tesla calls a training tile, with each tile containing its own hardware for cooling, data transfer and power, and acting as a self-sufficient computer.

 Six tiles make up a tray, and two trays make up a cabinet.

 Finally, ten cabinets make up a hexapod, which Tesla says is capable of 1.

1 exaflops of compute.

 To put that into context, one exaflop is equal to 1 quintillion calculations per second.

 This means that if each person on the planet completed one calculation per second, it would still take over four years to do what an exascale computer can do in one second.

 It is impressive, right? But there are other, you know, supercomputers certainly that are performing in that ballpark as well.

 One of those supercomputers is located at the Department of Energy's Oak Ridge National Laboratory in Tennessee.

 The system, called Frontier, operates at 1.

2 exaflops and has a theoretical peak performance of two exaflops.

 The supercomputer is being used to simulate proteins to help develop new drugs, model turbulence to improve the engine designs of airplanes, and create large language models.

 The next generation of Zettascale supercomputers are already in development.

 A zetaflop supercomputer has a computing capability equal to 1,000 exaflops.

 As for Dojo, Dickens says its utility could go beyond turning Teslas into autonomous vehicles.

 If you wanted to train a robot on how to dig a hole, how many Tesla cars have driven past somebody digging a hole on the side of the road? And could you then point that at Optimus and say, hey, I've got hundreds of hours of how people dig holes.

 I want to train you as a robot on how to dig holes.

 So I think you've got to think wider of Tesla than just a car company.

 At a shareholder meeting this summer, Musk claimed that Optimus could turn Tesla into a $25 trillion company.

 But not everyone is convinced.

 It's a daydream of robots to replace people.

 It's a lofty goal.

 The price points, you know, don't sound too logical to me, but, you know, it's a great aspirational goal.

 It's something that could be transformational for humanity if we make it work.

 EVs have worked.

 I just call me a very, very heavy skeptic on this robot.

 Despite all this potential for Musk's supercomputers, the tech titan and his companies have quite a few challenges to overcome as they figure out how to scale the technology and use it to bolster their businesses.

 One such challenge is securing enough hardware.

 Although Tesla is designing its own chips, Musk is still highly dependent on Nvidia's GPUs.

 For example, in June, Musk said that Tesla would spend between 3 and $4 billion this year on Nvidia hardware.

 Here he is talking about the supply of Nvidia chips during Tesla's latest financial results call.

 We are seeing is that demand for Nvidia hardware is so high that it's often difficult to get the GPUs.

 I guess I'm quite concerned about actually being able to get state of the art Nvidia GPUs when we want them, and I think this therefore requires that we put a lot more effort on Dojo in order to ensure that we've got the training capability that we need.

 Even if Musk did have all the chips he wanted, not everyone agrees that Tesla is close to full autonomy and that Dojo is the solution to achieving this feat.

 Unlike many other automakers working on autonomous vehicles, Tesla has chosen to forgo the use of expensive lidar systems in its cars, instead opting for vision only system using cameras.

 The issues in FSD are related to the sensors on the cars.

 People that drive these vehicles report phantom obstacles on the road, where the car will just suddenly brake, or the steering wheel will tweak you aside where you're dodging something that doesn't exist.

 If you imagine a white tractor trailer truck that falls over and it's a cloudy day.

 You've got white on white, and a scenario that is not very easily computed and very easily recognized.

 Now, a driver that's paying attention is going to see this and hit the brakes hard.

 You know, a computer, it can easily be fooled by that kind of situation.

 So for them to get rid of that and they need to add other sensors onto the vehicles, they've been vehemently against lidar.

 They need to change the fundamental design.

 Dojo is not going to fix that.

 Dojo is just not going to fix the core problems in FSD.

 At times, even Musk has questioned Dojo's future.

 We're pursuing the dual path of Nvidia and Dojo.

 Think of dojo as a long shot.

 It's a long shot worth taking because the payoff is potentially very high.

