Full Episode - Trump Has Weaponized Every Part Of Government + Will Trump’s Tariffs Drive The Economy Into Recession? - The Chuck ToddCast

Episode Transcript
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Speaker 1 (00:04):
Hello there, Happy Monday. It is Columbus Day Indigenous People
Day depending on the state you live in. Yes, both
are used. At the end of the day, a lot
of people have today off, which should mean quite a
few of you have more time to be listening. So welcome.
For those of you trying the podcast out for the

(00:26):
first time, Thank you appreciate it. We've loved our growth lately.
A few pieces of housekeeping. The biggest thing in the
podcast household is we have a new dog, rescue Dog two.
She's a poodle mix. I bring it up because she
may or may not make her presence known during this

(00:49):
portion of my recording. That's mostly why I'm sharing. I'm
sharing that news with you. Those of you that follow
me very closely on social media know at the end
of June we lost we lost a dog that we
had for fourteen years, Ruby. She was a standard Poodle.
She was terrific and lived a very full life until

(01:15):
the end. So we've been waiting for the summer. I'll
be honest, and I wanted to make sure it was
a rescue. This time. We didn't have kids in the house,
so you feel like you can be a little more
accommodating two more rambunctious dogs. Shall we say. She's got
a ton of energy. She's got the puppy energy of

(01:37):
a two year old. And at the same time, you know,
I probably only have like six to nine months of
this rather than the three years of puppy behavior that
many of you I know are used to when you
get a new dog. Anyway, so that is my daughter's
in town visiting for fall break, and so she's been
a big help here. My son comes for fall break

(01:57):
to meet her. He's a bit bumped that he wasn't
here for but hey, she came a little bit earlier
than we expected. When you're on a rescue list, you
never know when they're going to say yes. Big thanks
to the folks in DC at City Dogs Rescue. They
do great work. It's almost all volunteers, as anybody knows.

(02:18):
You know, I hope if you're a pet lover you
help out any sort of dog and cat rescue in
your community. We know they do terrific work and it
is done simply. Most of the volunteers are there just
for the love of the animals. So big thanks to
City Dogs in Washington, d C. So that's housekeeping item

(02:41):
number one, Housekeeping it number two. My interview today is
with Mark Zandy, Moody's chief economist. As you know about
every quarter, I want to bring Mark Zandy in to
sort of give a state of the economy as it is,
where we're headed, what we need to be concerned about,
maybe what we're overreacting to underreacting to. We get through
a lot of variables in the economy. I'd like to

(03:04):
think I have asked every question you want asked of
Mark Sandy. But you know I've thought about this and
I'm going to have them on again just after January.
So keep this in mind if you ever have a
direct question of Mark Zandy, the chief economist at Moody's
that you would love to see me ask sentiment. We'll
keep track of them. I'll keep them, I'll keep them

(03:26):
on file. I absolutely would get that. Maybe there's some
specific questions I'm not getting to. I hope I got
to most of them that you thought of. It maybe
a couple that you didn't think of. It is worth
noting I'd taped the interview before China and the United
States had a escalating set of threats for the trade

(03:47):
war one hundred percent tariffs and responds to protectionism with
the minerals in China. For what it's worth, all of
it seems to be posturing before the actual negotiation between
to world leaders takes place in the next few weeks
to a month. So even though the markets are reacting,
and it is interesting, when do the markets react to

(04:08):
Trump teriff threats, it appears whenever it's about China. Any
other aspect of tariff threats don't seem to impact the
stock market China. That's enough. Another story which I think
tells you how important the Chinese economy is to the
world economy. Right, we are the dominant economy in the world,
but we're not alone, and you know we can have

(04:29):
we can have a lot of impact, and so can China.
So I think we're learning here and each country is
feeling each other out. I think each country thought they
could quote unquote when this trade war, and I think
both countries are finding out in some ways this is
an unwinnable trade war. I'll get to more of it
before we get to my interview with Sandy, but I
wanted to get that out of the way. But look,

(04:50):
I'm going to begin with what we've been talking about
for some time, and that is where we are in
the government shutdown. And I will tell you this, We're
nowhere near. We're nowhere close to seeing this resolved. And
the biggest reason is Donald Trump's not involved. Whatever you
think of Donald Trump, these days, you cannot negotiate with

(05:13):
Congressional Republicans without the sign off of Donald Trump. Congressional
Republicans cannot sign off on anything without getting permission from
Donald Trump. What do I mean by that? Permission? Sounds
you know, it sounds like I'm being snarky. But the
fact is, if Trump doesn't like something, he can absolutely
pull the rug out underneath from Republicans, as he has
right as he did as he does to his own

(05:33):
cabinet secretaries. He just did a big one on Howard Lutnik,
who was about to amp up tariffs on international pharmaceutical
companies until Donald Trump stepped in and said, nah, we're
not going to do that because he's paranoid about price
hikes and uncertain things. Right, Prescription drugs is one that
he's ultra sensitive to. He doesn't seem to be sensitive

(05:55):
to some things where his tariffs raise prices, but on pharmaceuticals.
He is sensitive to that. I think it gets what
he believes is a big part of his constituency, older,
culturally conservative Americans who have been voting Democrat for most
of most of this twenty first century until Donald Trump

(06:17):
essentially promised that he wasn't going to be a Republican
that tried to cut solid security, Medicare and Medicaid. Of course,
we're going to about to litigate a midterm election over
whether what the Republicans did is a cut to medicaid
or not, and what voters think of the medicaid policy
that Republicans have put in. But it's just a fact.

(06:40):
And with Donald Trump really not engaged yet in the
government shutdown at all, he is in the Middle East
as I record this, essentially or on his way to
the Middle East, getting ready for a victory lap. And frankly,
it's a victory lap he deserves on this one, because
you know, when you look at his style of diplomacy,
it's not a good style of diplomacy to deal with

(07:02):
the Europeans, it is not a good style of diplomacy
to deal with Southeast Asia, China, East Asia, you name it.
Not a good way. Maybe you could argue his style
works sort of kind of with the Indians, but that
so far has been a bit problematic. The one place
where his style of diplomacy I think can work is

(07:26):
in the Middle East. He's transactional, where many other of
an American president wouldn't feel comfortable, sort of doing the
kind of sleazy financial deals that are being done with
the Gulf States right now that get them engaged in
helping to pay for the rebuild of Gaza, get them
engaged with working with Israel, and if the Trumps make

(07:46):
a couple of bucks off of it, what does Donald
Trump care? And all of this right that it is
this sort of scratch my back, scratch your back kind
of mindset. It's unethical. It's some then that I think
we're not comfortable our government doing, but it's going to
get the job done in some ways because there are

(08:08):
no rules in the Middle East at times. I think
that that's why you're seeing this style where ninety percent
of the time it's ineffective, but in this case it's
an effective way to go. I don't know if another
American president could have bullied Netnahu into taking this deal.
He didn't want to take any deal because his right
flank wasn't going to accept any deal. Any deal that

(08:32):
stopped this war clearly wasn't going to be acceptable to
the far right. One thing Donald Trump wanted was a victory, right,
He wanted to take the win. And it's an interesting
parallel because he basically it was interesting when they announced
the deal Hamas accepted, but not quite on the terms
that Israel wanted. Trump went ahead and said, great, great

(08:54):
job Hamas, glad you took this deal, and it left
Netnah who completely naked, right, he yanked the rug. Bibe
did not want to say that Hamas agreed to those terms.
He wanted it continue to press forward, and Trump essentially
told him, no, you're not going to do it. Take
the win and move on. Now. Of course, the question

(09:16):
is going to be whether politically BB can survive without
having the threat of war. Right Who's entire political career
has been about playing off of fear, fear of a Ran,
fear of Hamas, fear of Hesbelah. But it's always been
fear fear fear. In some ways, He's had, you know,

(09:39):
the last two years incredibly successful dealing with Iran, dealing
with Lebanon, and Hesbela essentially is kneecapped Hesbela completely. Even
the uties are laying off, You're seeing diplomatic ties being
forged with many a Gulf state, and with all of
those fear factors off the table, it is likely going

(10:00):
to mean that this is probably the beginning of the
end of bb NET. Now, who's political career is. Does
he have another six months? Does he stretch this a year?
We'll see. I told you about that poll last week
that showed two thirds of Israeli voters believe he should resign.

(10:22):
About two thirds of those wanted him to resign immediately,
another third we're willing to wait till the war is over. Well,
the war is essentially on its way to being over,
So we are now up to two thirds of Israelis
believe he needs to take responsibility. That it was on
his watch that an exposed Israel got attacked by Jamas
and all of it. You know, it was strange. Much

(10:44):
of the military strategy that bb signed off on dealing
with Iran, the hooties or hesblah, we're all really smart
and savvy. He never dealt He never listened to his
military advisors on how to deal with Gaza and Hamas,
which is arguably why it was so brutal, why it
was so terrible, why it was so poorly thought out,

(11:07):
and why it is made Israel among the most isolated
nations in the free world. And that's uh, that's sad.
For It's just sad. I'm very sad about the fact
that Israel is so isolated. I'm relieved that many of
the threats are gone. But how you conduct yourself over

(11:31):
time has a huge impact long term, and we're going
to see what kind of long term penalty israel Is
is going to have to pay for. How for the
horrendous way that BB and his team conducted the war
and gossip everywhere else was much more precision efficiency, sort
of the the the way the Israelis had been in

(11:54):
some ways admired by militaries around the world for their
for their Saturday is havvy and their strategy. Nobody was
admiring what they were doing in Gaza. There was nothing
like that, and in some ways that was driven by
just a far right fringe that was keeping BB in power.
But still, that is what President Trump is doing right now.

