Peter Thiel, the co-founder of PayPal and who rarely gives public interviews, spoke with Michael Arrington at the TechCrunch50 conference today.

Topics ranged from politics to finance and technology. On the item of the stock market, Thiel is concerned that our economy keeps producing bubbles — technology, housing, foreign investing, etc. — yet he does not feel the current technology market is a bubble. Referring to the valuation of Google, Yahoo, Amazon, and other tech stocks, he said, “on a relative basis, they’re among the cheapest companies in terms of stock.”

But the 2000 bubble, he says, “set technology back 10 years,” by discouraging people from getting into technology. Thiel raised the political issue here: Why doesn’t our system see and proactively address these bubbles. It’s not like they don’t have precursor signals.

Arrington engaged Thiel in discussing YouNoodle, a project he’s funding that applies quantitative analysis to vetting start-ups. YouNoodle examines a ton of variables, including things like how long the founders have known each other, and then predicts not just success for companies but their three-year valuation. Traditionally an exercise for investors, Thiel says that YouNoodle applies, “a division of labor.” Computers, he says, do some things better in humans, and “there are certain quantitative metrics that work very well in startups.”

For instance? CEO salary. The lower it is, the more like the company is to succeed, since it indicates alignment with growing equity, and also because it keeps the salary cap for all employees reasonable. “It’s been powerfully predictive,” Thiel says. And the magic number: $100,000 to $120,000. Above $150,000, “you start to have issues.”

Thiel, a ranked chess player in his younger years, has interesting thoughts about artificual intelligence and its benefits and dangers. While people used to think that Chess would never be mastered by a computer since it was a reflection of innate human intelligence, clearly people were mistaken about that. And it’s instructive, he says. “How many domains are like Chess, where they can be quantified?” Thiel asked. “My thinking is that there are probably more than we think.”

Responding to a question from the audience about computers taking over the world: “My own sense, it’s not going to happen. But I was wrong about chess.”

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One more spammer is heading off to jail, but not before he managed to bilk at least several hundred people out

of $400,000 or more. Michael Dolan, 24, has been sentenced to seven years in jail—the maximum he could have received—followed by three years of supervised release. Dolan and a group of co-conspirators ran a scheme from 2002-2006 in which they first trolled AOL chatrooms for user names, then bombarded these users with phishing attempts.

As Infoworld reports, the scheme ran as follows. Victims typically received a link to a false greeting card which, when opened, installed a malware package. The next time the target attempted to log on to AOL, the program would request credit card numbers, bank account data, or other personal information. Users who refused to enter the data were prevented from logging into AOL. As schemes go, this was a fairly novel idea at the time, and I actually remember running into several systems infected this way. Dolan also sent spam purporting to be from AOL’s billing department, asking customers to please reenter their billing details due to a server meltdown. As you can imagine, all of this left AOL feeling a bit perturbed.

Dolan himself has something of a history of bad behavior. He was first sentenced to two years of probation after pleading guilty to a misdemeanor count of accessing a computer without authorization. His probation was revoked in 2006, after the ruling judge discovered that he had taken several trips out of state, including at least one trip overseas. Dolan was then sentenced to nine months of imprisonment, and was charged in the AOL scam on September 28, 2006. Considering that the scam itself ran from 2002-2006, Dolan was likely making money from computer fraud both while on probation and in jail.

The federal government claimed that Dolan masterminded the scheme, but if he did, his intelligence appears to be confined solely to computing. Assistant US Attorney Edward Chang stated in a sentencing memorandum that Dolan attempted to variously bribe, coerce, and threaten various witnesses, and succeeded in convincing his girlfriend to perjure herself. Combined with his modus operandi of committing computer fraud while directly under the nose of the authorities, Dolan simply doesn’t seem to be the sharpest crayon in the box.

Sharp or dull, however, he’s headed to jail. Five years for fraud, two years for aggravated identity theft, followed by his supervised release, which is essentially probation. Judges are allowed to impose conditions during a supervised release, and can bar the individual in question from engaging in activities which are otherwise lawful. The judge in Dolan’s case has not set the terms of the release yet, but based on his record, it’s a safe bet that Dolan won’t be touching a PC until 2018.

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