0:00:03 Support for the show comes from Public.com.
0:00:06 If you’re serious about investing, you need to know about Public.com.
0:00:09 That’s where you can invest in everything, stocks, options, bonds, and more,
0:00:13 and even under 6% or higher yield that you can lock in with a bond account.
0:00:19 Visit Public.com slash PropG and get up to $10,000 when you transfer your old portfolio.
0:00:21 That’s Public.com slash PropG.
0:00:26 Paid for by Public Investing, all investing involves the risk of loss, including loss of principal.
0:00:30 Brokered services for U.S.-listed registered securities, options, and bonds
0:00:33 in a self-directed account are offered by Public Investing, Inc.,
0:00:36 member FINRA, and SIPC.
0:00:39 Complete disclosures available at Public.com slash disclosures.
0:00:42 I should also disclose I am an investor in Public.
0:00:49 Thumbtack presents the ins and outs of caring for your home.
0:00:50 Out.
0:00:51 Indecision.
0:00:52 Overthinking.
0:00:55 Second-guessing every choice you make.
0:00:56 In.
0:01:00 Plans and guides that make it easy to get home projects done.
0:01:02 Out.
0:01:03 Beige.
0:01:04 On beige.
0:01:06 On beige.
0:01:07 In.
0:01:11 Knowing what to do, when to do it, and who to hire.
0:01:14 Start caring for your home with confidence.
0:01:16 Download Thumbtack today.
0:01:23 Soon enough, high schoolers will be donning those caps and gowns.
0:01:27 But what comes next is less of a sure thing than it was a decade ago.
0:01:32 Students are genuinely questioning if college is worth it, and if college is really the right
0:01:35 thing for them, knowing what they know about themselves.
0:01:40 This week on Explain It to Me, a look at the new range of alternatives to college, and how
0:01:43 some high schools are setting up their graduates for success.
0:01:47 New episodes on Sunday mornings, wherever you get your podcasts.
0:01:50 Today’s number, $313 million.
0:01:56 That’s how much a Minecraft movie made in its opening weekend, the biggest video game film
0:01:57 opening ever.
0:02:00 Ed, a rabbi, a priest, and a stripper walk into a bar.
0:02:01 What does the bartender say?
0:02:02 What?
0:02:06 I don’t know, but Donald Trump is a fucking idiot.
0:02:18 I just made that up.
0:02:19 I’m proud of that.
0:02:19 That’s good.
0:02:20 That’ll get the people going.
0:02:24 And for those of you who think I have Trump derangement syndrome, I have this thing called
0:02:27 capitalism and democracy addiction syndrome.
0:02:36 I really love Netflix, and I love living somewhere nice, and I love rule of law, and I love people
0:02:40 who make smart decisions and prosperity.
0:02:46 I’m just so into this whole prosperity and rights thing, and I’ve gotten so used to it.
0:02:49 So Megyn Kelly is super easy to find.
0:02:55 If you’re looking for people to justify, like, say he’s playing 4D chess, right?
0:02:57 No, he’s not even playing fucking Jenga or checkers.
0:03:00 He’s playing Russian roulette with everyone’s prosperity.
0:03:02 I am in a bad mood today, Ed.
0:03:03 I can tell.
0:03:11 It is interesting how all these, I mean, the response to any criticism has always been Trump
0:03:12 derangement syndrome.
0:03:16 And I’ve said, you know, I think probably a month ago that there’s a new syndrome, which
0:03:22 is TDSDS, which is Trump derangement syndrome, derangement syndrome, where you basically ascribe
0:03:27 any criticism of the government as a symptom of Trump derangement syndrome.
0:03:31 It is funny, this week I have not been hearing any accusations of TDS.
0:03:38 I think people have finally gotten it through their heads that that’s not really a valid argument
0:03:39 you can make anymore.
0:03:44 So we’ll be getting into all of it today and all of the arguments that the other side has
0:03:48 been making as to why any of this could possibly make sense.
0:03:50 A few notes from me.
0:03:54 One, please go vote for us in the Webby Awards.
0:03:55 Yes.
0:03:56 Please vote for us.
0:03:58 I need a raise.
0:04:01 So we need to get this win under our belt.
0:04:02 You think that’s going to get you a raise?
0:04:05 Yes.
0:04:06 Okay.
0:04:07 Fine.
0:04:10 So go vote for us in the Webby Awards.
0:04:12 Voting ends this week.
0:04:16 So please go vote for us at vote.webyawards.com.
0:04:19 Type in Prof G Markets in the search bar.
0:04:20 You will find us.
0:04:21 Please vote for us.
0:04:24 We’ll also leave a link in the description to make it easy for you.
0:04:27 And the second point I will make, just a bit of housekeeping before we start the show.
0:04:33 Starting in June, we’re going to be going every single day on this podcast.
0:04:39 And I think the events of this past week have made it very evident to us why we need to do
0:04:39 that.
0:04:41 We want to stay on top of the ball.
0:04:43 We want to be up to date.
0:04:49 We want to make sure that everyone is informed as we embark on this unbelievably wild ride over
0:04:50 the next several years.
0:04:52 So we’re going to be doing markets daily.
0:04:57 But that’s only going to be happening on the Prof G Markets feed.
0:04:59 It’s not going to be happening on the Prof G Pod feed.
0:05:06 And so if you’re listening on the Prof G Pod feed, the main feed, the logo is a turquoise
0:05:07 symbol with Scott’s head on it.
0:05:10 I encourage you to go switch over now.
0:05:13 Subscribe to Prof G Markets.
0:05:17 It’s a green logo with Scott and I bantering together in his living room.
0:05:20 Because that’s where the action is going to be happening.
0:05:22 And it’s going to be happening in a couple of months.
0:05:27 So please, if you haven’t done so already, go subscribe to Prof G Markets because soon
0:05:29 enough, we’re going to be doing this five days a week.
0:05:33 It’s going to be epic, but we won’t be on the Prof G Pod feed anymore.
0:05:35 And that is my housekeeping.
0:05:37 I’m now going to get into the headlines.
0:05:38 No, no, no, no.
0:05:39 We need to talk about me a little bit more.
0:05:40 That was a little too much ahead.
0:05:40 Okay.
0:05:44 This morning, Daddy went on La Vista, or as you gringos call it, The View.
0:05:45 I went on The View.
0:05:48 And I was out with Whoopi, who loves me.
0:05:49 She said she loves me.
0:05:52 She’s like, Professor, I love having you on.
0:05:53 I love that show.
0:05:57 The women are like, there’s some really like, really attractive women.
0:05:59 You’ve been on that show a few times now, right?
0:06:01 I think this is only my second time.
0:06:02 It’s still a few.
0:06:03 I think that’s called A Couple.
0:06:10 Anyways, but nothing moves books like Morning Joe and The View.
0:06:11 And it’s really interesting.
0:06:17 They’re both like, there’s the behind the scenes, the operations, the producers, the resources.
0:06:20 Those guys are really good.
0:06:25 You can tell that they’re making so much money because they are serious when you show up.
0:06:30 But yeah, I think my future ex-wife is one of those panelists or one of the women of The View.
0:06:33 I’ll let all the viewers guess who it is.
0:06:38 But my future ex-wife is one of the co-hosts of The View.
0:06:39 Oh my God.
0:06:40 I am just fascinated with this woman.
0:06:42 You’ve said you find her hot before.
0:06:43 She asked me a question.
0:06:45 I’m like, I see her lips.
0:06:46 What’s her name?
0:06:46 Alyssa?
0:06:48 Don’t out me.
0:06:53 I’m like, I see her lips moving, but I don’t hear the words because I love you.
0:06:54 I love you.
0:06:58 I saw her backstage and I’m like, let’s take a picture together so I can show this to our children.
0:07:02 Oh my God.
0:07:05 And she’s conservative, which really gets me kind of.
0:07:06 Absolutely.
0:07:09 But they’re all really smart and impressive.
0:07:11 And anyways, I was on The View, Ed.
0:07:12 That’s very exciting.
0:07:13 Should we talk about what matters?
0:07:14 That hurts my feelings.
0:07:16 Get to the headlines.
0:07:26 The trade war has officially reached a boiling point.
0:07:30 President Trump announced a 90-day pause on tariffs for most countries Wednesday while
0:07:32 simultaneously raising tariffs on China.
0:07:36 The selective reprieve ignited a wave of investor euphoria.
0:07:39 Minutes after the announcement, the major indices skyrocketed.
0:07:41 The Dow was up nearly 8%.
0:07:43 The S&P rose by almost 10%.
0:07:48 That was its sharpest gain since October 2008 and the third biggest since World War II.
0:07:53 And the Nasdaq had its best day in 24 years, climbing 12%.
0:07:57 The Magnificent Seven alone added $1.5 trillion in value.
0:08:07 By mid-afternoon on Thursday, stocks gave up half of that rally as Trump raised the tariff rate on China again to 145%.
0:08:10 The Dow ended the day down 1,000 points.
0:08:15 And the S&P and the Nasdaq closed down around 4%.
0:08:18 Then stocks headed back up on Friday.
0:08:24 Scott, your reactions to the turbulence that we’ve seen in the markets in this last week.
0:08:26 Where do you stand on tariffs today?
0:08:29 So the only way I can play, I can think of to play this market.
0:08:31 And by the way, this is what I’m doing.
0:08:32 Don’t try this at home.
0:08:34 Be very careful because it has unlimited downside.
0:08:37 But options and volatility have gone crazy.
0:08:40 And so to buy options is super expensive.
0:08:48 So I have been selling options, specifically selling calls, because I think over the medium and the long term, we’re going to have contraction, multiple contractions.
0:08:51 And so I sell calls against stocks that I think are already overvalued.
0:08:59 And be clear, I imagine the thing tripling, the stock tripling, because there’s unlimited downside and it can’t be more than 5% of my net worth.
0:09:03 So keep in mind when you do this, you are playing with fire.
0:09:11 But that’s the only way I can think of to kind of play this volatility in this recklessness is to sell calls, quite frankly.
0:09:13 So I was looking at Apple calls.
0:09:18 And Wednesday in the morning, you could buy, I think the stock was at 175.
0:09:24 You could buy a call on Apple for 40 cents, meaning if you sell it, you only get 40 cents.
0:09:33 And then about 10 minutes before he made the announcement, he was pausing it, Apple skyrocketed and the calls went to $4.
0:09:36 So you invested a million bucks, you got 10 million.
0:09:41 If you took, and I didn’t do this, but if you took a million dollars selling those calls, you had to pay that person 10 million.
0:09:48 So people made and lost about a third of a billion dollars just on that one strike price, just on that one.
0:09:50 So literally billions of dollars made and lost.
0:09:54 But it was clear someone knew what was going to happen.
0:10:01 And when you have a president who’s comfortable opening a Swiss bank account where anyone can deposit money, call him and say, I’ve done this.
0:10:02 And he doesn’t ask for to disclose it.
0:10:12 When you have a president that is a convicted felon, to think that maybe he didn’t call some of his donors or some of his insiders or friends and say, FYI, wink, wink, nod, nod.
0:10:15 I think the markets are going to go up today.
0:10:17 I think we’re going to find out.
0:10:19 And in a digital world, there will be evidence of this.
0:10:34 I think we’re going to find out that April 9th, we’ll go down in history, is the greatest day of insider trading in history, where people were engaging in market manipulation and insider trading, trading on non-public material information.
0:10:37 Because clearly, word got out.
0:10:41 In this market, there’s someone on the other side of that trade losing money.
0:10:47 And the whole point of the markets is there isn’t a group of people in the know within a circle of proximity to people in power.
0:10:57 They get asymmetric advantage against you because then people just give up and stop investing in the markets and the cost of capital skyrockets for corporations.
0:11:02 So yesterday was D-Day for insider trading.
0:11:08 And I think that will come out about a week after the next president is inaugurated.
0:11:15 I think the SEC and forensic accountants are going to find there was so much bad shit that went down yesterday.
0:11:16 Any thoughts, Ed?
0:11:21 Well, you said you predict or you believe that that happened.
0:11:22 I can tell you right now the evidence is there.
0:11:23 It did happen.
0:11:37 There was someone who bought a huge number of zero-day call options on the S&P hours before he released that tweet and released that announcement saying that he’s pulling and pausing the tariffs.
0:11:44 And so this is basically a bet that the S&P would rise by a huge amount within one day.
0:11:45 They expire at the end of the day.
0:11:52 And those options, we don’t know who this was, but those options exploded by more than 2,000%.
0:11:56 So this person, whoever it is, made millions.
0:12:04 And, of course, the only rational implication is that this individual knew what was going to happen and they were insider trading.
0:12:05 Again, we don’t know who that was.
0:12:09 The Democrats are now calling for an investigation into this.
0:12:13 And the big question is, did Trump tip someone off?
0:12:17 I don’t see any way that it couldn’t have been that.
0:12:24 Or maybe it was sloppiness and word got out among his close group of friends that this is what he was going to do.
0:12:29 But there is evidence in the markets that someone was doing this.
0:12:31 Someone was insider trading.
0:12:39 So I think, you know, you’re almost calling the prediction too late in that we know it actually happened.
0:12:47 But all of your points there align with the first thing that I’ve been thinking coming out of this insane week.
0:12:55 We had these unbelievable swings in the stock market, in the Nasdaq, in the S&P, in the Dow, the entire U.S. stock market.
0:13:03 And essentially what’s happened is the president has turned our economy or our stock market into a meme stock.
0:13:14 You know, falling or rising 10 or more percentage points within a day for six days straight, those are the characteristics of a meme stock.
0:13:20 That’s something like a GameStop or an AMC or a cryptocurrency like a Faultcoin or a CumRocket.
0:13:26 And that might sound funny or hyperbolic, but it was plainly true last week.
0:13:32 The price movement of the S&P resembled those of a meme stock, which makes me ask the question,
0:13:37 OK, well, what does it mean for us that our stock market has itself become a meme stock?
0:13:39 I think there are a few implications.
0:13:44 One, we’re going to see a huge surge in options trading, as evidenced by you.
0:13:47 You know, people are going to be making and losing huge amounts of money
0:13:52 based not on the cash flows and the earnings of our economy,
0:13:57 but on the words and the tweets of the spearheader of the movement, which is the president.
0:14:02 I think we’re also going to see a massive influx of young investors
0:14:06 who have grown up in an era of crypto and meme coins
0:14:09 and who are just more excited by this short-term upside of volatility
0:14:14 versus the long-term upside of actual investment, value investment.
0:14:18 And three, and I think this is the most important consequence,
0:14:22 I think our creditworthiness is going to collapse
0:14:27 because lending, far more so than investing,
0:14:34 is fundamentally dependent on certainty and stability and reliability.
0:14:38 And that’s why, you know, you look at every meme stock in existence,
0:14:39 they all have a junk rating.
0:14:42 You know, look at GameStop, AMC, MicroStrategy.
0:14:45 Yes, those stocks can at times outperform,
0:14:50 but over the long term, the underlying default risk is way too high,
0:14:52 which makes their debt essentially uninvestable.
0:14:55 And now we are putting the entire economy in that position.
0:15:00 And this is the dark side that I don’t think people are paying enough attention to right now.
0:15:04 Because on Wednesday, stocks went up and people said,
0:15:05 great, we’re back to normal.
0:15:10 We’re, you know, we’re not perfect pre-tariffs, but we’re back on track.
0:15:12 And what they seem to gloss over though,
0:15:17 which is now appearing to us in the form of the 10-year yield,
0:15:20 they were not paying attention to the bond market.
0:15:24 Because the yields came down a little bit from those insane highs
0:15:27 that nearly tilted into a full-on credit crisis,
0:15:30 but ultimately landed higher than where they were before the tariffs.
0:15:32 And now they’re rising again.
0:15:35 And what that tells me is that over the course of a few days,
0:15:38 we essentially kneecapped our ability to borrow.
0:15:41 We damaged our reputation as an investable economy.
0:15:45 We damaged other leaders’ ability to believe what we say.
0:15:48 We damaged this global assumption that the U.S.,
0:15:49 generally speaking, knows what it’s doing.
0:15:55 And beyond the politics and the embarrassment and the ridiculousness of it all,
0:15:58 I think the numerical consequence of all of that
0:16:02 is a massive long-term increase in our borrowing costs.
0:16:05 Which, as Trump has correctly pointed out,
0:16:07 is something our nation is overly dependent on,
0:16:11 and which, by the way, he has not made a plan to wean us off of.
0:16:14 So that’s the point I’d like to begin here.
0:16:18 It’s just what a dark week this actually was for America.
0:16:21 I mean, the way to summarize it, I would say,
0:16:25 is that last week we officially fired the starting gun
0:16:27 on this global rotation away from America,
0:16:30 which you have been talking about for more than 90 days now.
0:16:32 And that’s not to say we can’t come back.
0:16:35 I don’t think we’re necessarily doomed.
0:16:42 But in the same way that a landslide is triggered not by the buildup of pressure at the top of the hill,
0:16:47 but by someone stumbling on the rock and releasing that pressure and causing the slide,
0:16:50 that’s what I think happened last week.
0:16:57 One of the things you’re saying that’s really interesting is that if you listen to Ben Bernanke’s congressional testimony during the Great Financial Recession,
0:17:00 he talks about the Great or the Depression.
0:17:02 And he said, while everyone was focused on the stock market,
0:17:05 he said the thing that really took us into the Depression was the credit markets.
0:17:09 And the stock market is more fun to look at,
0:17:12 but it’s really the credit markets are much bigger than the stock market
0:17:15 and are much more influential on everyday business.
0:17:18 And my thesis is the following,
0:17:23 that the president has access to more information than any individual in the world.
0:17:25 He has access to the best security apparatus.
0:17:27 He has access to the best economists.
0:17:32 He really is the person that could do the most insider trading,
0:17:33 which I think this is going on.
0:17:35 But distinct to that, he has the most information.
0:17:36 And this is what I think happened.
0:17:38 The adult in the room is the 10-year.
0:17:39 We’ve been saying this.
0:17:41 And I think he got information the following,
0:17:44 and that is companies are cutting their spending.
0:17:45 They’re paralyzed.
0:17:46 They don’t know what to do.
0:17:47 They’re cutting their spending.
0:17:50 Companies are rerouting the supply chain.
0:17:54 Every economic indicator is that there’s less money and less activity.
0:17:58 At the same time, interest rates are going up.
0:18:00 That is stagflation.
0:18:02 That takes you potentially into a depression.
0:18:08 If the cost of capital goes up as productivity and spending is going down,
0:18:16 that is literally nitro and glycerin that explodes into stagflation and then a depression.
0:18:17 I think he got both those data points.
0:18:19 And someone said,
0:18:22 This is really, really bad.
0:18:24 And probably just as importantly,
0:18:29 Alyssa was wearing a yellow ribbon to signify the hostages.
0:18:31 Do you think she was doing that to impress me?
0:18:35 I need a distraction here, Ed.
0:18:37 I need a distraction.
0:18:40 Seriously, I think she’s into me.
0:18:41 I think she’s into me.
0:18:42 I think she’s into me.
0:18:44 What do you think?
0:18:45 I have no comment on that.
0:18:48 We were really getting somewhere.
0:18:49 We were breaking new ground.
0:18:53 I had to bring it back to Alyssa.
0:18:53 That’s all right.
0:18:54 Stagflation.
0:18:55 I’m sorry.
0:19:01 I think what you’re saying there is the important point, which is that the bond market was the adult in the room.
0:19:03 And you’ve said that for a while.
0:19:06 And Andrew Ross Sorkin said it as well on this podcast.
0:19:17 If there is any blockade to this administration’s efforts and the Republicans to get what they want over the next, call it two years,
0:19:19 because we’ll see what happens in two years in the midterms,
0:19:27 the only potential governor on them is, oddly enough, the bond market.
0:19:32 If, in fact, the investor class around the world says,
0:19:33 You know what?
0:19:34 We’re just not doing it this way.
0:19:37 We don’t like what’s going on here.
0:19:41 They can vote with their wallet and they can say,
0:19:47 We are not going to be buying your bonds unless you’re going to pay us a lot more for them,
0:19:51 in which case everything becomes a lot more expensive for all of us.
0:20:01 And that is the only thing, frankly, that I can even imagine that is a governor on the politics of our country over the next, call it two years.
0:20:03 That’s not what the administration is saying, though.
0:20:06 And I think we should clear this up here.
0:20:11 The way they are justifying this pause on the tariffs, the pullback.
0:20:19 They say it was all this, it was this 4D chess move to put China in a corner to bring our trading partners to the table.
0:20:26 And most importantly, they have said this, that it had nothing to do with what happened in the bond markets on Tuesday night,
0:20:32 where yields exploded and markets were digesting the very likely prospect of a credit crisis.
0:20:38 And so Howard Lutnick, as soon as this happened, he went on CNBC and they asked him point blank.
0:20:44 Did the market reaction cause the administration to rethink its tariff plan?
0:20:46 Absolutely not.
0:20:48 Scott Besson, he also went on CNBC.
0:20:50 They asked him the same question.
0:20:57 I would say that the negotiations are the result of the massive inflow of inbound calls to come and negotiate.
0:20:59 Had nothing to do with the market.
0:21:11 But the best interview to me, the most telling interview, was Trump’s, where he’s standing outside of the White House and unprompted, he starts rambling about the bond market.
0:21:12 Bond market is very tricky.
0:21:13 I was watching it.
0:21:17 But if you look at it now, it’s beautiful.
0:21:19 The bond market right now is beautiful.
0:21:23 But yeah, I saw last night where people were getting a little queasy.
0:21:28 People were jumping a little bit out of line.
0:21:33 They were getting yippy, you know, they were getting a little bit yippy, a little bit afraid.
0:21:40 And by the way, apparently he was watching Jamie Dimon’s interview on Fox just a couple hours before he hit send on the tariff pause.
0:21:43 And that’s the interview where Jamie was saying he was expecting a recession.
0:21:54 So this idea that this was all part of the plan and that this was not a reaction to the bond markets, that it was just a coincidence that it happened right after yields went haywire, total lie.
0:21:57 It is absolutely a response to the bond markets.
0:22:02 This was the administration realizing the markets are more powerful than they are.
0:22:05 The world will only tolerate so much of their craziness.
0:22:12 And they were essentially strong-armed by the bond vigilantes, the bond investors, into admitting defeat.
0:22:14 Now, of course, they can’t say that.
0:22:17 We remember who Trump’s mentor was, Roy Cohn.
0:22:19 His number one rule, never admit defeat.
0:22:22 So they come out and say, this was a big win for us.
0:22:37 But I think the most pathetic thing that I saw was watching all of his backers file into a line and having been genuinely and publicly rattled by what had happened, genuinely frightened by the world’s response.
0:22:40 They go out and say what a genius Trump is.
0:22:45 And I’d like to read you some quotes here from Stephen Miller.
0:22:46 This is from Twitter.
0:22:46 He said, quote,
0:22:52 You have been watching the greatest economic master strategy from an American president in history.
0:22:55 From David Sachs, quote,
0:22:58 Once again, Trump was right about everything.
0:23:00 From Bill Ackman, quote,
0:23:03 This was brilliantly executed by Donald Trump.
0:23:04 Textbook.
0:23:05 The art of the deal.
0:23:09 And my response to Bill Ackman would be,
0:23:11 What deal?
0:23:14 I mean, seriously, tell me, what is the deal?
0:23:15 What did we get here?
0:23:19 Their incompetence is just bursting at the seams here.
0:23:21 They can’t even coordinate their messaging.
0:23:37 And although I don’t think Bill’s coordinating, well, I don’t know this, but that Stephen Miller tweet and that David Sachs tweet, that was written by a White House communications director that works for Dear Leader.
0:23:41 I mean, look at how just similarly sycophantic it is.
0:23:45 Doesn’t it sound like the same person writing this shit?
0:23:48 I mean, those guys, you know, not, I don’t know.
0:23:52 David is a smart guy, regardless of what you think of his politics.
0:23:54 That just so, that sounded so ridiculous.
0:24:01 So they’re clearly coordinating on tweets, but they can’t get their message straight when they go on CNBC.
0:24:05 And, oh, they’re not freaked out about the market, but they’re going on CNBC every fucking day?
0:24:07 Oh, we don’t care.
0:24:13 No, the credit markets didn’t make us do this, but we need to go on CNBC to tell everyone the credit markets didn’t make us do this.
0:24:26 I mean, the level of, I don’t know, just constitutional, you know, necrophilia here, combined with the incompetence of these guys going left, going right.
0:24:32 I mean, at some point, we got numb to the fact that, oh, the economy can survive this level of incompetence.
0:24:39 And I’ve said this to you before, pulling the knife halfway out of the back of the economy by pausing the tariffs.
0:24:42 This, again, weakens our hand.
0:24:43 We’re pausing the tariffs.
0:24:46 This guy is blinking left and right.
0:24:49 What was the impetus?
0:24:51 They were trying to accomplish a few things, according to them.
0:24:54 One, bring jobs, good manufacturing jobs back to America.
0:24:58 Two, reconfigure global trade to our advantage.
0:25:01 And three, raise a bunch of money through tariffs.
0:25:02 All right.
0:25:06 Tariffs never increase the treasury.
0:25:10 They might protect an industry, an infant industry like in South Korea, or ensure a certain level of domestic production.
0:25:13 But they’re not revenue generators.
0:25:20 Tariffs on the whole, they reduce revenues to reconfigure the supply chain to our advantage.
0:25:22 It’s done exactly the opposite.
0:25:26 We have declared war on everyone, meaning all of our imports are more expensive.
0:25:28 box-checked.
0:25:35 He is reconfiguring the global supply chain, but he’s reconfiguring in a way that is to our huge disadvantage.
0:25:51 And then the notion we were going to bring back American jobs, the average assembly worker in Shenzhen working for Foxconn who builds the iPhone makes about $6,000 a year.
0:25:53 So Apple has said, here’s an idea.
0:25:56 Let’s outsource the really shitty low-paying jobs.
0:26:08 And let’s hold on to the design, the business development, the store technology, the strategy, the marketing, all of the jobs that pay kind of like $200,000, $300,000, $400,000 a year.
0:26:24 And by the way, that unlocks more margin, more profit that Apple then reinvests in growing the market, which creates more high-paying jobs.
0:26:32 It just cracks me up that these folks think that they’re going to bring back these fantastic manufacturing jobs.
0:26:34 And I love that stat.
0:26:42 The Cato Institute did a survey on manufacturing, and 80% of Americans think that we need more manufacturing.
0:26:44 There’s a romanticization of manufacturing.
0:26:48 But only 20% of Americans want to work in manufacturing.
0:26:51 Ed, let me ask you this.
0:26:55 Now, granted, you went to Princeton, and you’re a little bit of a debutante.
0:26:59 But do you have any friends that are just dying to get into manufacturing?
0:27:01 Seriously.
0:27:02 No.
0:27:04 We’re the second largest manufacturer already.
0:27:07 It’s not like – and our manufacturing is high-value-add.
0:27:12 We put together really cool shit that we can sell for a lot more money than it costs to bring.
0:27:13 It’s really complicated.
0:27:14 It’s really value-add.
0:27:20 And the, quote-unquote, lower-value-add stuff, that, quite frankly, they can find people who decide,
0:27:28 all right, if I move in from a rural town in a province in China and I make $500 a month, that’s an upgrade to my quality of life.
0:27:41 And it’s just hilarious that the fact that what Trump has not calculated in his, quote-unquote, game theory is that Americans will not endure very much pain.
0:27:44 I mean, the Chinese will endure a lot of pain.
0:27:47 Russians will send a million of their young men to die.
0:27:51 You know, we lose 57,000 in Vietnam.
0:27:55 We leave even though the Viet Cong has lost a million men.
0:28:01 I mean, our tolerance for pain, our threshold for pain, we’re the men of the species.
0:28:08 And that is because of childbirth, women are born with the ability to have a much higher tolerance for pain because they have to endure childbirth.
0:28:09 We’re the men.
0:28:11 We’re the ones like, well, fuck that.
0:28:12 That hurts too much.
0:28:12 Stop.
0:28:12 Stop.
0:28:19 And China and Russia are the women in the sense they will endure much more pain than we will.
0:28:27 All of a sudden, if you announce the first iPhone that goes on sale here for $2,100, again, he’s going to blink.
0:28:29 Americans won’t tolerate that.
0:28:30 They will not tolerate it.
0:28:40 The first time the 77% of toys under the Christmas tree go up, doubling costs, and American households have to cut the number of toys under the tree in half.
0:28:42 Americans won’t tolerate that.
0:28:45 They’ll burn their MAGA hats.
0:28:58 So the notion, what he doesn’t realize is, yeah, maybe on a dollar-per-dollar basis, we can hurt these guys more than they hurt us, not taking into effect that the dollar we get is usually a higher margin, much higher market cap dollar.
0:29:04 These folks are willing to endure much more pain than the American consumer.
0:29:07 He is playing with such a weak hand right now.
0:29:10 We’ll be right back after the break.
0:29:16 If you’re enjoying the show so far, be sure to give the Prof G Markets feed a follow wherever you get your podcasts.
0:29:27 More for the show comes from the Fundrise Flagship Fund.
0:29:29 Real estate investing is boring.
0:29:36 Now, prediction markets, on the other hand, or even the stock market, which can swing wildly on a headline, those will keep you on the edge of your seat.
0:29:42 But with real estate investing, there’s no drama or adrenaline or excuses to refresh your portfolio every few minutes.
0:29:46 Just bland and boring stuff, including diversification and dividends.
0:29:52 So you won’t be surprised to learn the Fundrise Flagship Real Estate Fund is a complete snoozefest.
0:30:00 The fund holds $1.1 billion worth of institutional-caliber real estate, managed by a team of pros focused on steadily growing your net worth for decades to come.
0:30:01 See?
0:30:02 Boring.
0:30:03 And that’s the point.
0:30:09 You can start investing in minutes and with as little as $10 by visiting Fundrise.com slash Prof G.
0:30:15 Carefully consider the investment objectives, risks, charges, and expenses of the Fundrise Flagship Fund before investing.
0:30:20 Find this information and more in the Funds Perspectives at Fundrise.com slash Flagship.
0:30:21 This is a paid ad.
0:30:27 Support for the show comes from Public.com.
0:30:28 All right.
0:30:31 And if you’re serious about investing, you need to know about Public.com.
0:30:33 That’s where you can invest in everything.
0:30:35 Stocks, options, bonds, and more.
0:30:43 They even offer some of the highest yields in the industry, including the bond account’s 6% or higher yield that remains locked in even if the Fed cuts rates.
0:30:46 With Public, you can get the tools you need to make informed investment decisions.
0:30:51 Their built-in AI tools called Alpha doesn’t just tell you if an asset is moving.
0:30:56 It tells you why the asset is moving so you can actually understand what’s driving your portfolio performance.
0:31:02 Public is a FINRA-registered, SIPC-insured, U.S.-based company with a customer support team that actually cares.
0:31:07 Bottom line, your investments deserve a platform that takes them as seriously as you do.
0:31:14 Fund your account in five minutes or less at Public.com slash PropG and get up to $10,000 when you transfer your old portfolio.
0:31:17 That’s Public.com slash PropG.
0:31:30 Paid for by Public Investing, all investing involves the risk of loss, including loss of principal, brokered services for U.S.-listed registered securities, options, and bonds, and a self-directed account are offered by Public Investing, Inc., member FINRA, and SIPC.
0:31:33 Complete disclosures available at Public.com slash disclosures.
0:31:37 I should also disclose I am an investor in public.
0:31:49 President Trump on Truth Social has been suggesting that he’s open to deals to end the trade war that he started by levying tariffs on U.S. trading partners.
0:31:56 The administration says these Liberation Day tariffs will bring manufacturing jobs back to America.
0:31:58 Why is that so important?