(12:15):
He's taking a victory Levet. What he is not doing
is in the room on the shutdown, and that at
the end of the day is why we are going
to be here until he engages and at this point
and this is this sort of gets to the theme
I want to hit on today, and that is the
sort of next level ugliness of our politics. You know,

(12:39):
there's always been this obviously politics and governing blur, but
there is a point where every successful government, no matter
which why you were governed, why you were elected, you
were elected because you're a liberal, you're elected because you
were a conservative, that ultimately, when you're governing you have
to do what's in the best interest of everybody. That

(13:01):
when you're governing, you don't just worry about your supporters,
you actually worry about the electorate as a whole. That's
the hallmark of this democracy. This administration governs has weaponized
everything through a political lens. When you look at what
Russell Boyd is doing at the Budget Department, this is

(13:23):
not a left right thing. This is dangerous behavior because
the minute we decide that you should govern politically and
only govern for those that support you, that is the
end of the republic as we know it is. I'm
not saying that our democracy ends. But what it becomes

(13:44):
is that each time one party gets elected, they get
in there and decide to purge the other party and
purge the government of You've heard Donald Trump say that
he wants to just lay off the Democrat part of
the government, right, which is why you know, in their
first round of doing this, Russell Voyd, who is as usual,

(14:05):
is sloppy with his initial you know, he comes across
as somebody that's very precise. But it's shocking how often
they do a lot of stupid things when they try
to do these layoffs or reduction, the reduction in force,
and that they overfired at CDC, and they overfired at HHS.
And why did they target, right, HHS is considered a

(14:25):
democratic cabinet agency. Right, It's obvious they do that when
you look which ones they consider the democratic agencies and
which one they consider the republican agencies. Like nobody has
essentially hardly anybody's been furloughed or laid off from the
Department of Olymit Security, but quite a few have been
laid off at the Department of Labor. And they went

(14:48):
with a hatchet at the Department of HHS, specifically at CDC,
and then they realized, oh wow, all these people are
experts at certain things. These aren't political acts. These are
reputable scientists that have incredible expertise in a lot of
areas that are crucial for the US government. To be

(15:11):
involved in. Public health is something government has to be
involved in. This is not something you can privatize, certainly,
and so it is this is what is so scary
about what's happening. And in some ways, Lindsay Graham gave
a piece of this in a recent appearance on Meet
the Press, and this goes at the weaponization of the

(15:32):
Justice Department, where essentially he justified what Trump was doing
by saying, but they went after Trump, and because Letitia
James went after Trump and went over the top something
that I look, I don't disagree that she shouldn't have.
She shouldn't have gone there. She could have, but she
went there for solely political reasons. You know, there it is.

(15:54):
It's certainly that doesn't mean he didn't do anything wrong,
but it's pretty clear she went after him. To quote,
get Trump on that front. But if you are upset
about the weaponization law of law enforcement, then the last
thing you ought to be doing is then weaponizing law enforcement.
But that's exactly what they're doing, right. Pam Bondi's just

(16:17):
despicable appearance in front of the Judiciary Committee last week,
where you know, we now have learned thanks to some
photographs that sort of leaked she wrote down. She clearly
had her staff she so cares about politicizing the Justice
Department that she prepared for her testimony with one line
Zingers to go after any Democrat that questioned her in

(16:39):
a tough way. So she like had some pre made
attacks on Sheldon Whitehouse and pre made attacks on different
Democrats that questioned what she was doing over there. And
it just just take a step back, take your partisan
hat off, or put your partisan hat on, and say
if that is how Merret Garland had behaved, okay, andage

(17:00):
Senate Judiciary Committee just coming up with these spending time
taxpayer dollars to get her, get his staff to write
one line zingers. Republicans would be rightfully apoplectic at the
politicizing of the Justice Department. But that's exactly what Pam
Bondi did. She literally spent taxpayer dollars coming up with
one liners and zingers to go after rather than explaining

(17:23):
if they're because she had no legal rationale for what
they did to Jim Comey. She had no legal rationale
for what they're doing to Leticia James. She had no
legal rationale to how they're just firing US attorneys if
they don't abide by the President's words. And you know,
this is another story that sort of has gotten lost.
The Washington Post has since reported and got multiple sources

(17:47):
to confirm that when in the infamous Donald Trump truth
social posts, that is going to probably get the Jim
Comy case thrown out of court, and likely we'll get
the Leticia James throw out of court because of the
obvious bias that was used to get them and diet it.
And if I remind you, the truth social Post stated this, Pam,

(18:10):
I have reviewed over thirty statements in posts saying that
essentially quote same old story as last time, All talk,
no action, nothing is being done. What about Kmy, Adam,
Shifty Shift, Letitia? They're all guilty as hell, but nothing
is going to be done. Then we almost put a
Democrat supported US attorney in Virginia and with a really
bad Republican past, awoke rhino who is never going to

(18:30):
do his job that's why two of the worst DEM
senators pushed him so hard, referring to Mark Warner and
Tim Kaine for agreeing to have you to confirm that
US attorney even lied to the media and said he
quit and that we had no case. No, I fired him,
and there is a great case. And many lawyers in
legal pundits say so, Lindsay Halligan is a really good

(18:51):
lawyer and likes you a lot. We can't delay any longer.
It's killing our reputation and our credibility. They impeach me twice,
induited me five times over. Nothing just must be served now,
President DJT, I repeat this because we now know this
was never intended to be a public truth social post,
so believe it or not, in the year twenty twenty

(19:12):
five your United States government, the President of the United
States sends a private direct message. Although he didn't the
seventy nine year old techno expert didn't know how to
do it. Pretty much all of our some of us
in our fifties have been there, but certainly many people
in there. Was this supposed to be public? I didn't know,

(19:33):
but apparently he was trying to send her a private message.
Apparently the only way he can send a private message
to the sitting Attorney General of the United States is
through his truth Social app. Seriously, but apparently that's what
it was, because this was never meant for the public.
This was supposed to be a direct message. This is

(19:55):
how your president of the United States communicates with our
attorney general. Our president is doing is communicating this way.
How what kind of direct messages have gotten through? This
is how he communicates even to his own staff. Look,
he was clearly threatening her and like, hey, you better

(20:16):
get it done. I already fired in a US attorney
that wouldn't do what I asked. I mean, it is
not hard to jump to the conclusions that he was
using this. You know, he didn't. He didn't give her
any any sort of honorific It was pam, let me
tell you what you're going to do. But I don't
think we have had nearly the amount of focus and

(20:40):
attention to the fact that the president is communicating with
his staff on a completely unsecured truth. Trust me, you
think truth socials are really secure, just up to snuff,
right that Devin Newness Man, that guy is a real
sharp guy, right, You trust him with your cybersecurity? You
trust him with the government cybersecurity. This is the way

(21:01):
the president. You Look, did you have any did you
have an issue with Hillary Clinton's emails and her private server?
This is a hundred times worse. Look, this was why
some of us thought what Hillary Clinton did was wrong.
Don't set these precedents. Don't sit here and say no, no, no,

(21:23):
But it's okay for me because I'm somehow I'm not
you know, I know what is what belongs in the
public record, and what doesn't. And this is what happens. Right,
We do these slippery slopes, and every time somebody decides
to change the way we do certain things, everything moves.
And now this guy has decided to have carte blanche.

(21:44):
He has no morals or ethics at all. There are
actually laws. These are again more laws that he's breaking. Here.
Nobody's going to prosecute him for the Presidential Records Act.
We we thought about trying to do that during the
U during the term that he was not serving, when
he clearly took classified material that belonged to the government,

(22:05):
not Donald J. Trump. But he of course does not
see the presidency as any different other than an extension
of himself, and he doesn't see any of it that way.
There's a reason results matter more than promises, just like
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(23:12):
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Their fee is free unless they win a US Congress
With any other president, oversight hearings would be set. Look
at all the hearings we had with Hillary Clinton's email

(23:34):
server where she was up there for hours being grilled
about the use of it. And again, I'm sorry, I
think she did have to answer for that because it
was wrong that she did it, because I know why
she did it. She did it to avoid Freedom of
Information Act requests. Okay, but she but she was held accountable.

