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[SPEAKER_01]: big things going on in our sphere of the world this week with this gents and wang and a video chips to China scandal unfolding in Washington is not going to go away sex scandal you forgot to mention the sex part I was leaving that to you my cookie you are you're good on that part going back on some experience looking into your investigative history yeah the blue dress okay maybe that

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[SPEAKER_01]: something like that will come out in this story.

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[SPEAKER_01]: Anyway, you compared this involving scandal to the uh, uh, profumo of there and really back way back in the 1990s.

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[SPEAKER_01]: Yeah, 60s or involving Russian espionage and a senior U.K. uh, official.

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[SPEAKER_01]: Yes.

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[SPEAKER_03]: So there was a uh, there was a minister for the state

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[SPEAKER_03]: uh... in the british cabinet appointed by harald mickmill in the conservative prime minister's name was john perfumo and in the early sixties sixty two sixty three it turns out that he was having a sexual relationship with a nineteen-year-old call girl named christine killer uh... who was simultaneously had

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[SPEAKER_03]: a relationship with a Soviet military intelligence officer, GRU spy for the Soviets.

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[SPEAKER_03]: And this produced a huge scandal in British politics.

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[SPEAKER_03]: Of course, initially denies.

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[SPEAKER_03]: He has the relationship

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[SPEAKER_03]: he never shared any intelligence with the call girl that made its way to the Soviets.

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[SPEAKER_03]: There was a whole official inquiry, the Labor Party slammed the Tories really hard on this and it led to the defeat of Harold McMillan as President as Prime Minister in 1964 and the election of Harold Wilson as Labor Prime Minister.

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[SPEAKER_03]: So that's an example of a sex scandal with national security implications,

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[SPEAKER_03]: that had a real impact on British politics.

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[SPEAKER_03]: And I think the one NVIDIA Chinese spy scandal has the potential to be something like the profumo affair was in Britain because it is a sex scandal with huge national security implications.

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[SPEAKER_01]: For sure, but back then, profumal affair evolved only, you know, a sequence that went to the Russians.

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[SPEAKER_03]: Here we have the whole bunch of billions of dollars of computer chips that went to the Chinese.

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[SPEAKER_01]: And the kind of computer chip that could give the Chinese of strategic edge over the United States in military and other affairs and economic affairs is all on sale.

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[SPEAKER_01]: And in terms of, we have a really terrific guest to talk about this, uh, the video with Genshin Wong of Fair and Nick F. Demiades is a retired former senior CIA in State Department and Defense Intelligence expert on Chinese espionage.

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[SPEAKER_01]: And he's going to be with us in a short while.

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[SPEAKER_01]: Before we move along to Nick, let's talk about Jim Himes taking over the intelligence committee.

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[SPEAKER_01]: That's big.

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[SPEAKER_01]: He says he's going to look into CIA covert operations involving contractors.

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[SPEAKER_03]: Yeah, interesting comments from Jim Himes at an interview he did with the New York Times.

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[SPEAKER_03]: presumptive incoming chairman of hipsy, the House Intelligence Committee, which suggest to me that he knows something about what's been going on in covert ops that is disturbing to him and we don't know what it is at this point.

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[SPEAKER_03]: Obviously he's, you know, has access to all sorts of classified briefings, but something about the way under John Radcliffe, the CIA has been

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[SPEAKER_01]: Of course, there was that phony cover that chinned up by David Rush, who just let out, who created a phony cover up program and amassed $400 million worth of gold bars, a cash and watch this.

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[SPEAKER_01]: So, we may get another taste of that.

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[SPEAKER_03]: We would like to see Radcliffe answer questions about this, by the way, because there's been no public hearings whatsoever about how this happened.

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[SPEAKER_01]: Yeah, God.

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[SPEAKER_01]: And anyway, Iran, Jadi Ves just had his legs cut out from under him by President Trump today.

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[SPEAKER_03]: Yeah, pretty striking.

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[SPEAKER_03]: You remember right after the election Vance writes this tweet saying, we lost the election because of the Iran War and our relationship with Israel.

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[SPEAKER_03]: Those are the two things he cited.

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[SPEAKER_03]: And also remember that after Vance who initially opposed,

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[SPEAKER_03]: the Warren Iran, but then obviously got behind it as Trump's vice president.

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[SPEAKER_03]: But just last week before the election, before that tweet, he had written a letter to a top Iranian official.

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[SPEAKER_03]: Let's remember the Supreme Council, former IRGC guy, who saying that the U.S. government was open to diplomacy.

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[SPEAKER_03]: Can we get back to the diplomatic table and talk about this and see if we can

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[SPEAKER_03]: Then Trump cuts the legs out from under and says, no, you will work exclusively on fraud and democratic states.

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[SPEAKER_03]: That's true.

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[SPEAKER_01]: So next you wonder was was was vans freelancing?

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[SPEAKER_01]: Yeah, it seems to me.

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[SPEAKER_01]: He wouldn't be writing letters to Iranian officials without Trump's approval.

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[SPEAKER_03]: I'm not sure about that because he wants to run for president he knows this is the biggest baggage he's got the Iran war his buddy Tucker Carlson has been whispering in his ear if not shouting in his ear.

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[SPEAKER_01]: So we have a rogue vice president.

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[SPEAKER_03]: Well let's see how he responds to his new directive from protest to focus focus your energy on democratic fraud not this Iranian stuff.

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[SPEAKER_01]: it seems to be clown show material.

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[SPEAKER_01]: I'm not saying.

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[SPEAKER_01]: Anyway, let's get onto the scandal to you.

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[SPEAKER_01]: And this is a very big one.