0:32:01 There are some really dumb ways to answer that question.
0:32:05 When you sit behind a screen all day, it makes you a woman.
0:32:06 Studies have shown this.
0:32:07 Studies have shown this.
0:32:09 And some much smarter ones.
0:32:19 This is a policy at the end of the day that’s oriented toward helping some of the folks who have really been the losers in the economy and have been left behind for a long time.
0:32:21 Coming up on Today Explained, the best minds.
0:32:26 The White House advisor who’s gone ham on tariffs defends his position.
0:32:28 Weekday afternoons.
0:32:30 Today Explained helps you make sense of the mess.
0:32:46 We’re back with Profty Markets.
0:32:52 I’ll bring us back to what the tariffs mean for our actual economy going forward.
0:32:57 But I just want to stay on what happened in the stock market for a second.
0:33:08 Because I think what we saw when the markets ripped back up was Trump and the MAGA base basically bragging that this was a win, that this was a great deal.
0:33:11 Of course, that doesn’t make any sense.
0:33:21 I mean, he was literally gloating, oh, wow, we’ve had one of the greatest stock market rallies in history after he, of course, brought one of the greatest stock market crashes in history, too.
0:33:25 So, I think we can all agree that this was not really a win.
0:33:30 But I also want to emphasize what a loss this actually was for so many regular Americans.
0:33:38 You know, if you took our advice, your advice, which was to do nothing, then you were fine.
0:33:41 And you’re okay for now, generally speaking.
0:33:45 But the trouble is, not everyone listens to this podcast and not everyone listens to you.
0:33:52 And there were many people out there in America who actually did sell, who got super freaked out.
0:33:54 They saw the market was down 10%.
0:33:56 They thought it was going to keep sliding.
0:33:57 And they decided to liquidate.
0:34:08 And I would point you to a statistic, which is that April 7th, Monday of last week, was the fifth largest trading day for 401k assets in recorded history.
0:34:10 And you look at what happened.
0:34:12 What were people doing with their 401ks?
0:34:14 They sold their stocks.
0:34:24 And the money, they either kept it in cash or they moved it into more, quote-unquote, stable assets like bond funds and money market funds.
0:34:27 And you look at what’s happening to those assets, T-bills and notes.
0:34:29 Those assets are going down, too.
0:34:33 But the reality is that, you know, these are the stories you don’t hear.
0:34:44 You don’t hear about the guy in Pittsburgh or Gary, Indiana, who only has so much in his 401k and his retirement account, who actually sold at the bottom.
0:34:47 And hundreds of thousands of Americans did this.
0:34:49 And they’re looking at their 401ks this week.
0:34:51 And they have to digest this now.
0:34:59 They have just registered not an unrealized loss, but a realized loss of 10% or more because they sold.
0:35:06 So I just want to point that out, too, that, you know, for many of us, it was just a wild week, right?
0:35:08 It went up and went down and went up and went down.
0:35:10 Looks like it’s coming down again.
0:35:13 And it looks like the long-term trend is down.
0:35:16 But for many people, this was a flat-out loss.
0:35:20 Just pure, unadulterated, down 10%.
0:35:26 And no amount of the 40-chest justification or the sycophantry is going to change that.
0:35:32 And I just want to point that out, you know, that a lot of people got really, really hurt last week.
0:35:46 Now, on investing trends in general, what we’re identifying here is a massive fuck-up from the administration who went ahead with this crazy tariff idea.
0:35:49 The bond market told them that was a bad idea.
0:35:51 And then they pulled it at the last minute.
0:36:17 We’ve been talking for a while about this global reorganization of the investment economy, where America has benefited from, generally speaking, massive inflows, perhaps unjustified, but at the very least justified by the fact that we had a stable government that was respected by investors around the world.
0:36:28 Our thesis has been that we might be witnessing a rotation away from that dynamic, which would massively upend global markets.
0:36:34 Given what happened with pulling the tariffs, what do you think that does to this dynamic?
0:36:36 What is happening now?
0:36:37 No one gets out of this alive.
0:36:43 I mean, there’ll be a few people who bought puts or something and show their picture on Reddit or whatever.
0:36:48 There’ll be a few, you know, a few, quote-unquote, speculators that win.
0:36:53 But 99 percent, I mean, there’s so many cohorts they’re going to lose here.
0:36:56 Let’s talk about people hoping to retire.
0:36:59 And they thought, wow, the markets have done great.
0:37:01 They thought, okay, I can retire.
0:37:03 Well, that’s maybe not as true now.
0:37:04 Families.
0:37:14 If these tariffs are anything resembling what they’re stating, the example I use is toys under the Christmas tree.
0:37:15 They’re just immediately going to fill it.
0:37:20 Young people, what do you think has happened to hiring in the last week?
0:37:25 I got to imagine so many people recruiting at colleges, high schools.
0:37:27 You finally get an interview that said, hey, we love you.
0:37:28 We want to bring you in.
0:37:31 But we’re putting everything on pause right now.
0:37:35 Microsoft just announced, was scrapped a $1 billion data center project in Ohio.
0:37:43 Stellantis paused production in Canada and Mexico, leading to 900 layoffs at U.S. plans in Michigan and Indiana.
0:37:51 I got to think there are so many interviews and recruiting plans that have been paused.
0:37:55 And typically, paused means they’re not happening because they don’t double up.
0:38:04 If they canceled our recruiting for two, three months, they then don’t double their recruiting the following two or three months.
0:38:07 My brother-in-law is at business school right now.
0:38:08 He went into class last week.
0:38:10 The professor came into the class.
0:38:13 He said, I just want to apologize to everyone.
0:38:14 They said, what for?
0:38:16 He said, I don’t think any of you guys are going to get jobs next year.
0:38:18 So this is already happening.
0:38:25 Well, the double whammy of companies trying to figure out if AI replaces a lot of these kind of high-end information workers with total uncertainty.
0:38:28 It’s like Eisenhower said, the bad decision is wrong.
0:38:30 No decision is worse.
0:38:32 And I love the term.
0:38:38 We have been thrust into this dynamic of the U.S. is now, the U.S. brand is now toxic uncertainty.
0:38:49 We would have been much better off if he had said, 10% tariffs across the board or whatever it is, and you just stuck to it.
0:38:51 The back and forth, the what?
0:38:54 You dare threaten me, fine, sir.
0:38:56 Your tariff is now 125%.
0:38:58 Or, oh, I like you.
0:39:00 I just had lunch with you in Mar-a-Lago.
0:39:04 I mean, nobody knows how to plan their business.
0:39:06 So when you don’t know what to do, what do you do?
0:39:07 You do nothing.
0:39:08 You don’t hire people.
0:39:10 You press the pause button.
0:39:14 And the pause button is essentially, it’s a light no.
0:39:23 But it’s still a no because the number of people who need jobs, the number of people who have rent doesn’t go on pause.
0:39:30 Your landlord doesn’t say, well, I’m pausing rent because I know you had a bunch of interviews lined up and you don’t have them now.
0:39:31 So I’m pausing.
0:39:32 That doesn’t happen.
0:39:35 Your expenses continue to roll on.
0:39:49 So whether it’s people looking to retire, whether it’s people just out of college looking for a job, whether it’s families, whether, can you imagine how many corporations probably correctly are going to say, we’re freezing all new hires.
0:39:51 And quite frankly, we’re freezing salaries.
0:39:52 There’s no bonuses.
0:40:00 Who’s going to say, oh, all this uncertainty is bad, but we see an opportunity in all this and we’re going to hire faster.
0:40:01 I haven’t heard any company say that.
0:40:07 Think about how many foreign companies were planning to build plants here.
0:40:09 And there’s a ton of them.
0:40:13 They want to build production over here who have all of a sudden said, let’s just press pause.
0:40:14 We don’t know what’s going on.
0:40:20 Or I’m on the board of a company that was thinking about relocating or opening a second headquarters in New York.
0:40:34 And they’re worried that in the second layer of mendaciousness, they’re like, we’re not sure if we don’t know the state of immigration and we don’t know if we’re going to be able to staff it with some of our folks from here.
0:40:37 So we’re just doing nothing right now.
0:40:39 The IPO market is dead.
0:40:41 Nobody wants to go public right now.
0:40:49 This is across every point of the economy, literally across every income class from CEOs.
0:40:56 They’re going to see their pay go down to the worker at making minimum wage, to the college grad, to the family.
0:40:58 Everybody gets hit here.
0:40:59 Everybody.
0:41:04 And as we’ve always said, few more elegant ways to hurt everybody than tariffs.
0:41:13 Just some examples of companies that are on hold or pausing or freezing, however we want to call it.
0:41:20 The reality is they’re no longer producing output or contributing to our economy like they used to.
0:41:29 So you mentioned that Microsoft, they are now pulling back from AI spending, which, of course, Trump was, you know, on the podium.
0:41:35 Gloating about what a tremendous chip investment the U.S. is going to make.
0:41:38 So Microsoft, which is going to be the biggest spender, they’re now pulling back.
0:41:40 Audi halting shipments to the U.S.
0:41:45 They also froze 37,000 vehicles that were waiting at ports across America.
0:41:50 Amazon canceling their vendor orders across Asia with no explanation.
0:41:52 This is reported by Bloomberg.
0:41:56 Roughly half a million dollars worth of goods were frozen.
0:42:07 And this is a signal, not that Amazon will be paying the tariffs as we expected, or as hopefully, as I assume Trump expected, but they’re just going to halt their production entirely from China.
0:42:14 So we’re going to see a lower supply of goods in America, which, you know, Econ 101 means we’re going to see higher prices.
0:42:15 Hollywood.
0:42:17 This is going to massively affect Hollywood.
0:42:18 China is reducing.
0:42:21 They’ve said they’re going to reduce their imports of American films.
0:42:27 Last year, American films grossed $585 million in China alone.
0:42:35 In other words, you know, all of this nonsense is happening in the stock market, and we’re all getting flustered about it, and rightly so.
0:42:39 But meanwhile, the real economy is grinding to a halt.
0:42:41 We’re already seeing layoffs.
0:42:43 We’re seeing order cancellations.
0:42:44 We’re seeing price increases.
0:42:51 Walmart just said that we should be bracing for price volatility, and that’s Latin for price increases.
0:42:59 So, you know, beyond Trump, beyond politics, we’re seeing massive effects play out in the real economy right now.
0:43:05 And so, Scott, what do you think we as regular people can expect?
0:43:11 And is there anything we can do to sort of brace ourselves for this change?
0:43:16 I do think it’s powerful when you call your local representative, and it sounds, you know, I’m going to write me a letter.
0:43:23 But I do think your representative in Congress does listen, and they track very closely the calls they get.
0:43:32 So I do think if you think that these policies don’t make sense, I think reaching out to your – I mean, my representative is Lois Frankel.
0:43:33 She’s a Democrat.
0:43:37 I’m pretty sure she’s, you know, on board with how I feel.
0:43:52 But if you haven’t heard or, you know, if you wonder if your representative has not been vocal enough or is still trying to, you know, bend the knee and bow to dear leader, at some point the dam needs to burst.
0:44:00 And the person riding shotgun, the Republican Party that’s in control here, needs to say, hey, you know, you’re drunk.
0:44:02 Pull over.
0:44:04 Stop driving the car this way.
0:44:08 Somebody has got to get a sanity check here.
0:44:14 So – and then in terms of your own personal behavior, I think that – I mean, there’s a couple things to remember.
0:44:21 Recognize that this is important, but it’s not profound.
0:44:27 And what I try to tell myself – I went to the doctor yesterday and my blood pressure had been so good.
0:44:28 It’s so weird, Ed.
0:44:30 I used to be so – I used to love getting my physical.
0:44:34 And I think I told you for the first time I had high blood pressure and it just freaked me out.
0:44:39 So I took my drinks down from 12 to 16 a week till 11 to 12.
0:44:42 But I’m trying to manage my blood pressure.
0:44:46 And then this week I go back in and it’s totally fucking spiked.
0:44:49 That’s mostly because I’m back in New York and Daddy loves to go deep in the paint.
0:44:55 But I read something – I’ve been reading a lot of Buddhism recently because I find it fascinating.
0:44:56 And there’s so many interesting things in there.
0:44:58 And I read this one line that really struck out of me.
0:45:03 And it said, when you’re healthy, you have thousands of problems.
0:45:06 When you’re not healthy, you have one problem.
0:45:17 And what I would say is to anyone out there that feels emotionally strapped or like this is really taking a mental health because they look at their phone 15 times a day or they’re losing money or they’re worried about their job.
0:45:19 Are you healthy?
0:45:25 If you’re healthy, you got, you know, 49% of everything, 51% of everything.
0:45:30 Do the people in your life who love you and that you love, do they still love you and do you still love them?
0:45:32 Then you’re riding it about 90%.
0:45:37 And again, I go back to the same thing that life isn’t about what happens to you.
0:45:39 It’s about how you respond to what happens to you.
0:45:44 And we’re probably going to look back on this over the medium and the long term.
0:45:47 And this is really rough for people trying to retire because they don’t have time to make more money.
0:45:55 But over the medium and the long term, the markets tend to be up and to the right, especially if you diversify across asset classes and what we’ve been saying across geographies.
0:46:03 You’re going to look back and you’re probably, probably 95% of us are going to think, I wish I hadn’t reacted so emotionally.
0:46:07 Very few of us are going to say, I underreacted, right?
0:46:15 Because you have the media and you have algorithms all trying to say this is, quote unquote, economic.
0:46:17 Somebody described it as economic Armageddon.
0:46:19 I’m like, no, it’s not.
0:46:23 I remember my second week at Morgan Stanley in 1987.
0:46:28 The Dow went from like 1,400 to 900 in one day.
0:46:33 That would be, you know, that would be like we wake up tomorrow and the Dow’s at 28,000.
0:46:43 I mean, I feel like your generation doesn’t really know what war is like, what combat is like when we get a real speed bump.
0:46:49 Just to interrupt, because you look at the numbers and the swings that we’ve had, they are at that level.
0:46:54 They do rival the largest crashes and crises we ever seen.
0:46:56 Not on a percentage basis.
0:46:57 On a percentage basis, yes.
0:47:00 Well, over a three-day period, right?
0:47:00 Sure.
0:47:02 But here’s the reality.
0:47:04 It hasn’t even taken us back a year yet.
0:47:08 Okay, so we’ve lost, I think as we see here today, we’ve lost seven months of gains.
0:47:17 You know, the 2008 Great Financial Recession at the lows took us back, I think it took us back several years.
0:47:27 And the question I think everyone is wondering, and by the way, I’m not disagreeing with your point here, but the question is, are we reaching that point?
0:47:31 Are we, is it possible that the stock market will continue to slide?
0:47:38 Do we have a 2008 or maybe a 2000 type event on the horizon here?
0:47:48 And I’m with you that we don’t have enough data to make that call yet, and we don’t really have the right to start panicking and saying that the sky is falling.
0:47:52 But are you saying it’s just not on the table?
0:47:53 Of course it is.
0:47:54 But it always is.
0:47:55 But it’s impossible to know.
0:47:58 And again, I go back to the same level of advice.
0:47:59 What do you do?
0:48:02 You do, in my view, you do nothing.
0:48:07 And because we said on Monday the markets could go up 2,000 points, and they did.
0:48:09 And today they’re down 1,000 points.
0:48:22 What you can do, though, is if you do decide to sell and diversify, the good news is that you’re not selling at a low here and buying in at a high.
0:48:24 All markets are down right now.
0:48:37 So to a certain extent, it’s a bit of a free trade around diversification right now because the majority of markets have also taken a hit because see above, the definition of being stupid is hurting yourself by hurting others, and we’ve done both.
0:48:40 So the markets have gone down here, but guess what?
0:48:42 They’ve gone down pretty much everywhere else too.
0:48:52 So you get to arb into diversification here kind of almost cost-free after you’ve figured out the tax implications.
0:49:06 But you get a bit of a freebie here in terms of diversifying, and that is investors tend to be a little bit rear-view mirror-looking, and that is, oh, the markets are down here, so I’m going to go into this other better market, and the better market has already gone up.
0:49:07 That’s not the case here.
0:49:10 Almost everyone has been hit pretty hard.
0:49:26 So I’m all about not to keep calm and carry on, but I do think diversification across geographies is something everyone should be thinking about because I believe that over the next 10 years, there’s a real non-zero probability that the return in the S&P in the U.S. market is zero.
0:49:28 We’ll be right back.
0:49:33 If you’re enjoying the show so far, hit follow and leave us a review on the Prof G Markets feed.
0:49:45 For as long as I can remember, bread has given me hiccups.
0:49:49 I always get the hiccups when I eat baby carrots.
0:49:54 Sometimes when I am washing my left ear, just my left ear, I hiccup.
0:49:58 And my tried and true hiccup here is…
0:50:05 Pour a glass of water, light a match, put the match out in the water, drink the water, throw away the match.
0:50:10 Put your elbows out, point two fingers together, and sort of stare at the point between the fingers.
0:50:13 It doesn’t work if you bring your elbows down, but it works.
0:50:16 Just eat a spoonful of peanut butter.
0:50:17 Think of a green rabbit.
0:50:21 I taught myself to burp on commands, like…
0:50:24 Excuse me.
0:50:29 And I discovered that when I make myself burp, it stops my hiccups.
0:50:34 Unexplainable is taking on hiccups.
0:50:38 What causes them, and is there any kind of scientific cure?
0:50:41 Follow Unexplainable for new episodes every Wednesday.
0:50:51 The regular season is in the rear view, and now it’s time for the games that matter the most.
0:50:54 This is Kenny Beecham, and playoff basketball is finally here.
0:50:58 On Small Ball, we’re diving deep into every series, every crunch time finish,
0:51:02 every coaching adjustment that can make or break a championship run.
0:51:04 Who’s building for a 16-win marathon?
0:51:06 Which superstar will submit their legacy?
0:51:10 And which role player is about to become a household name?
0:51:15 With so many fascinating first-round matchups, will the West be the bloodbath we anticipate?
0:51:17 Will the East be as predictable as we think?
0:51:19 Can the Celtics defend their title?
0:51:23 Can Steph Curry, LeBron James, Kawhi Leonard push the young teams at the top?
0:51:28 I’ll be bringing the expertise to pass in the genuine opinion you need for the most exciting time of the NBA calendar.
0:51:32 Small Ball is your essential companion for the NBA postseason.
0:51:36 Join me, Kenny Beecham, for new episodes of Small Ball throughout the playoffs.
0:51:38 Don’t miss Small Ball with Kenny Beecham.
0:51:43 New episodes dropping through the playoffs, available on YouTube and wherever you get your podcasts.
0:51:53 It really seems like tariffs are about to make just about everything more expensive.
0:52:01 And so this week on The Vergecast, we’re trying to figure out not only which gadgets do you need to buy right now before they get more expensive,
0:52:15 but also what can tech companies big and small do to cope in complicated, uncertain times when it seems like nothing makes sense and the money changes every day and all they want to do is ship gadgets.
0:52:20 The future of gadgets in a tariff world all this week on The Vergecast, wherever you get podcasts.
0:52:30 We’re back with Prof. G Markets.
0:52:35 I think you look at what has happened over the past 10, 20 years.
0:52:49 The reason that we’ve had all this capital entering the U.S. markets is because it was sort of the only place where you could get these really strong returns and you had a guarantee of relatively low risk compared to other nations.
0:53:00 And when you say that the U.S. has sort of given up its edge, I think what’s really happened is the U.S. has given up its edge in terms of a relatively risk-free investment.
0:53:06 There is now all of this associated risk attached to America that didn’t exist before.
0:53:09 And this is the kind of thing that affects the Chinese markets.
0:53:18 I mean, those Chinese companies that we talk about, they do very well, but the multiple is contracted because of this government risk that everyone prices in.
0:53:21 And now we’re seeing a reversal of that trend.
0:53:33 And, you know, if you go into Europe, I think a lot of investors are thinking, I can get, you know, relatively similar returns at lower risk, but also it’s very cheap right now.
0:53:41 You just look at the multiples compared to the U.S., the entire European stock market on a price-to-earnings basis is cheaper.
0:53:53 So I think what we’re saying, I mean, we have been saying do nothing, which I think is the right call on a weekly basis, just given the volatility we saw last week.
0:53:57 But when else would we rotate out than now?
0:53:59 I mean, isn’t it the time?
0:54:00 I think that’s a fair point.
0:54:04 What I would suggest is the following is that it is very hard to read the label from inside of the bottle.
0:54:07 You want to talk to a tax advisor.
0:54:12 You want to – and also this sounds superfluous or – you want to talk to your partner.
0:54:14 You want to get alignment with your partner.
0:54:20 Hey, this is what’s going on in the market because what you don’t want to do is tell your partner in six months, you made a decision, got unlucky.
0:54:23 You want alignment, financial alignment with your partner.
0:54:24 I don’t know if you’ve been watching.
0:54:24 It’s really volatile.
0:54:26 I’m thinking diversifying in other companies.
0:54:28 You definitely want to talk to a tax advisor.
0:54:37 Because if you sell a stock that has huge gains or whatever, you have a taxable event, it might be an unwelcome thing you didn’t see.
0:54:43 And if you talk to a tax advisor, you might have said, well, you should have sold stuff where we could harvest the losses or whatever it might be.
0:54:47 Or there might be an investment vehicle where you can do tax-free exchange, whatever it might be.
0:54:53 Unfortunately, the code, the tax code has been weaponized by the wealthy who can afford tax advisors.
0:54:54 You really want to be thoughtful for tax.
0:54:55 You want to speak to people.
0:54:58 You want to do a little bit of research.
0:55:00 You don’t – you want to make informed trades.
0:55:05 But to your point, right now, it’s not a bad idea in my view.
0:55:07 And this is what I’m doing.
0:55:10 I am diversifying out of the U.S.
0:55:14 And I’m trying to be thoughtful about stocks or about taxes.
0:55:16 I’m trying to be thoughtful around which regions I go into.
0:55:26 But China – for every – if a company in China does a billion in revenues and is growing 10 percent, it trades at – or 5 percent growth, it trades at 14 billion.
0:55:30 The same exact company in the U.S. right now trades at 25 or 26 billion.
0:55:32 I think that’s going to normalize.
0:55:38 I think it’s much more likely that China goes to 20 than the U.S. goes to 35.
0:55:47 And I think there’s a much greater risk that the U.S. goes below 20 than China goes below 10.
0:55:51 And we have had an incredible run.
0:56:01 If you live in America and you’ve participated in any way in the markets by virtue of the job you have, the house you have, the stocks you have, you’ve done well.
0:56:11 So the idea of taking a little bit off the table and diversifying right now, it’s a free diversification arbitrage because everything’s gotten the shit kicked out of it the last week.
0:56:13 That is not a bad idea.
0:56:15 And if you want to do it over the next week, I get it.
0:56:20 I’ve been doing it over the last three months because I want to be thoughtful and measured about it.
0:56:23 And my sense is the markets are now moving a bit in unison.
0:56:25 They will disassociate from one another once things settle down.
0:56:32 But to your point, for your own mental health, what you want to do is adopt a military decision-making strategy.
0:56:36 And that is when they look at the results of a military operation, they don’t look at the outcomes.
0:56:45 They look at the information the officer had at that moment and did he or she make the best decision possible based on the information at the time.
0:56:47 And this is what you want to do.
0:56:49 You want to speak to people.
0:56:51 You want to go to a robo-advisor.
0:56:52 There’s so much good information online.
0:56:59 You want to talk to friends, be open about money, and get alignment with your partner such that you could look back.
0:57:07 And even if things don’t pan out as well as I think they will if you diversify or you do, you made the right decision at the time.
0:57:13 That’s how – because what people don’t realize is there’s returns, there’s financial returns, and there’s mental health returns.
0:57:17 I really did have this suspicion that the markets were going to puke.
0:57:22 And I thought a couple times about going deep and really shorting the market aggressively.
0:57:23 And I didn’t do it.
0:57:24 And I would have made a lot of money.
0:57:25 But here’s the thing.
0:57:28 I’m really diversified right now.
0:57:30 And that’s been the right decision.
0:57:36 So I haven’t gone aggressively at anyone’s strategy because I’ve decided at this age I’m not looking to get rich.
0:57:37 I’m looking to not get poor.
0:57:44 And if I talk to enough smart people, which I do, they would say, Scott, you need to just be wildly fucking diversified.
0:57:48 Even if you leave some upside on the table, you need to be wildly diversified.
0:57:50 You can take some big swings right now.
0:57:53 And I’m not suggesting you do that, but you can take bigger swings than me.
0:58:02 And by virtue of the fact you’re young, you’re probably going to have to be overly concentrated in a house at some point or overly concentrated in terms of your wealth and your job, whatever it might be.
0:58:05 But you have another 40 years to make money.
0:58:14 If you’re a little bit older and you have some assets, I absolutely think that the D word should be on your mind all day long.
0:58:15 And that is diversification.
0:58:16 Yes.
0:58:22 And I also want to emphasize something you point out there, which is that this has been a months-long venture for you.
0:58:26 It wasn’t that you woke up one day and you decided, OK, I’m rotating out.
0:58:35 This has been something you’ve been doing over the course of several months, which makes sense because the entire bet that we’re describing here
0:58:37 is a bet based on capital flows.
0:58:45 We’re not betting that some massive crisis event is going to trigger a reversal that’s going to happen within a day.
0:58:56 We’re describing a bet that involves large institutions and large investors gently and gradually re-steering their investment into a different locale.
0:59:00 And that is something that we’re going to see play out over, let’s face it, years.
0:59:08 So if you’re going to make this play, I think what you want to do is what Scott is describing here, which is drag it out.
0:59:10 You don’t have to do it all in one go.
0:59:12 You can make it a months-long play.
0:59:20 You could even make it a years-long play because the bet is that those returns are going to come not within a day, but within several years.
0:59:23 Let’s take a look at the week ahead.
0:59:34 We’ll see earnings from Goldman Sachs, Johnson & Johnson, Bank of America, U.S. Bank, TSMC, UnitedHealth, and Netflix, i.e. earnings season, has begun.
0:59:35 Scott, any predictions?
0:59:37 Yeah, a few, which means three, Ed.
0:59:43 One, Trump is going to blink.
0:59:46 This guy plays the worst poker in the world.
0:59:50 He’s literally like a guy at a poker table who starts convulsing if he has a good hand.
0:59:53 I mean, he just, he is the worst poker player in the world.
1:00:00 And the President Xi looks at President Trump the way Logan Roy in succession looked at his kids and said the following,
1:00:02 you are not serious people.
1:00:07 The fact that we’re going to stare down China is just fucking ridiculous at this point,
1:00:11 given our lack of credibility, given our lack of willingness to endure pain.
1:00:15 Apple is not going to see any tariffs.
1:00:22 I can’t imagine the riots if all of a sudden, you know, Gen Z has to pay $3,500 for their iPhone.
1:00:28 Thousands of you will decide to run for office and say, make America iPhone great again.
1:00:34 Anyways, Tim Cook is the CEO that, or the business person that Donald Trump thinks he is.
1:00:42 And you’re just, you’re just going to, he’s going to figure out a way to give an exemption to all Apple products.
1:00:49 And I also think, generally speaking, we’re going to look at, we’re going to be closer to normal in six months.
1:00:51 We’re going to be back to the future.
1:00:58 This tariff situation is going to look almost identical to what it was before we started this mess.
1:01:08 The only difference is the U.S. brand will now have a strong association of toxic indecision or toxic uncertainty.
1:01:14 And we’re going to see a pretty serious clip in that multiple contraction, which will take everything down.
1:01:30 This is going to be a round trip where on the way home, we realized we have just been through hell and back for fucking nothing, for nothing, except a loss of reputation and a serious downgrade in the prosperity and wealth of Americans.
1:01:35 This episode was produced by Claire Miller and engineered by Benjamin Spencer.
1:01:37 Our associate producer is Alison Weiss.
1:01:39 Mia Silverio is our research lead.
1:01:41 Isabella Kinsel is our research associate.
1:01:42 Dan Shallan is our intern.
1:01:44 Drew Burrows is our technical director.
1:01:47 And Catherine Dillon is our executive producer.
1:01:50 Thank you for listening to Prof G Markets from the Vox Media Podcast Network.
1:01:53 Join us on Thursday on Prof G Markets.
1:02:15 Thank you for listening to Prof G Markets from the Vox Media Podcast Network.
1:02:17 Thank you for listening to Prof G Markets.
1:02:22 Thank you for listening to Prof G Markets.
1:02:23 Thank you for listening to Prof G Markets.
1:02:23 Thank you for listening to Prof G Markets.
1:02:26 In love, love, love, love, love, love.

0:00:04 There’s over 500,000 small businesses in B.C. and no two are alike.
0:00:05 I’m a carpenter.
0:00:06 I’m a graphic designer.
0:00:08 I sell dog socks online.
0:00:12 That’s why BCAA created One Size Doesn’t Fit All insurance.
0:00:15 It’s customizable based on your unique needs.
0:00:18 So whether you manage rental properties or paint pet portraits,
0:00:23 you can protect your small business with B.C.’s most trusted insurance brand.
0:00:28 Visit bcaa.com slash smallbusiness and use promo code radio to receive $50 off.
0:00:29 Conditions apply.
0:00:38 Buying a house has long been considered the best way to build wealth and move into true adulting.
0:00:38 Isn’t it?
0:00:41 I mean, at least that’s what society wants us to think.
0:00:44 Got to get a Birkin, got to get a home, you know.
0:00:48 Okay, the handbag you can probably manage without.
0:00:50 But what about a house?
0:00:54 Surely that’s actually good, right?
0:00:58 We’re going to find out this week on Explain It To Me.
0:01:02 New episodes every Sunday morning, wherever you get your podcasts.
0:01:16 No judge decides a case based on the temperature of the day.
0:01:21 Every judge, however, is aware of the climate of the season.
0:01:22 I’m Preet Bharara.
0:01:26 And this week on Stay Tuned, I’m joined by Justice Stephen Breyer.
0:01:30 We get into how judges make sense of the law in a politically charged time
0:01:34 and what that says about the values and pressures shaping today’s Supreme Court.
0:01:36 The episode is out now.
0:01:40 Search and follow Stay Tuned with Preet wherever you get your podcasts.
0:01:45 I’m Scott Galloway, and this is No Mercy, No Malice.
0:01:49 Trump’s tariffs are wreaking havoc around the world.
0:01:53 But the real damage is here at home.
0:02:12 Countries have long used tariffs to protect strategic industries or counter unfair trade practices.
0:02:16 In some cases, targeted tariffs are justified.
0:02:22 In his first term, Donald Trump imposed levies on hundreds of billions of dollars of Chinese goods,
0:02:25 tariffs that Joe Biden largely retained.
0:02:32 But blanket tariffs of the scale we are now seeing are what leeches are to medicine.
0:02:36 An outdated strategy that doesn’t work.
0:02:43 With his Liberation Day tariffs, Trump has threatened to blow up the global economic order
0:02:45 and spread pain around the world.
0:02:49 From China to the Pacific Island nation of Nauru.
0:02:56 But when the shitstorm subsides, America will emerge from the wreckage with the most serious wounds.
0:03:02 Erecting a protectionist trade wall around the U.S. is a brilliant idea
0:03:07 if your goal is to elegantly reduce American prosperity.
0:03:14 The markets ripped higher Wednesday when Trump postponed tariffs on dozens of nations, except China,
0:03:18 pulling the knife halfway out of the back of the U.S. economy.
0:03:22 Then tumbled again the next day.
0:03:25 Treasury Secretary Scott Bessent told reporters,
0:03:27 I don’t see anything unusual.
0:03:29 Investors disagree.
0:03:33 They realize these injuries will take years to heal.
0:03:38 Brand America now stands for toxic uncertainty.