 But it's not something that is a high probability.

 It's not like a sure thing at all.

 It 's a high risk, high payoff program.

 And then there are the environmental concerns, supercomputers like those being built by Musk and other tech giants, require massive amounts of electricity to power them, even more than the energy used in conventional computing, and an exorbitant amount of water to cool them.

 For example, one analysis found that after globally consuming an estimated 460 terawatt hours in 2022.

 Datacenters, total electricity consumption could reach more than 1,000 terawatt hours in 2026.

 This demand is roughly equivalent to the electricity consumption of Japan.

 In a study published last year, experts also predicted that global AI demand for water may account for up to 6.

6 billion cubic meters of water withdrawal by 2027.

 This summer, environmental and health groups said xAI is adding to smog problems in Memphis, Tennessee, after the company started running at least 18 natural gas burning turbines to power its supercomputer facility without securing the proper permits.

 xAI did not respond to a CNBC request for comment.

 But beyond supply chain issues and environmental concerns, some question whether supercomputers and AI are good business.

 Tesla is a company with car manufacturer problems with AI and robotics aspirations.

 They're not about to make any money from AI anytime soon, and this FSD that was promised five years ago isn't really about to happen either.

 Dojo is a massive project, it's interesting and exciting, and it could open tremendous frontiers for them.

 It's just, I think we need to be skeptical, right? How does someone make money with this? There's no visibility on that whatsoever.

 It seems like, you know, a shot in the dark.

 Instead, Irwin suggests that Musk stick to what he knows, making EVs.

 I'm very bearish on the stock.

 I see the fundamental value in EVs, right.

 If Tesla goes into Thailand and India and they invest billions in India, the supply chain will bounce into existence.

 They're going to be a cost leader in the world.

 You know, they need to get out there with a mini car.

 So if they do, the outlook for the company will change.

 But Dickens is more positive.

 I think Tesla is changing the supercomputing paradigm here because the scale of their investment, the deep pockets that they've got and their ability to put all that investment to a single use case.

 Now, you can argue that FSD has been promised for a long time, and you can think what you want to think of Elon, all of the above is valid, but they are ahead, and they're already built a moat that the likes of GM, Stellantis and Ford won't get close to anytime soon or ever.

 Elon Musk is on track to become the world's first trillionaire by 2027.

 Musk is the closest person to the 13 figure mark.

 The biggest driver of Elon Musk's wealth has been Tesla stock.

 If you look before the pandemic, that stock was trading at below 50 bucks a share.

 Now it's at $230 a share.

 Some people think it could easily go to $300 a share if they have self-driving taxis, autonomous vehicles.

 But not all Americans benefit from stock marketplace.

 Wealth inequality in the U.

S.

 has significantly increased over the past 30 years.

 Federal reserve data shows the wealth of the top 1% has grown dramatically, while the wealth of the bottom 50% has stagnated.

 In the early 1990s, the top 1% held about $4.

76 trillion, or 23% of the nation's wealth, while the bottom 50% had about $730 billion in equity, or 3.

5% of total wealth.

 Fast forward to Q1 2024.

 The top 1% share increased to nearly $46.

1 trillion, or 30% of the total wealth, while the bottom 50% held $3.

78 trillion, or 2.

5% of total wealth.

 The American system, which is an economy fundamentally driven by entrepreneurs and innovation, where you're rewarded for taking risks, that that creates growth for everybody.

 While others feel that wealth concentration can be harmful to society.

 So talk of a trillionaire is frightening.

 Billions of dollars of wealth, translate into billions of dollars of power.

 A hundred years after the first billionaire, what has led to the concentration of wealth that could make the first trillionaire possible? And what does it mean for the U.

S .

 economy? Elon Musk was named the richest man in the world in January 2021.

 He started 2020 worth about $28.

5 billion and ended it being worth around $167 billion.

 As of September 2024, his net worth is valued at roughly $265 billion, according to the Bloomberg Billionaires Index.