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[SPEAKER_01]: Nick F. The Miades is with us today's retired former senior CIA State Department and DIA expert on Chinese intelligence.

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[SPEAKER_01]: He's author.

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[SPEAKER_01]: of the much praised Chinese espionage operations and tactics, which is what we're going to be talking about.

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[SPEAKER_01]: Over a 34-year US government career, he held senior roles in counter-terrorism, futures strategy, and space issues.

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[SPEAKER_01]: He's a Penn State professor in Atlanta, counsel, non-resident senior fellow, really looking forward to talking to us.

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[SPEAKER_01]: Let's not wait a moment longer, bring him on.

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[SPEAKER_01]: Nick asked to me on his welcome to spy talk is great to have you back again what a moment for you.

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[SPEAKER_01]: I think a lot of Americans might look at this Nvidia Jensen Huang Chinese spy thing as rather obscure nothing to do with them.

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[SPEAKER_01]: What do you make of all and what do you what's the essence of this?

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[SPEAKER_01]: What do we really need to know about this developing scandal?

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[SPEAKER_02]: Well,

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[SPEAKER_02]: I think the way I first took it when I heard about it was, wow, that's Chinese intelligence really going for the jugular.

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[SPEAKER_02]: I mean, they went for the top elements of policy and technology, policy formulation.

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[SPEAKER_02]: That was an audacious operation.

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[SPEAKER_02]: It really was.

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[SPEAKER_02]: And it takes about unravel and to understand the implications for the United States as a whole.

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[SPEAKER_02]: But it really was going for the core of our technology prowess and our political decision making.

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[SPEAKER_01]: If she was a spy, and it's not proven that she was, we just have intimations from US intelligence via the New York Times, that she was a spy, but if she was a spy, and doing what she's reported to have been doing, she was not just in a position to collect secrets from Jezyn Huang and about President Trump, because they are very close, but to influence policy.

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[SPEAKER_02]: You know, that's the keep on I actually like in this, I hate to say, but to like cancer, you know, once it gets organization, once it gets into an organization and a body, it spreads.

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[SPEAKER_02]: So she would have clearly targeted board members, to learn about board members, to learn about their positions on Salesforce China, who is more conservative and thinking, that we need to follow the federal government, you know, we need to work along with them, who is more in the Latinic camp, you know, I said, it's not thinking not on, I would need to sell sell in commerce, secretary.

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[SPEAKER_02]: Right, yes, comersector, Latinic, who is more in line with sales of China?

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[SPEAKER_02]: That would have spurred far more collection, right?

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[SPEAKER_02]: And their communications would have been targeted, their emails would have been targeted.

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[SPEAKER_02]: So that's how this type of activity spreads out.

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[SPEAKER_02]: And so certainly her position was to...

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[SPEAKER_02]: probably the influence as much as she couldn't pillow talk.

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[SPEAKER_02]: And, you know, let's face a Jensen Wong had every reason to want a self, right?

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[SPEAKER_02]: He's probably advocated that a lot, and of course he was selling chips to China.

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[SPEAKER_02]: So, you know, I mean, he certainly has a willing recipient over there.

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[SPEAKER_02]: So, I'm sure they, they commensurate it on that, you know, that whole idea.

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[SPEAKER_02]: but it's the additional things, the insight into his organization and into the federal government that aren't secrets, but it's the human behavior, that and the human positions and policy formulation that she could have really given to her.

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[SPEAKER_03]: What about the national security

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[SPEAKER_03]: dangers here of these invidia chips going to the Chinese, the advanced, uh, uh, going to the Chinese.

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[SPEAKER_02]: It's absolutely certain that.

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[SPEAKER_02]: And as you know, her company mega speed found a way around that, that they put a facility in Malaysia.

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[SPEAKER_02]: and they were doing the computing for Ali Baba any number of other places, basic selling that back, you know, a millisecond of time, you know, for that communication has to go over.

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[SPEAKER_02]: So they were working around the Department of Commerce at rules, right?

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[SPEAKER_02]: That's how they were originally targeted by the Department of Commerce, for doing that.

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[SPEAKER_03]: But just to spell out though, if you can, what the national security danger or threat to the United States would be

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[SPEAKER_03]: We're trying to have these advanced Nvidia chips.

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[SPEAKER_02]: Well, let's say for China to be able to produce the advanced advantage chips, which is in a worse than just having, but where they were able to produce them and put them into mass production, I mean, we have to think of every application for military uses, as well as commercial uses, that in advanced computing capability would get them.

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[SPEAKER_02]: So the faster they are, more they are, the more in in parallel with us, and if they get the production capability of it,

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[SPEAKER_02]: they'll easily overtake us.

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[SPEAKER_01]: And with those ships, they even clarify Mike's very good question, even more clearly.

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[SPEAKER_01]: It's said that those who can dominate in the AI ship world have military superiority.

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[SPEAKER_01]: Right.

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[SPEAKER_02]: Well, let's think of things in a couple different ways.

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[SPEAKER_02]: Let's think of artificial intelligence.

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[SPEAKER_02]: Let's think of chips and semiconductor production, okay?

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[SPEAKER_02]: The ability to move that speedily, you know, to do those computations quickly, and let's move to a third area of quantum computing, okay?

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[SPEAKER_02]: Add of those three areas, the chip production is probably the least concerning.

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[SPEAKER_02]: The artificial intelligence concerning capabilities there is more concerning than that, and the quantum computing capabilities far above the other as far as concerns.

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[SPEAKER_02]: or what things, all lead to military superiority, okay, all lead to encryption capabilities, the breaking encryption, all lead to what we call loop to getting in past and loop for decision-making, whether that be economic and stocks and trade, or whether that be military decision-making.