0:03:46 Extreme tariffs, if sustained, will immolate decades of economic integration,
0:03:51 bringing an end to an era of globalization that’s created unprecedented wealth for the U.S.
0:03:56 They’ll raise prices and decrease demand for American products abroad,
0:04:01 curbing economic growth and destroying shareholder value.
0:04:05 The revenue raised will be dwarfed by the losses.
0:04:13 Like Britain’s vote to leave the European Union in 2016, dubbed Independence Day by Nigel Farage and other Brexit dullards,
0:04:19 Trump’s tariffs will go down as one of the biggest own goals in history.
0:04:25 But this is Farage on steroids, and the fallout will be much wider.
0:04:29 It’s impossible to foresee exactly how this will play out.
0:04:35 Before I sign off, Trump’s sclerotic policies will undoubtedly have lurched again.
0:04:37 See above, toxic uncertainty.
0:04:45 But what’s clear is that Trump’s trade war will thrust America’s allies into the arms of its adversaries.
0:04:48 To quote Winston Churchill, quote,
0:04:53 There is only one thing worse than fighting with allies, and that is fighting without them.
0:04:54 Unquote.
0:04:59 We’ve moved to the worse part of the equation.
0:05:05 One country is playing the long game, however, and positioning itself to exploit America’s self-harm.
0:05:07 China.
0:05:18 When I first moved to New York, I started boxing with a trainer who convinced me that I had a gift I was paying him,
0:05:20 and talked me into entering a tournament.
0:05:23 I was dumb enough to do it.
0:05:27 I remember the bell and the bright lights as I lay flat on my back.
0:05:31 More than two decades later, my nose still veers to the right.
0:05:37 It turns out a 23-year-old 5’8 guy who knows how to box and weighs 190 pounds
0:05:42 is a reasonable facsimile of Mike Tyson when matched up against a 38-year-old professor.
0:05:45 My rookie strategic mistake?
0:05:48 Assuming your adversary won’t hit back.
0:05:56 After Trump detonated his tariff bomb in that now infamous Rose Garden ceremony,
0:05:59 China responded swiftly and aggressively,
0:06:04 declaring it would match the president’s taxes with its own levies on imports from the U.S.
0:06:11 Although Trump later said he’d pause reciprocal tariffs for most countries for 90 days,
0:06:22 he raised tariffs on China’s exports to 145% in a desperate cry for some sort of big, i.e. small dick relevance.
0:06:26 China has vowed to fight to the end.
0:06:27 The difference?
0:06:30 Xi means what he says.
0:06:32 Trump is the other guy.
0:06:37 While a trade war will likely hurt China more, that misses the key point.
0:06:41 China is willing to endure more pain.
0:06:45 Remember, we left Vietnam after losing 58,000 men,
0:06:49 compared with more than 1 million for the North Vietnamese and Viet Cong.
0:06:52 I love the U.S.,
0:06:57 but the notion that Americans are going to tolerate 50% fewer toys under the Christmas tree
0:07:01 and $3,500 iPhones is laughable.
0:07:09 Amid the chaos, Europe is pitching itself as reliable, predictable, and open for fair business.
0:07:14 The EU has signed trade deals with Mexico, Chile, and Mercosur,
0:07:18 a South American bloc that includes Brazil and Argentina,
0:07:22 and aims to finalize a pact with India by the end of the year.
0:07:27 As the markets melted down and the president’s acolytes took to CNBC
0:07:31 to make excuses for giving the wheel of the world’s largest economy to a madman,
0:07:35 European Commission President Ursula von der Leyen
0:07:39 visited Central Asia to seal a new strategic partnership.
0:07:45 Among the countermeasures Europe is considering, if talks with Trump fail,
0:07:50 are imposing tougher regulation on American big tech and taxing digital services.
0:07:53 And there’s the insult to the injury.
0:07:56 European companies, such as Mercedes,
0:08:02 lose revenue that trades at a price-to-sales ratio of about 0.3,
0:08:04 while U.S. companies, such as Meta,
0:08:09 lose revenue that registers at a price-to-sales ratio of 8.
0:08:12 This is not apples for apples,
0:08:14 but apples to aircraft carriers.
0:08:18 And we are on the wrong side of the trade.
0:08:22 Trump could also thrust Europe into the arms of China.
0:08:26 The two sides agreed to restart negotiations
0:08:30 after the EU hit Chinese-made EVs with greater tariffs last year,
0:08:33 with Europe willing to take a fresh look at pricing.
0:08:38 China, the world’s second-largest economy,
0:08:43 is holding its first economic dialogue with South Korea and Japan in five years
0:08:46 and carrying out a broader charm offensive
0:08:49 aimed at redirecting exports away from the U.S.
0:08:53 China is touting itself as a global trade champion,
0:08:56 minus the toxic uncertainty.
0:08:59 In a meeting with Spain’s prime minister today,
0:09:03 Xi Jinping called for closer collaboration with the EU
0:09:07 to defend economic globalization and resist Trump.
0:09:13 Regardless of how skillfully America’s trading partners react,
0:09:17 Trump’s tariffs will inflict significant global damage.
0:09:21 Tariffs on European exports could reverse any gains
0:09:25 from Germany’s planned defense and infrastructure spending,
0:09:30 while also hitting Italy, Ireland, and other countries especially hard.
0:09:34 At the same time, China is coping with Trump’s measures
0:09:37 at a time when it’s trying to attract foreign investment
0:09:40 to tackle anemic growth and deflationary pressure.
0:09:45 Even governments in Africa that Trump has contemptuously dismissed
0:09:49 as shithole countries find themselves in his crosshairs.
0:09:54 In addition to sending shockwaves around the world,
0:09:57 the tariffs will lead to carnage at home.
0:10:01 Trump believes that taking the effective U.S. tariff rate
0:10:06 to levels we haven’t seen in a century will spark an American manufacturing renaissance,
0:10:09 make the country more self-reliant,
0:10:13 and correct decades of unfair trade imbalances.
0:10:17 In pursuit of this fever dream that will never turn to reality,
0:10:20 we’ve decided to fight a war on every front.
0:10:24 Each nation will see products imported from the U.S.
0:10:28 rise in cost as they respond with their own tariffs.
0:10:33 However, the U.S. will see an increase in the cost of all imports
0:10:35 as we take on the world.
0:10:40 If you know the 1930s Smoot-Hawley Tariff Act,
0:10:43 it’s likely you’ll recall the scene from Ferris Bueller’s Day Off,
0:10:46 the 1986 Matthew Broderick movie.
0:10:50 A tariff bill, the Hawley-Smoot Tariff Act,
0:10:56 which anyone raised or lowered, raised tariffs
0:10:59 in an effort to collect more revenue for the federal government.
0:11:01 Did it work?
0:11:02 Anyone?
0:11:03 Anyone know the effects?
0:11:05 It did not work,
0:11:08 and the United States sank deeper into the Great Depression.
0:11:09 Today…
0:11:10 Anyone?
0:11:11 Anyone?
0:11:18 Smoot-Hawley imposed sweeping tariffs on imported goods to protect American workers,
0:11:23 sparking a global trade war and deepening the Great Depression in the process.
0:11:28 U.S. tariffs under Trump will be even greater.
0:11:36 Commerce Secretary Howard Lutnick sees a future in which Apple’s iPhones are assembled in America,
0:11:38 eliminating what he called a Chinese, quote,
0:11:50 With Apple making most of its iPhones in China,
0:11:54 a trade war means the company will have to eat the costs
0:11:57 or raise prices and shift the pain to its customers.
0:12:02 A scenario that could drive the cost of a high-end iPhone
0:12:05 to as much as $2,300 from about $1,600
0:12:08 and slash Apple’s market cap.
0:12:13 Although the company has diversified production to other countries,
0:12:15 those nations, too, have been targeted.
0:12:17 And, sorry Howard,
0:12:20 Apple isn’t going to make iPhones in America.
0:12:24 If the company chose to relocate production to the U.S.,
0:12:28 they could cost an estimated $3,500.
0:12:33 Lutnick asked why iPhones can’t be made in the U.S. with robotics,
0:12:36 but he also seems to realize that automation
0:12:39 won’t fuel a sharp rise in manufacturing jobs.
0:12:45 The insanity of believing this time will inspire a better outcome
0:12:52 led to Apple shedding the value of Walmart in three trading days.
0:12:56 Even if America were to undergo a manufacturing revival,
0:12:58 it would take years to realize.
0:13:02 Intel estimates it takes three or four years
0:13:05 to complete construction of a semiconductor fabrication plant.
0:13:10 U.S. producers also import an array of items,
0:13:12 from car parts to electronic components,
0:13:16 relying on countries including Mexico, China, and Canada.
0:13:20 Trump’s tariffs ignore other important factors.
0:13:25 As the number of manufacturing jobs has plunged since the 1970s,
0:13:27 U.S. wealth has surged,
0:13:31 with the country relying increasingly on knowledge economy jobs
0:13:35 in areas ranging from software development to financial products.
0:13:38 America has made a conscious decision
0:13:40 to move to higher-end businesses
0:13:44 that pay better than traditional manufacturing roles.
0:13:46 To be sure,
0:13:48 industrial towns across the nation
0:13:50 have experienced painful declines,
0:13:53 and many Americans have been left behind.
0:13:55 But I don’t see young Americans
0:13:57 clamoring to work on an assembly line.
0:14:01 There are better ways to address America’s economic problems,
0:14:02 lift people out of poverty,
0:14:04 and tackle inequality.
0:14:08 One is to hike the federal minimum wage
0:14:10 to $25 an hour
0:14:13 from a pathetic $7.25,
0:14:15 as I’ve argued before.
0:14:19 There’s another reason this is idiotic.
0:14:23 America exports higher-margin products
0:14:25 and imports lower-margin ones.
0:14:28 Contrast NVIDIA,
0:14:31 which enjoys a 56% profit margin
0:14:33 selling highly valuable computer chips,
0:14:35 with Mercedes,
0:14:36 the German carmaker,
0:14:39 which expects a profit margin
0:14:41 of no more than 8% this year.
0:14:43 U.S. exports
0:14:46 also create much more market value.
0:14:48 Tesla recently traded
0:14:50 at more than 8 times revenue,
0:14:51 while Toyota
0:14:55 traded at less than 0.8 times revenue,
0:14:56 meaning the tariffs
0:14:59 will punish American companies more.
0:15:02 Before he’s even reached
0:15:03 the 100-day mark,
0:15:05 Trump has given lap dances
0:15:07 to a murderous dictator in Russia,
0:15:09 ambushed the democratically elected
0:15:11 leader of Ukraine at the White House,
0:15:13 sought to undermine the rule of law,
0:15:14 jeopardize the country’s position
0:15:16 as a global research leader,
0:15:18 and threatened to take over Greenland
0:15:19 and annex Canada.
0:15:21 Canada!
0:15:24 which hid Americans in Tehran
0:15:26 during the Iranian hostage crisis.
0:15:28 By isolating itself
0:15:31 and splintering its economic alliances,
0:15:33 America is on a dangerous course
0:15:35 that will weaken its economy
0:15:36 and imperil its dominance
0:15:38 on the global stage.
0:15:40 It’s as if Xi Jinping
0:15:41 and Vladimir Putin
0:15:43 are running the country,
0:15:44 not Trump and Vance.
0:15:47 White House officials said
0:15:49 the U.S. is considering offers
0:15:50 from 15 countries
0:15:51 and is close to trade deals
0:15:52 with some of them.
0:15:55 Does anyone believe that?
0:15:58 Regardless of how these talks unfold,
0:15:59 confidence in America
0:16:01 is rapidly eroding.
0:16:03 Rebuilding trust
0:16:04 and repairing the economic damage
0:16:06 will take many years.
0:16:10 The definition of stupid
0:16:11 is hurting others
0:16:12 while hurting yourself.
0:16:15 Let’s hope the Republicans
0:16:16 riding shotgun
0:16:17 will realize
0:16:18 the guy with his hand on the wheel
0:16:20 is blind drunk.
0:16:22 My prediction?
0:16:24 Within six months,
0:16:25 U.S. tariffs
0:16:27 will be largely the same
0:16:28 as when Trump decided
0:16:31 to make America 1890 again.
0:16:32 U.S. citizens
0:16:34 will opt for Netflix
0:16:35 and Novocaine
0:16:36 over outdoor plumbing
0:16:37 and child labor.
0:16:40 Xi will not back down.
0:16:41 With Trump,
0:16:43 he’s come to the same conclusion
0:16:45 as Succession’s Logan Roy
0:16:46 regarding his own kids.
0:16:49 You are not serious people.
0:16:51 Stupid.
0:16:54 Just fucking stupid.
0:16:59 We are less rich.
0:17:03 We are less rich.
0:17:03 We are less rich.
0:17:04 We are less rich.
0:17:04 We are less rich.

0:00:02 Support for Prop 3 comes from Viore.
0:00:04 Oh my God, true story.
0:00:08 I am wearing, totally coincidentally, guess what?
0:00:09 Viore shorts.
0:00:12 Viore’s high quality gym clothes are made to be versatile
0:00:14 and stand the test of time.
0:00:17 They sent me some to try out and here I am.
0:00:20 For our listeners, Viore is offering 20% off
0:00:21 your first purchase.
0:00:24 Plus, you have free shipping on any US orders
0:00:26 over $75 in free returns.
0:00:27 Get yourself some of the most comfortable
0:00:30 and versatile clothing on the planet.
0:00:31 Viore.com slash Prop G.
0:00:35 That’s V-U-O-R-I dot com slash Prop G.
0:00:37 Exclusions apply.
0:00:40 Visit the website for full terms and conditions.
0:00:47 There’s over 500,000 small businesses in BC
0:00:48 and no two are alike.
0:00:49 I’m a carpenter.
0:00:51 I’m a graphic designer.
0:00:52 I sell dog socks online.
0:00:56 That’s why BCAA created One Size Doesn’t Fit All Insurance.
0:00:59 It’s customizable based on your unique needs.
0:01:03 So whether you manage rental properties or paint pet portraits,
0:01:07 you can protect your small business with BC’s most trusted insurance brand.
0:01:13 Visit bcaa.com slash small business and use promo code radio to receive $50 off.
0:01:14 Conditions apply.
0:01:20 Buying a house has long been considered the best way to build wealth
0:01:22 and move into true adulting.
0:01:23 Isn’t it?
0:01:26 I mean, at least that’s what society wants us to think.
0:01:27 Got to get a Birkin.
0:01:28 Got to get a home.
0:01:28 You know.
0:01:29 Okay.
0:01:32 The handbag you can probably manage without.
0:01:34 But what about a house?
0:01:38 Surely that’s actually good, right?
0:01:42 We’re going to find out this week on Explain It To Me.
0:01:47 New episodes every Sunday morning, wherever you get your podcasts.
0:01:51 Episode 343.
0:01:54 343 is the area code serving Eastern Ontario, Canada.
0:01:57 In 1943, nachos were invented.
0:01:59 How do you get 12 babies into a bucket?
0:02:00 A blender.
0:02:02 How do you get them out?
0:02:04 Nachos.
0:02:07 Oh, why does that make me laugh?
0:02:08 Anyways.
0:02:11 Go, go, go!
0:02:21 Welcome to the 343rd episode of the Prop G Pod.
0:02:22 Okay, what’s happening?
0:02:24 I am back in New York.
0:02:26 The dog is back in the city.
0:02:27 He’s howling.
0:02:28 I’m going to…
0:02:28 Where am I going tonight?
0:02:31 Because my social life is obviously on your mind.
0:02:33 I’m going to Silicon…
0:02:33 What’s going on?
0:02:36 I keep thinking S.U.P., Silicon Valley Bank.
0:02:38 No, I’m not going to a bank that over leveraged
0:02:40 and almost took down the global economy.
0:02:42 I’m going to San Vicente Bungalows.
0:02:44 A total HQ of douchebaggery.
0:02:45 I used to go…
0:02:47 I went a couple times in L.A.
0:02:50 And they just opened here in New York.
0:02:51 They opened in the Jane Hotel.
0:02:53 And I think it’s going to be a great summer for them
0:02:54 because the Jane Hotel has…
0:02:58 The Jane Hotel has beautiful outdoor space.
0:02:59 At least they used to.
0:02:59 I haven’t been there yet.
0:03:00 Anyways, going tonight for the first time.
0:03:01 I’m very excited.
0:03:02 And it is crazy.
0:03:05 All of these private members clubs have opened.
0:03:06 Let’s go through each of them.
0:03:08 There’s Casa Cipriani downtown.
0:03:10 Now, let’s go with the original gangster.
0:03:11 Zero Bond.
0:03:13 Best crowd, I think, in New York.
0:03:14 My favorite because it’s in walking distance.
0:03:16 And I like the owner, Scott Sartiano.
0:03:18 And it’s just got a good vibe.
0:03:20 Very curated group of people.
0:03:21 Sort of, I don’t know.
0:03:25 Just, I think, kind of the original gangster after So House.
0:03:28 So House came in and said, we’re a Lexus.
0:03:30 Then they became a public company and said,
0:03:32 we’re going to go Toyota because we need to sell more.
0:03:34 We need to be more about volume than prestige.
0:03:40 And Scott saw an opening and got a beautiful space and created a very kind of curated group
0:03:42 and just, I think, just printed money.
0:03:44 And then a bunch of people who were probably members said,
0:03:51 I like the idea of owning one of these and backed restaurateurs or hospitality folks.
0:03:54 And they all, none of them obviously talked to each other.
0:03:58 Because if they’d all known about a dozen of them were going to come online in a 12-month period,
0:04:02 they wouldn’t have done it because they’re probably all going to put each other out of business
0:04:04 or at least substantially erode their margins.
0:04:06 Anyways, then Casa Cipriani opened.
0:04:12 Casa Cipriani is the, you know, it’s the Loro Piano or the Armani.
0:04:13 It’s a super rich kid.
0:04:15 I don’t know who’s funding that thing.
0:04:18 But they’ve spent tens if not hundreds of millions of dollars.
0:04:19 It’s in a weird location.
0:04:20 It’s downtown.
0:04:23 But you do feel, and by the way, I went there.
0:04:27 I had some drinks and some appetizers and a light meal.
0:04:28 And I was with some friends.
0:04:29 It was two or three of us.
0:04:31 And the check came and it was 700 bucks.
0:04:36 And I said, I asked the manager, I said, how can anyone afford this?
0:04:37 Because it’s all young people there.
0:04:39 And he said, well, one, none of the women are paying.
0:04:41 I’m sure that’ll trigger some people.
0:04:42 But he said, none of the women are paying.
0:04:45 And two, most of the young men here are not paying either.
0:04:46 And I’m like, how’s that?
0:04:47 And he said, they have their parents’ credit cards.
0:04:49 Supposedly, it’s a lot of trust fund kids from New Jersey.
0:04:51 Trust fund kids from New Jersey.
0:04:54 Now, that’s on the new season of Sopranos.
0:04:55 They’re not mobsters.
0:04:56 They’re trust fund kids.
0:04:57 Jesus.
0:04:58 That would be interesting.
0:04:59 Anyways, that’s Casa Cipriani.
0:05:02 And then the Crane Club opened.
0:05:05 The Crane Club was opened by the Tao Group.
0:05:08 The Tao Group, they’re sort of the nightclub guys that were really good business people that
0:05:10 actually made real money.
0:05:13 And they had, I think they opened, I think they were the guys behind Avenue.
0:05:18 And then they opened what became the highest grossing per square foot restaurant in the world,
0:05:19 Tao Las Vegas.
0:05:21 And they were bought by MSG.
0:05:23 These guys are smart.
0:05:24 They’re great operators that work really hard.
0:05:30 Jason and Noah, who I knew back like 25 years ago, if I tried to get into a cool party,
0:05:32 it’s like, does anyone know Jason or Noah?
0:05:33 Anyway, it’s good for them.
0:05:34 And they made real money.
0:05:36 And they opened something called the Crane Club.
0:05:39 That is, I don’t know how to describe it.
0:05:40 It’s sort of a mix of all of them.
0:05:43 I went there on Saturday night.
0:05:43 They had a DJ there.
0:05:45 When the DJ starts playing, I just don’t know.
0:05:46 It just sounds like a DJ.
0:05:51 It’s like, okay, I could just let me stream my iPod and I’ll save you some money.
0:05:57 But anyways, they’re the ones you would probably bet on long term because they’re such good operators.
0:06:03 The hot one, though, right now, the one of the moment is a place called Chez Margot,
0:06:06 which has sort of this French underground libertine.
0:06:07 I don’t know what the term is.
0:06:13 I don’t know the Louvre and opened an underground club with the cool nephew or something.
0:06:16 No windows, very European feel.
0:06:19 And that has, that is somehow, and it’s kind of exciting because they,
0:06:23 I don’t know if I would call them sort of, if people would have bet on it,
0:06:25 but that’s the hot one right now.
0:06:28 And then the new one is San Vicente Bungalows.
0:06:30 Supposedly, the Almond opened up in Midtown.
0:06:30 I haven’t been.
0:06:32 I’ve heard it’s just old men and their mistresses.
0:06:33 Is that too harsh?
0:06:34 Anyways, I haven’t been there.
0:06:35 Don’t know.
0:06:36 Jazz bar is supposed to be nice.
0:06:37 Anyways, I’m excited.
0:06:38 I’m doing that.
0:06:42 It’s a really interesting lesson in economics and competition
0:06:47 because you pay $5,000 to go essentially pay for a meal.
0:06:50 So it’s an outstanding business model when it works
0:06:53 because the shareholders can better plan.
0:06:57 And instead of trying to focus on all their money on marketing
0:06:58 to get people in the door,
0:07:01 they can focus on the relationship and do programming
0:07:04 because essentially the economics are the following.
0:07:09 They try and break even on the food and the beverage and the hotel,
0:07:12 and then the membership is just straight profit if it works well.
0:07:16 And because the membership is hopefully a recurring revenue model
0:07:17 that is more predictable,
0:07:21 these things get higher valuations than just a restaurant
0:07:22 and are more sustainable.
0:07:24 But the key is, and this is what’s so powerful,
0:07:26 but the membership model, the key is getting renewals.
0:07:27 And so what do you do?
0:07:28 You start investing in the relationship
0:07:31 as opposed to just trying to get more people in the door.
0:07:34 That’s why a retailer trades in one to two times revenues
0:07:38 and software companies that are recurring revenue pay at six to eight.
0:07:40 So it’s sort of the software of hospitality.
0:07:42 I just made that up and I’m really proud of myself.
0:07:43 That was good.
0:07:44 That was good.
0:07:46 And I didn’t even do any math this morning
0:07:48 and I came up with that all on my own.
0:07:50 The other part of the economics here though
0:07:52 is the dark side here.
0:07:55 And that is, I never invest in anything that sounds cool.
0:07:58 A friend of mine approached me about a member’s club two years ago.
0:08:00 It was going to be for artists and musicians.
0:08:01 And I said, it sounds great.
0:08:01 I’ll be a member.
0:08:04 But I don’t invest in anything that sounds really sexy
0:08:09 because there’s typically a disproportionate or overabundance of capital,
0:08:11 which means the return of that capital gets driven down.
0:08:13 I think that’s exactly what’s going on here.
0:08:17 And that is, there are just too many of these things opening up.
0:08:20 And I don’t know how many people are going to be able to afford $5,000
0:08:22 to go pay for dinner.
0:08:25 They are smart in the sense that they also price discriminate.
0:08:27 I think price discrimination is really interesting
0:08:30 because I think pricing is the most difficult thing in business.
0:08:31 It’s the thing I have struggled with most.
0:08:32 And that is,
0:08:39 William Sonoma in 1995 hires my firm Profit to do their internet strategy.
0:08:42 And I don’t know whether to price it at $200,000 or $2 million.
0:08:46 I just could never figure out pricing or launch a product.
0:08:48 You know, any of the companies I’ve started,
0:08:50 I just always really struggle with pricing.
0:08:52 I think pricing is artisan because it sends a signal.
0:08:54 But at the same time, you want to have a great value proposition
0:08:56 such you get to a certain level of scale.
0:09:00 But pricing your product at a premium sends a signal about what it is.
0:09:01 I think it’s more the business model.
0:09:04 And I finally figured out going to recurring revenue to see above members clubs.
0:09:05 But I think these guys,
0:09:09 unfortunately, there’s just way too many of them.
0:09:11 And there are really interesting kind of lessons in branding.
0:09:14 The other thing that’s sort of a bummer, I would argue,
0:09:18 is that when I first got to New York when I was 22,
0:09:19 I worked at Morgan Stanley.
0:09:23 And there was places you could go
0:09:26 and there was some insecurity about whether or not you’d get in.
0:09:28 And the value proposition now that I have more,
0:09:32 I have more money, but I’m less handsome,
0:09:33 dramatically less handsome.
0:09:36 Oh my God, I was a tall drink of lemonade back in the day.
0:09:36 That’s right.
0:09:38 All the hair, all the hair.
0:09:41 I was a solid six, a solid six.
0:09:45 And you go with some friends and you’d go to Lotus or Pangaea or whatever.
0:09:49 And they’re, or I used to go to the tunnel, I think it was called, or Obar or Surf Club.
0:09:55 And you’d walk up and you’d push like the women in front or the coolest guy and hopefully know the doorman.
0:09:58 And he’d look at you, size you up and then let you in.
0:10:02 But anyone or almost anyone could get into these places.
0:10:08 And now I find that this giant velvet rope is being strung across all of New York and London nightlife.
0:10:11 And if you’re not a member and you can’t afford it, you can’t get in.
0:10:14 What they do is price discrimination, though, and that is they have junior memberships, which is smart.
0:10:18 So ugly old guys like me, if I pay five grand a year to go spend money on drinks,
0:10:21 and younger people under the age of 30 spend two grand.
0:10:23 I think price discrimination is really interesting.
0:10:25 The airlines are the best price discriminators.
0:10:31 You can be sitting next to someone who paid five times or a fifth of what you pay based on price discrimination.
0:10:32 Oh, you’re staying over Saturday.
0:10:33 That means you’re not a business traveler.
0:10:36 That means you’re probably paying, which makes you much more price sensitive.
0:10:40 So we’ll give you a much lower fare if you’re staying for the Saturday night.
0:10:41 Oh, you’re booking last minute.
0:10:42 It’s probably on business.
0:10:42 See above.
0:10:43 Someone else is paying.
0:10:45 We jack up the rates.
0:10:47 And these guys are learning about price discrimination.
0:10:54 The thing that bothers me is that more and more people are being, or the wealthy are sequestering
0:10:56 from the middle class.
0:10:59 And that is we are going further and further behind velvet ropes.
0:11:04 I basically won’t go anywhere now that’s not a members club because I want to know I’m going
0:11:04 to get in.
0:11:06 I want to be treated really well.
0:11:07 And I want to go somewhere.
0:11:10 I mean, all my exploration vibe has gone away.
0:11:15 And I worry that it’s just taking younger people and people who don’t have as much money.
0:11:19 We’re further and further sequestering from each other, which means we have less empathy
0:11:21 for them, less mixing.
0:11:24 Also, young people can’t afford this shit.
0:11:25 And I’m going to end here.
0:11:29 And that is I think the government should be subsidizing third places through tax policy.
0:11:34 And that is if you can show that you are getting a ton of people under the age of 40 into an
0:11:39 environment where they’re together, whether, I mean, obviously churches and religious institutions
0:11:41 have tax exempt status.
0:11:47 But there’s a place called Putt Shack in the UK that brings together young, obviously kids.
0:11:51 But at night, a lot of young people go or the Topgolf or bars or pubs.
0:11:56 40%, get this, 40% of nightclubs in London have closed since COVID.
0:12:02 One of the things I like about London is they zone a beautiful piece of real estate just for pubs.
0:12:08 So you can buy a pub for fairly little money in an amazing neighborhood in Marlebone or Mayfair,
0:12:11 but you can’t do anything with it except you have to keep it a pub.
0:12:15 And I love that because I think more people need to get out, be around each other, and quite frankly,
0:12:19 drink more and make a series of bad decisions that might pay off.
0:12:25 And I worry that this trend towards members’ clubs is further sequestering people with money
0:12:31 from people who don’t have money and also less mixing and also we’re pricing out young people’s
0:12:35 ability to meet, to demonstrate excellence to each other, maybe to have a drink or two,
0:12:41 bring their inhibitions down and say, hey, I think you’re ridiculously hot.
0:12:42 Will you go to the movies with me on Sunday?
0:12:47 Speaking for a friend, when I look back on all, and this is kind of embarrassing.
0:12:48 Is it embarrassing?
0:12:51 What do I do that’s not embarrassing?
0:12:53 Seriously, what do I do?
0:12:54 What do I do?
0:13:01 Anyways, when I look back on all of my friendships, a decent proportion of them and a vast majority
0:13:05 of my romantic relationships, alcohol has played a role.
0:13:11 And what has definitely played a role is being in environments with strangers in a safe place
0:13:16 where we all felt some sort of agency and comity of man.
0:13:18 And there’s just fewer and fewer of those places.
0:13:22 We are sequestering behind a velvet rope in our society.
0:13:24 And quite frankly, it’s not a good thing.
0:13:26 Okay, enough of that.
0:13:30 In today’s episode, we speak with Ian Bremmer, the president and founder of Eurasia Group,
0:13:32 the world’s leading political risk research and consulting firm.
0:13:36 It’s Ian’s 12th appearance on the show.
0:13:36 Love, Ian.
0:13:37 Love, Ian.
0:13:38 He’s Canadian.
0:13:40 He doesn’t know it yet, but he’s Canadian.
0:13:44 We discuss with Ian Trump’s tariffs, U.S.-China relations, the latest developments in Iran,
0:13:47 and the war in Ukraine.
0:13:48 He’s my Yoda.
0:13:49 He’s my Yoda.
0:13:50 Right?
0:13:51 Wait.
0:13:54 So these are my two imitations from movies.
0:13:55 I just spawned this.
0:13:55 All right.
0:13:58 First, this is Darth Vader from Star Wars.
0:13:58 Okay, get ready.
0:14:01 Trust your feelings.
0:14:03 You know this to be true.
0:14:04 All right.
0:14:06 That’s imitation number one.
0:14:09 Big hit with my eight-year-old son when he was eight.
0:14:10 Not so much anymore.
0:14:11 All right.
0:14:12 And here it is, my second impression.
0:14:13 Dr. Evil.
0:14:15 How about no?
0:14:17 Oh, that’s so money.
0:14:20 That is so money.
0:14:21 All right.
0:14:26 With that, here’s our conversation with Ian Bremmer, the president and founder of Eurasia Group.
0:14:40 Ian, where does this podcast find you?
0:14:48 I am in New York at my office and in the middle of the milestone that we are dealing with.
0:14:49 There you go.
0:14:51 So we’ll bust right into it.
0:14:58 There seems to be an obsession with how Trump’s tariff plan is impacting the markets and how it might impact U.S. consumers.
0:15:02 Talk a little bit about if and how it sort of reshapes the world order.
0:15:07 Specifically, what are the geopolitical ramifications in terms of our relationships with other nations?
0:15:07 Yeah.
0:15:20 I mean, this is yet one more component of something you and I have been nibbling around, which is the reputational capital of our country, right?
0:15:40 I mean, other countries around the world align with us and do our bidding in part because we’re strong and in part because they believe that we are like we’ll actually do what we say because they have a level of trust and confidence that we will act as we say we will act going forward.
0:15:57 And we’ve done an awful lot to shake the ladder over the past weeks, whether it is the way we treat judges or law firms or universities or green card holders in the United States,
0:16:17 or whether it’s the way we treat territorial integrity in Denmark and Greenland and Panama, in Canada, or it’s the way we treat our treaty obligations, our tariff obligations, our trade relationships, our partners, our allies.
0:16:25 I mean, all of these things were basically saying to everybody else around the world, look, we’re stronger than you are.