(23:58):
And then some nobody's holding Donald Trump accountable for what
it is a brazen violation of the Government Records Act
one two, exposing all sorts of of of security issues
by using an unsecure truth Social app to communicate with

(24:23):
a member of the National Security Council. The Attorney General
is a member of the National Security Council, so in theory,
much of what they discuss is classified information all somehow
in this stew again of that, you know, because I'm

(24:43):
sure many people feel comfortable. If you feel comfortable with
the security of truth Social, go ahead and direct message
your social security number, Donald Trump, tell me if you
would be comfortable doing that. I don't think you would.
This is something that is just completely completely insane, and

(25:05):
we're like totally glossed over it because we're so used
to Donald Trump not sort of abiding by norms or
following the law. You know, when we say abiding by norms,
that's code for not following the law. Sort of totally
dismissive of laws in the US Congress's past. But of
course we have a Congress. This current Republican control Congress

(25:26):
is the single weakest Congress we have had, easily going
back to the FDR and the New Deal. Right, but
he at least had numbers on his side. That's why
he was overwhelmingly getting Congress to essentially do what he wanted.
He actually won a large political argument which gave him
a large majority. Donald Trump has never won a majority

(25:49):
of anything. Even winning the popular vote, he didn't get
fifty percent. He didn't get over fifty percent. And this
Congress is just rolling over and again. The concern is
we are just setting all sorts of new precedents and
there are going to be this this Donald Trump's decision

(26:10):
to weaponize and ruin the credibility whatever was left of
the FBI, it is gone right. He is cash Btel
is literally making Hoover seem like a statesman. We are
completely destroying the reputation of the rule of law in
this country, all because Donald Trump can't can't accept the

(26:35):
fact that he won. That's what's strange here. Right. He
lied to the country when he said he wouldn't be
focused on retribution. Right, he clearly was focused on retribution.
And in his own way, he thinks like a He
thinks like a movie mobster. Okay, not a real mobster, right,
Donald Trump, everything in him is sort of imaginary in

(26:56):
many ways, So he thinks like a movie mobster. And
in the movie, the mobster send a message so no,
everybody knows, you don't do this again. And he goes
after certain people so that he can make sure other
people abide by his wishes. This is movie mobster stuff,
and is it really is deteriorating what is left of

(27:17):
political discourse in this country. It is deteriorating the reputation
long term of the Republican Party. And the thing is,
you know who knows it? About half of the elected
Republicans in Congress, they all know this is ridiculous. They
all know that if the roles were reversed, they would
be apoplectic. Sometimes every once in a while they admit it.

(27:38):
The governor of Oklahoma, Kevin Stitt, is one of the
few Republican governors questioning the decision by Greg Abbott to
send National Guard troops for the president's use in the
state of Illinois. As he said, if Joe Biden sent
National Guard troops from the state of Illinois and Oklahoma,
there'd be a problem Oklahoma and and a lot of Republicans,

(28:02):
a lot of Oklahoma's would have a problem with that.
Good for Kevin Stitt for speaking out the lack of
people and again, I understand the political fear many of
these Republicans have, but this stuff is not conservative, and
this stuff is eroding, eroding the reputation of the US government,

(28:22):
eroding the reputation of democracy around the world, right, Because
if the US government, which is if the United States,
which is considered the leading democracy around the world, starts
to you know, essentially be abusive in its way and
its attempts to dibort people, who are we to who
are we to talk about human rights violations to take
place in Turkey, right? Or human rights violations to take

(28:45):
place in China where the Wigers are clearly clearly being
ex being forced basically enforced labor camps. But we have
no credibility on these issues anymore because of how our
democracy is behaving. We have made no legal We've really

(29:06):
not given any legal justification for bombing boats that come
out of Venezuela. I had an interesting conversation with Jim
Stevriti's for my new Sphere show. Please check it out
and on oh Sphere if you haven't tried it, do
a free trial and check out the interview. Stavradis was terrific.
We talked, We did a whole you know, we we
we did a tour of the world, but we also

(29:28):
talked about what would military leaders do. What would he do?
He was the former head of Southern Command and if
he was given the orders that Southern Command has been
given in Venezuela so far. I asked him how would
he handle it? And the first thing he did, get
his lawyer, he said, his jag lawyer, which would then

(29:49):
and if there was some question about the legality of it,
he would go back to the Secretary of Defense and
say what is the legal justification of this? And if
they created if they had a legal justification that he
felt that that was defensible, he would follow the order,
but if he couldn't follow the order, he would resign.
And I asked him, I said, that's what is the if?

(30:12):
What is the most likely scenario if a high level
general or admirals given what they believe is an illegal order?
And he said, they'd likely resign without saying it in public,
just simply resign. There's there's that in his His explanation

(30:32):
was there is such a high level of belief in
staying out of the political fray that many a general
or admiral would feel uncomfortable making themselves the story in
something like that. I know some of you may hear that,
because I told the story to a few others and
they were disappointed to hear that. Many of these generals

(30:55):
and admirals, if they choose resignation, would probably do so
silently and not not go public right away with why
they were resigning. Maybe they'd eventually go public, but not
right away. But that's just the that's that's how seriously
many in the military take the a political status of

(31:17):
the military, and what Donald Trump's trying to do right
now by politicizing the military, by trying to turn the military.
I mean, it was interesting to me to see the
story about Joe Biden in the Washington Post where Biden
was really seething apparently at how Donald Trump in that
speech in front of the military leaders seemed to run

(31:39):
down Biden personally like eight or nine times, right, totally nope. Again,
before Donald Trump, presidents drew the line at at sort
of dehumanizing previous presidents. Right, you may criticize previous policies,
but there was always there was some sort of respect
given to the person that once held the office. And

(32:00):
Donald Trump's lack of respect. And a supporter will tell
me he's he's treating Biden the way he thinks Biden
treated him. Of course, Biden gave Trump a post election
oval office meeting. Donald Trump did not do that. Joe
Biden accepted the results of the twenty twenty four election.

(32:20):
Donald Trump didn't accept the results of the twenty twenty election.
But he has just runs down everybody. Shoot, he's runs
down pretty much every president before him except Abraham Lincoln,
and then sort of has the has this weird obsession
with saying he's better. Some people think he's greater president

(32:41):
than Lincoln. He's lucky. Some people don't think he's being
compared with James Buchanan, and I'll just leave it at that.
But it is this politicizing of everything right, using the
government shutdown to own the attack Democrats. He's supposed to

(33:03):
govern for the entire United States of America. And you've
heard me rant about this before, but this inability to
want to go again. If a democratic administration refused to
govern for Republicans tried to find a way to prevent
government congressionally approved government money from going to a constituency

(33:25):
that votes more Republican than Democrat, there would be impeachment proceedings,
and by the way, it would be justified. What Donald
Trump is doing is illegal, will likely get reversed by
the courts, but in the meantime, he is setting some
precedents that this is somehow acceptable politics and the lack

(33:48):
as always and I know I'm just sort of old
man yelling at cloud here, but the inability of what's
left of the principal elected Republicans out there who cannot
bring them else to say this is wrong because they
know it's wrong, all because they are just trying to
survive politically, because oh, you know, some of them say hey,

(34:10):
if you got rid of me, somebody crazier would replace me.
That's just that's just wishful thinking. Nobody is irreplaceable, Nobody,
even James Franklin at Penn State, right, nobody is irreplaceable.
How'd you like that?

Speaker 2 (34:26):
Right?

Speaker 1 (34:27):
Giving you a hint a little bit of what I'm
gonna chat about in football after the interview. But it
is really the left. You know, look, we've got a
lot of crazy stuff that's happening right now with the
way he's conducting this government. But the idea that he
communicates with his staff via direct message on truth social

(34:49):
that sometimes can't make it out. He has put you know,
so much of national security at risk by doing that.
And again god only knows how other what other bad
idea ways that they're communicating with each other, including members
of the national security staff. And then the second thing
is the lack of outrage or concern that Again, this

(35:15):
goes to the whole two wrongs make a right. Donald
Trump governs as if two wrongs make a right, so weaponizing,
So if he believes that Leticia James unfairly prosecuted him,
he's gonna unfairly go after her well lucky for both
Jim Comy and Leticia James. Donald Trump said the quiet

(35:35):
part out loud because he didn't know how to send
a direct message to Pam Bondy on truth Social. But
imagine being a cabinet secretary and realizing before you go
to bed, oh God, did I check my direct messages
on truth Social to see if I have any new
orders to follow from dear leader. That's an this is

(35:56):
this is this is how we're running the country. Anyway,
Before I get to Mark Zandy, as I said, a
few little updates on the economy, I do again the
one percent tariff threat. Look, there's no doubt that our

(36:18):
trade relationship with China was a mess. Is a mess,
has been a mess before Trump got there has been
a mess. Trump knows one way of trying to deal
with them tariffs sledgehammer. Biden kept many of them in place. Right.
This is a very antagonistic relationship. But what we're both
finding out is we both need things from each other

(36:38):
and we're going to end up having a trade deal
that gives away some things that neither side's going to
be happy about. But that's the reality of the situation.
And if we because If we don't do that, we're
going to go to war. And but this is a
reminder when you start a trade war, it is really
hard to win a trade war. And we've started a

(36:59):
trade war, and we're having a really hard time quote
unquote trying to win this trade war. There are real
reasons why we've got to we've got to recalibrate our
economic relationship with China, but much of it has to

(37:20):
do with what we need to do here, right And
and one thing Donald Trump another thing that you know, Look,
I will point out when I think Donald Trump does
things that are correct. This Midi Steel I think is
one that only he could have pulled off given the
characters involved here. But he signed an executive order basically
trying to jump start UH production and research and h

(37:48):
and frankly the mining of rare earth metals in the
United States. And it is what is motivating the quote
the purchase of Greenland, and that we are way too
reliant on China for these rare earth minerals. Look, if
we had, if we had, if we knew how to

(38:09):
conduct better form policy with Latin America over the last
fifty years. And I say we, I mean the United states.
This is not just something that Trump doesn't do well.
This is something every president hasn't done well. We could
likely have dominance in our own hemisphere, but we have
so blown our relationships down in South America, with Brazil
in particular, Mexico slightly improved there, and within Canada. All

(38:35):
these antagonistic relationships we're creating. Our own hemisphere likely could
be the answer to many of the rare earth metals
that we could use, but we've been short sighted there
either way. Figuring out how to either try to find
these rare earth metals domestically or diversifying our supply chain

(38:58):
around the world will allow us to be tougher on China.
But right now we really can't. And that's the that's
the uncomfortable that's the uncomfortable truth there. All right. So
coming up, we got Mark Sandy again, I think I
call him my answer man on the economy. Let's just

(39:19):
say he's really concerned about the next six to nine months,
but he's surprisingly bullish about things perhaps a year or
more from now. So with that, let's sneak in a
break when we come back by conversation with Moody's Analytics
chief economists and my friend Mark Sandy Well, as we

(39:52):
begin the fourth quarter of the year, if you want
to look at it in quarters, and of course it's
supposed to be the first quarter of America's fifth school year,
but we have a government shutdown since we can't agree
on those things. I always want to bring back somebody
who makes I think makes the most amount of sense
about what's happening in this economy and how much of

(40:13):
this uncertainty can feel certain down the road. It's of
course Mark Zandi from Moody's Analytics.