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[SPEAKER_02]: the 50 you can process, the 50 you can do, the more data you have in an artificial intelligence capacity, the better, the more fought and education that AI has, the better it can do that.

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[SPEAKER_02]: And when you take a step towards quantum, faster you get more.

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[SPEAKER_03]: Yeah, I should also point out there's been reporting about, you know, how,

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[SPEAKER_03]: AI can is enhancing Chinese surveillance of its own citizens, the authoritarian nature of the regime, which is already pretty heavily authoritarian, gets even more so when it can, I mean, I was in China over the summer and you saw the surveillance cameras on every block in every city.

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[SPEAKER_03]: They are, the government is watching its people, you know, non-stop.

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[SPEAKER_02]: I actually did study on this and got a hold of the tenders, you know, that were put out online for China and the sponsors for companies as to what they were, what the Ministry of Public Security was actually putting into place.

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[SPEAKER_02]: And it's, you know, I think it's like in one camera for every six people in China.

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[SPEAKER_02]: So we're talking, you know, or every four people, something like that.

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[SPEAKER_02]: That's 100 billion cameras, but it's not only that, it's voice recognition.

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[SPEAKER_02]: that they have in the system, the monetary 1.4 billion cell phones, or at the same time, it's monitoring facial recognition, it's linking that up with your health records, linking that up with your banking records, linking that up.

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[SPEAKER_02]: If you crot, yeah, this is by no means pervasive across the board, right?

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[SPEAKER_02]: You're not going to find this in Chinese villages, okay?

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[SPEAKER_02]: So it depends where you are, how much they have implemented.

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[SPEAKER_02]: Your picture appears across the street, you know, Nick F. T. Mianas, you've just been fine $15 per day walk and they brought out of your bank account.

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[SPEAKER_02]: So that's the pervasive level of monitoring that we see internally in China.

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[SPEAKER_02]: The problem is is that they actually look at that expansion globally.

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[SPEAKER_01]: bold vision.

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[SPEAKER_01]: I suppose this supercharges their ability to hack into our systems here as well.

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[SPEAKER_01]: Of course, we know that years ago the Chinese hacked into the government's personnel database and installed, I forgot the exact number, millions of files of US government workers.

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[SPEAKER_01]: I suppose AI could sift through these records very quickly to identify lifestyle choices of these officials, financial vulnerabilities of these officials, and so forth.

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[SPEAKER_02]: All right, and when you combine things like that with salt type moon and volt type moon, which were penetrations of critical infrastructure in the United States, thousands of companies,

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[SPEAKER_02]: as well as the major communications providers in the United States.

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[SPEAKER_02]: In some cases, they laid in, you know, inside companies for up to five years without being detected.

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[SPEAKER_02]: Right?

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[SPEAKER_02]: So it poses a pretty frightening picture if something were to occur, the fact that they could shut off electricity and let's say New York or Texas or pick a place that they could shut it off locally and potentially regionally,

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[SPEAKER_02]: You know, for some period of time, how are Americans going to do when Chicago lets shut off electricity for two weeks?

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[SPEAKER_03]: So here's why I think this scandal has real legs that could be going on for a while and that is there are so many questions about who knew what when and the US government's response.

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[SPEAKER_03]: It's the, the, the, the.

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[SPEAKER_03]: Backhand in the headline talked about the relationship, the close relationship between Alice Wong, the suspected Chinese spy who ran mega speed, essentially a smuggling operation for Chinese gyms, and Wong the head of NVIDIA.

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[SPEAKER_03]: So that was out there.

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[SPEAKER_03]: It was public and it was public that mega speed was suspected of being the smuggling operation for Chinese gyms.

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[SPEAKER_03]: The New York Times has reported that Trump was briefed at the time.

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[SPEAKER_03]: You would think he would be it's a front-page article in New York Times about his good buddy, Johnson Wong, so when that sort of thing happens, you've been in the intelligence community yourself, I would suspect that the intelligence community would be making recommendations or at least options about what the president

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[SPEAKER_03]: should do, or could do, or what the US government could do at that point, and I can think of many things, starting with a defensive briefing for Wong, but going much further than that.

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[SPEAKER_03]: What was recommended by the, what did the intelligence community tell the president, the risks were, and what should he have done at that point, or what should the US intelligence and law enforcement community have done at that point?

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[SPEAKER_02]: Well, let's jump to what he should have done.

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[SPEAKER_02]: know what they told because we don't know exactly what they told.

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[SPEAKER_02]: We do know they told them about the about the fair the relationship and her lead collection to the ministry of state security.

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[SPEAKER_03]: And that mega speed was under investigation by the commerce department for smuggling absolutely in the video chips to China.

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[SPEAKER_02]: Actually what's on this is mega speed was under investigation by the department of commerce and then Nvidia general counsel called over

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[SPEAKER_02]: from, you know, the two department of commerce asking about this, and of course, that's wholly inappropriate.

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[SPEAKER_02]: And so that's what triggered them dumping the case into Bartman.

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[SPEAKER_02]: I was just as flat and said, it's just took another turn that we, you know, we're getting this off our hand because someone's internally leaking that, you know, that we are on your investigation over to you department of justice.

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[SPEAKER_02]: And I think that's where the collection is something.

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[SPEAKER_02]: That's where the collection started, you know, against her in earnest.

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[SPEAKER_02]: because up until that time, the real issue was her processing out of Malaysia and sending data back to China.

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[SPEAKER_02]: That was the that was the focus issue at that time.