0:16:29 So that’s all that really matters is what we say and you’re going to do it.
0:16:41 And it can be arbitrary and capricious and we can change our mind, you know, three times before breakfast as, you know, as through the looking glass days, right?
0:16:46 That’s kind of where we find ourselves is through the geopolitical looking glass.
0:16:51 Who do you think, well, let’s talk about outside of the U.S., who are the biggest winners and the biggest losers?
0:16:56 And let’s just assume that we agree that Ukraine is probably a loser so far.
0:17:00 But I’m just with respect to tariffs, who do you think the biggest winners and losers are abroad?
0:17:06 You know, Scott, the biggest winners are nobody.
0:17:32 I mean, honestly, if you’re looking at the last 50 years that created this unparalleled period of global growth, improved efficiency, lower prices, and an emerging global middle class that unlocked human capital that everyone in the world could benefit from, you’re undoing that.
0:17:41 So, I mean, some countries are going to get hit in the face and knocked out and others are just going to have a glancing blow and they can keep walking.
0:17:42 But you wouldn’t call the latter winners.
0:17:45 You just say they aren’t really losers.
0:17:49 So in that regard, there are a lot of countries, I think, that’ll be just fine.
0:17:54 I mean, India, for example, in this environment will be just fine.
0:17:58 They’re taking a hit from the U.S., but it’s not going to matter much for their growth.
0:18:05 Maybe, you know, sort of 20 basis points, max half a point to GDP for a very strong growing economy.
0:18:12 They’ll benefit from all of the unwinding between the U.S. and China and a lot more people will end up going in.
0:18:15 So on balance, like net-net, India should be OK.
0:18:19 Gulf states, everyone has to work with them no matter what.
0:18:20 They’re rich.
0:18:21 They’re pretty diverse.
0:18:21 They’re stable.
0:18:26 You know, Trump is going out there shortly, going to visit Saudi, UAE, Qatar.
0:18:28 You know, they feel pretty comfortable with him.
0:18:30 That’s going to be fine.
0:18:33 They can deal with, you know, a slight increase in tariffs.
0:18:37 The longer term, there are some winners.
0:18:39 There are some big winners.
0:18:58 The Mexicans and Canadians long term are winners because they will find ways to ensure that USMCA gets renegotiated and that will create more post-crisis tested resilience for the most important integrated common market in the world.
0:19:16 And China long term will also benefit because the United States will have given up so much reputational capital and China will be able to take advantage of that, particularly in the global south, but also to a degree in Asia, the Japanese, the South Koreans, to a degree in Europe.
0:19:19 But in the near term, China gets hit really badly.
0:19:23 In the near term, Mexico and Canada get hit really badly.
0:19:28 In the near term, the United States is the comparative winner, and I expect that to be reflected in the markets.
0:19:42 So I think it’s hard to argue that international trade or free trade over the medium – there’s some short-term losers in specific industries, but over the medium and the long term, I would argue it’s probably been the biggest economic unlock of the last hundred years.
0:19:49 And that it’s not a zero-sum game and that, you know, prosperity elsewhere, we make something really well.
0:19:51 They make something really well for less money and we trade.
0:20:06 I wonder if actually sooner rather than later, I see the biggest winner is China because I would imagine and I believe Chinese diplomats and economic ministers are roaming the world saying, you may not love us, but you can count on us.
0:20:25 I think they’re going to scoop up so much trade that it’ll not only replace what they lose from the U.S., it’ll net-net that it’ll be a positive actually pretty soon in terms of – I mean, I just saw that Japan and South Korea are having discussions with China for the first time in a while.
0:20:29 I wonder if China is a really big winner here, your thoughts.
0:20:32 I think it’s the right question to ask, Scott.
0:20:40 I always like our conversations because you immediately get into the important issues and want to, like, thrash them out, right?
0:20:43 And I take the other side of that.
0:21:02 First of all, on the Japan-South Korea-China discussions, which were discussions among their trade ministers, they certainly, in an environment where the U.S. is raising tariffs with reckless abandon and may not be willing to undo them, at least not immediately,
0:21:12 these are countries that trade a lot with each other and need to make sure that that trade is comparatively frictionless or at least has less friction to it.
0:21:18 So I do think there’ll be more coordination, but they won’t coordinate policies vis-a-vis the U.S.
0:21:30 because the Japanese and South Koreans still really need the U.S. in technology and particularly in security, and they don’t trust the Chinese on that, and that’s not going to change.
0:21:47 But the more important point is that China is seriously underperforming economically, and if the United States is getting involved in a trade war with China, in other words, if the additional 50 percent actually gets implemented,
0:21:55 and I know that Trump says it’s happening as of midnight on the day that you and I are now speaking, he could easily decide, you know what, we’re going to talk to them.
0:21:56 They just called me.
0:21:58 They just set up a call.
0:21:58 It’s going to be great.
0:21:59 It’ll be fine.
0:22:01 You know, I’ll make it okay.
0:22:02 Maybe he suspends that.
0:22:07 Maybe he kicks down an hour, but let’s assume that what he said actually stands and he actually implements that.
0:22:13 That is a trade war that the Chinese can afford a lot less than the Americans can.
0:22:15 They have a lot less leverage.
0:22:17 They do have more patience.
0:22:20 Maybe they have more political stability in the long term.
0:22:27 They certainly have a leader that’s going to be in place for a lot longer, but their domestic economy is not working.
0:22:29 Their population is not buying.
0:22:35 They don’t want to spend because they don’t trust the government and they don’t have consumer confidence.
0:22:54 They are manufacturing a lot and they’re dumping and they’re dumping in a way that is going to be much harder to do, given all of these U.S. tariffs, not just against China and against the Japanese and South Koreans, but also against all the countries that the Chinese are exporting to and through to the United States.
0:22:57 Some of the countries that got hit the worst were in Southeast Asia.
0:23:01 Those are precisely the countries where the Chinese are exporting and getting into the U.S.
0:23:03 Well, that’s going to get closed down.
0:23:05 So I think they’re in trouble.
0:23:09 I think that there is going to be a lot of capital flight.
0:23:11 They’ve got about three trillion in reserves right now.
0:23:18 Last time they got a serious financial crisis, they were from four point five, went down to three in six months.
0:23:25 There is an argument to be made that their economy is going to be truly and unprecedentedly tested.
0:23:31 So I think in the near term, they’re actually in a lot of pain.
0:23:45 And I think that they’re going to be careful in not doing further tit for tat against the Americans like the immediate 34 percent announcement that they made in the hopes that that was going to calm it down.
0:23:48 I would take the other side of the China bet.
0:23:50 I think that’s super interesting.
0:23:52 And I think you’ve changed my you’ve changed my view.
0:23:55 I thought China really was the big winner here.
0:23:59 I mean, but I think you’re right that they’re going to be the big winner, but they have to be patient.
0:24:04 They have to be able to get through getting really hit in the face by the most powerful country in the world.
0:24:07 And it just ain’t going to be easy for them long term, though.
0:24:14 I mean, you know, you can just imagine not only on the stuff we’re talking about now, but U.S. leaves USAID, shuts it down.
0:24:15 Like who’s dominant?
0:24:17 Who’s the dominant trade partner of every global South country?
0:24:19 That’s China, right?
0:24:23 Who’s going to be able to pick up much more influence over that part of the world?
0:24:23 China.
0:24:30 U.S. leaves the Paris Climate Accord, says that, you know, climate’s not something we’re paying attention to anymore.
0:24:35 Who’s leading the world in transition energy, sustainability and supply chain?
0:24:36 China.
0:24:39 Who’s going to drive the COP summits going forward?
0:24:39 China.
0:24:51 So, I mean, I can absolutely see there is a light at the end of the tunnel for the Chinese, for our principal adversary, that’s actually really quite dangerous for us.
0:24:56 We have to be very careful about that, especially because it’s not like they don’t know how to do new technology.
0:25:00 You saw DeepSeq and that announcement.
0:25:02 I mean, they’re very capable.
0:25:03 They’re going to build data centers.
0:25:06 They have cheap energy available.
0:25:10 I mean, they’re going to be competitive with the U.S., even in artificial intelligence.
0:25:19 So we’ve got to be careful, and we’re the ones undoing our Chips Act, right, which makes no sense whatsoever, especially if you’re trying to get more manufacturing in the U.S.
0:25:23 Like, we don’t want to build – we don’t want to make sneakers.
0:25:29 We want to make semiconductors, and you’re ripping up the one thing that we have that’s going to drive more semiconductor production in the U.S.
0:25:31 I don’t know why they’re doing that.
0:25:36 But the Chinese, long term, I think, do have lots of opportunities.
0:25:37 I’m just worried about them right now.
0:25:41 We’ll be right back after a quick break.
0:25:49 Support for Prop G comes from Vanta.
0:25:51 Trust isn’t just earned.
0:25:51 It’s demanded.
0:26:01 Whether you’re a startup founder navigating your first audit or a seasoned security professional scaling or GRC program, proving your commitment to security has never been more critical or more complex.
0:26:03 That’s where Vanta comes in.
0:26:14 Businesses use Vanta to establish trust by automating compliance needs across over 35 frameworks, including SOC 2 and ISO 27001 centralized security flows.
0:26:19 Complete questionnaires up to five times faster and proactively manage vendor risk.
0:26:22 Vanta not only saves you time, it can also save you money.
0:26:29 A new IDC white paper found that Vanta customers achieve $535,000 per year in benefits, and the platform pays for itself in just three months.
0:26:37 You can join over 9,000 global companies, including Atlassian, Quora, and Factory, who use Vanta to manage risk and prove security in real time.
0:26:42 For a limited time, our audience gets $1,000 off Vanta at Vanta.com slash Prop G.
0:26:48 That’s Vanta.com slash Prop G for $1,000 off.
0:26:56 Support for Prop G comes from ShipStation.
0:27:00 What if you never had to worry about shipping and fulfillment for your business ever again?
0:27:09 With ShipStation, you can save hours and money every month by shipping from all your stores with one login, automating repetitive tasks, and finding the best rates among all the global carriers.
0:27:13 ShipStation grows with your business no matter how big it gets.
0:27:22 You can ship products to your customers with discounts up to 88% off UPS, DHL Express, and USPS rates, and up to 90% off FedEx rates.
0:27:27 You can also seamlessly integrate with the services and selling channels you already use.
0:27:34 You can deliver a better customer experience with industry-leading, scalable features that help ensure accuracy and get shipments out the door faster.
0:27:44 Over 130,000 companies have grown their e-commerce businesses with ShipStation, and 98% of companies that stick with ShipStation for a year become customers for life.
0:27:48 Calm the chaos of order fulfillment with the shipping software that delivers.
0:27:50 Switch to ShipStation today.
0:27:55 Go to ShipStation.com and use code PROFG to sign up for your free trial.
0:27:57 That’s ShipStation.com, code PROFG.
0:28:10 The Nintendo Switch 2 is basically guaranteed to be the most interesting gadget of 2025.
0:28:13 And we learned a lot of new stuff about it this last week or so.
0:28:16 Some of the games that are coming out, some of the specs of the new device,
0:28:20 and the fact that it’s going to cost $449.99.
0:28:24 Except maybe it’s not, because the other thing going on right now is tariffs.
0:28:28 And tariffs threaten to change just about everything about tech.
0:28:34 What it is, how it’s made, where it comes from, and crucially, how much we have to pay for it.
0:28:38 So that’s what we’re talking about on The Vergecast all week, wherever you get podcasts.
0:28:48 So this has dominated the headlines, and I find that the U.S., we’re narcissists.
0:28:55 We want to talk about ourselves, and we also, I would say, struggle with or suffer from an idolatry of the dollar.
0:29:00 So if the NASDAQ goes down, you know, that dominates the headlines over anything else.
0:29:06 Catch us up, for those of us who have been distracted from what’s going on in Ukraine and in Gaza.
0:29:12 Give us a sense for what has happened over the last four, eight weeks,
0:29:18 as we have been totally distracted with discussions of the market falling 10 percent.
0:29:24 Well, let me start with the biggest news this week, which is what’s happening in Iran.
0:29:32 So you probably saw that the Israeli prime minister, I can make a transition here, just came to the Oval Office.
0:29:40 And, you know, he had said, we’re proactively taking all of our tariffs off the United States, zeroing them out.
0:29:44 And Netanyahu, of course, thought his great friend, who doesn’t really like him,
0:29:47 but nonetheless has certainly been a big supporter, Donald Trump.
0:29:54 He’s going to come to the Oval, and the U.S. will announce that those tariffs will also be removed.
0:29:55 And that did not happen.
0:30:02 Instead, what happened was the U.S. said, we’re going to keep them on.
0:30:07 And by the way, you should be really appreciative because we spend so much money in aid for your military,
0:30:10 billions of dollars a year, by the way.
0:30:18 Also said, Turkey, Erdogan, my great friend, so trusted, really appreciate what he’s doing for us in Syria,
0:30:20 which, of course, the Israelis are on the other side of.
0:30:29 And then said, by the way, we’re going to open direct negotiations with Iran, with the Iranian government,
0:30:31 which, by the way, is not actually true.
0:30:39 The Iranians said they would do indirect talks through Oman, but that if those initial talks went well,
0:30:42 they’d be willing to do direct talks with the U.S., which is new.
0:30:47 It is actually a concession and is exactly not what the Israeli prime minister wanted to hear.
0:30:57 So, I mean, his his meeting in the Oval wasn’t quite as bad as Zelensky’s a month ago when Vance beat him up and everyone went nuts.
0:31:03 But it was it was the worst trip that Netanyahu has had to the United States since the war.
0:31:04 There’s no question about that.
0:31:05 I mean, you know, long, long time.
0:31:07 Barely registered in the Western media.
0:31:08 Yeah.
0:31:08 Yeah.
0:31:09 Well, I figured I mean.
0:31:17 And so you now have the United States saying they’re going to start negotiations with Iran directly.
0:31:22 And they’re going to see if I mean, Iran’s in a very, very weak position.
0:31:37 One of Iran’s remaining proxy fighters in Iraq, the Islamic resistance in Iraq that has been part of the attacks on U.S. troops and others in the region.
0:31:43 They have said that they’re going to voluntarily disarm because the Americans said they were going to blow the crap out of them.
0:31:46 So you’ve got the U.S. fighting the Houthis.
0:31:49 That was the whole signal gate thing from a couple of weeks ago.
0:31:54 And that hasn’t been very successful so far, but certainly trying to deal with that.
0:31:56 Now you have the Americans.
0:31:58 Hezbollah is gone.
0:31:59 Israel took care of them.
0:32:04 Hamas has obviously been blown up consistently over the last year plus.
0:32:10 And now you have the U.S. going to the Iranians and saying we’re willing to negotiate.
0:32:14 And if it doesn’t work out, there’s going to be hell to pay.
0:32:18 But the intention is not is not to engage in military strikes.
0:32:30 The intention is to try to see if you can do something better, something bigger and broader and more lasting than the JCPOA, the nuclear deal that was signed under Obama.
0:32:32 That was a multilateral deal.
0:32:33 This would be a bilateral deal.
0:32:41 But that’s probably the most important thing that has changed in the last few weeks on the geopolitical front.
0:32:43 Ukraine.
0:32:44 Ukraine.
0:32:54 So the Ukrainians, I mean, the news today is that there were two Chinese citizens that the Ukrainians captured that were fighting with Russia.
0:32:56 It’s a non-issue.
0:32:59 It’s not like the People’s Liberation Army had sent them there.
0:33:03 There are Americans that citizens happen to be fighting in Ukraine, too.
0:33:06 And it’s that’s because they have the right to leave and travel and whatever.
0:33:13 The Ukrainians have accepted the ceasefire terms provided by Trump with no conditions.
0:33:14 The Russians have not.
0:33:15 The Russians have not.
0:33:22 And that is something that is increasingly irritating Trump.
0:33:26 He’s been more than willing to engage directly with Putin.
0:33:37 There’s been a lot of back and forth between Putin’s advisors and cabinet, including the head of his sovereign wealth fund, Dmitriev, who just actually came.
0:33:50 He was sanctioned and has a visa suspended, but he was just allowed to come in an exception made a few days ago to the White House, where he had good conversations with Steve Whitcoff, the special envoy and others.
0:34:00 So the Russians are very interested in doing a deal with the Americans and getting investment from the Americans and pulling sanctions off, of course.
0:34:06 But they have not been willing to accept American terms for a ceasefire.
0:34:14 And Trump has now said a couple of times, you know, I’m not I’m running out of patience here.
0:34:31 So you need to accept a ceasefire and it doesn’t require me pulling sanctions off and it doesn’t require Zelensky leaving office because he’s there and you’ve got to deal with them or else I’m going to put much tougher sanctions against Russia.
0:34:42 He has not yet at least said or else I’m going to send much more military support to Ukraine, something he had said before he was elected, hasn’t come back to that.
0:34:57 But certainly Zelensky’s position with Trump in the U.S. today is dramatically better and more normalized than it was when he visited the White House in that shambolic meeting a few weeks ago.
0:35:00 What’s actually happened on the ground over the last couple of months in Ukraine?
0:35:04 They’ve lost a tiny amount of territory.
0:35:10 The Russians continue to make territorial gains, but every month they’re making smaller and smaller gains.
0:35:13 And so you would say that the front lines have mostly held.
0:35:27 The exception is that small amount of territory inside Russia around Kursk that the Ukrainians had suddenly quite surprisingly taken with the cost of about 40,000 men being redeployed to that area.
0:35:34 Most of those men have now had to withdraw and the Russians have retaken almost all of their territory.
0:35:41 You said on a previous broadcast that, you know, this was just not sustainable for Ukraine.
0:35:46 And I like the Lincoln quote that you can’t win a war without public support and you can’t lose a war with it.
0:35:50 Has the mood changed at all in Ukraine?
0:35:59 I mean, at some point in its buff of World War II history, it strikes me that Russia’s core confidence is this willingness to endure a lot of pain.
0:36:06 Do you see any evidence over the last couple of months as this kind of meat grinder continues to grind on that this war is losing support in Russia?
0:36:12 Or is it the same as it always was and you still hold to Ukraine as, you know, running on borrowed time?
0:36:16 I hold to both, but there have been small shifts in Russia, less of a shift.
0:36:23 The Russians have just finished yet another call up of of reservists, of troops, hundreds of thousands, which they do every year.
0:36:25 But they had no problem in getting those numbers.
0:36:31 They’re also spending a lot more money on getting troops to the front.
0:36:40 They’ve increased the bonus salaries dramatically, you know, sort of 50x what the average Russian worker could expect in an entry level job.
0:36:53 And that’s made a difference to certainly no demonstrations on the ground in Russia or any opposition to what you’re seeing, despite the fact that they’ve, you know, had like a million casualties, which is just an astonishing number, right?
0:36:54 Again, not dead.
0:36:57 I mean, dead is more in the hundred thousand plus.
0:37:09 But I mean, still, I mean, the impact that has on society in Russia is so meaningful and it just shows how much control Putin has over the country, over the information networks, all of that.
0:37:11 Now, for Ukraine, it’s interesting.
0:37:17 Militarily, they’re still going to run out of steam come summer.
0:37:23 And certainly they’re having a harder time with their own raising of reserves.
0:37:35 And, you know, they’re, they’re only, they still haven’t, I mean, the age of the call up, I think, went down from 28 to 25, but it’s, they have been very reluctant to go to 21 or 18.
0:37:37 They’re just, it’s enormously unpopular.
0:37:39 And that’s problematic for them.
0:38:02 Olenski’s popularity, which had been trending downward somewhat, though it was still like in the 50s, 60s, is now back up to high 70s on the back of that trip to the White House, where he stood strong and refused to end up signing what was seen as an exploitative critical minerals deal.
0:38:09 And giving back as, as good as he got effectively from Trump and Vance.
0:38:19 So if there were elections in the near term, and constitutionally there can’t be because there’s martial law because a big piece of their territory is occupied by foreign invaders.
0:38:23 But if there were elections today, it’s very clear that Zelensky would win.
0:38:33 And I think that that actually put, makes it easier for him to start negotiations with the Russians and not fear that he’s going to be ousted domestically.
0:38:39 So he actually has somewhat more flexibility diplomatically, even though his military position hasn’t improved.
0:38:43 That meeting was such a low point for us, us being in the U.S.
0:38:55 Let me outline what might be a Pollyanna scenario, and you tell me where, if there’s anything, you know, if there’s any veracity or any hope that this might come to fruition.
0:38:59 The EU is a $19 trillion economy combined.
0:39:01 Russia is a $2 trillion economy.
0:39:02 It’s smaller than Canada’s economy.
0:39:17 That if the recognition that the military umbrella of the U.S. no longer applies, that we’re not going to weigh in, and that we have become an inconsistent, sclerotic partner, that, you know, rich Uncle Sam cannot be counted on.
0:39:18 He’s lost his shit.
0:39:27 And the EU, for the first time, Europe becomes a union, increases their defense budget, as they’ve announced, from 1.9% to 3%.
0:39:30 They don’t have the surface-to-air capabilities.
0:39:33 They still need the U.S., but they do have a great manufacturing base.
0:39:40 French, U.K., and German companies, you know, if Germany makes an amazing car, they should be able to make an amazing tank, and they do.
0:39:45 And they’re able to actually push back on Russia without the aid of the U.S.
0:39:48 And, you know, glory to the EU.
0:39:54 Am I being, am I smoking my own crack pipe here?
0:39:56 No, no.
0:40:07 I mean, there’s definitely a lot more that the Europeans can and should be doing, and they’ve become more unified around the EU because of Trump.
0:40:09 I mean, Trump is a great unifier.
0:40:14 He’s unifying the Canadians, who, you know, now the liberals are likely to win.
0:40:18 Polly Eve, the conservative, was a slam dunk.
0:40:29 And Trudeau, of course, after 10 years, had lost all of his credibility, and yet the Canadians have completely unified against the United States.
0:40:34 Mexico, Claudia Scheinbaum, 85% approval ratings right now.
0:40:48 Anger with the EU, much stronger now, favoring the EU, spending more, supporting their own defensive capabilities, supporting investing more in technology,
0:41:01 And hitting the Americans back on tariffs because of what they see coming from the U.S., not just in terms of economic policy, but also in terms of undermining their own democracies in Europe,
0:41:11 Algorithmically direct support from Elon, from Vance, from others, for people like the AFD, who are considered a neo-Nazi party in Germany, and support for Russia.
0:41:16 So, right, so all of those things are making the Europeans do more.
0:41:18 But is more enough?
0:41:20 Is more enough?
0:41:28 Because, Scott, the Europeans have not spent on defense for 40 years, right?
0:41:29 Almost 40 years.
0:41:32 And so it’s not like, okay, now they’re going to spend 3%.
0:41:37 Okay, so how long is it going to take them to get to the point they can defend themselves?
0:41:43 Now, defending themselves against a $2 trillion Russian economy, frankly, isn’t all that hard.
0:41:46 Russia will do asymmetric things.
0:41:48 They will engage in cyberattacks.
0:41:50 They will engage in espionage.
0:41:51 They will blow up critical infrastructure.
0:41:52 They’re already doing that.
0:42:00 They’ll use a network on Telegram to order a whole bunch of local citizens to commit crimes, arson, vandalism, you name it.
0:42:03 But they’re not going to send tanks into the Baltics.
0:42:05 They’re not going to send tanks into Poland.
0:42:06 They get crushed.
0:42:09 So that’s not what I’m worried about.
0:42:20 But can Europe rebuild fast enough that they could defend the Ukrainians in a Russian war that the Russians are completely committed to?
0:42:23 And the answer there, I think, is no.
0:42:25 I think that answer is no.
0:42:55 And I also don’t know whether the Europeans spending more on defense are going to stay aligned enough to allow them to become independent from the U.S. defensively in five and ten years’ time, given that there is a vastly greater level of security concern in countries that are not economically performing well, unlike the United States, that aren’t productive, that don’t have big tech.
0:43:08 I mean, if you’re Spain or Italy or even France, how much are you prepared to spend in your tightly contested budget on long-term defense?
0:43:11 Are you willing to spend the way the U.S. does?
0:43:12 The answer is probably not.
0:43:13 What about Germany?
0:43:18 They’ve made some enormous announcements to get rid of their debt break.
0:43:22 But the new government that’s coming in, assuming they can put the government together.
0:43:26 And by the way, everyone assumes that Mertz is going to have no problem putting that government together.
0:43:30 There’s like probably a 10% chance that he fails in constructing a government, right?
0:43:33 And then we’re in a very, very different place.
0:43:41 But assuming he does in the next month-ish, the fact that they have the debt break gone doesn’t mean that they’re going to spend all that money.
0:43:46 It doesn’t mean they’re prepared to actually change EU borrowing rules to allow them to.
0:43:48 It’s going to be a very weak government.
0:44:16 So as I look forward three, four, five years, I still see a significant likelihood that in many of the countries you’re talking about, we’re going to end up with more Trump-aligned, Orban-aligned, Mille-aligned, Bukele-aligned governments that get elected in in Europe, which weakens the EU, which makes it harder to talk about a collective security among the European states themselves, a coalition of the willing.
0:44:18 We’ll be right back.
0:44:30 So we want to introduce you to another show from our network and your next favorite money podcast, for ours, of course.
0:44:36 Net Worth and Chill hosts Vivian Tu is a former Wall Street trader turned finance expert and entrepreneur.
0:44:41 She shares common financial struggles and gives actionable tips and advice on how to make the most of your money.
0:44:47 Past guests include Nicole Yoder, a leading fertility doctor who breaks down the complex world of reproductive medicine and the financial cost of the economy.
0:44:54 And divorce attorney, Jackie Combs, who talks about love and divorce and why everyone should have a prenup.
0:44:57 Episodes of Net Worth and Chill are released every Wednesday.
0:45:01 Listen wherever you get your podcasts or watch full episodes on YouTube.
0:45:02 By the way, I absolutely love Vivian Tu.
0:45:04 I think she does a great job.
0:45:15 We’re back with more with our good friend, Ian Bremmer.
0:45:18 So you brought up Canada.
0:45:20 I’m curious to get your thoughts on Prime Minister Carney.
0:45:22 Well, he’s a friend.
0:45:26 I mean, I’m completely biased in that regard.
0:45:27 I’ve known him for a long, long time.
0:45:28 You strike me as very Canadian.
0:45:34 He’s, look, I mean, he’s, I don’t, most Canadians don’t strike me as very Canadian.
0:45:36 No, no, no, no, you strike me as Canadian.
0:45:37 Oh, me?
0:45:39 Oh, 100%.
0:45:39 You’re very…
0:45:40 What the hell does that mean?
0:45:42 I think I’m almost offended by you saying that.
0:45:43 What do you mean by that?
0:45:47 Super friendly, super nice, educated, pretty easy to get along with.
0:45:48 Okay.
0:45:50 Exceptionally Caucasian.
0:45:55 If you said, like, a bit of a weenie, I would be really a little upset, you know, that would be…
0:45:57 How do you get 100 drunk Canadian fraternity brothers out of your pool?
0:45:59 Hey, guys, would you please get out of the pool?
0:46:01 I love, by the way, I love Canada.
0:46:02 I was conceived in Canada.
0:46:03 Let’s bring this back to me, Ian.
0:46:04 Okay, good.
0:46:04 I was conceived.
0:46:05 You were, where in Canada were you conceived?
0:46:06 In Toronto.
0:46:10 And then my parents were sick of the weather and seven months pregnant.
0:46:14 My mom loaded up her Austin Mini Metro with my dad and they moved to San Diego.
0:46:19 I’m actually thinking, and I’m going to rope you into this, I want to do an I Love Canada
0:46:20 tour and I want to get together.
0:46:22 Yeah, I would be good for that.
0:46:22 You would.
0:46:28 I’m thinking Toronto, Montreal, Montreal in the summer, Vancouver, pick a fourth city,
0:46:30 but I would like to do an I Love Canada tour.
0:46:32 Anyways, you’re signed up and you’re included.
0:46:33 What do you think of Carney?
0:46:37 Well, look, again, I mean, I say it because…
0:46:38 As a fellow Canadian.
0:46:39 As a fellow Canadian, yeah, exactly.
0:46:50 He is, I mean, intellectually, economically, he is a generational mind for Canada on the global
0:46:50 stage.
0:46:54 When he was Central Bank Governor in Canada, when he was Central Bank Governor in the UK,
0:46:56 right?
0:47:04 Through Brexit, this was a guy that was respected incredibly highly by every other major interlocutor,
0:47:12 by the entire G7, by all of the CEOs of the financial institutions, by the central bankers.
0:47:14 I mean, they all have a lot of time for him.
0:47:20 I mean, he’s the one Canadian that Macron seriously respects at a high level.
0:47:26 Christine Lagarde thinks the world of Mark Carney, you know, all of that.
0:47:32 And I mean, at a time when the Canadians are facing an unprecedented challenge economically
0:47:37 from their most important trade partner, you understand why so many people are suddenly
0:47:39 flipping towards him.
0:47:45 And, you know, until very recently, we really thought Paulie Ebb was going to win because,
0:47:51 again, the liberals have so outlived their welcome in Canada.
0:47:56 But it’s interesting, bringing Carney in and getting rid of Chrystia Freeland, who was the
0:48:01 deputy prime minister, is what the United States didn’t do and what the U.S. needed to do,
0:48:01 right?
0:48:06 You had Biden, who had completely outstayed his welcome and was completely incapable and
0:48:07 incoherent at the end.
0:48:13 And instead, they brought in someone who was basically undifferentiated from Biden.
0:48:14 When asked, what would you do differently?
0:48:16 The answer was absolutely nothing.
0:48:19 This is an anti-incumbent wave, people.
0:48:21 You can’t run an incumbent.
0:48:26 And Biden ran an incumbent and lost, even against a very unpopular Trump.
0:48:31 And the Canadians are, got rid of their incumbent, got rid of the deputy.
0:48:34 Now they’re running an outsider who’s probably going to win.
0:48:42 And I think he’ll actually, he’ll end up having a fairly unified Canada, even though it’s a
0:48:43 different system.
0:48:44 It’s a parliamentary system.
0:48:51 And he might have to govern in coalition because everyone in Canada is so incredibly angry at the
0:48:57 United States, so incredibly unnecessary, the fight that the Americans have decided to pick
0:48:58 with them.
0:49:03 I mean, part of the problem I have with what Trump is doing is that he is picking every fight
0:49:04 simultaneously, right?
0:49:09 So like, if you want to go and reorganize the global trade order at a time when the U.S. economy
0:49:17 is particularly strong, then you should also be leaning into U.S. industrial policy at home.
0:49:19 So don’t get rid of the CHIPS Act.
0:49:20 Expand the CHIPS Act.
0:49:22 It was too small to begin with, right?
0:49:24 Don’t go after American universities.
0:49:28 Expand funding in American universities because you need the best talent from around the world
0:49:31 not to stay there, but to come to the United States.
0:49:33 Don’t undermine rule of law.
0:49:36 You need people believing in rule of law and contracts.
0:49:39 You want, in other words, make the consistent bet.
0:49:44 But the only consistent thing is that Trump wants to beat up on everybody all at the same
0:49:45 time.
0:49:52 And that, unfortunately, even for the most powerful country in the world, is going to end up hurting
0:49:52 us a lot.
0:50:01 And beating up on the Canadians was, you know, really, among a lot of stupid things, it was
0:50:02 the stupidest thing that we could do.
0:50:03 Yeah.
0:50:08 The people, you mean the people who hit us in the Iran hostage crisis, largest undefended
0:50:08 border?
0:50:10 Just talk about head up your ass.
0:50:11 I agree with you.
0:50:16 I love that saying that I’ve been quoting a lot.
0:50:18 It’s attributed to Churchill, but I think it was actually Victor Hugo.