Speaker 2 (40:19):
Mark, good to see you, Chuck, good to be with you.
Thanks for the opportunity.

Speaker 1 (40:23):
So I have been describing the economy this way. If
you have money, have some savings, and have the ability
to invest, this gotta be is going okay for you.
But if you don't, this is a scary economy. I

(40:45):
confess that's a simple, simplified way of putting it. But
that's what it looks like to me as a lay person.
What kind of is that too simplified of a description
or how would you do?

Speaker 2 (40:55):
No, I think that's pretty apt. I think if you're
in the top part of the income and wealth distribution,
let's say the top third of the distribution, you're doing fine.
You got a job, you're getting a pay increase, get
a bonus, you own your own home, you own some stocks,
and of course stocks are on a tear, and you

(41:16):
you don't really owe anything. You might I might have
a mortgage, but you probably locked in back during the pandemic,
so you've got a three three and a half four
percent mortgage rate. So you're making more on your money
market account than on your you're paying on your mortgage.
So yeah, you're sitting pretty. If you're in the bottom
two thirds of the distribution of income, certainly the bottom third,

(41:38):
it's a struggle. You know, you probably have a job,
but unemployment is starting to not hire her, and you
don't want to lose your job because it's getting increasingly
hard to find another one. Hiring rates are very low.
You don't you know, you really don't own very much.
If you're in the middle part of the distribution, probably
own a home. But if you're in the bottom part,

(41:58):
you don't, and you owe on credit cards, auto. If
you're in the bottom third, you're probably on student loan debt.
So so it is more of a struggle. So I
think that way, thinking about the economy and whether it's
working for people works is very apt. Yes, I agree.

Speaker 1 (42:14):
So you know, it's interesting because this creates sort of
I think political challenges more now for the Trump administration.
You know, you know the Biden administration, and it was
Biden and I've always thought it was a bit almost
because he spent most of his professional life where the
economy was judged. A good economy was based on whether
there were jobs being created. A bad economy is when

(42:35):
there weren't. And I do think Donald Trump looks at
a good economy is when the stock market does well.
A bad economy is when it doesn't. And like, ultimately,
both ideas miss the Hey can I afford this economy? Right?
Can I live in this economy? You know, it's one
thing to have a job. Can you afford participating in
the economy with your job? It's one thing if the

(42:57):
stock market's doing well, but do you have the money
to actually benefit from that? So I do see that
as political. But let's start with what you have to do,
which is trying to forecast, trying to understand what the
economy is. There's all these little tea leaves I was
reading about the other day that people are pulling back

(43:18):
on big home renovations and they're now doing smaller ones.
People are pulling back on big trips, so they're doing
maybe road trips that while that you're starting to see
these little signs of a pullback consumer pullback, and it's
not yet reflective anywhere else, not quite reflected in GDP. Yet,

(43:39):
how important are those little indicators to you? And what
ones do you look at, especially now that government data
has been paused.

Speaker 2 (43:47):
Well, yeah, I mean I pay attention to the anecdotal
information in the kind of the little pieces of information
here and there that you get from different sources, but
I ultimately lie on the the data, the aggregate data.
I mean, you can get fooled by you know, the
economy is a big elephant, right, and depending on which

(44:09):
part of the elephant you touch, you get a very
different picture. So that you know, if I'm in one
part of the country or another, that will influence people's thinking.
If I'm in one talking to one industry or another
that influences people thinking. If I'm in the top part
of the distribution of income or the bottom, that influences
people thinking. So I try to be careful not to
get caught up too much in the anecdotes, in those

(44:31):
little straws as you as you put it, look at
the aggregate data and you know, there and for me,
at the end of the day, it's still about jobs.
And you know, we're creating jobs or they good paying jobs.
Is a pay enough that people can afford to, you know,
purchase the things that they need and that they want.
And there it feels like the economy is kind of

(44:54):
a struggle, a bit of a struggle of you know,
in aggregate we're not creating many jobs at all. Jobs
we are being created, are you know, in a very
few industries like healthcare. It just doesn't feel like it's
working for you know, a lot of Americans. So we're
not in recession, we're growing. GDP is positive, but it

(45:15):
just feels kind of punk. That might be the word
to use.

Speaker 1 (45:18):
So if we see the general consensus apparently is a
thirty to forty percent chance of a recession next year, Yeah,
how should folks interpret a prediction like that?

Speaker 2 (45:31):
Well, the most likely scenarios we kind of navigate through
without an actual downturn, So the economy produces enough job
so that unemployment really doesn't take off. Here we're okay.
It's not it may not be great, but we're okay.

Speaker 1 (45:47):
But so kind of like the first I felt like
the economy in twenty oh one twenty oh two, where
it was a mild recession but we kind of got
through it.

Speaker 2 (45:56):
Yeah, that's that's right. But you know, the risks are
to the downs side, right, I mean, you know, if
if things turn out different than that kind of that
economy we just described, it's going to turn out worse,
not better. You know, just to give a little bit
more context, kind of in a typical economy, the probability
recession would be fifteen percent. We tend to have a

(46:18):
recession once every six seven, eight years.

Speaker 1 (46:20):
So every year, if there was no you would you
would say, well, you have to put it at fifteen percent.
But that's just because that's the way it is all
the time.

Speaker 2 (46:28):
That's just it's so called unconditional probability. I mean, on average,
you get a recession every seven years. Therefore fifteen percent.
So if you're a thirty percent forty percent, well, you
know that's on the high side. It's not over fifty
that I'll take it, but you know, thirty forty is
uncomfortably high you know, the other way to think about
it might be nothing else can go wrong, right. The

(46:50):
economy is you know punk, it's it's vulnerable to anything
that might go off the rails here, and it doesn't
have to be a big thing. It could be a
small thing because the economy is asponible as it is.

Speaker 1 (47:03):
What has been the impact of what feels because you know, look,
the DOGE cuts get a lot of attention, but there's
a real pullback on government jobs on the state and
local level because there's a lot of federal money is
no longer going to state and local, right, A lot
of we had a lot of COVID. You know, it's funny,
we lived almost a decade, decade, decade and a half.

(47:26):
First the Great Recession sort of triggered federal help for
state and local, and then COVID created more help for
state and local. And you know, I look at a
California which is going to struggle for the first time
with a budget deficit that they got to figure out,
they got to do. They're going to do something really hard.
I think a lot of states, I think there's going
to be a lot of sort of chickens coming home

(47:48):
to roost in a lot of states who have these
constitutional amendments that actually have to balance our budget. Right,
what is that risk factor of contraction of government workers
and how much could that trigger a recession.

Speaker 2 (48:01):
Well, we're certainly seeing a lot of job loss at
the federal level. I mean, the number of federal government
employees down about one hundred thousand since the beginning of
the year. So we are making the numbers up, but
you know, rough word magnitude, we had three million federal
government workers at the start of the year. We're now
at two nine and we've probably got another one hundred
k to go.

Speaker 1 (48:21):
Now, some people will hear that, say that doesn't seem
like much two point eight to three. I mean, you
round it up, it's still three million, right, Like, I mean,
you know what I mean, Like it's yea, why is
that a lot?

Speaker 2 (48:31):
Well, in the context of federal government never lays off.
It's always the reliable source of of of jobs. And historically,
h you know, it's been around three million for as
long as I can remember. So losing one hundred k
and losing another one hundred k in a short period
of time six twelve months, you know that's meaningful. It
certainly you know, obviously for the broad DC area and.

Speaker 1 (48:55):
No regional economy, you can feel it, right, Yeah.

Speaker 2 (48:58):
That broad metropolitan area is in a recession. There's no
doubt about that. Now if if you're right, and I
think you know, you make a good point that you know,
federal government support the state and local first states and
then local governments is now starting to wane. And you
saw a tremendous amount of support in the in the pandemic.

Speaker 1 (49:19):
A lot of teachers got raises from that money, right,
Like it was just a lot of public officials with cops, firefighters, teachers,
you know, the stuff politicians feel good about. Hey, look
we gave our teachers a raise, we gave our cops
and firefighters are raised.