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[SPEAKER_02]: There have been three prosecutions, Taiwan, Malaysia, Singapore, over the course of the last year and a half or so of actually rerouting servers to, you know, replacing them and moving them to China through those three countries.

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[SPEAKER_02]: So we have a lot happening, we have commerce taking a look at it and one aspect of this dumping it over to department of justice.

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[SPEAKER_02]: The president is briefed on this.

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[SPEAKER_02]: And, you know, the all the things we could say on, you know, how this president runs, he tends to be pretty shrewd.

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[SPEAKER_02]: So, you know, I don't think he's stupid on this and said, oh, whatever.

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[SPEAKER_02]: I think he thought that this was information.

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[SPEAKER_02]: I think he thought it was power.

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[SPEAKER_02]: And I think he thought he could use it.

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[SPEAKER_02]: I don't think he trusted the bureaucracy.

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[SPEAKER_02]: So just to follow up on that, why no defense of briefing of Jens and Wong?

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[SPEAKER_02]: Because I think that exposes what you know.

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[SPEAKER_02]: I think Trump, I don't know this from Adam, but just with that ego, I think Trump was in the position to sit and say, I'll take care of this.

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[SPEAKER_02]: I'll talk to, you know, I'll talk to Jens and maybe he was gonna feed Jens and something, maybe he was gonna monitor the situation.

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[SPEAKER_02]: but he doesn't trust his own community.

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[SPEAKER_02]: That much has been established.

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[SPEAKER_03]: All right, here's what the FBI and the old days would have wanted to do.

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[SPEAKER_03]: confront Jensen Wong, tell him he's under investigation for knowingly smuggling chips to China.

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[SPEAKER_03]: You either cooperate with us, agreed to be wired, set up a sting with Alice Wong, and let us nap a real Chinese spy, and get info on the Chinese espionage operations, targeting Americans.

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[SPEAKER_03]: No, why not?

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[SPEAKER_02]: Well, for start, I don't think they met in the United States, right?

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[SPEAKER_03]: Yeah, but, you know, you could use, you could, you could set up a meeting anywhere in the world.

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[SPEAKER_03]: And the FBI could nap them.

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[SPEAKER_02]: Theoretically, you could draw it.

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[SPEAKER_02]: If she was willing, drag her, you know, get her to the United States.

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[SPEAKER_02]: Because, you know, the foreign

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[SPEAKER_02]: Right doesn't you know if it if it goes in country XYZ it doesn't you know that no, but if she's a suspected spy Then Yeah, but there is no there is no spy here.

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[SPEAKER_02]: There is no espionage.

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[SPEAKER_02]: There is no classified information that has to come into 18 USC 790 series And basically it's got to have a stamp on it all right someone's got to say secret confidential something like that To actually clean espionage statute

21:56.751 --> 21:59.698
[SPEAKER_02]: That's not what we're talking here, and that's where China dances and evades.

22:00.099 --> 22:03.388
[SPEAKER_02]: They go soda for the jugular, right for the policy positions.

22:04.070 --> 22:05.651
[SPEAKER_02]: You don't write the names and make it.

22:05.671 --> 22:11.374
[SPEAKER_03]: But the export controls were a potential criminal case.

22:11.934 --> 22:18.918
[SPEAKER_03]: And if you suspect a spy, a Chinese MSS agent, is it the middle of it?

22:19.679 --> 22:21.420
[SPEAKER_02]: I would think he would want to get the spy.

22:21.740 --> 22:27.123
[SPEAKER_02]: Yeah, and it's also if she is doing export control issues, it's the last place he's ever going to come is the US.

22:27.881 --> 22:30.702
[SPEAKER_02]: Okay, you know, well, that's a pretty stupid, you know, it's said there.

22:30.782 --> 22:34.283
[SPEAKER_02]: So yeah, I'll come to you in the United States where I'm vulnerable.

22:35.624 --> 22:38.004
[SPEAKER_02]: And by the way, they knew they were under investigation.

22:38.044 --> 22:39.305
[SPEAKER_02]: That isn't being hidden.

22:39.985 --> 22:43.826
[SPEAKER_02]: And what she did, you know, look, at first what she did.

22:44.766 --> 22:51.669
[SPEAKER_02]: And I don't know the details and I don't think we know the details of exactly Megaspees involvement of actually moving chips over to China.

22:56.904 --> 22:59.205
[SPEAKER_02]: It was a way around department of commerce rules.

22:59.805 --> 23:05.468
[SPEAKER_02]: It was a way of, you know, I'm setting processing, it places in Malaysia and selling the data back to China.

23:06.088 --> 23:06.929
[SPEAKER_02]: Perfectly legal.

23:07.189 --> 23:08.810
[SPEAKER_02]: Now, department of commerce didn't like that.

23:09.270 --> 23:10.290
[SPEAKER_02]: And they moved immediately.

23:10.310 --> 23:13.552
[SPEAKER_02]: They want to get executive orders and law to say, hey, you can't do that.

23:13.572 --> 23:14.292
[SPEAKER_02]: That's cheating.

23:14.993 --> 23:20.135
[SPEAKER_02]: But, you know, when she was doing it, when she still when she was doing it, you know, it's perfectly legal.

23:20.956 --> 23:21.836
[SPEAKER_02]: I mean, it was commerce.

23:24.619 --> 23:25.160
[SPEAKER_03]: I don't know.

23:25.200 --> 23:31.145
[SPEAKER_03]: I mean, like the New York Times says they went to mega speed and there were like two employees there.

23:31.526 --> 23:35.109
[SPEAKER_03]: Lots of boxes filled with chips that were going straight to China.