0:50:24 The only thing worse than fighting with your allies is fighting without them.
0:50:28 We’ve essentially decided we’re not even just going to fight with allies because we’re, to
0:50:29 your point, fighting with all of them at the same time.
0:50:31 We’re now fighting without our allies.
0:50:37 I apologize for hopping around here, but you mentioned that a lot of nations, unfortunately,
0:50:39 or the world seems to be headed towards people like Orban.
0:50:42 I’ve actually been quite inspired by some of the protests in Hungary.
0:50:43 Do you think that’s more show?
0:50:46 My sense is that’s pretty powerful.
0:50:46 What are your thoughts?
0:50:48 Yeah, absolutely.
0:50:54 I mean, you know, Orban has, first of all, his economy has performed very badly, and so
0:50:56 the people are angry about that.
0:51:06 His corruption and his willingness to control with a group of oligarchs, key industries, as
0:51:14 well as the media, is something that is not appreciated among rank and foul Hungarians, specifically
0:51:14 not in the cities.
0:51:16 Again, it’s kind of like Moscow, right?
0:51:18 When you had problems with Putin, it was only the urban center.
0:51:21 They did very well in the rural areas and the smaller towns.
0:51:28 Hungary, it’s the same thing, but in Budapest itself, very easy now to rally large, large groups
0:51:30 of Hungarians, specifically against Orban.
0:51:32 So he’s doing very badly.
0:51:38 But, I mean, you know, getting rid of him in an environment where he controls so much of
0:51:44 the judicial power, so much of the media power, so much in how elections are conducted, you
0:51:47 just don’t have the checks and balances there, so it’s much harder to get rid of him.
0:51:52 Look, Turkey, there have been really big demonstrations in Istanbul, not in other parts of the country
0:51:59 because they haven’t been allowed, and Turkey has just taken a complete big step, a leap into
0:52:01 full-on dictatorship, right?
0:52:08 Where they have arrested the opposition leader who was about to announce his own run for the
0:52:12 presidency and was the one guy that could have beaten Erdogan, and now he’s not going to be able to run.
0:52:14 And you know what?
0:52:16 Trump says Erdogan’s his best friend.
0:52:19 The Europeans need him, so they’re not complaining very much.
0:52:21 He’s going to get away with it.
0:52:27 So, as we wrap up here, let’s come back home, and I think of you as someone who’s an expert
0:52:32 on geopolitics and domestic politics isn’t your focus, but you’re able to do something I think
0:52:36 99% of us are not able to do, and I’m certainly not able to do, and that is you’re able to separate
0:52:38 your emotions from the facts.
0:52:45 How do you see this shaping up as Trump’s current policies so far are shaping up for,
0:52:51 and I know it’s early, for 26 and the general fulcrum or the general power structure between
0:52:53 the Democrats and Republicans right now?
0:52:53 Any observations?
0:52:54 Yeah.
0:52:57 Well, first of all, I mean, you’re very kind to say that, Scott.
0:53:02 I don’t know that I can always separate my emotions from my analysis, but I try to at least
0:53:05 be aware of when they’re hitting it, you know, and be honest about it when it comes.
0:53:08 It’s like when you just asked me about, like, you know, Canada, and I’m like, okay,
0:53:11 well, let me tell you, like, I’ve got an emotional connection there.
0:53:18 On the United States, you know, I think that Trump has an opportunity here.
0:53:19 I don’t know that he’s going to take it.
0:53:29 You know, you and I both know that the Republican voting base is no longer the free trade, certainly
0:53:34 not neocon, U.S. lead the world thing.
0:53:41 It is working class, middle class, especially non-college educated, and especially men.
0:53:44 And, you know, you talk to a lot of these people.
0:53:47 You inspire a lot of these people, especially young people around the country, which I really
0:53:48 appreciate.
0:53:52 And I think that Trump needs to lean into that.
0:53:56 So, you know, this, the markets are taking a hit.
0:53:57 Okay.
0:53:59 And portfolios are getting hit.
0:53:59 Okay.
0:54:02 Well, a lot of the people I just mentioned don’t have portfolios.
0:54:02 Right.
0:54:10 So, what, what, what, what you, if you made that a feature, you would then also say, we’re
0:54:16 not doing the extended tax cuts for the highest bracket.
0:54:17 We’re going to snap those back.
0:54:22 And yeah, there’s going to be inflation and these tariffs to rebalance.
0:54:27 We’re going to have to, the corporations are going to get hit because they’ve taken advantage.
0:54:28 They’ve taken all the profits.
0:54:34 The foreigners have taken advantage that they’ve done so well, but what about our own
0:54:35 middle and working classes?
0:54:40 We’re going to redistribute the sales tax that we collect on these tariffs.
0:54:43 We’re going to redistribute it, that to the poor and the middle class.
0:54:47 And, um, I don’t think he’s going to do that.
0:54:51 And I look at, you know, I look at what I was going to say, who are we talking about
0:54:52 here?
0:54:57 Well, you know, at the end of the day, there’s a real, it’s not like Trump used to be a Democrat.
0:55:00 It’s not like he has an ideological, ideological true North.
0:55:02 Like, I mean, he’s going to make his money anyway.
0:55:07 So why not go with the people that really love him and deep MAGA, right?
0:55:12 I mean, these are people that actually are hurting that he needs to do more for.
0:55:13 And that can’t just be throw paper towels at them.
0:55:19 But, you know, when I look at, um, what we’re seeing from make America healthy again, and the,
0:55:24 uh, the food assistance snap, you know, I see, okay, we’re going to nudge, we’re going
0:55:30 to allow, um, certain States to, uh, not give those benefits for like, you know, soda and
0:55:31 for junk food.
0:55:31 Okay.
0:55:32 I’m fine with that.
0:55:36 I mean, we, I’d love to bring down our type two diabetes in this country and obesity, but
0:55:39 they’re also reducing the benefits.
0:55:44 They were also taking away what the Biden administration did to expand them.
0:55:44 That’s crazy.
0:55:47 Like you can’t hurt the poor people in this environment.
0:55:49 You got to help the poor people.
0:55:56 And so I think because Trump, I mean, Trump has gotten it right for the majority of the
0:55:59 country on the border and illegal immigration.
0:56:04 And he’s gotten it right for the majority of the country and on identity politics and anti-woke
0:56:13 ism, but he is failing most of the country on redistribution to the average American, to the
0:56:14 people like my family growing up.
0:56:16 He’s not helping those people economically.
0:56:22 And, and if he got the trifecta, then he would actually have a shot in the midterms.
0:56:27 Absent that, you probably expect the Democrats come back and take the house.
0:56:30 I think you are calling on his better angels.
0:56:34 I’m convinced that those first two are nothing but weapons of mass distraction from his ultimate
0:56:37 goal, which is to continue to enrich the 1%.
0:56:41 That that’s who he sees at the end of the day as his core constituency.
0:56:44 And that our tariffs don’t help them.
0:56:47 Well, they really don’t.
0:56:49 They hate him.
0:56:52 I mean, you know, you talk to like Steve Schwartzman, right?
0:56:54 And, you know, ask him what he doesn’t like about Trump.
0:56:58 And the number one thing he’ll tell you is I hate his trade policy.
0:57:00 And that was, that was months ago.
0:57:01 That was before the election.
0:57:04 Now, oh my God, these people, their, their hair’s on fire.
0:57:05 Right.
0:57:11 In my sense is tariffs are just blanket, are just blanket stupid and hurt everyone.
0:57:16 They especially hurt the poor because who spend a disproportionate amount of their money on
0:57:17 discretionary items.
0:57:22 That, sure, the wealthy will take a hit to their stock market portfolio.
0:57:27 But at the end of the day, I think the Republican Party and Trump’s genius is an ability to convince
0:57:33 the lower 99 that he’s serving their interests because at some point they might be in the top
0:57:33 one.
0:57:39 But if I upload my tax returns into ChatGPT and say, under the proposed Trump tax plan,
0:57:40 what happens to me?
0:57:44 And the answer is, you know, champagne and cocaine.
0:57:48 Things only get better for me based on his proposed tax policy.
0:57:49 I think tariffs hurt everyone.
0:57:49 It’s a fair point.
0:57:52 But they hurt poor people a lot more.
0:57:53 That’s just blanket stupid.
0:57:57 I wouldn’t argue that’s any sort of class warfare one side against the other.
0:57:59 Well, I guess I take your point, Scott.
0:58:03 And again, given that that’s why I’m saying in order to deal with that, you’ve got to do a
0:58:04 redistribution.
0:58:11 I do I do think that long term tariffs also have the capacity to as for the most powerful
0:58:15 country in the world to redirect investment in capital into the United States.
0:58:18 And I do think that there are blanket tariffs like this.
0:58:19 That never works.
0:58:21 When has no, no, no, no, no.
0:58:27 I’m assuming that you use them to actually negotiate and force weaker countries to do deals.
0:58:32 But we haven’t we, my understanding is since 2009, we’ve put in place more thoughtful individual
0:58:37 tariffs that are asymmetrically advantaged to us than any other nation, three times more
0:58:41 than Germany, five times more than France that we’ve been doing exactly what you’re talking
0:58:41 about.
0:58:45 Brazil gets tariffed 82 percent on their sugar.
0:58:47 Our sugar gets tariffed 12 percent.
0:58:52 Japan pays a 25 percent tariffs to put deliver trucks into us.
0:58:53 They charge us zero percent.
0:58:57 And we’re mostly I mean, there are there are counter examples to that, of course.
0:58:59 but also, you know, and that’s why we get so.
0:59:00 We’re not the victim here.
0:59:01 We’re the oppressed.
0:59:01 No, no, no.
0:59:02 We’re clearly not the victim.
0:59:07 And services, we run massive surpluses and our economy is tilted towards services.
0:59:11 And why would we want to go back to manufacturing given where the global economy is heading?
0:59:11 We don’t want to make Nikes.
0:59:12 We want to wear them, right?
0:59:13 What Dave Chappelle said.
0:59:14 Absolutely.
0:59:21 But my point here is that I don’t see Trump as necessarily needing to support the top one
0:59:21 percent.
0:59:26 I see Trump supporting himself and his family, you know, and a small number of donors.
0:59:27 That’s a handful of people.
0:59:29 He’s very transactional for that.
0:59:31 I get that.
0:59:35 But like, you know, if you want to go after you want to close the border and take out illegal
0:59:39 immigrants, like the easiest way to do that that could build a lot of support is go after
0:59:42 the corporations that are actually like bringing in all these.
0:59:44 Just tax the employers.
0:59:45 Just tax the employers.
0:59:50 But again, he doesn’t want to go after the employers or the corporations or those nice people
0:59:54 who are, that’s always been the case with immigrant.
0:59:59 I could go from, I think illegal immigration is the most profitable part of immigration.
1:00:00 We’ve turned a blind eye.
1:00:00 It’s a real problem.
1:00:04 So it turns out that we are more kleptocratic than authoritarian.
1:00:12 And that is probably, I guess, ultimately better for the American civilians, but not by much.
1:00:15 OK, respond to my conspiracy theory here.
1:00:21 Trump sets up essentially a Swiss banking account where you can put money in and the person who
1:00:25 puts money in can call you and say, by the way, I’m about to make you the wealthiest man
1:00:26 in the world.
1:00:30 What do you think about withdrawing support from Ukraine?
1:00:32 By the way, I’m also going to make you the wealthiest man in the world.
1:00:37 Maybe do something to thrust potential trading partners into our arms.
1:00:45 My conspiracy theory, Xi, China, and Putin, Russia, have committed to buying massive amounts
1:00:53 of the Trump coin in exchange for him levying a set of decisions that see just massive political
1:00:58 and economic advantage to Russia and to China.
1:01:00 I would ask the following.
1:01:05 If Putin and Xi had been elected president and vice president, what would be different about
1:01:06 what’s going on right now?
1:01:11 Yeah, me no like the Trump coin.
1:01:19 I mean, that is that’s obviously yet one more completely opacity driven means for corruption
1:01:21 and enrichment of Trump and his wife.
1:01:24 And this that’s not where the country should be heading.
1:01:30 I mean, the country would look very different if it was run by Xi and by Russia.
1:01:38 I mean, first of all, we wouldn’t be announcing 100 and 24 percent tariffs against China.
1:01:39 Right.
1:01:45 So, I mean, I think that let’s let’s take the China piece out of your conspiracy right
1:01:45 away.
1:01:52 He’s done a lot more with the Russians, but I have you don’t need if you don’t need a conspiracy
1:01:55 theory to explain something, don’t use one.
1:01:55 It’s additive.
1:01:58 And, you know, it’s complicated.
1:02:00 It’s it’s a complicating factor.
1:02:04 There are a lot of reasons for Trump to be doing what he’s doing with Putin, irrespective
1:02:05 of that.
1:02:05 Right.
1:02:07 I mean, he doesn’t like the EU.
1:02:14 He wants the EU to go away because they are a strong, coordinated group with trade competency
1:02:17 that undermines his influence on the global states.
1:02:21 He wants to deal with a bunch of individual smaller, weaker countries much more than he
1:02:22 wants to deal with the EU.
1:02:25 And by the way, Putin agrees with that completely.
1:02:29 So also when he meets with the European leaders, it’s like Obama.
1:02:31 They are educated.
1:02:32 They’re a feat.
1:02:34 They don’t respect him.
1:02:35 They snigger behind his back.
1:02:37 He got the intelligence on those conversations.
1:02:39 He knows what they really say about him.
1:02:43 Putin actually, like MBS, kind of treats him just like one of the guys.
1:02:49 So, I mean, Trump actually does enjoy talking with Putin more than he does enjoy talking with
1:02:54 Macron or or or Schultz or Starmer.
1:02:58 And so I think that gets you a fair amount of the way.
1:03:12 And then the fact it is true that if you look at the Riyadh conversations that the Americans had with the Russians a couple of months ago, Russia sent a couple of cabinet ministers, but also sent a businessman who was said to be an advisor to Putin.
1:03:23 But he also happened to have bought, coincidentally, a really expensive apartment from Trump that he spent a lot in Florida.
1:03:23 Oh, God.
1:03:24 How did we get here?
1:03:25 Literally, how did we get here?
1:03:26 Right.
1:03:28 So, I mean, I do.
1:03:39 I do accept, Scott, that like with MBS, which is where Trump is again making the first trip, that if there is a deal made with Russia, the cash register will be open.
1:03:49 That unlike the Europeans who can’t deliver money directly to Trump and family, you know, the Gulfies can and the Russians can and they will.
1:03:53 But I don’t think China is any part of that deal remotely.
1:04:09 Isn’t that, don’t we just start circling the drain when you allow certain levels of corruption that the incentives are just for everyone to be corrupt, that if you decide not to buy Trump coin or send Trump money, you end up on the wrong side of the largest person, the strongest military in the world.
1:04:11 Isn’t this just, isn’t this just a downward spiral?
1:04:20 I really don’t like the fact that the United States is setting the example for kleptocracy.
1:04:38 I don’t like the fact that the wealthiest man in the world, who you are no fan of, is, you know, occupying a position of authority in the United States, in the White House, at the same time that he is running and owning those companies, however well or badly.
1:04:44 And I remember when he met with Modi during the state visit at Blair House.
1:04:46 So, you know, part of the White House.
1:04:46 Right.
1:04:48 And he’s asked.
1:04:54 Trump is then asked in a press conference by a member of the journal, the media said.
1:05:05 So when when Elon met with Modi, was that in his official capacity or was it in his private sector capacity to advance his business interests?
1:05:07 And Trump, God bless him, actually answered honestly.
1:05:09 He said, I don’t know.
1:05:12 I mean, how could he know?
1:05:12 Right.
1:05:15 I mean, I neither both.
1:05:16 What does it matter?
1:05:17 Right.
1:05:19 And I mean, so we we have this.
1:05:21 It’s a very serious problem.
1:05:32 Most powerful country in the world and the most wealthy person in the world is conducting business and government affairs simultaneously interlinkedly.
1:05:33 Like, that’s not OK.
1:05:50 And he’s going after Schumer saying he’s corrupt and has fraud and and has no has no has given no evidence at the same time that he’s actually his companies are benefiting from billions of dollars of direct contracts from Pentagon and NASA.
1:05:56 I mean, that is that’s clearly a conflict of interest that we should have no part of.
1:05:57 Yeah.
1:06:01 And calling Senator Kelly an astronaut and an outstanding patriot a traitor.
1:06:04 But anyways, you’re you’re an amazing father, Elon.
1:06:08 Ian, give me give me something to be hopeful for here.
1:06:10 What have you seen recently that gives you hope?
1:06:13 Um, I’ve started this.
1:06:27 So I think the markets do create a level of honesty in people that we don’t necessarily see on a day to day basis.
1:06:30 So the adult in the cabinet right now is the Dow and the Nasdaq, isn’t it?
1:06:32 I mean, basically.
1:06:32 Right.
1:06:38 I mean, Jamie Dimon is saying he sounds a lot differently this week than he did at Davos.
1:06:38 Right.
1:06:42 And I don’t I don’t think that is courage.
1:06:50 I think that is, you know, his deep, his deep strategic revealed interest being, you know, made public.
1:07:03 And if we could do more of that, I mean, there’s got to be pain, there’s got to be crisis, but there might just be enough economic incompetence in all of this crisis to start hearing a little bit more pushback.
1:07:05 And I think that would be a useful thing.
1:07:18 Look, I mean, the fact that Elon is really at at at odds with Trump Navarro on the most disruptive thing they’ve done so far is helpful, frankly.
1:07:20 The most disruptive thing being immigration?
1:07:22 What are you referring to?
1:07:23 No, on tariffs, on tariffs.
1:07:23 On tariffs.
1:07:23 Excuse me.
1:07:24 Thank you.
1:07:36 Ian Bremmer is the president and founder of Eurasia Group, the world’s leading political risk research and consulting firm, and GZero Media, a company dedicated to providing intelligent and engaging coverage of international affairs.
1:07:48 He is also the author of 11 books, including the New York Times bestsellers, Us Versus Them, The Failure of Globalism, and The Power of Crisis, How Three Threats and Our Response.
1:07:49 We’ll Change the World.
1:07:54 He joins us from his office in, is it Midtown or Flatiron?
1:07:55 What would you call that?
1:07:55 A nomad.
1:07:57 It’s called nomad, officially.
1:07:57 Nomad.
1:07:57 Very cool.
1:07:58 Very cool.
1:08:01 Ian, it is always good to hear from you.
1:08:03 And let’s be honest, you are a Canadian spy.
1:08:06 You joined the ranks of Andrew Ross Sorkin.
1:08:08 I believe you’re working for the Canadian government.
1:08:09 It’s okay.
1:08:11 You will soon again be our allies.
1:08:17 Everyone can see me and Canadian spy Ian Bremmer and Andrew Ross Sorkin.
1:08:20 We’re going to do our I Love Canada tour.
1:08:20 You’re in.
1:08:22 You’re committing right now, right?
1:08:22 I am.
1:08:23 I am committing to you.
1:08:23 You get to pick the first city.
1:08:24 Is it Montreal or Toronto?
1:08:26 No.
1:08:28 If it’s I Love Canada, you’ve got to start with Toronto, of course.
1:08:29 Toronto.
1:08:29 All right, brother.
1:08:30 It’s always good to see you.
1:08:31 Okay.
1:08:31 Be good, man.
1:08:32 Thanks, Ian.
1:08:49 Algebra of Happiness on our other podcast, Prof G Markets.
1:08:50 I don’t know if you’ve heard.
1:08:51 I have several podcasts.
1:08:52 That’s right.
1:08:59 Anyways, on Prof G Markets, Ed Elson and I interviewed Gary Stevenson, who is this economist who’s sort
1:09:04 of blown up on TikTok, who is what I call a class trader, and I say that in the most complimentary
1:09:09 way, and that is he’s calling bullshit on wealthy people and is promoting what I think
1:09:14 is a basic truth, and that is, despite what the 1% and the incumbents will tell you, the
1:09:18 middle class is an accident, and if you don’t reinvest in it constantly through a progressive
1:09:22 tax structure and subsidies for the middle class, it goes away, folks.
1:09:23 It’s an accident in history.
1:09:26 It started from 1945 to 1995, maybe.
1:09:29 It’s been eroding since then, and if you don’t reinvest in it,
1:09:30 it goes away.
1:09:36 And I love this guy, and I think he’s fearless and out there spreading, I don’t know, God’s
1:09:36 gospel.
1:09:43 But he said something that really struck me, and that is that young men, I asked him what
1:09:49 advice we give to young men, that essentially, unfortunately, the likelihood that you end up
1:09:52 wealthy is a function of how rich your parents are.
1:09:57 And I always say it’s a function of when and where you’re born, but he’s right.
1:10:00 It’s more a function of how wealthy your parents are.
1:10:04 You can be born in any nation, and if your parents are rich, you’re probably going to do
1:10:05 okay.
1:10:10 You still have as much agency in the U.S. as any country in the world.
1:10:15 The mobility has not gotten worse here, but it’s not gotten better, and that is 11% of
1:10:18 the people in the lowest quintile make it to the top quintile.
1:10:20 That hasn’t gone up or down.
1:10:27 But what has changed is that if you’re the 89% that don’t make it into the top quintile,
1:10:30 you’re reminded 210 times a day that you’re failing.
1:10:35 There’s this notion that anyone can get rich with crypto, or we all know someone really
1:10:42 talented that ended up at NVIDIA at the right time, or becomes an influencer and makes a shit
1:10:42 ton of money.
1:10:48 But the vast majority of people don’t get that lucky or are just not that remarkable.
1:10:51 And there’s tremendous shame.
1:10:59 In Alain de Bouton, the British philosopher said that the downside to a meritocracy is that,
1:11:04 or the belief that we live in a meritocracy, is that if you don’t make it, that it’s your
1:11:06 fault, that you screwed up.
1:11:11 And what Gary said really struck me that there’s real dignity, and young men should feel good
1:11:15 about, can they find a way to make a decent living, take care of themselves, take care of
1:11:16 their kids.
1:11:19 They don’t necessarily need to have a plane.
1:11:20 They don’t even need to be wealthy.
1:11:26 But if they can put a roof over their family’s head, provide a warm, loving environment for them,
1:11:28 that that is something to be really proud of.
1:11:33 And as I think about it, I think these algorithms have been trained to tell young people, specifically
1:11:36 young men, that if they aren’t partying in St.
1:11:40 Bart’s and on a private jet, that they have fucked up.
1:11:47 That in a meritocratic society, in an economy with all these magnificent seven superstar companies,
1:11:49 that you should be rich.
1:11:51 And if you’re not, it’s your fault.
1:11:56 And most of the time, all of the time, it’s not your fault.
1:12:00 That a lot of your success for wealthy people is not your fault.
1:12:06 But if you’re not one of those people that manages to get to the top quintile, that there’s
1:12:12 real dignity, there’s real pride, and there’s real reward in being someone trying to live a
1:12:15 virtuous life that takes care of themselves and takes care of their family.
1:12:20 That that should be, we need to restore this notion that that’s enough and that there’s
1:12:23 real honor in that.
1:12:29 This episode was produced by Jennifer Sanchez.
1:12:30 Our intern is Dan Shallon.
1:12:32 Drew Burroughs is our technical director.
1:12:35 Thank you for listening to the Prop G pod from the Vox Media Podcast Network.
1:12:40 We will catch you on Saturday for No Mercy, No Malice, as read by George Hahn.
1:12:45 And please follow our Prop G Markets pod wherever you get your pods for new episodes every Monday
1:12:46 and Thursday.
1:12:46 Thank you.
1:12:47 Thank you.

0:00:04 There’s over 500,000 small businesses in B.C. and no two are alike.
0:00:05 I’m a carpenter.
0:00:06 I’m a graphic designer.
0:00:08 I sell dog socks online.
0:00:12 That’s why BCAA created One Size Doesn’t Fit All Insurance.
0:00:15 It’s customizable based on your unique needs.
0:00:18 So whether you manage rental properties or paint pet portraits,
0:00:23 you can protect your small business with B.C.’s most trusted insurance brand.
0:00:28 Visit bcaa.com slash smallbusiness and use promo code radio to receive $50 off.
0:00:29 Conditions apply.
0:00:32 Scientists find weird kinds of life all the time.
0:00:35 And normally they can run experiments.
0:00:38 If I hypothesize, life can live in bleach.
0:00:41 Well, I can get bleach and see if life lives in it.
0:00:47 But what if the weird thing about the life they find is that it lives for millions of years?
0:00:48 Time!
0:00:50 I don’t have any control over that.
0:00:52 I can literally do nothing with time.
0:00:54 This week on Unexplainable,
0:00:56 Intra-Terrestrials.
0:00:58 Aliens on Earth.
0:01:00 Deep beneath the seafloor.
0:01:04 Follow Unexplainable for new episodes every Wednesday.
0:01:14 Buying a house has long been considered the best way to build wealth and move into true adulting.
0:01:15 Isn’t it?
0:01:17 I mean, at least that’s what society wants us to think.
0:01:20 Got to get a Birkin, got to get a home, you know.
0:01:24 Okay, the handbag you can probably manage without.
0:01:26 But what about a house?
0:01:30 Surely that’s actually good, right?
0:01:34 We’re going to find out this week on Explain It To Me.
0:01:38 New episodes every Sunday morning, wherever you get your podcasts.
0:01:44 Welcome to Office Hours with Prof G.
0:01:48 This is the part of the show where we answer your questions about business, big tech, entrepreneurship,
0:01:49 and whatever else is on your mind.
0:01:52 Today, we have two great listener questions lined up.
0:01:56 And then after the break, we’re continuing our new segment, the Reddit hotline,
0:01:58 where we pull questions straight from Reddit.
0:02:02 If you’d like to submit a question for next time, you can send a voice recording to
0:02:03 officehours at profgmedia.com.
0:02:07 Again, that’s officehours at profgmedia.com.
0:02:11 Or if you prefer to ask on Reddit, post your question on the Scott Galloway subreddit.
0:02:14 Jesus Christ, that’s something I never thought I would say, Scott Galloway subreddit.
0:02:17 And we just might feature it in our next episode.
0:02:18 What a thrill!
0:02:20 Let’s bust right into it.
0:02:23 First question, I have not heard or seen these questions.
0:02:26 Hey, Prof G.
0:02:32 Given the recent performance of the stock and his dual roles as the CEO of Tesla and
0:02:38 Chief Doge Doge Doge, is there a point where Elon’s divided attention and or ever-increasing
0:02:43 negative public perception become a violation of his fiduciary responsibility to shareholders?
0:02:44 Thanks for all you do.
0:02:45 Jacob in Kansas City.
0:02:47 Jacob in Kansas City.
0:02:50 So yeah, but he doesn’t have a board.
0:02:52 So this is how corporate governance works.
0:02:53 Shareholders elect the board.
0:02:56 And the board really has two jobs.
0:02:58 They’re supposed to, one, what does it mean to be a fiduciary?
0:03:00 I love the word fiduciary.
0:03:01 I think it’s a fantastic word.
0:03:05 And that is once you have your deal, once you say, okay, I’m getting paid X,
0:03:09 your job is then as a fiduciary to represent the interests of others.
0:03:11 I love that.
0:03:15 When someone asks you to be their fiduciary for their estate, that’s a real compliment
0:03:18 because what they’re saying is, I think you can represent other people.
0:03:20 I think you have the skills to represent somebody else.
0:03:26 And also you have the integrity to think about or look at the lens of decision-making through other people.
0:03:27 It’s very difficult.
0:03:31 Other than instincts, one of the things that separates us from the animals is that we have
0:03:33 the ability to be just better fiduciaries.
0:03:34 We can represent society.
0:03:36 We can represent people that we will never meet.
0:03:39 I mean, I guess the board really has two jobs other than being good fiduciaries.
0:03:43 And then where you become a good fiduciary is you kind of have two things.
0:03:47 One, the chair of the audit committee just needs to make sure there’s not fraud, no surprises.
0:03:51 And then the other two real responsibilities of the board are one, when to hire and fire
0:03:55 the CEO and two, when to sell and if and when to sell the company.
0:03:59 But your primary job is to make sure you have the right guy or gal running the company.
0:04:01 That’s the most important decision they make.
0:04:05 I have found with almost every company I’m with, if you have the right guy or gal, things
0:04:06 work out.
0:04:08 If you don’t have the right guy or gal, it’s just not going to go well.
0:04:11 A good board can’t save a bad CEO.
0:04:14 A bad board can probably fuck up a good CEO.
0:04:21 But it really is about finding the right person and then having the sober conversation with other
0:04:27 board members who the CEO tends to weaponize and play golf with and help get their kids into
0:04:28 the school he went to.
0:04:31 And before you know it, you have a board that is just their buddies.
0:04:33 I have a four-year statute of limitations.
0:04:38 I leave every board within four years because I want to do a series of different things.
0:04:40 And I also find that boards need churn.
0:04:44 And on every board I’ve been on, there’s at least one or two people, if not three or four,
0:04:48 that are golfing buddies with the CEO and just don’t objectively evaluate the CEO.
0:04:51 And the CEO likes that because they don’t want to be objectively evaluated.
0:04:55 They want a board that’s going to continue to increase their compensation and agree with
0:04:56 them and provide advice.
0:04:57 Is that fair?
0:04:58 Some CEOs do like pushback.
0:05:00 Probably somewhere in the middle.
0:05:05 Anyways, in the case of Tesla, the board there has made so much fucking money.
0:05:11 They would let him, I don’t know, kill puppies on live TV.
0:05:13 And they’d say, oh, he’s a genius.
0:05:16 That’s a strategy around autonomous driving.
0:05:19 The chairman of the board, I think, has made $150 or $200 million.
0:05:23 So her job is just to make excuses for his behavior.
0:05:28 He basically engaged in market manipulation or securities fraud.
0:05:33 He said that he was taking the company private at $420 a share and that the funding was secured.
0:05:35 And the stock skyrocketed.
0:05:38 And then it ended up that, what do you know, he was probably on ketamine.
0:05:39 That was a lie.
0:05:41 And then the stock fell.
0:05:47 So anyone who bought the stock thinking that was credible information is owed money by Tesla,
0:05:50 whose CEO was lying to them.
0:05:54 And what does the board do of 499 of the S&P 500 companies?
0:05:56 They fire this area, boss, you’re in trouble.
0:06:00 At a minimum, they would say, you need to go into rehab and maybe we give you a job back, but unlikely.
0:06:03 Anyways, they have not done their job.
0:06:04 They’re not fiduciaries.
0:06:08 They made so much money that they’re basically the worst board now.
0:06:09 He could absolutely leave Tesla.
0:06:10 Why?
0:06:14 Because to his credit, he does what a good CEO is supposed to do.
0:06:17 And that is he builds a really strong team.
0:06:23 Supposedly, the way they describe him at Neuralink or at SpaceX now is he shows up,
0:06:26 gives a bunch of speeches, kicks over a bunch of trash cans,
0:06:28 and then he leaves and they get back to work.
0:06:29 He’s clearly a visionary.
0:06:33 But what people don’t appreciate or what he doesn’t get the credit he deserves for
0:06:38 is that he clearly can put together really talented management teams such that even when he’s off,
0:06:43 impregnating anyone he can find at a conservative CPAC conference
0:06:45 such that they can give birth to someone he will ignore
0:06:48 and then ultimately get sued for sole custody of that child because he hasn’t seen them,
0:06:52 that, all right, he’s able to do all these different things
0:06:54 because he’s put in place competent management teams.