Speaker 2 (49:33):
Well. A bunch of other states they cut taxes, right
but you know they now that that's that's an issue
because they're not getting that support from the federal government
and likely not to going far. And now they have
a diminished tax base and so that's complicating things for them.
So yeah, the state local then there are a lot
more folks working in state and local government then and
then in the federal government, and that if that sector

(49:55):
is now not adding to payrolls and ultimately starting to
reduce perils and that becomes an even bigger deal. So yeah,
it's a It's just you know, the labor market has
gone flat here. It's not creating any jobs. The only
sectors that's creating jobs is healthcare, and everything else is
a little bit adding a little bit or reducing a

(50:16):
little bit. Government is reducing a little bit. At this point, all.

Speaker 1 (50:19):
Right, let's talk about AI. Yeah, how is A How
are is AI having an impact on the job market yet?

Speaker 2 (50:26):
Uh? Yeah, there's some evidence. You know, I mentioned the
hiring rate, the fact that if you look at the
number of people getting hired relatives of the workforce, it's
about as low as it gets when you're in the
middle of a recession. We're not in recession because businesses
aren't laying off, but they're not hiring. And one reason
they may not be hiring is related to AI. You know,
businesses are thinking, oh, you know, do I really need

(50:49):
to go out and hire those folks because artificial intelligence
will be able to empower my existing workforce to do
those do that work.

Speaker 1 (50:55):
And I don't know, is this an experiment? Like my
sense is businesses are trying to see if they can
use AI to replace humans and then they're good and
then if they don't, they'll go and hire. But if
they can, then could then exponentially grow.

Speaker 2 (51:10):
Yeah, absolutely, yeah, I think you know, AI has captured
the imagination, you know, particularly of the senior leaders management
of many large multinational corporations around the country. In fact,
they're selling themselves as AI companies increasingly because stock prices
are as high as they are juiced by the promise

(51:31):
of artificial intelligence creating all this wealth and genering a
lot of economic growth that they are now saying, we
are AI. Therefore we have to make AI work for
our businesses, and so they're asking their existing workforce to
figure that out. And you're right, I mean, so far,

(51:52):
you know, there's some success stories, but there's a lot
of failures as well, and must have to see how
this plays out, and some companies will have to backtrack
at some point. But I think ultimately, you know, businesses
will figure it out, and new companies when they form,
they're going to optimize around the AI technology, just like
they did the Internet, and so it will diffuse throughout
the economy and will have more of an impact on

(52:14):
the labor market going forward. Particularly certain occupations in certain
industries that are more likely to be affected by the
use of AI.

Speaker 1 (52:22):
Yeah, politically, I think AI job, the fear of AI
job displacement, I think it is going to be a
big issue in twenty eight, But not until twenty eight, right,
Like I think we're I don't think we're there yet
on that. But when is there? You know, all these
data center investments, all this money that's going into this

(52:43):
AI expansion, is it create is there? It's not creating
new jobs, it's just computer power.

Speaker 2 (52:50):
And so far it's it's more about it's not about jobs.
It's not creating jobs. It's more about GDP and.

Speaker 1 (52:59):
It's creating a lot wealth, creating revenue. It's creating wealth.
It's we're really good at manufacturing money right now.

Speaker 2 (53:08):
Well, here is an amazing thing. And this goes back
to where we started when we were talking about the
folks in the top part of the distribution of the
wealth distributioning. Well, the value of all US publicly traded
stocks is up ten trillion dollars in one year, So
it's sixty seven trillion dollars today. It was fifty seven
trillion dollars a year ago. Trillion dollars. And of course

(53:30):
if you own stocks, and particularly the AI stocks, you're
feeling pretty good and that's what's kind of driving the
economic training. So the real impact of AI so far,
it's not about jobs. It's more about wealth in GDP
and not more. In fact, if anything, it's reduced to
employment and the tech sector and some of the other

(53:51):
sectors that are that we just talked about.

Speaker 1 (53:54):
So give me some historical parallels. We had this kind
of investment in tech in the nineties turn of this century.
We had this kind of investment in the Industrial Age.
We had this kind of investment in the build out
of the suburbs after the after World War Two? Is
this a bubble? And and it certainly looks bubblish, and

(54:16):
yet it's amazing to me only Jamie Diamond seems to
be the the only one in that world that seems
to be concerned that this could could all be a bubble.
How would you you know, is this something you can
forecast or you don't know if it's a bubble until
after it pops?

Speaker 2 (54:31):
Well, uh, And I'm hearing more voices kind of uh
variations on that theme. And I think it's appropriate that
the you know, the stock market. Stock investors, uh in
are kind of getting over their skis, you know, they
there's there's this is real. These companies are jogger nots.
They're you know, they're they're they're making massive investments and

(54:53):
they're generating a lot of revenue. Uh. But uh that
is also generating a lot of euphoria around the prospects
that these companies uh, you know are are generating, and
it's driving up their stock price. So you can have
a situation and I think we do very similar to
what happened back in Y two K and the Internet
bubble and in previous huge technology periods of technological advance,

(55:17):
where investors kind of get ahead of the story. You know,
they they discount all the good news and then some
and then some and then once that happens, uh, you
get speculation. That's when investors in stocks and other assets
buy that stock or that asset simply because they think
they can sell it at a higher price down the road.

Speaker 1 (55:36):
That's it.

Speaker 2 (55:37):
They're not they're not doing they're not thinking about, you know,
what's where the value comes from. You know, will this
be more valuable in the future, or simply the euphoria
the speculation, and you know, I don't know that we're
quite there yet, Chuck. That what I That's what I
would call a bubble when you get that kind of
speculative Furvor. But it feels like that's the direction of
travel here, right. And in fact, you know, when I

(55:59):
look most economists and people in the market, so I'm
looking at the stock market four or five six times
a day, you know, I go see what's going on,
and usually when I see green on the screen, that's
means stock prices are up. I feel good. Now I'm
feeling when I see green, I'm getting more nervous about it.

Speaker 1 (56:30):
I'm not quite at retirement thinking about retirement, but you know,
so I'm still kind of and at the same time, yeah,
you're like, geez, I know, I know there's going to
be a correction. How massive is it? Right? You just
talked about ten trillion dollars. That means we could lose
five trillion dollars of wealth and still be up five

(56:51):
trillion dollars. But if we lose five trillion dollars in
wealth in the next six months, people are gonna panic.

Speaker 2 (56:56):
Yeah, exactly, you got it just right, So you know
this might be a little nerdy, but you know, to
measure this to your question, are we in a bubble?
The tried and true way of kind of looking at
that is the so called price earnings multiple. Take take
take the stock prices, look at it relative to the
earnings of the companies that you know.

Speaker 1 (57:17):
I love doing that. Pallidteer is like one hundred and
fifty times earnings, but like Google is still only nineteen
times earnings.

Speaker 2 (57:24):
You know, you're a pe. Wow, that's impressive.

Speaker 1 (57:27):
You know, I'm not an economist, but too yeah.

Speaker 2 (57:30):
Yeah, Well, anyway, so if I look at I have
what I call the economy wide price earnings multiple. That's
the Wilsher five thousand. It's the value of all stocks,
all stocks, divided by economy wide after tax corporate earnings.
So that's the Ice motile on average since nineteen sixteen.
That's as far back as I can calculate it. And
I'm making this up roughly, so it's I'm rounding it's ten.

(57:53):
That's the multiple's ten ten times stock prices are ten
times earnings. Right now today it's almost twenty twenty. There's
one other time in that historical period when it's been
higher Y two k it was twenty four so and
of course we're still going higher here. So I don't
know this so called mean reversion. You know, it feels

(58:17):
like to me, we're getting we're overvalued, we're bordering on
frothy and speculative. If stock prices continue to rise, then,
you know, as ring some alarm bells, I do think
we're going to see a correction at some point.

Speaker 1 (58:29):
Then. I think what's odd about this is that a
lot of folks assume tariffs would slow down the growth
of our economy, right, would certainly hurt traditional companies because
of rising costs, you know, and all of those things.
And so here we are in this weird environment where
tariffs are having some impact, certainly on the consumer and

(58:54):
certainly on some businesses. But because this AI part is
an investment type of thing, it is it tied to
the tariff and in some ways Trump is has sort
of compartment, you know, has protected that space from his
protectionist policies. So how would you view that the impact

(59:15):
of the tariffs? It it? You know, every time I've
noticed this with a lot, every time we look at it,
it's like, yeah, it's coming, but it's not here yet. Yeah,
it's coming, but it's not here yet. Where are we now?

Speaker 2 (59:29):
The thing is, there's a lot of cross cards here.

Speaker 1 (59:31):
Right.

Speaker 2 (59:31):
We just talked about the tailwind, and that's a I
and that's a powerful tailwind. You know, all the data centers,
all the investment in the electric electrical power, electric power,
all the wealth that's being generated, that's driving consumer spending
of those folks that own the stocks, the you know,
the high end network, the individuals. About half the growth

(59:53):
in the economy is just AI. Right, So give you
to give you a number GDP growth that's the value
of all the things that we produce is two percent
year over year two percent. If not for AI, it
would be growing one percent. And that that's that's terraces
and you're growing one percent. That's not a recession, but

(01:00:14):
if that's really uncomfortable up.