 One of the reasons that Elon Musk has grown so wealthy is not only because Tesla stock has gone up so rapidly, but also because the number of shares that he owns is growing rapidly.

 Over that five year period, from 2019 to 2024, that stock went up 1,300%.

 If that stock continues to go up 100% a year along with his wealth, he will get to trillionaire status by 2027.

 Tesla's stock rise during the pandemic wasn't necessarily tied to production or revenue growth alone.

 The stock of Tesla is now up 677% for the year.

 And that move has changed everything.

 Yet it only plans to make up half a million cars this year.

 But this new generation of stock pickers.

 They believe that Elon Musk is a genius, and they want to stick with him as he takes over the world.

 People invest for all kinds of reasons.

 Some invest for very short term reasons.

 Other people invest because they think this stock is going to be a good one, and it's going to generate profits for years and years and years.

 Musk is in a unique position because of how he's compensated at Tesla.

 Elon certainly had a lot of other shareholders, and his stake in the company was fairly low when they started out, but he has had these massive pay packages, the most recent of which was over $50 billion.

 That's $50 billion in pay, not just what he owns in the company and the value of that stock.

 And so, in addition to growing rich from his existing stock, he has grown rich every year from options that are part of these massive pay packages.

 We have never seen pay packages like this in corporate America, where somebody is given, if they meet certain benchmarks, a $50 billion pay day.

 And so that has actually grown his share of the company over time to 13%.

 Some say based on current options he could get to 20%.

 So one of the things that helps him reach trillionaire status is that Tesla stock grows, but also his ownership of the company grows because of these massive and unprecedented options.

 Neither Tesla nor SpaceX representatives responded to CNBC's request for comment.

 Usually when we think about the Forbes 400.

 We think about them owning about 3 or 4% of the total wealth in the economy, which is already quite large and quite outsized.

 But this would be an order of magnitude difference for one individual.

 Whether or not it comes to fruition, I think depends on a lot of things happening, particularly what is the value of the businesses with which he has associated himself.

 Musk made his wealth through equity in the major companies he's led, such as PayPal, Tesla and SpaceX.

 This is a pretty typical wealth story for the 1%.

 If you look at the list of the richest Americans, you know, whether we're talking about Elon Musk or Jeff Bezos.

 The reason people get super rich is they start a company and they grow that company.

 And the reason that company keeps growing and growing is producing something valuable that people want.

 Wealthier individuals typically have larger portions of their assets invested in the stock market, while middle income households tend to have more of their wealth tied up in real estate.

 The wealthiest 1% of Americans own nearly 50% of all U.

S.

 stocks, while the bottom 50% of Americans hold about 1% of all stocks, as of mid 2024.

 About 58% of families own stock in 2022, either directly or indirectly through passive investments such as retirement accounts.

 Wealth inequality is very much driven by the prices of different types of assets, and so one of the things that will cause wealth inequality to go up, as measured by wealth concentration is the stock market.

 The stock market has done well, but other assets, especially housing, has also done quite well.

 House values go up.

 That tends to raise wealth in the middle of the distribution, which offsets some of the gains that are happening at the top.

 Most Americans wealth is in home ownership, with more than 66% of families owning their own home in 2022.

 The typical American, if you know a median house price, has gone up by 50% or 100% over the past 5 or 6 years.

 That's a lot of wealth that's being created.

 So when we talk about wealth distribution, that's going to be an offsetting factor.

 But home ownership as a main source of wealth creation can be a double edged sword.

 Although increasing house values can benefit homeowners, this trend also signifies decreasing house affordability for potential buyers.

 Many Americans primarily earn their income by trading their time and skills for a paycheck, which is then taxed based on how much that individual earns.

 On paper, the ultra wealthy's income isn't quite as clear.

 We think about income as being sort of the improvement in one's ability to spend over time.

 You and I have paychecks, and those paychecks measure how much we can spend.