0:06:57 Now, having said that, typically what happens in competitive markets
0:07:02 is that a company establishes differentiation based on technology or distribution channel,
0:07:06 which translates to margin power, which translates to above market shareholder gains,
0:07:10 and then the rest of the market goes, huh, maybe electric cars are the thing, huh,
0:07:12 maybe tune-ups over the airwaves are something, huh,
0:07:16 maybe we can come up with better battery technology, see above BYD,
0:07:19 and the differentiation gets reverse engineered out,
0:07:23 the margins or kind of irrational margins get starched out,
0:07:26 and the company just trades within a normal trading range.
0:07:28 The majority of car companies traded somewhere between, I don’t know,
0:07:31 six or eight and 20 times earnings,
0:07:33 and this company, see above, is trading at 144,
0:07:37 and that’s what I think we’re about to see over the next 12 months.
0:07:38 This is not financial advice.
0:07:40 I have been wrong on Tesla over and over and over,
0:07:43 but if this stock was trading at the same multiple as other car companies,
0:07:45 it’d be trading at about 14 bucks a share,
0:07:47 and I think today it’s at 260 or 270.
0:07:51 So, yes, they have violated their fiduciary duty.
0:07:52 Thanks for the question.
0:07:54 Question number two.
0:07:57 Hello, my name is Clara.
0:07:58 I’m from California.
0:08:05 I have a 15-year-old grandson who is desperate to learn something about money.
0:08:07 He wants to learn about money.
0:08:14 Unfortunately, neither his parents nor I have a clue as to how to guide him.
0:08:18 His school is of no use in that regard.
0:08:20 What do you suggest?
0:08:22 Thank you.
0:08:23 Clara, I love this question.
0:08:24 15.
0:08:27 So, my son is 14, and he’s constantly asking me,
0:08:28 how can I make some money, Dad?
0:08:32 And I sit down with him, and I say, all right, let’s go to ChatGPT,
0:08:35 and let’s say, all right, I’m a 14-year-old.
0:08:36 I have a little bit of money.
0:08:37 I’m good with technology.
0:08:41 I’m super into football, soccer.
0:08:42 How can I make extra money?
0:08:48 And it comes back with five ideas, including buying shirts, unprinted shirts, football shirts,
0:08:53 and then figuring out a way to embroider them or put cool stuff on them, using Shopify for the back end.
0:08:55 And we’ll do this together.
0:09:02 And then another idea was the AI suggested that we buy sneakers during sneaker drops at Nike
0:09:04 and then try and resell them.
0:09:05 And you have to have some money.
0:09:08 Some of the times the sneaker drops are $150 or $200.
0:09:10 But he learns about it.
0:09:11 He learns about taking risks.
0:09:16 He learns about trying to examine the market, look at data, customer service.
0:09:18 You’ve got to ship those shoes once you get them to a buyer.
0:09:20 How much money did he make?
0:09:21 Well, it ends up with shipping and everything in taxes.
0:09:24 We lost a little bit of money, but that’s a life lesson, too.
0:09:28 So I think the way you learn about money to a certain extent, if you’re talking about money,
0:09:30 is you start a little bit of a small business.
0:09:31 I’ve been an entrepreneur my whole life.
0:09:34 I started walking dogs when I was his age to try and make some money.
0:09:38 Now, in terms of learning the markets for money when you’re 15,
0:09:43 I don’t know if it’s too early for him to be reading the front page of the Wall Street Journal,
0:09:47 but I love that you’re involved in your grandson’s life.
0:09:48 What a gift.
0:09:51 What a gift for you and what a gift for him that you’re thinking this way.
0:09:56 So to the extent that he’s willing, read the front page of the Wall Street Journal,
0:10:01 those little bullets, and then discuss them with him and say, you know, what does it mean?
0:10:02 What are earnings?
0:10:05 Also, I think an interesting way to learn about the markets.
0:10:07 When I was 13, I wasn’t very popular.
0:10:08 I know that’s hard to believe.
0:10:09 I know that’s hard to believe.
0:10:13 And my mom’s boyfriend gave me $200.
0:10:15 By the way, he had his own family.
0:10:18 We were the second family, but that’s an entirely different story.
0:10:23 But he gave me $200 and said, if I get back next weekend and you haven’t bought stock,
0:10:26 go to one of those fancy brokerages in Westwood, I want my $200 back.
0:10:31 So I went down to Dean Witter Reynolds, I think it was, and I met this guy named Cy Saro.
0:10:33 This was literally 45 years ago.
0:10:36 And I walked in with $200 and I ended up buying.
0:10:38 He came out, introduced himself.
0:10:41 We bought 12 shares or 16 shares in Columbia Pictures.
0:10:46 And I used to call him from the Emerson Junior High phone booth and ask what the stock had
0:10:46 done that day.
0:10:49 And then he would give me a lesson on why the stock moved.
0:10:51 He said, okay, there’s buyers and there’s sellers.
0:10:56 When there’s more buyers one day than there are sellers, the sellers get to increase the
0:10:57 price or the buyers.
0:11:02 Actually, the buyers have to increase their bid such that they can attract more sellers
0:11:03 into the market to sell those shares.
0:11:05 And then where they two meet is the market.
0:11:07 And these platforms are market makers.
0:11:08 That would be a lesson.
0:11:11 And then he would say, okay, I would say, why is the stock up today?
0:11:14 He said, well, Close Encounters of the Third Kind is a hit.
0:11:15 I’m dating myself.
0:11:16 Why is the stock down today?
0:11:17 Well, Casey’s shadow is a bomb.
0:11:19 And I started learning about the market.
0:11:24 So maybe reading together the front page of the Wall Street Journal and discussing it,
0:11:30 maybe buying a couple of shares in stock, download the public app and buy a couple of
0:11:33 shares in companies and say, why do you want to buy this company and discuss it with them?
0:11:38 I’ve made a good amount of money starting and selling businesses, but where I’ve made a crazy
0:11:40 amount of money is investing in stocks.
0:11:46 And I go back to that moment where I walked into a brokerage and I used to call Cy from
0:11:48 Emerson Junior High School and talk about the markets.
0:11:52 To give me a love for the markets, it got me thinking about investing early and often.
0:11:56 And just a quick side note, Cy and I are still in touch.
0:12:02 45 years later, every Christmas, my birthday, Father’s Day, he sends me a nice text message
0:12:05 to say that he hopes I am doing well.
0:12:07 Anyways, Clara from California.
0:12:07 Thanks for the question.
0:12:10 We have one quick break.
0:12:14 And when we’re back, we’re diving into the depths of Reddit, the bowels of Reddit.
0:12:21 Support for Prop G comes from LinkedIn.
0:12:25 One of the hardest parts about B2B marketing is reaching the right audience.
0:12:30 And sometimes it feels like the only solution is posting everywhere, paying exorbitant amounts
0:12:32 of money just to get one company to notice you.
0:12:36 It’s time for a new strategy so your ads don’t get lost in the noise.
0:12:40 LinkedIn ads can help by ensuring your message makes it to the right audience.
0:12:45 LinkedIn has grown to a network of over 1 billion professionals, making it stand apart from
0:12:46 other ad buys.
0:12:50 You can target your buyers by job title, industry, company role, seniority skills, and company
0:12:50 revenue.
0:12:54 LinkedIn has all the professionals you need to reach in one place.
0:12:59 So stop wasting budget on the wrong audience and start targeting the right professionals only
0:13:00 on LinkedIn ads.
0:13:05 LinkedIn will even give you a $100 credit on your next campaign so you can try it yourself.
0:13:09 Just go to linkedin.com slash scott.
0:13:11 That’s linkedin.com slash scott.
0:13:15 Terms and conditions apply only on LinkedIn ads.
0:13:23 Support for Prof G comes from Masterclass.
0:13:27 It’s one thing to be curious, but you really set yourself apart from the crowd by turning
0:13:30 your curiosity into action and growing for the better.
0:13:33 With Masterclass, you can learn from the best to become your best.
0:13:37 You can think like a boss and live like a legend with Martha Stewart.
0:13:41 You can learn how to invest in the stock markets with investor Ray Dalio and some of Wall Street’s
0:13:41 best.
0:13:46 You can learn leadership skills from former CEOs, including Inja Noye, Howard Schultz, Rosalind
0:13:49 Brewer, Whitney Wolfherd, and more.
0:13:51 I checked out Masterclass.
0:13:56 I saw the one with Bob Iger and Martha Stewart and enjoyed them both and learned about the
0:13:59 creative process for just $10 a month billed annually.
0:14:04 A membership with Masterclass gets you unlimited access to every instructor, and you can access
0:14:07 Masterclass on your phone, computer, smart TV, or even in audio mode.
0:14:13 Right now, our listeners get an additional 15% off any annual membership at masterclass.com
0:14:14 slash prop G.
0:14:19 That’s 15% off at masterclass.com slash prop G.
0:14:21 Masterclass.com slash prop G.
0:14:28 Support for the show comes from Betterment.
0:14:32 When investing your money starts to feel like a second job, Betterment steps in with a little
0:14:33 work-life balance.
0:14:37 They’re an automated investing and savings app, which means they do the work.
0:14:41 While they build and manage your portfolio, you build and manage your weekend plans.
0:14:45 While they make it easy to invest for what matters, you just get to enjoy what matters.
0:14:50 Their automated tools simplify the complex and put your money to work, optimizing day after
0:14:52 day and again and again.
0:14:57 So go ahead, take your time to rest and recharge, because while your money doesn’t need a work-life
0:14:58 balance, you do.
0:15:01 Make your money hustle with Betterment.
0:15:03 Get started at Betterment.com.
0:15:07 That’s B-E-T-T-E-R-M-E-N-T dot com.
0:15:10 Investing involves risk, performance not guaranteed.
0:15:13 Welcome back.
0:15:15 We asked and Reddit delivered.
0:15:16 Let’s bust right into it.
0:15:22 Our first question comes from Pancake Gold E, as in Goldie Hawn.
0:15:23 That’s weird.
0:15:28 They say, okay, what is the craziest fan encounter you’ve ever had?
0:15:30 Generally speaking, they’re not crazy.
0:15:35 Generally speaking, they’re super lovely.
0:15:38 I don’t know if this is a good or a bad thing.
0:15:41 I had breakfast today and we were talking about addictions.
0:15:43 I think that every person has a certain level of addiction.
0:15:46 It’s just important to be in touch with it.
0:15:47 Addictions are for survival.
0:15:51 You’re supposed to be addicted to gorging food because there was an absence of salty,
0:15:52 sugar, and fattery food.
0:15:56 But now that industrial production has vastly outpaced our instincts, we gorge even when we
0:15:56 don’t need to.
0:15:58 But there’s a reason for addictions.
0:16:03 I’m addicted to the affirmation of others, specifically strangers.
0:16:04 But I can modulate it.
0:16:08 I can realize that, okay, what’s really important is to have your friends and family love you.
0:16:09 That’s like job number one.
0:16:16 And if strangers don’t like you on threads or on blue sky, you know, is that relevant?
0:16:17 Yeah, is it meaningful?
0:16:18 Maybe is it profound?
0:16:19 Absolutely not.
0:16:20 I’ve gotten much better at that.
0:16:23 I don’t get as rattled by strangers’ comments anymore.
0:16:26 I actually kind of stopped reading the comments.
0:16:31 I want to write and act as if no one’s reading or as if no one’s commenting.
0:16:36 It’s like I’ve always thought the people I’ve just so admired, the people at restaurants where
0:16:40 I’m on vacation and a good song comes on and they get up and they dance on the table like
0:16:41 no one’s watching them.
0:16:43 I think you want to live your life that way.
0:16:46 I think the most successful people in the world have one thing in common, and that is they dance
0:16:47 as if no one’s watching them.
0:16:49 I try and remember that when I dance.
0:16:51 I try and think, well, what happens when I’m home alone?
0:16:56 Like after when Trump was elected, I literally the next morning spent the entire day, entire
0:17:01 day experimenting with Xanax and Peroni, or as I call it, my panics method.
0:17:06 And I found out that I am an outstanding dancer to 80s music.
0:17:08 The dogs are totally freaked out.
0:17:09 Didn’t matter.
0:17:14 I have incredible moves to the straight line beats of George Michael, Tom Petty, R.E.M.
0:17:19 I mean, I can just fucking, I can just burn up the rug in my pajamas with a Peronian hand
0:17:25 and with a little bit of Xanax kind of helping daddy, helping daddy give a little bit of that
0:17:30 rhythm that every 49-year-old white guy has.
0:17:31 Is that racist?
0:17:32 Is that racist?
0:17:34 Anyways, probably, hey, Graham.
0:17:37 So when I get fan encounters, they’re really nice.
0:17:38 People come up to me.
0:17:39 They’re super wonderful.
0:17:40 They want to take photos.
0:17:47 Even when they disagree with me, they go, the most common comment I get, hands down, is
0:17:48 the best comment, and it’s the following.
0:17:50 And people say the following.
0:17:53 While I don’t always agree with you, you make me think.
0:17:55 And that’s, folks, that’s why I’m here.
0:18:02 If I’m just reinforcing your current beliefs, then I’m just fucking Fox News, tickling your
0:18:03 censors and dividing America.
0:18:08 The whole idea is to occasionally, and I do this sometimes, sometimes I’ll say something
0:18:12 I know coming out of my mouth, I don’t know if that’s right, but it’s provocative and I
0:18:13 want people to think.
0:18:17 I want us to look at the issue from all different angles and think, are we getting this right
0:18:21 and wrong such that we can express different viewpoints and hopefully craft better solutions
0:18:25 and learn and stretch and strain and damage the muscle in between our ears such that it
0:18:26 grows back stronger.
0:18:30 Anyways, I can’t tell you how lovely the encounters are.
0:18:30 The craziest ones.
0:18:32 One comes to mind.
0:18:39 I was a can and this guy came up, this nice guy in kind of a leather jacket.
0:18:40 And I was saying, why is he in a leather jacket?
0:18:41 It’s so warm.
0:18:42 And he came in and he’s like, I love your videos.
0:18:44 And I had a line actually develop.
0:18:46 I’m kind of a big deal at can.
0:18:49 Anyways, and there was a line of people who wanted to say hi or get their book signed.
0:18:50 So he said, I love your video.
0:18:50 I’m like, great.
0:18:51 Do you want to get a picture?
0:18:52 And he was sort of like, well, okay.
0:18:54 And we took a quick picture and I said, boss, big line.
0:18:55 He started asking me a question.
0:18:58 I cut him off and said, I really apologize, but I got to get through the rest of the line.
0:18:58 He said, oh, I understand.
0:18:59 And he laughed.
0:19:03 And then the next person comes up and goes, you know, that was Jensen Huang, right?
0:19:07 That’s the CEO of NVIDIA who’s built an amazing company that’s worth more than Intel.
0:19:07 And I didn’t know what to do.
0:19:10 And I turned around and went, Jensen, Jensen.
0:19:11 He’d already walked off.
0:19:13 He didn’t need to hang out with me.
0:19:15 Anyways, that was sort of funny.
0:19:16 Is there another one?
0:19:18 Is there another one?
0:19:22 Someone, when I was in, where was I?
0:19:23 I was in LA.
0:19:24 I said, wait for a minute.
0:19:24 Wait for a minute.
0:19:28 And she pulled her kid out of the car and it was like a three-year-old.
0:19:33 And she held the baby in her arms and she said, Johnny, Johnny, what do you say?
0:19:35 What do you say when the radio comes on?
0:19:38 And he went, go, go, go.
0:19:43 Because I guess they listen to my podcast in the car and his favorite part is when I say go, go, go.
0:19:47 So in general, they haven’t been that crazy, but what they have been is lovely.
0:19:59 And I’ve often said, or I believe that LLM, it’s a shame that LLMs are crawling the online world because I think the online world is, while fascinating and interesting and can be inspiring, there’s a lot of toxicity.
0:20:00 And it is a bit of a cesspool.
0:20:04 But on the whole, I find in general, people out in the real world are really nice.
0:20:06 And I don’t always find that online.
0:20:10 But nothing that crazy, just mostly really lovely.
0:20:13 And I really do appreciate when people come up and say hi.
0:20:14 It’s really nice to me, really rewarding.
0:20:15 Thanks for the question.
0:20:25 Next and last question, a faceless void reads, before having kids, where did you find meaning in your life?
0:20:26 Whoa.
0:20:31 Before kids, where did you find meaning in your life?
0:20:35 I don’t think I did.
0:20:40 I had motivation.
0:20:44 I grew up without money or without enough money.
0:20:55 And I quickly learned in a capitalist society that your ability to take care, I would say the reason I’m rich is because of, I mean, there’s a lot of reasons.
0:21:05 The generosity and vision of California taxpayers and the reason I’m rich in California that led unremarkable kids into UCLA, 76% admissions rate, 2.27 GPA at UCLA, then got into Berkeley.
0:21:08 So public, I’m a product of public, I’m a product of big government.
0:21:22 So United States government, being born in America, the United States and all of the sacrifice and commitment people have made to build this incredible infrastructure, this incredible public works, including the University of California, is a key component of my success.
0:21:30 Two, or maybe it’s the irrational passion for my well-being of my mother, but every day in small and big ways, she told me she loved me.
0:21:34 And if you do that with a child, I think over time, they start to believe you.
0:21:35 And I think that’s really important.
0:21:42 The thing that was most motivating for me was women, specifically two types of women.
0:21:45 And one’s a hallmark story and the other’s like kind of crass.
0:21:48 The first is I wanted to take care of my mom.
0:22:01 I got, my mom got very sick when I was in graduate school and it was the most kind of rattling, traumatizing thing I’ve ever been through because I didn’t, I wasn’t capable of taking care of her because I was in graduate school.
0:22:10 I didn’t have any money and she was discharged from the hospital early and it was just a very ugly situation and I didn’t know what to do and I felt powerless.
0:22:17 And that was the first time I really felt this sort of masculine instinct kicking in that I, I’m the man of the house.
0:22:18 It’s me and my mom.
0:22:23 I am supposed to take care of my mom who took great care of me and I couldn’t.
0:22:25 And it was just incredibly humiliating and upsetting.
0:22:35 And I thought, all right, there’s a lot of things outside of your control in terms of making money, but the things that are in your control, getting your shit together, being disciplined, working really hard, none of which I had done to that point.
0:22:36 I decided, all right, that’s it.
0:22:40 I’m going to, I got to get my act together because I got to take care of my mom.
0:22:50 And from that point forward, quite frankly, I just worked all the fucking time, took a lot of risks and really tried hard to, to make money.
0:22:51 Money was my motivation.
0:22:54 And then the second thing also involves women.
0:22:58 And that is I wanted women in my life.
0:23:00 I wanted romantic and sexual partners in my life.
0:23:07 And I noticed I did the math pretty early that women seem to be attracted to guys who had their shit together and could signal resources.
0:23:14 So for me, my motivation, I don’t really think I had meaning, was making money.
0:23:17 And I’m not proud of that, but that’s the truth.
0:23:29 Up until the age of 45, my identity and my motivation was to be economically secure so I could take care of my mom and be more attractive to potential mates and also just be relevant to other men and be interesting.
0:23:31 It wasn’t even about living well.
0:23:33 Like I wasn’t addicted to things.
0:23:37 I didn’t, you know, I never like had fat cars or anything like that.
0:23:38 I lived well.
0:23:40 I didn’t deny myself of anything, but it wasn’t, that wasn’t the motivation.
0:23:48 The motivation for me was relationships specifically to take care of loved ones and to be, you know, to find a great mate.
0:23:49 That was my motivation.
0:23:52 I did not have purpose in my life.
0:23:53 And I kind of knew it.
0:23:55 I kind of knew, like, I don’t know what this is all about.
0:23:57 I can’t get enough of anything.
0:23:59 I can’t get enough of experiences.
0:24:00 I can’t get enough of money.
0:24:02 I can’t get enough of dating.
0:24:03 I can’t get enough of anything.
0:24:06 I recognized that I was like a hunger monster.
0:24:16 And the, when I had kids, which I didn’t want to have, I didn’t want to have, I was with a partner who was, you know, higher character, much hotter than me.
0:24:18 And she basically said, I want to have kids.
0:24:22 And I said, well, I don’t want to have kids because I don’t want to get married.
0:24:24 And she said, I don’t need to get married to call my bluff to have kids.
0:24:28 And boom, we pulled the goalie for like three minutes and she was pregnant.
0:24:31 The dog is fertile.
0:24:32 That’s right.
0:24:38 Anyways, when that kid came rotating out of my girlfriend, I felt tremendous anxiety at first.
0:24:41 Not like, oh, I have purpose because I, it was a rough time for me economically.
0:24:44 And I felt shame that I already wasn’t taking care of him.
0:24:45 Jesus Christ.
0:24:51 I think about the two hardest moments coming home, not being able to take care of my mom and feeling as if I failed my brand new son.
0:25:00 But slowly but surely, and Fraser Crane said this on the Fraser show, that you don’t, you don’t immediately love your kids, but you fall in love with them.
0:25:01 I found that to be true.
0:25:09 And I have found that caring more about these kids than I care about myself is an unlock.
0:25:09 It’s relaxing.
0:25:11 What are you doing this weekend?
0:25:12 Shit, I don’t know.
0:25:12 It’s Friday.
0:25:13 I need to be fucking fabulous.
0:25:14 I’m a baller.
0:25:15 I’m living in New York.
0:25:15 I’m a tech guy.
0:25:25 I need to be around super interesting people at super interesting venues and be with super hot women and do incredible things.
0:25:27 And then, okay, next weekend, how do we raise the bar?
0:25:29 Once you have kids, oh, what are you doing?
0:25:30 I’m going to soccer practice.
0:25:30 What are you doing?
0:25:31 Yeah, it’s the same soccer practice.
0:25:36 And I’m going to some lame birthday party on Sunday with all the other dads to give their partners a break.
0:25:39 At first, it’s like, this fucking sucks.
0:25:41 And then it becomes sort of relaxing.
0:25:44 It’s like, okay, that’s what I do.
0:25:45 I’m dad.
0:25:46 That’s what I do.
0:25:54 And being involved or caring more about someone else than you care about yourself has been incredibly cathartic for me.
0:25:56 And I do finally have my purpose.
0:26:01 And my purpose is to raise loving, patriotic men.
0:26:04 And I want boys who will find a good partner.
0:26:07 I try to be really good to their mother.
0:26:07 I model that.
0:26:19 I try to motivate them to a variety of things, and I want them to be patriotic, not only to their country, but to the world, to think about the human race, to be good, kind to others, build a better world, and absolutely build a better country.
0:26:21 And that’s my purpose.
0:26:25 That will be the last thing I think that will run through my mind is that I want, have I done that?
0:26:28 Have I tried to model that behavior?
0:26:29 Have I given them the resources?
0:26:35 So it’s really nice to feel a sense of purpose in a weird way just to get existential.
0:26:40 I’m not ready to die, but I feel like it’s no longer going to be a tragedy.
0:26:42 I feel like I’ve mostly accomplished that.
0:26:43 We’ll see.
0:26:44 They’re still young.
0:26:49 But it just makes the idea, when I was young, the idea of dying was just terrifying to me, as it should be.
0:27:00 And now I’d like to be around for another 50 years, but if I’m not, I’ve kind of checked the box, and that is I have produced offspring that I think will add more value to the world than I’ve added.
0:27:08 And at the end of the day, that is really our core and only mission here is to produce, in my view, or make the world a better place.
0:27:13 And one way you can do that is by producing offspring that are smarter, stronger, faster than you.
0:27:16 And it’s so nice to have that purpose.
0:27:20 I’m not saying everyone needs that to have purpose, but that was where I found mine.
0:27:24 But pre-kids, I didn’t have meaning.
0:27:25 What I had was motivation.
0:27:29 And my motivation in a capitalist society was, quite frankly, was money.
0:27:30 Thanks for the question.
0:27:34 That’s all for this episode.
0:27:38 If you’d like to submit a question, please email a voice recording to officehours at proptamedia.com.
0:27:41 Again, that’s officehours at proptamedia.com.
0:27:48 Or, if you prefer to ask Reddit, just post your question on the Scott Galloway subreddit, and we just might feature it in our next Reddit hotline segment.
0:27:58 This episode was produced by Jennifer Sanchez.
0:27:59 Our intern is Dan Shallon.
0:28:01 Drew Burrows is our technical director.
0:28:04 Thank you for listening to the Prop G pod from the Vox Media Podcast Network.
0:28:09 We will catch you on Saturday for No Mercy, No Malice, as read by George Hahn.
0:28:15 And please follow our Prop G Markets pod wherever you get your pods for new episodes every Monday and Thursday.

0:00:04 There’s over 500,000 small businesses in B.C. and no two are alike.
0:00:05 I’m a carpenter.
0:00:06 I’m a graphic designer.
0:00:08 I sell dog socks online.
0:00:12 That’s why BCAA created One Size Doesn’t Fit All Insurance.
0:00:15 It’s customizable based on your unique needs.
0:00:18 So whether you manage rental properties or paint pet portraits,
0:00:23 you can protect your small business with B.C.’s most trusted insurance brand.
0:00:28 Visit bcaa.com slash smallbusiness and use promo code radio to receive $50 off.
0:00:29 Conditions apply.
0:00:34 Support for this show comes from Panerai for more than 150 years.
0:00:38 Panerai’s watches have showcased the perfect balance of pioneering innovation
0:00:40 and the brand’s storied legacy.
0:00:45 And now the newly unveiled Luminor Marina timepieces celebrate the evolution
0:00:49 of one of Panerai’s most emblematic and enduring collections, the Luminor.
0:00:52 While the Luminor collection traces back to the 1960s,
0:00:56 the latest models introduced new innovative materials and design refinements
0:00:59 while retaining the collection’s bold, iconic style.
0:01:02 You can shop the new Luminor collection at Panerai.com
0:01:05 or make an appointment at the boutique nearest you.
0:01:12 Discover the world of Panerai at P-A-N-E-R-A-I dot com.
0:01:16 Hey, this is Peter Kafka.
0:01:20 I’m the host of Channels, a podcast about technology and media
0:01:23 and how they’re both changing all the time.
0:01:27 And this week, I’m trying to figure out how Donald Trump is changing the media
0:01:30 in Washington, in the courtroom, and in the boardroom.
0:01:33 On to help me figure it all out is Sarah Fisher,
0:01:37 the excellent Washington-based media reporter for Axios.
0:01:42 That’s this week on Channels, wherever you get your favorite podcasts.
0:01:49 Welcome to Raging Moderates.
0:01:50 I’m Scott Galloway.
0:01:51 And I’m Jessica Tarla.
0:01:52 Should I run for president, Jess?
0:01:54 It seems like the internets want you to.
0:01:55 Yeah?
0:01:56 Stack ranking.
0:01:58 Give me the pluses and the minuses.
0:01:59 The dog.
0:02:00 Dog 28.
0:02:01 A chicken in every pot.
0:02:03 A Cialis in every cupboard.
0:02:04 We’re going off script here.
0:02:06 I’m coming in hot.
0:02:07 What do you think?
0:02:08 Give me the negatives first.
0:02:09 I can take it.
0:02:11 I’m thick-skinned, although I may never speak to you again the rest of my life.
0:02:11 Go ahead.
0:02:12 Oh, well, that would be a bummer.
0:02:15 I would hope that you could at least give me a low-level campaign position.
0:02:17 You’re going to be ambassador.
0:02:20 No, you’re going to head up, what is it, American Free Radio?
0:02:23 To the islands with the penguins that got a big tariff?
0:02:24 No, the one they just canceled.
0:02:26 You’re going to be my Carrie Lake.
0:02:29 I’ll send you to Voice of America and then fire you the next day.
0:02:31 I’ll put you in charge of Doge.
0:02:35 Just use sub-congressional authority and ramp up the spending on everything.
0:02:37 I like that.
0:02:39 I won’t be in it for that.
0:02:40 I’ll think about what position I would want.
0:02:45 But the big negative, I would think, would be your family.
0:02:48 I do not feel like they would be excited about this.
0:02:49 100% agree.
0:02:51 My son brought it up.
0:02:53 My 17-year-old came home, panicked, and said, are you running for president?
0:02:54 I said, no.
0:02:58 And my partner said, the only thing, she listed off about 15 reasons I shouldn’t.
0:03:02 Then the one she liked said, I’d like the outfits.
0:03:06 And see, that almost compensated for the 15 negatives.
0:03:08 Yeah, the outfits are pretty serious.
0:03:19 And if they’re now even dressing first ladies that they don’t like, imagine what she would have access to if the couture were available to her.
0:03:22 I mean, saving the country seems like a good thing.
0:03:32 I feel like we’re moving into a world in which a traditional politician is going to have a much harder time winning a primary.
0:03:41 At least there’s going to be a need for some pushback of someone with, like, real-world experience, also understands media very well, which you do.
0:03:48 And not to be too positive, I guess, at the beginning of the show, because I don’t want you to get too big for your britches in minute three.
0:03:50 It’s happened already.
0:03:51 I’m already there.
0:03:52 We’ve already arrived.
0:03:53 Dad, when are we getting there?
0:03:54 We’re here.
0:03:55 We are here.
0:04:07 But it does feel as if an abundance Democrat, because now we’re a cohort, is going to have, I don’t want to say a very easy time, because I think the primary is going to be super fierce.
0:04:20 But if you’re looking at where the electorate is and how people moved in 2024, it feels like someone that thinks like you slash Ezra Klein could do very well.
0:04:22 So, I mean, I’m excited.
0:04:26 And once I figure out what it is that I want to do for the campaign, that’s going to be very important.
0:04:28 Well, you’re clearly, at this point, you’re comms director.
0:04:30 If you bring up Ukraine, you’ll be secretary of defense.
0:04:32 We’re going to pivot back and forth.
0:04:33 This is all inspired.
0:04:39 I was on a college tour this week, and it was a really, really lovely and emotional week for me.
0:04:45 And I spoke at the University of Chicago at the Institute of Politics, run by David Axelrod, and he interviewed me.
0:04:48 And he said, what should Democrats do?
0:04:51 And I said, this is the platform Democrats should adopt.
0:04:55 And then everyone weighed in and said, you should run.
0:05:04 And then, over the weekend, I heard from all people or organizations, a guy who runs a law firm who’s very involved in democratic politics.
0:05:06 And this is how the sausage gets made, I guess.
0:05:09 And he said, I slash we will put in $10 million.
0:05:18 If you put in $10 million, that’ll get you the name recognition you need and get your ideas out there.
0:05:20 And we’ll see how you do, and we’ll go from there.
0:05:23 And I thought, that’s really interesting.
0:05:33 They clearly want people with money, but there’s a machine out there kind of behind the curtain working to identify candidates.
0:05:46 And it’s also sort of a signal of just how desperate things have become when they reach this far into the barrel that someone is willing to give me $10 million to announce I’m running for president and start putting my ideas out there.
0:06:01 Well, I think, and I don’t want to diminish the importance or the weight of this early ask, but I think that people are pretty smart about the fact that we’re going to spend several billion dollars on doing this.
0:06:08 Again, if it’s possible that they’re going to hit a winner or someone who at least can get the conversation started.
0:06:14 Remember when we were on the bulwark with Tim Miller and he said, like, why doesn’t someone just start running for president now?
0:06:22 And you could be that person because you’re not the governor of Pennsylvania right at this particular moment.
0:06:33 So I think a $10 million investment makes a lot of sense when they, A, could have someone who could go on and do it, and B, looking at the total haul that’s going to be spent on this.
0:06:34 So are you taking the money?
0:06:35 Are we going?
0:06:39 Well, first I’ll tell you what my platform is because I made it up on the spot.
0:06:42 I think our platform, I don’t think we can go back.
0:06:48 I think the current platform of we need to return to normal is not what Americans are looking for.
0:06:56 The right is coarse and mean and stupid, but the left is corporate elitists who tell us what we want to hear and then just continue in this grift that’s not helping Americans.
0:06:57 Can’t go back.
0:07:05 And my campaign or my platform that I thought the Democrats should adopt is very simple.