23:35.389 --> 23:35.709
[SPEAKER_03]: Right.

23:35.890 --> 23:37.851
[SPEAKER_03]: I mean, this was a front company.

23:38.312 --> 23:40.414
[SPEAKER_03]: All the top executives were in China.

23:40.914 --> 23:43.677
[SPEAKER_02]: It was a smuggling operation for Chinese chips.

23:43.877 --> 23:45.038
[SPEAKER_02]: So there are two things.

23:45.398 --> 23:49.362
[SPEAKER_02]: There's the smuggling component of this and they got some of that even on video camera.

23:50.348 --> 23:52.369
[SPEAKER_02]: That was much later on in the investigation.

23:52.389 --> 24:04.155
[SPEAKER_02]: The initial thing that we were talking about was renting out time basically and going to, you know, renting out computing time over the course of that investigation that you're speaking about just now.

24:04.596 --> 24:11.179
[SPEAKER_02]: Over the course of that investigation, they determined that some of the stuff has been rerouted and sent to China.

24:12.940 --> 24:14.381
[SPEAKER_02]: Don't know her relationship with it.

24:15.217 --> 24:18.538
[SPEAKER_02]: don't know her relationship even with the company at this point, right?

24:19.018 --> 24:21.338
[SPEAKER_03]: She's lesser self a CEO on LinkedIn.

24:21.739 --> 24:29.700
[SPEAKER_02]: She has a well, yes, but who said in November 2023, she at least claimed publicly that she relinquished that role.

24:30.060 --> 24:31.221
[SPEAKER_02]: And on paper, she did.

24:32.041 --> 24:35.842
[SPEAKER_02]: The people, you know, the rumors coming with the company is no, she's still in charge.

24:36.142 --> 24:39.363
[SPEAKER_02]: But at least on paper, she relinquished that role years ago.

24:42.093 --> 24:53.255
[SPEAKER_02]: It takes a way to get through this and all the paperwork and all the companies and the front companies that own this, that are behind it, and it's in the course of that investigation that the connection to the MSS will discover.

24:54.769 --> 25:01.193
[SPEAKER_01]: Nick, as a veteran intelligence official, yourself, who has significant experience and counterintelligence.

25:01.573 --> 25:21.343
[SPEAKER_01]: Don't you think it's also obvious that at some point, the counterintelligence investigators were FBI, whoever was, you know, the lead in this investigation, would have said, oh my God, we have to look at maybe whether Jason Huang himself is under control of Chinese intelligence.

25:23.220 --> 25:32.168
[SPEAKER_02]: I guess I think there's a lot to this on the other hand that has a billion air so I mean they have blackmail material right.

25:32.568 --> 25:39.113
[SPEAKER_02]: They have a lot of blackmail material for a guy who's cheated on his wife twice and things like who's a multi-billion air.

25:40.114 --> 25:43.537
[SPEAKER_02]: Exactly what are you going to blackmail him with?

25:43.998 --> 25:47.821
[SPEAKER_02]: I'm sure he has as much on people in the CCP as they would have on hand.

25:48.288 --> 26:03.915
[SPEAKER_01]: Well, the revelation that he's sleeping with a rich Chinese by and having an affair at some point with a subordinate, that was enough to get him kicked out of the company today, so you know, that was blackmail material.

26:12.445 --> 26:13.065
[SPEAKER_01]: Exactly.

26:13.165 --> 26:14.306
[SPEAKER_01]: So make your wonder.

26:14.586 --> 26:24.830
[SPEAKER_02]: Yeah, well, it does, but, you know, they're not going to get this guy kicked out and nothing of blackmail them because the next person coming in, particularly under the circumstances you suggest, right?

26:24.871 --> 26:28.052
[SPEAKER_02]: Because an expression coming in, they have no idea what's coming in after that.

26:28.548 --> 26:30.429
[SPEAKER_01]: No, it's the threat of blackmail.

26:30.469 --> 26:32.711
[SPEAKER_01]: He hold over your target.

26:33.812 --> 26:39.475
[SPEAKER_02]: I had a friend, Steve Estation, who was kicked out once, and he told the government before, you know, they pee and jeet him.

26:39.776 --> 26:42.217
[SPEAKER_02]: They said, you know, I'm the best friend you've ever had.

26:43.138 --> 26:46.280
[SPEAKER_02]: Kick me out of the week to see what the next guy coming in is going to be like.

26:46.340 --> 26:48.762
[SPEAKER_02]: And a fair amount of reasoning to that.

26:49.311 --> 26:50.792
[SPEAKER_01]: I have to ask you something else.

26:51.512 --> 27:10.784
[SPEAKER_01]: I have been to come across an old movie, written based on a book by an old late friend of mine called Red Sparrow about a Russian agent, you know, the Russians had a school for hookers, you know, just to do the Western Tardis.

27:11.104 --> 27:16.728
[SPEAKER_01]: Do you know, if China has such a school to train so-called swallows,

27:17.448 --> 27:18.809
[SPEAKER_01]: No, I would love to attend it.

27:18.870 --> 27:33.144
[SPEAKER_03]: I could, but I should point out that David Ignatius in the Washington Post today had a column quoting a former CIA station chief in China.

27:33.480 --> 27:42.722
[SPEAKER_03]: who said he was aware of at least 20 honeypot schemes similar to this one by MSS, the Chinese intelligence agency.

27:43.182 --> 27:50.804
[SPEAKER_03]: I strike it, it's like they have a honeypot division of MSS to do precisely this.