Speaker 1 (01:00:16):
With your inflation at that point.

Speaker 2 (01:00:18):
Yeah, So the terrorists are doing damage to the economy.
It's just that, you know, the the fallout is being
masked to a significant degory by this powerful tail end
of AI that's really come into its own over the
last six, nine, twelve months.

Speaker 1 (01:00:35):
So this is it's so look at some point AI
investment plateaus, right, and the terriff stick, so that that's
where this is headed.

Speaker 2 (01:00:46):
Right, Well, I mean, if the terraces rise and level
off and stop rising at some point, we're you know,
the economy just to that. So you know, both those
things could iron you know, kind of offset each other,
so we could increasingly. This is the consensus view in
my view that we you know, it's going to feel
uncomfortable at times, but we're going to be able to
avoid recession because of that AI tailwind that we're enjoying.

(01:01:10):
But having said that, you know, the economy is soft,
the job market is punk. You know, we're not seeing
any job growth whatsoever. We are vulnerable to you know, again,
whatever else might not stick the script, and there's certainly
a lot of things that might not stick stick to script.

Speaker 1 (01:01:27):
Here a few I want to hit two other topics
here to sort of understand gold. Yeah, whenever gold, I've
sort of in my head, you know, when I see
gold go higher, that's bad news for the American economy.
It always gets me nervous. Yet this is a case
where everything's going up gold too. Yeah, that's unusual.

Speaker 2 (01:01:51):
No, it is, I mean, and this goes back to
the question of are we in a bubble and speculation
in the fact that we're seeing prices rise for all
kinds of assets at the same time adds to the
concern that this is you know broader that you know,
a bubble is developing, and gold prices are at record
highs where we're four thousand dollars an ounce, uh for

(01:02:13):
the first time, silver prices, obviously, crypto prices. Actually, interestingly enough,
the only asset for which that's not this is not
the case is real estate, right if you've looked.

Speaker 1 (01:02:22):
Well, that was going to be my next topic, which
is sort of it is that's a strange aspect that
people that that real estate is not seen as a
safe harbor, but gold still is.

Speaker 2 (01:02:33):
Yeah, And I think the thing about gold is it's
got in these one of these asset classes that were stocks,
commodities like gold and crypto have its own kind of
idiosyncratic aspects to it as well. In the case of gold,
you know, it really has got to boost When Russia
invaded Ukraine, in the US froze Russian reserves. Those are

(01:02:54):
dollar reserves or dollar assets sitting in bank accounts around
the world, and the US froze those assets, those dollar assets,
and so countries around the world with those dollars assets
begin to wonder, well, maybe they'll do that to me
if they don't like something I'm doing. Therefore, I'm going
to diversify away from dollars into let's say gold. So

(01:03:16):
central banks around the world are now, you know, big
investors in gold. The other thing is there's some you know,
concerns about the safe haven status of the US right
in the context of the trade in terior wars and
kind of the repositioning in the US and the global
economy and the financial system by the Trump administration. I
think global investors are asking themselves, is the US really

(01:03:38):
the place you want to go to put your money
when times are tough? And if that, if you question that,
then you know, you buy something like gold, you know,
as a hedge. And then the final potential reason for
what's going on in the gold market is inflation. So
you know, there's inflation has been a problem since the pandemic,
the Russian War, and then that head on energy and

(01:04:01):
command prices push up inflation even more. And there's a
lot of discussion. Concern about FED independence is that theors
are going to remain an independent going forward, and if not,
does that mean the Fed's going to keep raids too
low for too long and juice up inflation. And if so,
if you're worried about inflation here, going down the road here,
you're going to buy something like gold. So you know,

(01:04:23):
there's a lot of things coming together there, I think
pushing up demand for that commodity.

Speaker 1 (01:04:29):
What is the risk to our economy if we're not
a safe haven, Well, it.

Speaker 2 (01:04:33):
Means it means higher interest rates all else being equal.
I mean, you know, especially in most times, that that's
not that big. It's a deal. I mean, we benefit
from that, but it's really a big deal when things
aren't going well. When the world has a crisis, when
we have a pandemic or a global financial crisis, or
something goes off the rail somewhere, money comes from all

(01:04:57):
over the world comes flowing into the United States. It
really cushions the blow of that shock on our economy
and it helps us navigate through and we kind of
lead the way for the rest of the world. That's
going to be harder to do if, in fact, investors
don't view us as that safe harbor or is that
safe haven, and the money doesn't come flowing in in

(01:05:17):
the next crisis, and we have to pay more for capital,
higher interest rates, and that's certainly a corrosive on our
ability to invest and to do all the things that
we want to do.

Speaker 1 (01:05:27):
Yeah, I just sort of like to how to connected
to the average person, Why should I care for not
a safe haven? What you're saying is, well, if you
like lower interest rates on your credit card debt, if
you like a lower interest rate on your mortgage, this
is why you want the rest of the world feeling
America as a safe harbor.

Speaker 2 (01:05:43):
Or your small business and you need to borrow money
to expand your business or hire, or even if you're
a large multinational and you need to go out and
borrow money to invest in let's say those data centers.
I mean, it's just going to be a lot more
costly to do it. And most times this generally going
to be more of a corrosive on the econom It's
not a cliff of that. It's not like all of
a sudden you go off a cliff because the safe

(01:06:04):
haven status is under question. It's more of a weight
on the economy that over time diminishes the economy's ability
to do what we've done historically and that's kind of
lead the global economy.

Speaker 1 (01:06:17):
I don't know if this is sort of outside your field,
but how do you assess energy costs because it does
seem as if that's becoming a right. We're seeing rising
electricity bills all over the country. Is this you know
how much of this is we haven't diversified our grid enough.
How much of this is there's more of these AI companies,

(01:06:38):
more demand on the grid itself, and we're having to
do it. And is that easy to assess? And how
do you factor that? Because you know, when when when
energy costs rise, that impacts everybody. Right, that's just a
giant sort of slow down on the economy, and that
feels like something that that we're not really it's happening,

(01:07:01):
and we haven't really focused on on how that could
be a real sort of governor on our economic growth.

Speaker 2 (01:07:08):
Yeah, Well, if you're talking about electricity, the cost of electricity,
and that's going up just like everything else, demand and supply.
On the demand side, you know, all these data centers
scarf up a lot of electricity to be able to
run the servers and do the AI calculations, So that's
juicing up demand and on the supply side of the

(01:07:30):
electric power market. It's slow to respond, particularly in the
context of you know, policy changes under President Trump, where
he's moved away from clean energy, you know, moved away
from soular.

Speaker 1 (01:07:40):
Just the shift itself slows us down. It doesn't like
I'm not we're not weighing in on whether Biden's right
or Trump's right. The transition itself slows us down.

Speaker 2 (01:07:50):
Absolutely. Now there's a lot of discussion about going to
nuclear and that's the direction we're going to head here,
but that takes time. It's a lot of time, a
lot of time. There's least smaller nuclear facilities that you
can get online more quickly, but they're small. You need
big nuclear plants to be able to generate the power
that we need, and that's just going to take time.
So I would I would buckle in here on the

(01:08:11):
that we're going to be paid more for electricity. The
fortunate thing though, is oil prices, which obviously you know,
we still draw many people still drive of gas powered cars.
That's down, right, that's sixty sixty five bucks of barrowl that.

Speaker 1 (01:08:26):
But why if that's down, why isn't that having some
impact on our electric bills? Because usually when the price
of oil goes up, the price of every all energy
goes up.

Speaker 2 (01:08:34):
Well, I mean no electric electric power is very little
if it's oil powered. You know, there's natural gas, but
natural gas prices are relatively low. It's still relatively low
because we we produce a lot of natural gas here
and it's hard to export to the rest of the world,
although we're trying. But most of it is natural gas
or you know, renewable solar wind and to a lesser degree,

(01:08:58):
nuclear and coals becoming less of an issue. But oil
is a very very small piece of the gotcha of
the what's used to power electric power plants?

Speaker 1 (01:09:07):
Gotcha? So let's talk about real estate. There was an
interesting little one of the million newsletters I read every morning.
So I'm not going to say you're talking about right,
there's so many of them, but one notice that it's like,
so the the talking point of why real estate investment
has been slow as well, inventory is low, but it's

(01:09:30):
still one would assume if you're if if there are
investors looking for safe havens, why are they only going
to crypto and gold? Why aren't they going to real estate,
which has traditionally been a pretty good inflation buffer.

Speaker 2 (01:09:43):
Well, there's the there's the residential side, which you mentioned
the single family housing, and then there's the commercial real estate.
And that's where generally investors have gone as cre commercial
real estate, office properties, you know, retail malls.

Speaker 1 (01:09:59):
Uh some of the times, amazing what the price of
some of these beautiful office buildings are going for it
at the oh. I mean, if you ever want to
own an office building, right, do they have a deal
for you?