 Musk has a gigantic compensation package, but even that package, only a fraction of it shows up as taxable income, because much of it is in bonuses and other ways of getting paid, that make it easy to avoid taxation.

 Elon Musk has seen his fortune more than double over the past five years.

 What he does is he borrows against that $200 billion dollars in equity, takes those loans and uses them for income.

 And so he has millions and millions of dollars in income that he never has to pay taxes on.

 Over the past quarter of century, in particular, changes in tax policy have made it much more difficult to tax the rich.

 There are many more exclusions, many more ways to get around paying taxes.

 Those same changes are what lead to a buildup in unrealized capital gains.

 Capital gains are the profits someone makes once they sell an asset, such as stocks or real estate.

 We should think about taxing unrealized gains and other policies like that.

 Many people like Musk are probably going to die with very substantial unrealized capital gains.

 And the question is, do we allow those unrealized capital gains to pass untaxed to the next generation, or do we impose something like a tax on gains at death? So I think we need to do a better job of taxing the income while it's being earned, and that involves changes in tax law and eliminating some of these loopholes that have been put in place over the past quarter century.

 One assumption could be that it's only because of the tax code that these people got rich, which is absurd.

 They got rich because they built a company and spent a lot of time building that company.

 We have to create valuable products.

 That's why those people got rich.

 Not because of the tax code.

 And any big change you make, you have to think, will that change the incentives in the system? So I would be careful making small changes.

 It's not surprising that in this election cycle, the theme of taxing the wealthy and taking some of what they have to help those who have less has become very prominent, especially among Democrats and Vice President Harris.

 So one of the things that she has proposed is to tax what are called unrealized gains.

 And so what the Harris campaign has said is, look, it's not fair that because your wealth grows in value and you can borrow against that, that you never pay taxes, whereas the teacher or the firefighter, they have normal income and they have to pay taxes on that.

 We need to tax the ultra rich.

 We need to tax corporations.

 That's one of the most powerful ways to reduce inequality.

 President Trump and a Republican controlled Congress passed the 2017 Tax Cuts and Jobs Act.

 The Tax Policy Center found that while the average American saved on taxes because of the legislation, the savings was disproportionate.

 A middle income taxpayer saved about $900 by 2025, whereas the top 1% saved about $61,000.

 We're going to be seeing the expiry of many provisions of President Trump's tax cuts for the rich and for corporations that arrives in 2025.

 That's a huge opportunity to address the long standing problems with our tax code.

 We should also think about getting rid of loopholes that cause a disconnect between what someone is really earning, what their income is, and how much they're paying in tax because how much they're really earning, that's what determines how fast their wealth is going to grow.

 Elon Musk, if his wealth is truly going up $200 billion a year and his income is nothing, it's zero.

 That tells us we have a real problem.

 America has always had a love hate relationship with wealth.

 Great wealth in America is admired, but it's also envied.

 And there's a political strain in America that says we should redistribute some of that wealth to help those who need it most.

 And so Americans are very conflicted about inequality.

 Extreme levels of inequality slow down and undermine the fight against poverty.

 I'm inspired by the work of people like former U.

S.

 Supreme Court Justice Louis Brandeis.

 He's the one who said, we can either have extreme concentration of wealth in this country, or we can have democracy, but we can't have both.

 And I believe that's a choice that we're facing today.

 So far, the desire by most Americans to tax the wealthy has not played out in Congress.

 It has not played out in the White House.

 And there are some that say, well, that's because the wealthy buy the politicians and they have lobbyists who have fought this successfully for years.

 And that may be true, but it also has to do with the fact that if you have a tax that only applies to people worth $1 million or more with $1 million in income, like Harris has proposed, a lot of people say, wait, I don't have $1 million in income, but I might someday.

 So therefore I don't support a tax on those who make more than $1 million a year, because I might get there, too.

 It's hard to form policy when Americans themselves are so conflicted about yes, we're envious.

 We'd like to tax them.

 But I also want to get there, too.

 And I admire these people.