27:51.664 --> 28:02.107
[SPEAKER_02]: I went to my database and just gave me the honeypot cases and, you know, and it's like structure to get that type of data, but I can't hope what it does right off the top of my head, you know, if they're listed out.

28:03.477 --> 28:05.499
[SPEAKER_02]: Yeah, actually, 14 of them.

28:06.419 --> 28:09.142
[SPEAKER_02]: It's not unusual at all.

28:09.222 --> 28:11.964
[SPEAKER_02]: It's a very, very common practice, particularly for China.

28:12.244 --> 28:27.256
[SPEAKER_02]: What I'll tell you is actually quite different is sometimes you see these long-term relationships in China, you know, and in China, and externally, which is different from the KGB model, and the KGB model, different from what other Intel services do.

28:27.737 --> 28:30.499
[SPEAKER_02]: And for example, I mean, Katrina Yung,

28:31.256 --> 28:35.479
[SPEAKER_02]: with FBI agent Jim Smith and then William Cleveland, as well, Bill Cleveland.

28:35.939 --> 28:37.960
[SPEAKER_02]: You know, she was with him for years.

28:39.121 --> 28:40.362
[SPEAKER_01]: This is FBI agent.

28:40.522 --> 28:46.285
[SPEAKER_02]: FBI agent, yeah, she was double again and sleeping with the guy and and providing classified information back.

28:48.046 --> 28:52.989
[SPEAKER_02]: Was it kind of hung on or even make no French guy, French DGSE, right?

28:53.009 --> 28:55.991
[SPEAKER_02]: The father on full service, who was a station chief in Beijing.

28:56.707 --> 29:02.109
[SPEAKER_02]: He was recruited, and for 10 years with this girl's marriage broke up, eventually he got kicked out of the service office.

29:02.449 --> 29:05.490
[SPEAKER_02]: He went to jail for it in France, short period of time.

29:05.710 --> 29:15.354
[SPEAKER_02]: And even after he got out, the same woman who he had been in a relationship with came to France and said, you know, this still information inside your head we want.

29:16.054 --> 29:17.174
[SPEAKER_02]: Come back with me to China.

29:17.194 --> 29:18.035
[SPEAKER_02]: There's nothing for you here.

29:18.075 --> 29:18.515
[SPEAKER_02]: And he did.

29:19.155 --> 29:20.256
[SPEAKER_02]: And he lives in China now.

29:20.296 --> 29:20.816
[SPEAKER_02]: And hey, not now.

29:21.585 --> 29:45.552
[SPEAKER_03]: Well, let's not forget Eric Swallwell, former congressman from California member of the intelligence community who had a, I think it's been recently reported he's finally admitted he had a intimate relationship with a Chinese woman who was identified by the FBI as a spy, although in that case, I should.

29:46.372 --> 30:05.935
[SPEAKER_03]: You know, as I recall, he's putting out the FBI did give small well a defensive briefing in that case, and and he cooperated and, you know, ceased his relationship with this woman, which, you know, raises the question why they didn't follow the same playbook with Jensen Wow.

30:06.215 --> 30:12.259
[SPEAKER_02]: It is, by the way, she just also had a relationship with the mayor of Cleveland, Columbus, Ohio, and a few others.

30:12.519 --> 30:14.240
[SPEAKER_02]: Actually, I called up a lot of people knew them.

30:14.860 --> 30:19.603
[SPEAKER_02]: And I got 78, nine people that she was concurrently seen.

30:19.623 --> 30:20.804
[SPEAKER_03]: This is the Swallwell.

30:20.984 --> 30:23.226
[SPEAKER_02]: Yeah, this is Bunkfunk, Christine Funkfunk.

30:23.406 --> 30:23.686
[SPEAKER_02]: Right.

30:23.706 --> 30:25.087
[SPEAKER_02]: So, you know, made.

30:25.127 --> 30:28.028
[SPEAKER_01]: I got to ask you, I got to ask your Nick where this is going to go.

30:28.109 --> 30:30.330
[SPEAKER_01]: But first, we have to step away for just a second.

30:34.646 --> 30:35.447
[SPEAKER_01]: Okay, we're back.

30:35.707 --> 30:39.249
[SPEAKER_01]: Nick, we've talked about these other cases that Mike just raised.

30:39.489 --> 30:48.775
[SPEAKER_01]: It's just a tip of the iceberg situation that there are many other cases we're going to find of compromise, of top.

30:50.276 --> 31:14.305
[SPEAKER_01]: uh... technical attack bros uh... by chinese intelligence or maybe some u.s. officials i mean you have to really wonder what was going on in the commerce department which knew about these diversions and then sort of according to reporting by the new times and others this sort of slow down that investigation so what do you think where is this going to go a couple of different points there um... i am hopeful

31:19.440 --> 31:34.531
[SPEAKER_02]: you know, which it tends to be sometimes with media and and what I hope it gets out of it is a little more foundational understanding of the way Chinese intelligence behaves and our corporate sector to respond accordingly, right?

31:34.791 --> 31:40.235
[SPEAKER_02]: I mean, if the CEO can behave like this, what message does that send to everybody in the company?

31:41.201 --> 31:42.482
[SPEAKER_02]: right, the thousands of people there.

31:42.562 --> 31:56.674
[SPEAKER_02]: Well, CEO does this, but, you know, there is no mindset and understanding to protect, you know, to protect your intellectual property, to protect the economy, to protect the country, none of that's in and grossed in there.

31:56.934 --> 32:00.477
[SPEAKER_02]: And, you know, our corporations are territorial at that.

32:00.877 --> 32:02.438
[SPEAKER_02]: They're territorial, they don't want to do it.

32:02.538 --> 32:03.179
[SPEAKER_02]: It costs money.