Speaker 2 (01:10:11):
Yeah? And I think a couple of things happened to
commercial real estate. One is interest rates. When interest rates,
real estate's very interest rate sensitive, much more than any
other asset. And so when interest rates rose, when the
FED jacked up interest rates to cool things off back
you know a few years ago in twenty two and
twenty three, going into twenty four, that caused the prices

(01:10:35):
to come down for almost all CI. And then each
property type had its own kind of story. And you
mentioned office Obviously there it's remote work, and the demand
for office space, you know, got crushed. But you know
other property types also got have their own stories, Like
in the multi family sector, that's not about demand, that's
more about supply. That's where builders were got ahead of

(01:10:58):
themselves and put up a lot of these huge lungs
ux Trey apartment towers. While there's a lot of demand,
there was just too much supply, and that's that's caused
rents and prices to come in. So commercial real estate
has kind of operated on its own independent dynamic, and
it's been much more affected by the run up in
interest rates than the other asset classes. On housing, you

(01:11:21):
know that that's generally there's some investment in single family rental,
but mostly that's you and I, you know, Merrick Households
buying those homes and there the market has struggled in
terms of sales because of the so called interest rate
lock you know, rays for very low back in the pandemic,
people got mortgages at you know, three, three, two and

(01:11:42):
a half three.

Speaker 1 (01:11:43):
I'd love to sell my house, but I don't know
what I get into. Yeah, exactly, I mean, you know,
I mean that's a real thing. It's like you will
make Yeah, It's like, boy, i don't want to pay
that high interest rate in my mortgage. I've got this
great low interest rate, right.

Speaker 2 (01:11:54):
Yeah. So if you have a three percent mortgage and
existing mortgage rates now over six percent, are you really
going to make that trade and the answers most people are,
you know, at least not yet.

Speaker 1 (01:12:16):
So what could let's stick with housing? What what could
what could government do besides lowering interest rates? So let's
set interest rates aside? What else could government be doing
to just improve the affordability of the housing market. Yeah,
it's done a.

Speaker 2 (01:12:32):
Little bit of work here, I've got the paper out
was a few colleagues. You could google Zandy affordable housing crisis.

Speaker 1 (01:12:40):
And this is a this is for what it's worth.
When you talk to members of Congress and they say,
what issue do we and the press not bring up enough?
But your constituents talk about all the time, it's this
issue one right, yeah.

Speaker 2 (01:12:52):
Yeah. In this paper, what we did we tried to
estimate the balance between supply and demand for housing, both
on the rental side and on the home ownership side,
at a census tract level, so at a very detailed
little geography so you can and it's very interesting, you see.
And then we cut the data in lots of different ways,
one of which is around price points, you know, different

(01:13:14):
just different is it for the for high end consumers,
kind of workforce or low income And what we found
is no surprise. I just mentioned it. At the high
end of the rental market, it's oversupplied. You got too
many big luxury condo towers in d C. And Philly, Chicago,
San Francisco, that kind of thing builders got ahead of themselves.

(01:13:34):
Really interestingly, Chuck, you know, at the very lower end
of the of the market, it's it's not overly undersupplied,
it's kind of well balanced. And that's because there's a
lot of tax subsidy already provided for low income rental,
like light Tech that's low income housing tax credit. The
real shortage is actually for what I call workforce housing

(01:13:59):
rental and for homeers. Those are for kind of teachers
and firemen and you know, kind of middle class people
are making seventy five eighty K a year on a
household basis, you know, nationwide, that's where the real shortage is.
And so that's where policymakers really have not focused. They've

(01:14:19):
been focused on the low end. They really need to
focus on the middle part of the market. And there
I would argue, if we had some tax subsidy like
a LA tech for workforce rental, that would be very helpful.

Speaker 1 (01:14:30):
Is this so how sensitive is that issue by wealth
of county. Right, so I take a look at like,
you know, you go to around in and around San Jose, Frankly,
in and around d C. Right, Montgomery County, Arlington County,
where the service where the service industry folks, your teachers,
your firefighters, your police officers can't necessarily afford to live

(01:14:52):
in the county that they work in, right, because the
cost of single family homes are so high. This is
true in and around Valley, This is true in close
in parts of LA and New York, et cetera. It
seems like that's a unique that's a challenge that's very specific.
But is this is this also an issue in and
around Louisville, right in and around Wichita.

Speaker 2 (01:15:15):
Yeah, it's coast to coast and it's market to market.
And even in those you know, very wealthy areas of
the country, there are you can see there are you know,
real pockets of problem of shortages in certain segments of
the market. So it is coast to coast and it's
very very local. You have, it's not that's one of

(01:15:37):
the reasons why it's a hard thing for policymakers to address.
It's not like I can do something at at federal
government level, wave of magic wand and solve the problem.
It's really a lot of you know, trying to understand
individual markets at a local level and trying to figure
out what the best strategy is to address those. And
of course underlying all of this is zoning and permitting cours.

(01:15:57):
Feral government has nothing to say about that and won't
because the political you know, ramifications trying to address that
would be you know, overwhelming. It's something as possible. So
it makes it very difficult for government, federal government, for
the federal government to really address this head on in
a grand ways. It's got to be done, you know,
helping local governments try to figure out, you know, what

(01:16:20):
they need and where they need it and give them
the resources to help them do it.

Speaker 1 (01:16:23):
So in some ways it's incentivizing local governments to change there.

Speaker 2 (01:16:26):
Yeah, yeah, again, I'd go back to you know, there's
light tech is low income housing tax right, much maligned,
no one really likes it, but it's tried and true,
it's kind of works. Let's I take that and run
with that and to just kind of tweak it and
make it work for workforce rental.

Speaker 1 (01:16:45):
That gets me as something else that I think is
is and maybe this is just a hallmark of the
twenty first century, but how much would our economy benefit
from domestic migration? You know, we we and is that
it seems as if we move less domestically and we did.

(01:17:05):
You know, Hey, if I can't find a job here,
I'm going to travel to another state to go get work,
or I'm gonna I can't afford a house here, I'm
going to move somewhere else. And we've seen, you know,
there was a little COVID migration. Obviously Florida experienced that
Miami in particular, but that was kind of high end
and it really is messed with inflation in Miami uniquely.

(01:17:26):
But you know, I've always thought one of our one
of our problems is that we and why we're we
were so living in our silos, is that we don't
have the domestic migration that we actually did have a
lot of in the fifties or did have a lot
of in the thirties. Is that measurable?

Speaker 2 (01:17:45):
Yeah, yeah, it's an excellent point. You know, we get
had Moodies, all the credit files in country every month
anonymized and we can see address changes, so I can
tell you exactly how many people are moving from Chicago
to Miami and act in a given month. And you're
absolutely right. You know, over the last few decades we've

(01:18:07):
become a much less mobile.

Speaker 1 (01:18:09):
I used the U haul thing. By the way, U
haul light height always throws that out, and you know
that's what a lay person like me, the U haul
rental thing. It is interesting to me, and it does
seem Yeah, I.

Speaker 2 (01:18:20):
Should go look at that. I can look at that
in a while because I've been looking at this this crediphile.

Speaker 1 (01:18:25):
Do you have better data please?

Speaker 2 (01:18:26):
Kind of it's really good, you know, because I am
kind of nerdy. I love looking at that data. And
you know, one of the reasons why we're not moving
as much is because just raging when you get older.
You tend to move less when you're young, switching jobs.

Speaker 1 (01:18:40):
And so we're just an aging population.

Speaker 2 (01:18:42):
That's one explanation, yeah, And the other is I think
goes back to the income and wealth distribution. If you're
lower income, middle income and you live in parts of
the country that got nailed with the loss of manufacturing,
you know, the economy is just not very dynamic. House
prices have not risen at all. They may have actually

(01:19:03):
even declined in some of those communities. You just can't,
you can't. And then you've seen the house prices rise.
We're on the coast and say you can't afford to move,
You literally can't, literally can't afford to move. There's just
no possible way you're going to be able to do that.
So you're kind of stuck. Even if you wanted to
move to get that to that job that's sitting in
Miami or wherever it is, you just can't do it.

(01:19:25):
And and that's really cut down the mobility. I will
say though, that's one of that has historically been one
of the unique characteristics of the US economy compared to
anywhere else in the world. You know, very few exceptions
to that. And it's that mobility that has allowed the
US economy to adjust to shocks, because, as you say,
if you lose a job over here, you can pick
up a move to take a job over there. But

(01:19:47):
that that flexibility, it's still there. We're still much more
flexible mobile than let's say Europe or you know, other
parts of the Asia, other parts of the world, but
much less so. So we're not you know, we don't
benefit to the same degrees we did thirty forty fifty
years ago.

Speaker 1 (01:20:02):
From that, from that mobility, All right, let me get
you out of here on this, which is is our
how much is our economy at risk due to domestic
politics and how much of it is with more global forces?

Speaker 2 (01:20:20):
I'd say policy above, but you know.

Speaker 1 (01:20:25):
You know, I think it's clear or you can't really disentangle.

Speaker 2 (01:20:28):
Yeah, I mean, look, I think it's pretty clear that
our politics are fractured, and you know, probably goes back.

Speaker 1 (01:20:35):
To was that worth a point of GDP. Probably a
better politics or a more functional political system, we probably
would have a healthier overall economy.

Speaker 2 (01:20:47):
How could it not be the case? I mean, just
take a look at what's happening now with the government shutdown, right,
I mean, yeah, there's no upside to that. There's nothing
but downside, and it diminishes our.

Speaker 1 (01:20:56):
Large I have no there's nothing in the constitution that
says government has to shut down if there's appropriations dispute.
It tries to me crazy that we've just decided collectively
this is how we should function.