0:07:08 We all do this because we want to have purpose in our life.
0:07:09 We want to have meaning.
0:07:17 And the thing that is the source of that purpose and meaning, I think for most people, is the ability to partner with someone and raise children.
0:07:23 And I don’t think you have to do that to be happy, but I think that’s table stakes for the most prosperous nation in the world.
0:07:33 And so I would reverse engineer every policy up to this great unifying theory of everything, and that is young people should have the opportunity to meet and fall in love.
0:07:34 What does that mean?
0:07:49 National service, more freshman seats, more mental health, starting kids later, boys later, getting more funding in pre-K and education, putting a lot more money in their pockets, tax subsidies for third places.
0:07:59 Give more young people the opportunities, break up big tech, tax the shit, hold them liable for things that radicalize young men and sequester them for society.
0:08:02 Give people the chance to meet and fall in love.
0:08:07 And we don’t like to talk about it because it sounds sexist or weird, but not enough young people are getting together.
0:08:36 And then should they decide to have kids, table stakes, 7 million manufactured homes, which are 30% to 50% less expensive than homes built on site within six years, minimum wage of $25 an hour, every state that’s done it has grown their economy, stop the bullshit that it’s going to destroy jobs, tax holiday for people under the age of 40, such that young people, should they decide, can start the most meaningful, purposeful voyage in life.
0:08:43 And that is to have a family and should they decide not to have kids and spend that money on brunch and St. Bart’s more power to you.
0:08:49 But for me, that’s table stakes, and we should reverse engineer any policy that gets in the way of love.
0:08:56 If you can’t be in an emergency room or in a hospital room with someone because you’re the same sex, we do away with that law.
0:09:04 If you’re putting a family in poverty because you’re forcing a 16-year-old to carry a baby to term, no, we’re not going to lie.
0:09:09 We’re going to redo family court to try and get dads more involved in people’s lives.
0:09:11 And also, I’m a war hawk.
0:09:20 I’m just a big believer that the far left doesn’t understand that the moment people have the ability to take our Netflix and espresso away with violence, they will.
0:09:23 Anyways, love and prosperity, 2028.
0:09:24 What do you think?
0:09:24 I’m in.
0:09:26 I’m living it.
0:09:28 Well, a little bit less on the prosperity.
0:09:29 I see a vice president.
0:09:31 I see a vice president.
0:09:33 Oh, now I get upgraded?
0:09:34 Why not?
0:09:37 You’re literally more qualified than half the cabinet right now.
0:09:37 I mean.
0:09:38 You are.
0:09:39 Low bar, but thank you also.
0:09:41 I’m not sure about that.
0:09:42 Well, I don’t know.
0:09:44 I am a little bit sure of that at this particular moment.
0:09:55 But I’m looking forward to talking about your platform for the Democratic Party with our special guest of the live show, which is coming up next week.
0:09:56 He should run.
0:09:56 It’s Hakeem Jeffries.
0:09:57 Oh, Hakeem.
0:09:59 I was thinking Mark Cuban.
0:10:00 No.
0:10:01 He’d be amazing.
0:10:06 I think Mark Cuban has kind of the sauce in terms of witty banter and fleet of foot.
0:10:09 And also, he has the money, which unfortunately is hugely important.
0:10:11 Do you think Hakeem Jeffries should run for president?
0:10:18 I think Hakeem Jeffries is pretty busy right now, but I think it’s important that we tell our listeners that we have this amazing guest.
0:10:18 Oh, yeah.
0:10:19 He’s coming on with us.
0:10:20 Talk about that.
0:10:23 Well, we have our live show coming up on April 17th.
0:10:23 Sold out.
0:10:24 Sorry, folks.
0:10:24 You’re out.
0:10:25 Wait outside.
0:10:27 I might sign.
0:10:28 I might sign something.
0:10:31 I might say hi on the way out as I dash into my suburban.
0:10:33 Is that like a thing that people do at the Y?
0:10:35 They wait to sign autographs?
0:10:40 I’m expecting a suburban with one of the Kardashian sisters waiting inside adoringly for me.
0:10:45 That’s, you know, potential number, what am I, 48?
0:10:47 I should be dating a Kardashian.
0:10:50 You are the Benjamin Button of the podcasting world, huh?
0:10:51 That’s right.
0:10:53 I’m aging in reverse, 100%.
0:10:57 But Mark Cuban and Hakeem Jeffries are both probably in the top 10.
0:11:00 I haven’t heard Hakeem’s name a lot.
0:11:00 Really?
0:11:02 Is that because you’re not paying attention to politics?
0:11:03 Is that right?
0:11:06 Is that because I’m ignorant to all of this?
0:11:09 Yeah, the minority leader, the leader of the Democratic Party.
0:11:11 You’re not hearing a lot about him.
0:11:14 Is anyone hearing a lot from any Democrat right now?
0:11:15 Well, you were on school tour.
0:11:18 But anyway, we’re very excited to have him with us.
0:11:21 And it’s a big deal that he wanted to do it.
0:11:26 And we’ll see for those of you who can be there on the 17th, but you can also watch online.
0:11:31 There’s an option to buy tickets for that on the 92nd Street Y site.
0:11:32 Okay, Secretary of Commerce.
0:11:33 Oh, I’m sorry.
0:11:34 Be careful.
0:11:35 Pretty soon you’re going to be Secretary of Transportation.
0:11:37 Although you look great this morning.
0:11:38 I’m going to make you director of HHS.
0:11:40 Is that the good looking one?
0:11:46 Well, you got to think someone who’s in good shape and looks good should be, would be better than some anti-vax weirdo.
0:11:51 I mean, sure, but RFK Jr. is like not hot to me anymore, like post kids dying of measles.
0:11:55 I’m like, it’s overriding my attraction to him.
0:11:57 I mean, he looks great for his age, but all right, get into it.
0:11:58 He’s a good looking guy.
0:12:00 All right, let’s get into it.
0:12:05 Last week, President Trump shook global markets by announcing sweeping tariffs on nearly everything the U.S. imports.
0:12:15 In a Rose Garden appearance, he imposed a 10% baseline tariff on all countries and with much deeper rates for countries he called the worst offenders, including China, the EU, Japan, and South Korea.
0:12:20 Basically, our largest trading partners, if not our strongest allies.
0:12:26 China alone was hit with a 54% tariff and quickly responded with 34% of retaliatory tariffs.
0:12:28 Markets tanked.
0:12:35 The Dow posted its biggest back-to-back losses since March 2020 when the pandemic created, obviously, incredible uncertainty.
0:12:42 So it’s just important to note, we are now have the same level of uncertainty about what’s going to happen as when a global pandemic was killing,
0:12:47 when they had to have makeshift refrigerator trucks as morgues outside of Langone here in New York.
0:12:54 The S&P 500 entered bear market territory on Monday, and tech giants, including Apple and NVIDIA, were hit hard.
0:13:00 On top of that, Jess, a separate 25% tariff on foreign-made cars also took effect Thursday.
0:13:09 The Fed warns this could fuel inflation, and a Yale study estimates it’ll cost the average U.S. household over $2,000 a year, with low-income families hit hardest.
0:13:12 That’s usually U.S. economic policy.
0:13:19 And Congress is now pushing back with a bipartisan bill to limit the president’s power to impose tariffs without approval.
0:13:22 Jess, Trump has urged patience.
0:13:29 That’s the party line, that somehow he’s playing 40-chest, and we should just wait, and we’re taking some pain, but the pain will be worth it.
0:13:36 However, China’s slapping on a 34% retaliatory tariff, and the EU gearing up for its own responses.
0:13:39 Are we officially, do you think, in a full-blown trade war?
0:13:44 It feels, I mean, I’m looking forward to listening to your markets coverage again.
0:13:48 With that, I thought you guys did a great job on that episode that came out this morning.
0:13:55 It feels like someone formally has to declare that, someone more important than me, as I’m only the HHS secretary.
0:14:08 But it feels like we’re inching closer to it, and this level of whiplash is not comfortable for anyone but the true, true, truest of believers.
0:14:13 And it seems like even some of those people are just not having it anymore.
0:14:17 You kind of see top Trump defenders from the finance community.
0:14:22 Like, Bill Ackman has been having a meltdown on social media for the last few days.
0:14:28 He’s going after Lutnick, which I find that part pretty amusing in all of this.
0:14:38 But you have people like Stan Druckenmiller who tweeted, I guess this is not a regular occurrence for him, that he does not support tariffs in excess of 10%.
0:14:48 The Wall Street Journal wrote an article even about the fact that he had a tiny tweet just to say that people are taking his words out of context when he talked about the potential benefits of tariffs.
0:14:54 And, I mean, there were so many reactions to this that I found interesting.
0:15:05 But one in particular was the Singaporean prime minister who did a direct-to-camera, two-and-a-half, three-minute speech about what’s going on here.
0:15:12 And how this is a total shakeup to the global order and that this is not so bad for Singapore at this particular moment.
0:15:23 But as a country that relies heavily on trade, that they know now that we are entering a new, what do you say, arbitrary and protectionist phase, that America is not a reliable partner.
0:15:37 And he brought up the fact that when we did have a trade war in the 1930s, we ended up in armed conflict leading to World War II, which was a pretty scary forecasting to be hearing in all of this.
0:15:46 And, I mean, some things as a political strategist with, you know, I have a Ph.D. in political economy, but definitely politics more my business.
0:15:48 Remember, you’re going to be Secretary of State.
0:15:49 Oh, my God.
0:15:53 By the end of this, maybe I’ll be president and you can be my VP.
0:15:54 I’ll be comms director.
0:15:55 You just want to be comms director?
0:15:56 OK.
0:15:59 No, I’ll be like Billy Carter, just embarrassing you if you go.
0:16:03 No, you never embarrass me, or at least I wouldn’t admit that in such a public forum.
0:16:09 But I keep thinking about the job of government.
0:16:19 And we’ve this has been a theme in our conversations as, you know, we’ve gone the last six months and that the parties have a different vantage point on what role government is supposed to have in your life.
0:16:23 But fundamentally, we all agree that the government is supposed to protect us.
0:16:33 And Trump ran on that with the border, right, saying Biden opened it up and Harris was even the borders are and they did nothing about this policy.
0:16:36 And millions of people got in here.
0:16:42 Americans are dead as a result of undocumented people that came across the border during the Biden years, et cetera.
0:16:53 And I’m looking at an administration that tells you to keep holding the line when 62 percent of Americans own stocks or mutual funds.
0:16:57 This isn’t a problem only for the top 10 percent or something.
0:17:04 Scott Besant gave a big interview to Tucker Carlson and was making this out to be a rich person’s problem.
0:17:06 He did the same thing on the Sunday shows.
0:17:07 That is not true at all.
0:17:13 This is a middle class and upper middle class and certainly upper upper class problem.
0:17:27 But this collective F you to the majority of Americans who are not too dumb to understand what’s going on and are aware of the fact that also this calculation was based on a mistake.
0:17:33 There’s an incredible article from the conservative think tank, the American Enterprise Institute,
0:17:45 where they were the ones that figured out that they had done the equation improperly in determining what the tariffs are that led to that chart that they paraded out there that Ed was talking about on Prof G markets.
0:17:52 And people know it is not just about Nike doing more here or more auto plants here.
0:17:54 Like this is a small business problem.
0:18:08 The amount of small businesses in America that run off of cheap imports is in the millions and they can’t afford to pay a $500,000 tariff in order to stay in business.
0:18:16 This is going to wreck every sector of the economy if it keeps up like this.
0:18:19 And this morning there was and we should say it’s 11 a.m.
0:18:21 On Monday morning that we’re recording.
0:18:30 There was a rumor that Kevin Hassett from the president’s team had said that there was going to be a 90 day pause or they’re exploring a 90 day pause on everyone.
0:18:32 But China market jumped up.
0:18:35 Then the White House confirmed that that wasn’t the case.
0:18:37 And now the market is back down.
0:18:40 And how are we supposed to survive this?
0:18:46 Yeah, just to the point about playing the populist argument of like a small number of people.
0:18:54 I think the Dow and the Nasdaq are in fact terrible metrics because they give the illusion of prosperity and that everything’s fine.
0:18:58 So life expectancy has gone down for the last five years.
0:19:00 Our kids are more obese and anxious.
0:19:12 But we don’t have these really elegant metrics to track that that everybody talks about every day at the beginning of every news program if it goes up a lot or down a lot.
0:19:15 So we’ve decided that that’s more important.
0:19:18 And the argument they’re making is one they’ve never made before.
0:19:20 They didn’t make it until it was convenient.
0:19:27 But I do believe that the Dow and the Nasdaq are not an accurate reflection on the health and well-being of America.
0:19:27 They’re an indicator.
0:19:28 They’re a signal.
0:19:31 But people think, oh, market’s up 2%.
0:19:33 That means America is 2% better today.
0:19:34 No, that’s not true.
0:19:42 And there are reasons you would probably want to sacrifice or justify the long-term investment or tradeoff of the markets going down.
0:20:05 If we were to decide that people in the most prosperous nation in the world should not live in poverty if they work full-time and we need to create incentives for work and we need to buttress the American brand, which includes central to that, that we work, Americans work hard, and we raise minimum wage to $25 an hour, where it would be naturally if it had kept pace with productivity or inflation.
0:20:13 And McDonald’s and Walmart stock went down, and so did Chipotle, because they’re dependent upon labor at $12 or $15 an hour.
0:20:14 I think that would be worth it.
0:20:16 I think you could make the argument.
0:20:35 If we were to say we’re going to – these deficits are out of control and we need to be more responsible and stop taxing young people in the future and we’re going to substantially increase the tax rate on corporations, which are paying their lowest taxes since 1929, okay, I get it.
0:20:38 And the market would go down because I remember being on the board.
0:20:39 I was on the board of Dex Media.
0:20:43 I remember one quarter of them saying, we beat earnings by 30%.
0:20:44 And everyone was like, what?
0:20:45 What happened?
0:20:47 What good thing happened?
0:20:50 And they said, well, the Trump tax cuts just took effect.
0:20:51 And our stock went up.
0:21:05 So if you created a more progressive tax structure and took corporations back to, say, not even the median of what they’ve usually paid, but in the 30th percentile versus the lowest, which is where they are now, I think that’s worth it.
0:21:07 This is an own goal.
0:21:13 This is shooting yourself in the feet and then after recognizing what you’ve done, you take the gun and you put it in your mouth.
0:21:18 Lumber comes across or steel and aluminum comes across the border from Canada.
0:21:19 We tax it.
0:21:20 We collect some revenue.
0:21:27 But it makes it more expensive for our cars, which supposedly are going to go up $10,000 to $12,000 per car.
0:21:35 And aluminum that goes into everything, including a workout bench, including steel that you build in buildings, everything goes up in price.
0:21:39 So the demand for those products goes down so people can have less of them.
0:21:42 And then the other nation puts on reciprocal tariffs.
0:21:51 And Jack Daniels or Brown Foreman, one of the biggest companies, I think, in Kentucky, sells less and they make less money.
0:21:53 So our prices go up.
0:21:55 We make less money.
0:21:58 And the demand for our products goes down.
0:22:05 And the amount of money collected in the tariff is dwarfed by the loss in capital.
0:22:10 So this is just the oldest, this is the biggest un-goal or own goal since Brexit.
0:22:12 It’s an economy that’s $25 trillion.
0:22:15 So we’re taking everyone else down with us.
0:22:17 And it’s the definition of stupid.
0:22:20 Smart people help themselves while helping others.
0:22:23 That’s the basis of capitalism and, quite frankly, free trade.
0:22:26 We don’t want these manufacturing jobs back.
0:22:29 We are the second largest manufacturer in the world.
0:22:38 People don’t want to go back into a manufacturing facility and put on a hazmat suit or work with a robot doing repetitive tasks.
0:22:43 They would rather be in higher-paid service work or very high-end finished goods manufacturing.
0:22:45 We have purposely made these trade-offs.
0:22:48 Now, have we done a good job protecting the people outplaced?
0:22:49 No.
0:22:59 But this is a conscious decision to move to more higher-end, higher-margin, higher-paying lines of business in the service economy or very high-end manufacturing.
0:23:08 The other thing that people aren’t recognizing is that these tariffs are especially punishing on us.
0:23:09 And this is what people are missing.
0:23:13 Toyota trades at 0.6 times revenue.
0:23:16 Their market cap is equivalent to 0.6 times their top-line revenue.
0:23:19 Tesla trades at 8 times revenue.
0:23:26 So assume these tariffs sort of diminish each company’s revenues by a billion dollars.
0:23:32 That means the market capitalization that Toyota loses is $70 million.
0:23:36 The market cap that Tesla loses is $8 billion.
0:23:44 So just the general level of prosperity and wealth is massively decreased in America relative to other countries
0:23:48 because when they bring in a Mercedes, it trades at 0.23 times revenues.
0:23:54 When we export Meta or NVIDIA, NVIDIA trades at 24 times revenues.
0:24:05 So free trade is overly accretive to us because we’re selling them high-margin products and we’re importing low-margin products.
0:24:18 Every dollar we increase from selling our products abroad, we recognize a much greater increase in market capitalization and value and prosperity than when they lose a dollar.
0:24:29 This is the biggest own goal in history, maybe since we tightened the fiscal programs of 1929 and 30 and just made things worse.
0:24:30 What’s your thoughts?
0:24:31 I agree.
0:24:47 I mean, it all sounds reasonable to me the way that you’re putting it and it just runs completely counter to what Trump is saying, the quote-unquote goal of this, which is no more trade deficits, which is a complete impossibility.
0:24:59 We’re not set up anyway to be the kind of economy that you would need to be, a manufacturing economy, not less because we have to take, you know, two to three years to even build a factory.
0:25:06 But Larry Fink from BlackRock was speaking at the tariffs and he said, we don’t have the workers for this and we don’t have the interest in it.
0:25:25 Like to your point about people are not dying to go get an assembly line and you have the commerce secretary out there talking about how people can be the ones putting the screws in the iPhone, like as if that’s the goal for everybody who’s feeling like they’re getting a bad deal with the way the global economy is structured.
0:25:42 And I think as usual, I don’t want to say the fundamental problem, but at least a fundamental problem in what’s going on with this tariff strategy implementation is that nobody who’s speaking on behalf of the administration has the same story.
0:25:44 So Lutnik saying we want to reshore everything.
0:25:46 Besant wants more free trade deals.
0:25:48 Navarro wants to burn it all down.
0:25:53 Now Elon wants this robust free trade zone, right, an EU free trade zone.
0:25:56 So which official has the actual policy?
0:26:07 And, you know, I’m going back to the fact that it was all predicated on a mathematical error and the economists who they even whose paper is being cited in this have even now spoken out.
0:26:15 There’s have an op-ed in the New York Times saying they completely missed the point, which doesn’t surprise me at all about this administration and the kind of clown car that we have going on.
0:26:18 But what is the policy?
0:26:36 And if you were setting it, I’m curious as to what you would be doing about China, because I’ve been reading a lot, particularly in the FT, about how much China is pumping their products through other Asian countries,
0:26:44 particularly Vietnam, and that that’s the way that they’re going to try to get around any tariffing, also looking even to Mexico.
0:26:50 So they can kind of huff and puff and President Xi can say we’re going to have a retaliatory tariff to 34 percent.
0:27:00 But if China is the big dog problem in all of this for the U.S., how can they address that problem in particular?
0:27:05 Let’s use China as an example to bring it home down to a ground level.
0:27:06 Get this, Jess.
0:27:09 Seventy-seven percent of toys imported in the U.S. are imported from China.
0:27:14 As a result of the new tariffs, toy prices could jump as much as 50 percent.
0:27:15 Think about this.
0:27:20 Four-fifths of America is going to have half as many toys under the Christmas tree.
0:27:21 That’s what this president means.
0:27:23 You don’t think your kids are going to notice that?
0:27:27 Half as many toys this holiday.
0:27:29 And they do pay some tariffs.
0:27:30 I think it’s like 10 or 12 percent.
0:27:34 This is going to take those tariffs to 34 percent.
0:27:46 And the clowns of the Trump administration or Peter Navarro will say, well, actually, the company that we are exporting from that is sending their products into the U.S. will absorb those costs.
0:27:56 That would make them a monopsonist, meaning that they have so much power that essentially they’ve been able to dictate prices to this point.
0:28:03 And they can easily take the price down and still make a lot of profits if they could have if that were, in fact, the case, they would have already done it.
0:28:07 They would have already raised their prices and captured that additional revenue.
0:28:11 They will basically not have as much demand.
0:28:13 They will not lower their prices because they can’t.
0:28:14 They have to make a profit.
0:28:18 So the prices will go up and there’ll be less demand.
0:28:21 Now, 70 percent of people have hand to mouth.
0:28:24 So they’re not going to go, oh, toys are a little bit more.
0:28:26 But Trump has this master plan.
0:28:27 No biggie.
0:28:39 They will have to buy 20 percent less toys to meet the same Christmas budget, meaning that every kid in America, the family, is going to have eight toys under the Christmas tree, not 10.
0:28:43 This immediately impacts American consumers.
0:28:46 In addition, 40 million jobs in the United States.
0:28:49 And you think, well, it’s a big country, 350 million.
0:28:49 That’s not as bad.
0:28:52 Only 150 million people work.
0:28:58 So a quarter of workers, their jobs are directly linked, if not dependent, upon trade.
0:29:06 So this will have huge impact on unemployment, prosperity, inflation, prices.
0:29:08 And this leads me to one place.
0:29:15 And it sounds, I realize I’m going to sound a little bit Laura Loomerish, but just free your mind.
0:29:25 And that is, if somehow we had elected Putin as president and Xi as vice president, and they said, okay, what do we need to do with America to help us?
0:29:27 We need them out of Ukraine.
0:29:36 We need to fragment the alliances between the largest economies in the world that believe in democracies and pushing back on autocrats.
0:29:44 We need to thrust every large economy and trading partner into the arms of China, of me, Mr. Xi.
0:30:05 What would be different about the major policies that the Trump administration has implemented since inauguration than the policies that the Putin-Xi administration would be implementing had they been elected president and vice president of the United States?
0:30:35 And effectively, I believe, and I’m paranoid, it doesn’t mean I’m wrong, but he either has such weird acolytes and a cultish group around him that have bought into this cult of Trump, and he is really, really stupid, or they have taken advantage, Putin and Xi, of this ultimate grift, the Trump coin, where they essentially opened a Swiss banking account that people can put money in.
0:30:47 And it’s not disclosed and have called Trump and said, hey, I need you to figure out a way to get out of Ukraine, I’m losing, I’m losing, I’ve lost 800,000 people, it’s draining my military, it’s weakening me.
0:30:55 And Xi to say, I’d love for Japan and South Korea to get over their differences with us and start trading with us.
0:31:04 What would be different about America if it had been the Putin-Xi ticket than the Trump-Vance ticket?
0:31:09 It’s just, I mean, we don’t like to say that because we don’t want to be the pizza gate guys.
0:31:17 There is more legitimacy to the conspiracy I am outlining than any conspiracy they have put forward.
0:31:23 What would they do differently had they been elected president and vice president?
0:31:23 Your thoughts?
0:31:52 Well, I think that you’re touching on something that has become kind of omnipresent, I guess, in democratic circles or in buyer’s remorse circles as well about President Trump, which is the number of people, including first and foremost Hillary Clinton, who was on record, essentially calling every single thing that was going to happen through the first and beginnings of the second administration, save for the Abraham Accords, which I do think are a bright shining light in this.
0:32:01 And I’m not sure that President Xi and Vladimir Putin would have been as into that as Trump administration 1.0.
0:32:08 But you see, like, video circulating now of Mitt Romney calling it, saying we’re going to have a recession.
0:32:11 Kamala Harris calling it, saying we’re going to have a recession.
0:32:15 They were predicting by the summer, I think Kamala said.
0:32:16 So this could come a little early.
0:32:19 I think Goldman has it up to, what, a 60 percent chance.
0:32:27 And if the tariffs, the April 9th tariffs go through in full, they’ll say it’s immediately up to the 100 percent likelihood of a recession.
0:32:29 So I think your point is well taken.
0:32:37 But it gets to this larger issue of how do you say that without seeming like someone who needs to be wearing a tinfoil hat?
0:32:39 Because we’ve gone through this before.
0:32:46 People have been chicken little screaming for years about, you know, he’s a Russian agent.
0:32:48 He’s not on the side of America.
0:32:53 He’s on, you know, the side of the most terrible authoritarians that are out there.
0:32:59 And the American electorate rejected that argument at the ballot box.
0:33:10 And so now we are stuck with this mess and also in finding a way to articulate a cogent counterargument to it.
0:33:16 And I already mentioned a few minutes ago that I was listening to Scott Besson on with Tucker Carlson.
0:33:18 What do people say?
0:33:20 Like, I listen so you don’t have to.
0:33:23 But it was actually, you know, a pretty thoughtful conversation.
0:33:32 But I was stuck on, you know, the number of times that Besson says we’re heading for a financial calamity because of our debt.
0:33:35 Not something that you say the same, right?
0:33:36 He’s talking about wealth inequality.
0:33:38 He sounds like an economic populace.
0:33:40 He sounds like Bernie Sanders or Donald Trump.
0:33:47 And then the problem is, is that their solution does nothing to get us out of that jam.
0:33:51 You know, talking about lowering the corporate tax rate, benefits accruing to the richest people,
0:33:57 cuts to food stamps, cuts to food stamps are part of their policy, $880 billion in cuts to Medicaid.
0:34:01 And society will not be better off.
0:34:02 It will not be more balanced.
0:34:12 It will not be freer or fairer under the Republican legislation that they’re trying to get through, the big reconciliation bill, or frankly, under their leadership.
0:34:26 And, you know, you’re seeing because it has to do with money and money brings Republicans out of hiding and you’re seeing this pushback on whether Trump even has the right to do this in the first place.
0:34:36 So there are seven Republicans in the Senate that are signing on to this bill, which is a bipartisan co-sponsored bill, to limit his tariff ability.
0:34:46 But, like, I was watching Rand Paul on the floor give this speech, a completely historical speech, looking back, saying, like, this is why we left.
0:34:48 There is no taxation without representation.
0:34:52 The Constitution is clear that the president cannot do this.
0:34:56 And the power to tariff goes through Congress.
0:34:58 Ted Cruz has said something similar.
0:35:05 James Lankford was on TV last night, very conservative senator, talking about it as well, that this is going to be an issue for the courts.
0:35:07 There’s going to be a House bill.
0:35:12 Congressman Don Bacon, who’s a Republican, is bringing up on the House.
0:35:13 Obviously, all the Dems are going to sign on.
0:35:18 I don’t know how many Republicans will feel the same.
0:35:25 But he’s told us who he is more times than I can count.
0:35:32 You know, this is someone who gets to the Supreme Court, which ends up granting him a level of immunity that you never expected.
0:35:39 But this is someone who wants the ability to shoot someone on Fifth Avenue and for nobody to care and for there to be no penalties about it.
0:36:00 And I feel, you know, borderline despondent about this, not only because of the economic consequences of it, but this feels like a constant affirmation of the fact that this man has no limits and that society may not be structured in such a way that we can push back effectively and make a real change.
0:36:01 I’ll show a couple of things there.
0:36:02 Let’s talk about the deficit.
0:36:04 We’re a family.
0:36:07 If we’re a household, we make $50,000 a year.
0:36:11 We spend $70,000 and we have debt of $320,000.
0:36:15 And unfortunately, this debt, our kids will get it.
0:36:17 Our kids may not want it, but they’ll get it.
0:36:20 So mom and dad are going to Cancun and doing tequila shots.
0:36:26 And they have this amazing credit card and they keep getting more and more offers because they’ve always paid their debts.
0:36:28 And they continue to live above their means.
0:36:32 There is a really solid argument that we need to get our fiscal house in order.
0:36:36 I think the Democrats should become dead hawks.
0:36:40 Having said that, there’s two ways you address the deficit.
0:36:43 The first is to cut spending and raise taxes.
0:36:44 You just have to.
0:36:48 But you also need to continue to grow.
0:36:54 So if you were to, for example, massively raise taxes and cut spending the way they’re cutting.
0:36:57 People stop spending money.
0:37:03 And we’re not going to solve the deficit if we don’t continue, if we shrink the top line.
0:37:07 And the reason we’re headed, in my opinion, towards a deflationary economy.
0:37:09 I think inflation is going to come down and they’ll claim victory.
0:37:11 But I think we’re going to go deflationary.
0:37:21 And a deflationary economy is especially bad because what happens is if you have a mortgage or credit card debt or student loan debt, you end up paying with more valuable dollars.
0:37:23 You have less money, more valuable dollars.
0:37:29 Inflation, in some ways, is good for people with large fixed debt because they’re paying with less valuable dollars.
0:37:34 So you have to, you can’t put the economy into a coma.
0:37:39 If you were to cut Social Security or I don’t want to cut it, I want to means test it.
0:37:40 I want to move the age limit up.
0:37:44 It’s now three people for everyone supporting someone on Social Security.
0:37:45 It used to be 12 to 1.
0:37:48 It’s absolutely the thing we don’t talk about on Social Security.
0:37:49 It’s an aggressive tax.
0:37:53 Someone making $160,000 on my team pays $9,000.
0:37:58 If I make $10 million in a year selling stock or companies, I pay, wait for it, $9,000.
0:38:03 So we tax the middle class and lower class households full freight on Social Security.
0:38:04 But rich people, it’s capped.
0:38:08 But you wouldn’t want to cut it too much.
0:38:18 You wouldn’t want to cut spending too much because the last thing you want to do is diminish the second weapon of getting us out of the deficit, and that is growing.
0:38:29 If we just grow 3.6% a year GDP growth, which is real growth, that means in 10 years the economy grows by 50%, which should grow our tax base 50%.
0:38:38 And who knows, if we’re thoughtful and even keep spending flat, maybe take it down, we substantially reduce the deficit.
0:38:46 But you can’t just come in and start cutting and put the economy into a coma thinking you’re being responsible.
0:38:47 You’re not.
0:38:49 There are two sides to debt reduction.
0:38:50 Growth.
0:38:53 Growth isn’t everything, but it’s mostly everything, as is productivity.
0:38:55 You have to have both.
0:39:06 So attempting to, quote unquote, use it as an excuse to put the economy in a coma, that is cutting off your nose to spite your face.
0:39:09 It absolutely makes no sense.
0:39:25 The other thing we should just keep in mind here is that, and this is the reason why I believe that U.S. stocks are going to vastly underperform the rest of the world, is that there’s two components to a stock price.
0:39:33 There’s the earnings that represents the underlying innovation, culture, industry they’re in of a company, right?
0:39:38 The profits, and then the stock is a function of the profits times the earnings multiple.
0:39:47 The earnings multiple on the S&P 500, all 500 of our biggest, best companies, is around 28 until Wednesday.
0:39:48 Now it’s about 26.
0:39:52 The S&P multiple in the German stock market is 22.
0:39:53 Japan, 18.
0:39:55 China, 14.
0:40:03 Now, why do great companies trade as a whole on different multiples when they’re under the umbrella of a different nation or a different index?
0:40:05 And that’s why everyone wants to go public on U.S. exchanges.
0:40:11 It’s because we have certain attributes and features that people and investors all over the world really like.
0:40:13 America is more risk-aggressive.
0:40:14 It has more risk capital.
0:40:15 It has great universities.
0:40:16 It has great IP.
0:40:18 It’s really flexible.
0:40:19 It’s agile.
0:40:21 And it has rule of law.
0:40:26 No one’s going to come and just, China put Didi out of business.
0:40:28 We don’t like your practices around information.
0:40:29 You’re out of business.
0:40:31 They can put a company out of business.
0:40:35 Jack Ma, you’re talking, you’re a little too big for your britches.
0:40:36 We don’t like what you’re saying.