32:03.878 --> 32:21.354
[SPEAKER_02]: Right, you know, security and cyber security special all that take away from the bottom line I get that I want to do it, but sometimes the results can be traumatic not only for an individual but for the nation itself, so I am hoping that that there's a change based on that.

32:22.272 --> 32:32.041
[SPEAKER_03]: You mentioned before that, um, Nvidia had a relationship with Ali Baba, which is the e-commerce giant inside China.

32:32.281 --> 32:44.593
[SPEAKER_03]: And, um, is it that they were provide these chips that were being smuggled through mega speed, were going to, um, Ali Baba, is that the, I don't know that.

32:44.713 --> 32:46.535
[SPEAKER_02]: And we know, I don't know something.

32:47.733 --> 32:52.818
[SPEAKER_02]: a billion maybe a half a billion dollars worth of in one particular case of chips being smuggled in.

32:53.218 --> 32:57.022
[SPEAKER_02]: So, and look, it's an open secret that chips are flowing in all the time.

32:57.062 --> 32:59.944
[SPEAKER_02]: This is not anything unusual if you follow this for the last five years.

33:01.045 --> 33:10.554
[SPEAKER_02]: It has been a bucket with a lot of holes in it that chips have been flooding in to China a lot through Singapore, Malaysia, even Taiwan, other places in Southeast Asia.

33:10.594 --> 33:12.936
[SPEAKER_02]: So, this has been kind of an open secret.

33:13.740 --> 33:16.422
[SPEAKER_02]: the fact there are department of commerce.

33:16.442 --> 33:24.966
[SPEAKER_02]: I don't know if it was a component, but in fact that they couldn't handle this or didn't handle this a lot more expeditiously, it's a question that should be rightfully asked.

33:25.446 --> 33:32.470
[SPEAKER_02]: When you knew this five years ago, I mean, it was in the media three years ago, two years ago, why couldn't you shut it down?

33:33.490 --> 33:38.213
[SPEAKER_03]: It was interesting in the Ali Baba relationship, because I sent

33:41.256 --> 33:42.616
[SPEAKER_03]: one of the highlights for the trip.

33:42.636 --> 33:48.658
[SPEAKER_03]: I was part of a group, mostly were venture capitalists, but there were a few other former senior US government official and some others.

33:49.618 --> 33:59.500
[SPEAKER_03]: And we were scheduled to have a lunch with the president of Ali Baba's e-commerce division, which is the biggest part of the company.

33:59.520 --> 34:08.942
[SPEAKER_03]: And then I and the former US government official, John Feiner, who is the deputy national security advisor, under Biden.

34:09.262 --> 34:34.028
[SPEAKER_03]: we were told we were banned from the meat with olive pop and we're just me and finer and you know it was inexplicable on its face because like there was a talk to the others who were in the lunch and absolutely nothing sensitive was said whatsoever but to me it was like a reminder of just

34:35.048 --> 34:50.013
[SPEAKER_03]: closely, they're all watched by the party that that that even Ali Baba didn't want to have to answer questions about why they would be Concerning with somebody from spy talk or a former

34:50.533 --> 34:56.461
[SPEAKER_03]: national security advisor at the US government.

34:56.902 --> 35:00.006
[SPEAKER_03]: But anyway, I'm just coming back to the timeline, though.

35:00.086 --> 35:06.815
[SPEAKER_03]: I mean, we know reporting from Axios today that Scott Bessett confronted Lutnik.

35:07.763 --> 35:34.281
[SPEAKER_03]: uh... in the situation room about why he wasn't uh... cutting off uh... mega-speed entirely and cracking down on this and he kind of flummaged all looking to it but then he's ordered something along the lines of i'll have to talk to the president about this which suggests that um... whatever he was doing was well known to uh... the commander in chief

35:35.382 --> 35:55.491
[SPEAKER_03]: And to me, like, what an opening for the Democrats on Capitol Hill now, so peanut power, you haul and let Nick, what did he know, when did he know it, what did he discuss with the president, he wants those, but you know, everything else about the way the commerce department handled this will be fair game and he could get have some pretty rough sledding up there.

35:56.071 --> 35:59.633
[SPEAKER_02]: Yeah, it could very well be, you know, it could go that way.

35:59.673 --> 36:04.175
[SPEAKER_02]: I don't know enough in the inside of what's happening, but if the president was don't

36:05.710 --> 36:07.532
[SPEAKER_02]: he's going to get roasted for that public.

36:08.613 --> 36:21.087
[SPEAKER_01]: Before any of this becomes under the spotlight of Congress, it seems to me is incumbent upon the FBI and this is Cash Patel to aggressively interrogate Jez and Juan.

36:22.427 --> 36:33.912
[SPEAKER_01]: They got a squeeze him for everything he knew and everything he did in a, you know, private sessions and interrogation session, treating a mess of hostile witness.

36:33.952 --> 36:36.033
[SPEAKER_03]: Well, wouldn't he just lawyer up at this point?

36:36.333 --> 36:38.454
[SPEAKER_02]: Yeah, I think they got to get us so phone.

36:38.494 --> 36:38.894
[SPEAKER_02]: Yeah.

36:39.094 --> 36:40.915
[SPEAKER_02]: And email it out to say exactly.

36:40.955 --> 36:41.395
[SPEAKER_02]: Okay.

36:41.735 --> 36:43.916
[SPEAKER_02]: Let's talk about what you said on the.

36:44.477 --> 36:50.099
[SPEAKER_03]: But this is what I think they should, what I was suggesting they should have done a year ago.

36:51.519 --> 36:52.459
[SPEAKER_03]: and in confront.

36:53.080 --> 36:58.461
[SPEAKER_02]: Well, if you weren't going to give him a defensive breathing hammer, the question is who leaked it to?

36:58.841 --> 37:03.362
[SPEAKER_02]: I mean, maybe it was a person that disqualified because that wasn't the case, that didn't happen.

37:04.102 --> 37:04.342
[SPEAKER_02]: Right?

37:04.462 --> 37:05.882
[SPEAKER_02]: And this is B.S.

37:05.922 --> 37:12.844
[SPEAKER_02]: But, you know, we should have, you know, this guy's a complicit or knows what's going on and you're still cooperating here.

37:13.324 --> 37:18.245
[SPEAKER_02]: This company's under investigation for smuggling and for their practices, you know, what's going on.

37:18.965 --> 37:21.067
[SPEAKER_02]: I'm done with it and bleaks it to the press.

37:21.667 --> 37:26.451
[SPEAKER_03]: You know, the other guy who I'm sure is going to get a hauled up to testify on this is Rubio.

37:27.152 --> 37:33.196
[SPEAKER_03]: Because Rubio, in April of this year, writes a memo, laying it all out.

37:34.377 --> 37:37.780
[SPEAKER_03]: All the details of what the intelligence community had discovered about Wong.

37:38.160 --> 37:47.428
[SPEAKER_03]: And then, personally, briefs Trump in May, as he's about to go to China, telling him, Jensen Wong should not be on that plane.

37:48.935 --> 37:56.300
[SPEAKER_03]: He is on the plane, and then Trump invites him to the state dinner for G in September.

37:57.681 --> 38:03.224
[SPEAKER_01]: Yeah, he wasn't on the plane, he wasn't invited, and then he was invited to be on the plane to pay a change.

38:05.708 --> 38:32.643
[SPEAKER_02]: this is going to be peeled away like the leaves of an artichoke so the question is you know does I mean Trump said internally you know and that same group with luck Nick and said okay then let's go after calling Elon Musk right and say you know let's move ahead and you know and block the sales of the trip right so he made that decision and that's you know for more than one person that was that was apparently

38:35.752 --> 38:39.333
[SPEAKER_02]: He has come down on some sides in restricting export.

38:40.233 --> 38:44.134
[SPEAKER_02]: So the question is, did he just think this wasn't an issue worth discussing?

38:44.154 --> 38:49.976
[SPEAKER_02]: Did he want to use and exploit the issue in some way, being able to hold something over Jensen?

38:51.696 --> 38:57.698
[SPEAKER_02]: Did he want to push back information the other way, and just not trust his intelligence community?

38:57.958 --> 39:00.719
[SPEAKER_02]: I mean, a guy has zero trust for the intel community, right?

39:06.023 --> 39:07.664
[SPEAKER_02]: Go, did he just want to do it himself?

39:07.724 --> 39:08.505
[SPEAKER_02]: I'll handle it.

39:08.585 --> 39:12.487
[SPEAKER_02]: You know, you guys just stay away and I don't know.

39:12.567 --> 39:15.329
[SPEAKER_02]: And being, you know, we don't know if there are a lot of questions that are unanswered.

39:16.310 --> 39:17.251
[SPEAKER_01]: So many questions.

39:17.311 --> 39:19.432
[SPEAKER_01]: It's a highest level of the government.

39:19.452 --> 39:19.932
[SPEAKER_01]: Yeah, it really is.

39:20.633 --> 39:26.197
[SPEAKER_01]: And our national security establishment, my God, this is not going to go away any time soon.

39:26.797 --> 39:28.918
[SPEAKER_01]: So next, thanks for coming on this show.

39:28.938 --> 39:31.800
[SPEAKER_01]: Me, maybe when we have you, have you back again, again,

39:35.683 --> 39:40.290
[SPEAKER_02]: Yeah, I mean, I'm intrigued by that idea.

39:40.330 --> 39:41.411
[SPEAKER_02]: Mike, you mentioned it earlier.

39:41.492 --> 39:49.203
[SPEAKER_02]: I don't know how this is going to, I don't know if this is a flash in the pan or if this is going to, you know, spool up because it's three months before the demo.

39:49.323 --> 39:52.027
[SPEAKER_03]: I think there are so many unanswered questions here.

39:52.649 --> 39:55.432
[SPEAKER_03]: Democrats are not going to let this go, they're going to do everything we can to get on them.

39:55.472 --> 40:15.813
[SPEAKER_02]: We had on the answered questions with Kennedy Assess, I think, six years there and people are still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're still asking, we're

40:18.022 --> 40:19.703
[SPEAKER_01]: And that's it for this week's Pytalk.

40:19.763 --> 40:24.447
[SPEAKER_01]: Be sure to check out our complete podcast archive on Apple wherever you get your podcasts.

40:24.527 --> 40:39.399
[SPEAKER_01]: And if you haven't already, do check out the Spytalk.co new site on Substack, where we offer steady diet of scopes and original analyses from the intersection of intelligence, form policy, and military operations.

40:39.439 --> 40:42.962
[SPEAKER_01]: Just Google Spytalk, you'll quickly find your way there.

40:43.807 --> 40:52.894
[SPEAKER_01]: This edition of the SpyTalk podcast was smoothly produced, as always, by can I, and expertly edited by Molly Hawkey for MSW Media.

40:53.635 --> 40:58.019
[SPEAKER_01]: See you around, I'm Jeff Stein, I'm my Glosegoff, thanks for listening.

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[SPEAKER_00]: M-S-W-M-S-W-M-D-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-A-L-