0:40:39 We’re going to disappear you for six months.
0:40:41 The U.S. has rule of law.
0:40:45 So companies feel somewhat safe that when they’re investing, they’re protected.
0:40:47 Their money is protected.
0:40:49 Two, we’re seen as consistent partners.
0:40:51 They’re not stupid.
0:40:52 They’re not sclerotic.
0:40:53 They don’t have these epileptic seizures.
0:40:57 They don’t just weigh in and decide not to do business with certain people or kick these
0:40:59 nations out or kick these companies out.
0:41:01 They respect rule of law.
0:41:07 We haven’t seized the $300-plus billion in Russian assets, despite the fact they’ve invaded
0:41:11 a neighbor, because we have rule of law.
0:41:17 Because we no longer in the last two months have those associations with the American brand
0:41:21 of rule of law and consistency, I believe you’re going to see a re-rating of the price earnings
0:41:26 multiple on the S&P down from 28 to more like what China’s at at 14.
0:41:30 And this is what that means and why it’s so important to investors.
0:41:42 You can’t outrun multiple contraction if the multiple on U.S. stocks gets cut in half, which it very well could, and it’s happened before.
0:41:46 You know, all of these nations had traded at higher multiples in the U.S. before.
0:41:56 Then a company like Meta, a company like P&G could grow its earnings 18% a year, which is incredible.
0:41:59 And in five years, its stock would still be down.
0:42:03 In Latin America, it didn’t matter how good your company was.
0:42:12 The flows of capital out of Latin America because of different policies, inconsistent governments, unreliability, lack of rule of law,
0:42:18 have taken their multiple consistently down for the last 10 or 20 years, and no one’s made any money.
0:42:35 So the multiple contraction we’re about to endure in U.S. stocks because of the puncturing, because of the exit of this notion of this brand America that includes rule of law and consistency,
0:42:47 is going to result in a massive contraction in market capitalization in the U.S., which will trickle down to U.S. households, prosperity, tax revenue.
0:42:53 This is, I mean, you never like to predict a recession because people like me have predicted nine of the last three recessions.
0:43:05 But if you see this kind of multiple contraction that I think we’re about to incur because of the puncturing and erosion of the brand U.S. right now,
0:43:13 you’re going to see just a massive, you’re going to see companies overperform, hit all of their earnings, and their stocks are going to go down over the next couple of years.
0:43:14 That’s an uplifting story. Thank you.
0:43:15 Right?
0:43:15 Yeah.
0:43:17 There you go. I should write children’s novels.
0:43:20 Oh, my God. Your children’s novels would be so weird.
0:43:22 Dog, 2028. Things are about to get worse.
0:43:29 Sometimes, sometimes it’s darkest just, sometimes it’s darkest just before it’s pitch black.
0:43:31 How’s that on a bumper sticker?
0:43:37 I mean, I’ve seen worse ones, but that would be up there for sure.
0:43:40 But it feels like the mood that folks are in right now.
0:43:43 But we have to take a quick break. Stay with us.
0:43:49 Support for the show comes from NetSuite.
0:43:51 Nobody knows what the future will bring.
0:43:56 Sure, you can keep an eye on trends and cross your fingers, but rates will always rise and fall and rise again.
0:44:00 The bear market will change to a bull market and back again.
0:44:04 And until they invent a crystal ball, your next best bet is NetSuite by Oracle.
0:44:11 Almost 40,000 companies choose NetSuite to help future-proof their businesses so they can stay on track no matter what tomorrow brings.
0:44:20 NetSuite is a top- discarded cloud ERP bringing accounting, financial management, inventory, and HR into one fluid platform with one single source of truth.
0:44:25 NetSuite offers real-time insights and data you can use to make the right decisions at the right time.
0:44:32 All to help you close your books in days, not weeks, so you can spend less time looking backwards and more time on what’s next for your business.
0:44:39 And whether your company is earning millions or even hundreds of millions, NetSuite can help you respond to immediate challenges and seize opportunities.
0:44:46 Speaking of opportunity, download the CFO’s Guide to AI and Machine Learning at netsuite.com slash prof.
0:45:06 It’s been a rough week for your retirement account, your friend who imports products from China for the TikTok shop, and also Hooters.
0:45:10 Hooters has now filed for bankruptcy, but they say they are not going anywhere.
0:45:15 Last year, Hooters closed dozens of restaurants because of rising food and labor costs.
0:45:23 Hooters is shifting away from its iconic skimpy waitress outfits and bikini days, instead opting for a family-friendly vibe.
0:45:30 They’re vowing to improve the food and ingredients, and staff is now being urged to greet women first when groups arrive.
0:45:33 Maybe in April of 2025, you’re thinking, good riddance?
0:45:37 Does the world still really need this chain of restaurants?
0:45:44 But then we were surprised to learn of who exactly was mourning the potential loss of Hooters.
0:45:50 Straight guys who like chicken, sure, but also a bunch of gay guys who like chicken?
0:45:55 Check out today’s Explained to find out why exactly that is, won’t ya?
0:46:05 So we want to introduce you to another show from our network and your next favorite money podcast, for ours of course, Net Worth and Chill.
0:46:09 Host Vivian Tu is a former Wall Street trader turned finance expert and entrepreneur.
0:46:14 She shares common financial struggles and gives actionable tips and advice on how to make the most of your money.
0:46:27 Past guests include Nicole Yoder, a leading fertility doctor who breaks down the complex world of reproductive medicine and the financial costs of those treatments, and divorce attorney Jackie Combs, who talks about love and divorce and why everyone should have a prenup.
0:46:30 Episodes of Net Worth and Chill are released every Wednesday.
0:46:34 Listen wherever you get your podcasts or watch full episodes on YouTube.
0:46:35 By the way, I absolutely love Vivian Tu.
0:46:37 I think she does a great job.
0:46:41 Welcome back.
0:46:46 According to Politico, Trump told cabinet members that Elon Musk will be stepping down from his role in the White House by the end of May.
0:46:50 Musk had been working under a special government employee designation.
0:46:52 It’s called the mail abandonment designation.
0:46:58 Anyways, which limits him to 130 days per year, and that clock runs out soon.
0:47:01 But the possible exit comes at a very tense moment.
0:47:12 Musk’s Doge team, the Department of Government Efficiency, has been pushing aggressive federal budget cuts, and his unpredictable behavior, especially on X, has reportedly frustrated cabinet officials.
0:47:24 Critics say his entire billionaire mindset clashes with the realities of governing, especially after a major GOP loss in the Wisconsin Supreme Court race, a race Musk spent over $23 million trying to win.
0:47:30 The news follows a new Marquette poll showing just 41% approve of his working government, with 58% disapproving.
0:47:38 And while Trump publicly praised Musk early on, some insiders say may now be using him as a scapegoat for recent political missteps.
0:47:47 Meanwhile, Tesla is also feeling the heat, with Q1 sales down 13%, raising questions about whether Musk’s political ambitions are hurting his business.
0:47:49 Jess, what do you think?
0:47:50 Do you think Doge is coming to an end?
0:47:51 Do you think Elon’s leaving?
0:47:52 I think those are two separate questions.
0:48:07 So I think Elon is leaving, and, you know, he talked about being a special government employee, which has this 130-day limit on it, in his interview with some of the Dogettes with Brett Baer a couple weeks ago.
0:48:25 So that was the expectation, but it couldn’t come at a better time for how tense things are in D.C. between Musk and the other cabinet secretaries who are trying to do their job or at least trying to do their job less bad.
0:48:34 And Musk keeps getting in the way of it, because every time that he makes a cut from somewhere that has to be reinstated, that’s something that these cabinet secretaries need to deal with.
0:48:40 And there’s been public reporting about pushbacks in meetings and complaints.
0:48:49 Secretary Rubio and Secretary Duffy, in particular, have been very frustrated by Musk’s outsized role in this, and apparently Trump himself.
0:48:57 And, you know, you could see that something was changing by the content of Musk’s tweets.
0:49:02 So the last kind of week, he doesn’t talk about DEI much anymore.
0:49:05 He doesn’t talk about massive fraud.
0:49:13 He’s actually talking about business again and going to space and Tesla and Neuralink and Starlink.
0:49:20 And, yeah, he’s still red-pilled and getting into some of the conspiracies, but he was so far off the reservation that you can tell that something has changed.
0:49:31 And I think that this moment where he is advocating for a free trade zone at the time when Trump is putting forward these crazy tariffs,
0:49:33 And he’s going straight at Peter Navarro.
0:49:37 Those two seem to have a bit of a war going on.
0:49:43 I think Navarro called him not a carmaker, but a car assembler on CNBC this morning.
0:49:45 So that’s Monday morning.
0:49:48 You know that there was massive trouble in paradise.
0:49:57 And I don’t know if you caught it because you were on school tour last week, which was way more important than this, but Musk joined the five.
0:50:08 And I got to ask him a question last Tuesday, the day of the Wisconsin Supreme Court race, which he spent more than anybody else, you know, dwarfing George Soros, who loves to buy off elections.
0:50:12 Musk spent $23 million it was versus Soros spent $2 million, I think.
0:50:17 But I had just a couple hours to figure out what I wanted to ask him.
0:50:22 And there are so many things when you have the opportunity to talk to someone that is doing these other cool things.
0:50:23 Like, I’d love to talk about Neuralink.
0:50:28 I’d love to talk about global population trends with him and things like that.
0:50:29 But I was like, you know what?
0:50:35 I need to talk to or at least try to get him to answer something about these conflicts of interest that he has.
0:50:48 And so I brought up him firing all of the folks that are looking into his companies and then he keeps getting government contracts and he keeps accepting these subsidies for Tesla, even though he’s advocated against subsidies.
0:50:51 And he totally dodged, which is what I expected.
0:50:53 And I lured him in.
0:50:59 I was friendly and I smiled and I made a joke about being a liberal Tesla lover and not throwing a Molotov cocktail myself.
0:51:18 And that dichotomy between what he says that he’s doing, that this is a totally transparent process and they’re just trying to make government more efficient and what they are actually doing is what is animating and kind of setting the Democratic base on fire as of late.
0:51:24 I mean, Elon Musk is the most unpopular figure in government by far and away.
0:51:44 And I think that Trump saw the writing on the wall with all this, looked at the results of the Wisconsin Supreme Court seat, but also these special elections in Florida where Democrats overperformed 15, 16 points and just said, like, it cannot come soon enough for you to leave.
0:51:45 Maybe he’ll continue to be an advisor.
0:51:55 I’m sure they’ll have their alliance for time to come, but he can’t be someone that’s in every press conference and became a political liability for them.
0:52:01 And likewise, the government became a liability for Musk to continue to be a successful businessman.
0:52:09 I predicted, I think, three weeks ago on Pivot that Musk would fade to black and leave within 30 days.
0:52:24 And the reason why is if you want to understand anything or you want to understand behavior across big tech and for the most part across almost every individual in America, just reverse engineer to what decisions, what motivations would give them more money.
0:52:35 America used to be about your character, your partner, your reputation indicated a decent amount of what your life was like.
0:52:37 Now, you can have none of those things.
0:52:40 And if you have money, you can have an amazing life and you can have all of those things.
0:52:44 And if you don’t have a lot of money, you can have almost none, you know, none of the prosperity.
0:52:49 So all incentives are do whatever you can to make a lot of money.
0:52:57 And when I think it was the province of Alberta announced that they were canceling their start their SpaceX contract for Starlink.
0:52:58 I’m like, that’s it.
0:52:58 He’s out.
0:53:00 All he cares about is money.
0:53:01 He’s not trying to help America.
0:53:05 He’s trying to remove inspectors so he can get his autonomous out there faster.
0:53:13 He’s trying to remove any sort of oversight around merging X and XAI and data privacy.
0:53:19 He hates subsidies after he’s taken, you know, after he’s taken 15 to 50 billion.
0:53:22 These guys are all about money.
0:53:23 And there’s a few lessons in here.
0:53:28 The Democrats need to move away from identity politics.
0:53:36 There’s a very loud minority of people who see at Ivy League universities and in the media and cultural elites who see everything through the lens of race.
0:53:44 America, the people who decide the president, see everything through the lens of money.
0:53:47 Who’s going to put the most money in my pocket?
0:53:50 Yeah, I’ll give some lip service to women’s rights.
0:53:53 I’ll give some lip service to Ukraine.
0:53:58 But for the most part, I’ll vote for the criminal because I’m under the impression he’s going to put more money in my pocket.
0:54:01 So and it’s also the most dynamic issue.
0:54:07 If you’re a fierce, if you’re one of those voters that just votes on bodily autonomy, you know which party you’re going with.
0:54:11 But the swing voters basically vote on the economy.
0:54:15 And the economy is dynamic in the sense that sometimes Democrats get the benefit of the doubt around the economy.
0:54:23 If anyone does any homework and realizes over the last 50 years, Democratic administrations have created 40 million jobs and Republican administrations have created 1 million.
0:54:29 Or they say this guy is not a failed businessman and reality TV game show host.
0:54:30 He’s actual businessman.
0:54:38 And Biden and Harris were trying to tell us when we couldn’t afford to put food on the table that everything’s great, not to worry about it.
0:54:41 They went Republican, but it’s about the economy.
0:54:45 And this is what is so disappointing in my view.
0:54:49 Even though I know this is happening, but it shocks me when it happens.
0:54:52 What have we had in the last couple of months?
0:54:57 We’ve had a reversal in the global order.
0:55:09 We’ve said we used to use our massive tax base and military to support democracies and nations that believe in civil rights, women’s rights, trying to do the right thing.
0:55:10 We’ve torn it up and said, you know what?
0:55:14 Let’s pretend that Russia won the Cold War.
0:55:16 Let’s not support Democratic allies.
0:55:19 Let’s support murderous autocrats.
0:55:34 Let’s create an environment where we have judges where if a woman is bleeding out or dying from sepsis in an emergency room parking lot because people, doctors are so scared to treat her, you know, her pregnancy gone wrong.
0:55:36 Let’s create that environment.
0:55:57 Let’s decide that a woman who is a conspiracy theory fucking loon, Laura Loomer, that she gets to fire General Hawk, who is arguably one of the brightest generals, government men in the world who’s responsible for intercepting signals and making sure our troops are safe overseas.
0:56:09 Let’s hire a group of people that are so incompetent that they’re sharing attack plans on an unsecure phone, on an app, and then start calling the reporter they invited in a loser.
0:56:17 You know, let’s do everything we can to tear up 90-year alliances.
0:56:26 Let’s start picking up people with the wrong tattoo, shipping them to El Salvadorian prisons, not even where they’re from, and then claim we can’t get them back.
0:56:29 When that’s just a bald-faced lie, one call they could get this person back.
0:56:34 All of these things in my mind are well ahead.
0:56:38 I lost several million dollars on Thursday and Friday, which is the bad news.
0:56:42 The good news is if you lose several million dollars, it means you’re already wealthy and you’re doing just fine, and I am.
0:56:42 I’m doing just fine.
0:56:48 I was much less triggered by the markets than I have been about these other things.
0:57:00 And so if it took the markets going down 10% to convince you that this ass clown was the wrong person to be overseeing the greatest experiment in history, you still have your head up your ass.
0:57:04 I was kind of like, this is what it took to get people upset?
0:57:09 All of a sudden, the tech bros, the most powerful people in the world, are decided they need to go down to Mar-a-Lago.
0:57:19 Okay, when a 14-year-old girl in Mississippi has to carry a baby to term after being raped, you know, okay, that’s bad.
0:57:23 But when my stock goes down, I’m on a plane.
0:57:30 So what I know, but it always disappoints me, is the following.
0:57:32 Look what money has done to us.
0:57:42 We forgive a guy and idolize a guy that’s being sued concurrently by two women for abandonment, for not seeing his kids.
0:57:45 I mean, look what money has done to us.
0:57:53 And the thing we get outraged about, the thing that is the call to arms, is the markets go down fucking 10%.
0:57:59 This is number 15 on the reasons why we elect our leaders.
0:58:03 So I actually found this week, it didn’t trigger me at all.
0:58:04 I was on the college tour.
0:58:06 I was emotional for a lot of reasons.
0:58:06 I didn’t care.
0:58:14 I, you know, whether I’m worth X million or, you know, whatever, 0.95X, it doesn’t fucking make any difference.
0:58:23 What makes a difference is your kids growing up in a nation that’s no longer America, where, you know, their friends who aren’t them, who aren’t in the top 1%,
0:58:28 don’t have the same rights we had, don’t have a shot at getting out of the bottom 90.
0:58:37 So I find what’s happened in the last week disappointing because, not disappointing because Trump makes a stupid decision.
0:58:37 He’s been making them.
0:58:42 I actually am disappointed that this is what it took to get people into the streets of America.
0:58:48 That, okay, the war on poor women, well, okay, that’s too bad.
0:58:52 But, you know, what’s profound is if the NASDAQ goes down.
0:58:53 Your thoughts?
0:58:54 Depressing, but expected.
0:58:58 And that has been the lesson of the last few cycles.
0:59:06 And to your point about wanting to get away from identity politics, this is the game that we have to play.
0:59:19 And that the most compelling stories are going to be the ones that are rooted in the oligarch class taking something away from people with a lot less.
0:59:23 Man, that does come down to Social Security payments.
0:59:24 That’s been resonating.
0:59:24 That’s money.
0:59:26 How do you put food on your table?
0:59:27 Right?
0:59:28 Your Medicaid.
0:59:32 That’s money that you need to spend on your health care.
0:59:33 And they want to come for that.
0:59:40 And I do think that the Democrats are getting hip to the fact that those are the types of arguments that are going to resonate.
0:59:43 And that they’re the most powerful motivators.
0:59:54 And I still feel like heart’s in the right place, of course, to want to amplify those incredibly depressing stories that you’re talking about.
1:00:00 You know, young women being forced to carry children that they don’t want to term.
1:00:12 And what’s going on to the going on with the global order and how we’re treating our allies versus our enemies and that the world is moving on without us, whether we like it or not.
1:00:22 And, you know, we’re stuck here with this administration that feels like isolationism is the way to go.
1:00:26 But nothing is going to move the needle unless it’s bank accounts.
1:00:31 And I don’t want anyone to suffer.
1:00:33 I have said this multiple times.
1:00:36 And also, obviously, I’m fine financially.
1:00:46 But the stock market change makes a big difference in my life, thinking about how I’m going to send my girls to college and what retirement looks like and all of that.
1:00:57 But it feels like this was the fuck around and find out moment for a lot of people, those 62 percent that are invested in the market.
1:01:10 And I’m not sure that that’s such a bad thing for us to have this reminder this early in the Trump administration that he doesn’t care about anyone but himself and a few select friends.
1:01:11 And that number is dwindling by the day.
1:01:13 Let’s take one more quick break.
1:01:14 Stay with us.
1:01:20 Support for Prop G comes from Nutraful.
1:01:23 Your hair and your journey with your hair is a very personal thing.
1:01:27 And your hairline is often a reflection of what’s happening on the inside.
1:01:30 Hormones, nutrition, even lifestyle can contribute to thinning hair.
1:01:35 So doesn’t it make sense to target the key root causes with a physician-formulated product?
1:01:37 For that, you can try Nutraful.
1:01:43 Nutraful is the number one dermatologist-recommended hair growth supplement brand trusted by over 1.5 million people.
1:01:48 You can see thicker, stronger, faster-growing hair with less shedding in just three to six months with Nutraful.
1:01:59 That’s because Nutraful supports healthy hair growth from within by targeting key root causes of thinning, stress, hormones, aging, nutrition, lifestyle, and metabolism through whole body health.
1:02:02 Start your hair growth journey with Nutraful.
1:02:11 For a limited time, Nutraful is offering our listeners $10 off your first month subscription and free shipping when you go to Nutraful.com and enter the promo code PROFG.
1:02:16 Find out why over 4,500 healthcare professionals and stylists recommend Nutraful for healthier hair.
1:02:23 Nutraful.com, spelled N-U-T-R-A-F-O-L.com, promo code PROFG.
1:02:26 That’s Nutraful.com, promo code PROFG.
1:02:33 Welcome back.
1:02:38 Before we go, we wanted to briefly touch on the record-breaking speech from Senator Cory Booker last week.
1:02:41 He spoke on the Senate floor for over 25 hours straight.
1:02:47 The longest speech in congressional history urging lawmakers to reconsider proposed GOP cuts to Social Security.
1:02:54 He called on Democrats to unify and fight harder, even as the party continues to debate how aggressively to take on Trump’s policies.
1:03:01 This speech was followed by a massive hands-off protest in all 50 states over the weekend.
1:03:05 Groups including Indivisible and MoveOn organized around a simple message.
1:03:12 Trump’s economic policies, including cuts to healthcare, education, and Social Security, are hurting everyday Americans while helping the wealthy.
1:03:13 Actually, I should correct myself.
1:03:16 A lot of those protests weren’t just solely a function of the market decline.
1:03:19 They had been planned around some of these other issues.
1:03:21 So that was not fair to me.
1:03:24 Booker’s marathon moment wasn’t just about policy.
1:03:28 It’s also being read as a potential turning point in democratic leadership and strategy.
1:03:35 Jess, what are your thoughts on Booker’s Senate floor, diatribe speech, marathon?
1:03:37 We have a pulse.
1:03:45 I feel a little alive in terms of being a strong opposition force.
1:03:47 And there are going to be detractors.
1:03:56 And I work with a lot of them who were calling him Spartacus and mocking the whole scene of it all.
1:04:00 But it animated people.
1:04:06 And he made a lot of points that I think are really important to take stock of.
1:04:11 That, you know, we’re in a moral moment in American history.
1:04:15 And our coalition does not look like it used to.
1:04:18 Well, also, we used to win and now we don’t win as much.
1:04:19 So that’s part of it.
1:04:23 But he said, I’m standing here because of a national crisis that’s growing.
1:04:24 We talked about Social Security.
1:04:25 We talked about health care.
1:04:26 We talked about education.
1:04:28 This is a crisis for us.
1:04:36 And you’ve taken responsibility for going too hard about the market because those are things that are causing people to show up at town halls.
1:04:39 That are causing millions to go to these hands-off protests.
1:04:53 I saw that the Google searches for the protests this weekend rivaled the Women’s March in 2017, which I remember and participated in the New York one.
1:04:59 So I feel like we have a pulse.
1:05:03 And Musk has been the linchpin, I think.
1:05:12 And it’s the money component of Musk that he continues profiting off of us while trying to fire us and steal from us.
1:05:18 But Musk was a huge gift and something that I wanted to ask you about that occurred to me.
1:05:30 Do you think actually now looking at what’s happened in the few weeks since the continuing resolution passed that actually Chuck Schumer was right to make sure that we keep the government open?
1:05:35 Because now the Republicans own absolutely everything that’s going on.
1:05:41 There’s no way to blame a Democrat, right, for any of the cuts that are happening, for what’s happening in the market.
1:05:47 Like, you pick your pet issue, and we are nowhere near any position of power.
1:06:04 And I am feeling a little bit wrong that I was so hard on Schumer because I think it is a good thing that we can just point squarely to Mike Johnson, Donald Trump, Senator Thune, and say, Musk, you know, you did this.
1:06:05 So I love what the military does.
1:06:10 Whenever they have an operation, so the best performing organization in history is the U.S. military.
1:06:18 And a lot of corporations take their cues from military procedures and best practices because they’re so good at what they do.
1:06:35 And one of their best practices is that they review every combat operation, what went right, what went wrong, how can we improve the culture, the chain of command, the weapons, the intelligence, such that we iterate to become a more lethal force moving forward.
1:06:42 And one of the key sort of paradigms or lens through which they look at decisions is they say, it’s not about the outcome.
1:06:48 It’s about, did that officer, what did that officer know at that moment?
1:06:54 And did he or she make the best decision based on the available information at that point?
1:07:01 And given what’s happened in the market with these tariffs, you’re right.
1:07:07 It worked out well because they can’t say, well, if the Democrats hadn’t shut down the government, this wouldn’t have happened.
1:07:19 So it’s ended up, I think we would rather be here right now with the government open and then not having a, you know, a punching bag or a voodoo doll to blame this all on.
1:07:24 So it, the, the, the, the outcome here is good.
1:07:29 Having said that, given what we knew back then, I think it was still the wrong decision.
1:07:43 So I hear what you’re saying and I wouldn’t change anything now, but it doesn’t excuse the fact that based on what we knew then, he should have gone upstream and shut it down and said this, you no longer believe in government.
1:07:56 Fine, we’re no longer going to fund something that is nothing but a vehicle for you to raise, raise taxes on the young, uh, bypass congressional authority, make budget cuts that are supposed to have congressional approval.
1:07:58 We’re done.
1:08:02 We’re no longer going to fund your clown car, but I agree with you.
1:08:06 This is actually ended up turning to Democrats advantage.
1:08:23 I think we could judge it a little and we can meet in the middle and just say maybe he just, he should have messaged everything better, which we were talking about at the time and had a plan to keep the government open from the Democratic side.
1:08:35 And tried to do some negotiating, Nancy Pelosi styles, um, and maybe then we could have won on all, on all fronts, but I feel a bit better.
1:08:37 Like we’re a real opposition party.
1:08:41 I feel like 2026 could go well for us.
1:08:44 I already mentioned the overperformance in those Florida special elections.
1:08:56 One was by 16 points, one was by 22 and Elise Stefanik, who was headed to the UN to be our ambassador, was called back to her New York district, which is a Trump plus 21.
1:09:02 So, and they’re clearly afraid of the fact that they could possibly lose that or it would get so close.
1:09:09 That’d be another, you know, big moment of embarrassment for the Republican party and a harbinger of things to come.
1:09:22 So, you know, the country is in turmoil, but on the politics side of it, I, I feel like we’re getting our ducks in a row and I have not felt that way for several months.
1:09:24 There was so much I loved about Senator Booker’s speech.
1:09:25 You’re right.
1:09:27 It, it pulses the right word.
1:09:28 I love that.
1:09:33 And just because I like to trigger our listeners, I thought it was a very masculine thing to do.
1:09:38 Uh, I think the Democrats lack a certain level of aspirational masculinity.
1:09:44 I think showing that sort of physical strength and endurance and people will say, well, could a woman do it?
1:09:45 Not as easily.
1:09:46 Men are stronger.
1:09:47 We definitely have to pee.
1:09:50 Women can endure more pain because they have to endure childbirth.
1:10:02 Notice how I, my politically correct instincts moved in and I had to say something nice about when you say, or if you say something nice about women, you don’t feel a need to compensate with saying something nice about men, but we need to say something nice about women.
1:10:14 But anyways, I think the Democratic Party is lacking aspirational masculinity and demonstrating that sort of strength and endurance demonstrates some of that masculine energy, which I think we’re desperate for.
1:10:17 So hats off to you, Senator Booker.
1:10:27 It also convinces me that he’s going to get married or engaged in the next two years because these guys realize it’s like, who is that?
1:10:30 Who is the senator?
1:10:31 Is he a senator from?
1:10:32 Tim Scott?
1:10:37 Yeah, who was making a run for VP, so decided to get engaged in the middle of his run for VP.
1:10:42 These guys, they’ve all figured out you can’t be president as a single man.
1:10:43 I’ll be like, that would be a good rap.
1:10:44 What do you do?
1:10:45 I’m president.
1:10:48 Hey, you want to go back and, you know, watch some TV?
1:10:51 That would be a good rap, right?
1:10:53 Well, I mean, nothing better than the American president.
1:10:55 He was a widow, widower.
1:10:56 That was such a fantasy.
1:10:59 A nice Democrat who’s single.
1:11:01 That was so ridiculous.
1:11:02 It’s the best.
1:11:04 Annette Bening, God, she’s hot.
1:11:05 She’s really hot.
1:11:05 Yeah.
1:11:14 Andrew Shepard, though, he is, I think he usually is the top for fictional presidents on all of those lists.
1:11:16 She was great in Bugsy.
1:11:18 I mean, she’s great in everything.
1:11:22 And she makes that haircut so hot, like the little pixie cut.
1:11:24 Yeah, I hadn’t thought about that.
1:11:30 She was in one of my favorite movies, which is how I would describe almost every tech bro right now.
1:11:32 Did you ever see Grifters, The Grifters with Angela?
1:11:33 No.
1:11:34 Oh, gosh, what’s her name?
1:11:35 Am I saying the movie right?
1:11:39 The woman who was dating John Cusack, Annette Bening.
1:11:41 It’s a fantastic film.
1:11:45 And the woman, Angela Houston, that’s her name.
1:11:48 That is a fantastic film.
1:11:53 Well, I need something to watch because I saw the White Lotus finale, and I am not pleased.
1:11:54 We shouldn’t talk about it.
1:11:54 No spoilers.
1:11:54 Don’t say anything.
1:11:55 You don’t know?
1:11:56 You’re the star of White Lotus?
1:11:57 You don’t know what happened?
1:11:59 Well, I’m glad you recognize I’ve carried the season.
1:12:01 It’s pretty obvious.
1:12:02 It’s pretty obvious.
1:12:12 No, but I think Cory Booker basically is now one of the top three or four contenders for the Democratic nomination for president.
1:12:14 All of these guys want to be president.
1:12:16 So, one.
1:12:16 Mostly you.
1:12:18 I’m probably the most recalcitrant.
1:12:19 I’d have to give abettables.
1:12:22 I just don’t think I could be president.
1:12:22 Would you?
1:12:23 To be president?
1:12:25 Look what’s going on right now.
1:12:25 Would I?
1:12:27 I mean, he’s sober, but he’s.
1:12:29 Yeah, but it’s a different standard.
1:12:30 It’s a different standard.
1:12:33 I’d have to go so fucking crazy like him that nothing mattered.
1:12:37 Edibles would be the least of your issues, I think, if you were.
1:12:37 Yeah.
1:12:39 No, I love the idea of running.
1:12:41 I just don’t like the idea of actually being president.
1:12:44 It’s like the key to happiness is to be rich but anonymous.
1:12:46 I’d rather.
1:12:48 I’m going to fade into anonymity.
1:12:57 Anyways, but my prediction here is that Cory Booker, in the next 24 months, as he makes a move towards announcing his presidency, is he going to realize he needs to be married.
1:13:02 So, ladies, if you like the Senator Booker, he is looking right now.
1:13:05 Because, you know, marriage, as I coach young people, I’m really going off script.
1:13:08 I’m like, it’s not about meeting the one.
1:13:09 There is no such thing as the one.
1:13:14 It’s about where you are and where they are at that point in their lives.
1:13:24 So, but he’s at that point because he realizes that he actually has a shot at doing what he’s wanted to do his whole life, be president.
1:13:26 But he needs to be married.
1:13:28 Anyways, kind of an odd prediction, but I’m standing by it.
1:13:31 First person to ever say timing is everything, huh, Scott?
1:13:32 That hurts.
1:13:35 A chicken in every pot of sea.
1:13:36 Alice in every cupboard.
1:13:36 All right.
1:13:38 That’s all for this episode.
1:13:40 Thanks for listening to Raging Moderates.
1:13:42 Our producers are David Toledo and Chinenye Onike.
1:13:45 Our technical director is Drew Burroughs.
1:13:47 You can now find Raging Moderates on its own feed every Tuesday.
1:13:48 That’s right.
1:13:49 Its own feed.
1:13:50 What a thrill.
1:14:04 That means exclusive interviews, including the one with the person who will come in number two in Iowa, Mark Cuban, with sharp political minds you won’t hear anywhere else except every other fucking place in the world as they’re all whores running for president.
1:14:07 But yeah, just exclusively on Raging Moderates.
1:14:09 Unless you got a mic and they’ll speak there.
1:14:12 This week, as we said, we’ll be speaking with Mark Cuban.
1:14:15 Make sure to follow us wherever you get your podcasts.
1:14:16 You don’t miss an episode.