Speaker 2 (01:21:05):
Yeah, there you go. And then you know, but of
course that this goes to our ability to respond to
the challenges that we face, and there are many challenges
both domestic and you know globally, what's going on globally.
There's a tremendous challenges there, and we can't address them
if we're as politically fractured as we are. So I

(01:21:28):
think that's you know, again, I want to say, it's
not a cliff event. I kind of think of there
are corrosives and there's cliff events. This is not a
cliff event. It's not like we're going to go off
the cliff here. But it's one of those things that
kind of undermines the economy's ability to grow a longer run.
And you know, you don't really feel it in a
given year, but when you look back over a decade

(01:21:49):
or two, you go, oh my gosh, you can see it.
You can see it and you can feel it. Well.

Speaker 1 (01:21:53):
The reason I asked about the international versus the domestic.
I mean, look, I think we all understand the domestic,
but I look out of China. Is that a healthy
economy or not? If you thought employment is near twenty percent,
how's that a healthy economy?

Speaker 2 (01:22:06):
Now they got their we got their own problems.

Speaker 1 (01:22:08):
I mean, could that lead to contagion globally? I mean,
there's such a big economy, how could it.

Speaker 2 (01:22:13):
Not well, I mean, I think it's one of those
things where they can keep it together for an extended period.

Speaker 1 (01:22:21):
Right, I mean because of their system of government.

Speaker 2 (01:22:23):
Their system of government, I mean, it's very autocratic. I
don't think it works well in terms of in terms
of long term economic growth, but they can keep things
going for a long time, and you know, paper over
a lot of a lot of mistakes, and you know
that's what they're doing right now. So you know, I'm
not bullish on China long run, but I'm not bearish

(01:22:46):
in the near term. I don't think that's something that's
going to fall apart anytime soon.

Speaker 1 (01:22:50):
All right, So if I have you back here after
the first of January, you think we're probably going to
be in the same levels of risk more likely than not,
just sort of sitting in this same sort of elevated
but not there in a recession.

Speaker 2 (01:23:03):
Yeah, I think that that'll be the case, junk. I mean,
I do think that if we look out a year
from now and towards the second half of next year,
you know, we might start to see a lift because
at that point we're on the other side of the tariffs,
the immigration policy, and you've got lower interest rates. The
Fed is going to be cutting interest rates, and you
know there's a lot of fiscal so called fiscal stimulus
in that one big beautiful bill that got passed. You know,

(01:23:25):
there's a lot of cutting, but that comes later, you know,
next year, telling the tax cuts and so people are
gonna get bigger refund checks.

Speaker 1 (01:23:32):
Good, So you think there could be another that in
some ways we maybe we might have a leaky, hot
air balloon, but there's gonna be more more air pumped
into it.

Speaker 2 (01:23:40):
That's great what I think of putting it. Yeah, that's
a great metaphor. It's exactly what's going to happen. So,
you know, I think the economy is going to be
most vulnerable in the next six to nine months. On
the other side of that, then I think it it'll
get some juice from the fiscal and monetary stimulus that's
in train here.

Speaker 1 (01:23:54):
All right, Mark s Andy, Always great to hear from you.

Speaker 2 (01:23:57):
Yeah, thanks, Chuck thinks, thanks for all the wide ranging
lisson is always appreciated.

Speaker 1 (01:24:01):
Well, I you know, you you humor me well and
at the same time you're pretty good about putting this
stuff in English, and I do.

Speaker 2 (01:24:08):
I mean, there you go, pretty good, pretty good, pretty good.

Speaker 1 (01:24:14):
Well, you know, you can't ever say great, right, but
I never give five stars, right, I'm a four point
nine guy. No, I hear you.

Speaker 2 (01:24:23):
Thanks Mark.

Speaker 1 (01:24:24):
It is Monday, which also means we're going to go
back into the toodcast time Machine. Do I need to

(01:24:48):
do it right? I don't know if you guys have
you know, I hope you like our little music interlude
on this you should. You should know that the inspiration
I was looking for was sort of Huey Lewis meets
you know, without you know, without having to pay Huey
Lewis rights for you know, Huey Lewis adjacent to give

(01:25:13):
you the vibe of back to the future. So the
time podcast Time Machine has actually got a financial theme
to it. I figured, you know, we're talking a lot
of things having to do with money, the economy. Well,
on October nineteenth, nineteen eighty seven, that's where we're going back.
It's now called Black Monday. That was the day that

(01:25:34):
the US stock market lost twenty two point six percent
in a single trading day. It was one of the
most sudden and alarming crashes and financial history and today
as we move in October twenty twenty five, we're in
the middle of it with a lot of people wondering
as how bubblicious is this AI driven stock market? Right,

(01:25:55):
it's worth re examining the moment and asking could history
teach us anything relevant for this market and what risks
lurk in twenty twenty five that echo nineteen eighty seven?
And are there safeguards that are missing? I have to
tell you this, we have a lot of safeguards today
because of the nineteen eighty seven black market. But here's
what you need to know about how it happened. And

(01:26:16):
I'll just be honest it that eighty seven crash. I
was fifteen. My dad would die thirty fourteen months later.
He was a modestly successful financial advisor. Needless to say,

(01:26:38):
all his clients lost a lot of money that day.
Whatever savings my parents had were gone that day never
recovered at that point and led to sort of So
I've it has always been a it was sort of
I've always pinpointed it, even though my dad had not
been diagnosed yet, always have pinpointed it as sort of

(01:27:00):
the beginning of the end for my father. So there
is a for me. This is both personal and prepared
and certainly had an impact on how I think about
markets and how I think about the economy, and how
I think about how you what you think of the
stock market and how much you should react, underreact, overreact,

(01:27:22):
et cetera. But let me give you sort of a
larger look at what the economy was looking like back then.
In mid eighty seven, market had already been running up
big time. Valuations were stretched, growth was decelerating, while inflation
and interest rates were starting to rise again. Yet international
currency was a contributor to this one. The eighty five

(01:27:43):
Plaza Accord, which sought to push the US dollar lower,
that had a contribution there, and by eighty seven markets
were uneasy about the coordination under a follow up accord
called the Louver Accords. And what was interesting is that
in the week leading up to the crash, it was
a crash happened on a Monday. Markets had already been

(01:28:05):
seeing some sharp, sharp decline, so there was definitely pressure
to sell more and more we're thinking about selling. So
when you look at you know, when you look back
in history, the biggest structural culprit to the sort of
near to this crash was something called portfolio insurance or
dynamic hedging. This was sort of the first iteration of computerized,

(01:28:28):
computer based programs that automatically triggered trades. So as prices fell,
it automatically increased short positions i e. Futures that were
then to hedge, and it effectively was selling into a
weak market and it would sort of ballooned on itself.
It triggered all sorts of horrible feedback loops, falling prices,

(01:28:49):
more hedge, hedging, more selling, more downward pressure, more hedging, right,
and it was it was sort of it was what
it was. It was the first time we were warned
of what happened when you start to attempt to automate
certain trading decisions, right, you automatically buy if you see
a number here, automatically do this if you see a
number there. So, all of a sudden, quickly liquidity and

(01:29:12):
got stressed immediately. Some stocks even open late, they were halted.
Sometimes bids disappeared because remember some things were computerized, some
things weren't, and then the structure of the market couldn't
absorb all the orders. I mean it basically, if you
think about what happened in October of eighty seven. And

(01:29:33):
you know the movie Trading Places when they're having that
when those guys are on the floor, when everything's panicking
and they're having heart attacks, Sell, sell, and the whole
frozen orange juice concentrate business. If you can imagine that,
that's kind of how it looked there, and that's still
the way trading was done on that floor, and it was.

(01:29:55):
It certainly led to a lot of safeguards being put in.
But the crash. Interesting about this crash is it wasn't
rooted in sort of a singular catastrophic macro shock like
the collapse of Layman Brothers right in the Great Recession.
There was no war, there was no overnight dead crisis.
The ferocity came simply from the markets of fragility, leverage,

(01:30:16):
and mechanical strategies. Right. It was a bit over leverage.
Trust me, as a kid, I knew. I knew that
it was a tripping triple Witching Friday was something like
when option Friday coincided with a report. I can't remember
what all of that lingo meant, but I know it
would make my father's mood either good or bad, depending

(01:30:38):
on the situation. Let's just say he never had another
good mood after that. Again, the good news about that
crash is that, because it was essentially a mechanical crash,
I guess the way to put it, it didn't provoke
a broader banking crisis. Right. There wasn't a run on
banks like we had during the Great Recession, and we

(01:31:00):
didn't end up in a deep recession unlike two thousand
and eight or even after nineteen twenty nine. Believe it
or not, it took only two sessions after the crash
for the Dow to claw back fifty seven percent of
its drop. The market fully regained its prior high by
early nineteen eighty nine, less than two years later, and

(01:31:21):
then afterward regulators and exchanges added mechanisms like circuit breakers
trading halts to slow panic in future crashes. Look, it
was the first lesson I ever got, which was, hey,
don't panic. You know, close your eyes. If you're younger,
close your eyes. Eventually the market is going to come back,
because the market always you can see it, right, there's

(01:31:44):
always this upward trajectory, and in some ways many people
behave that way. Anyway. Now the question is where are
we sitting now, Right, Is this a bubble? Do we
only have? Right? The S and P five hundred keeps
going gangbusters, the Dow not so much. Right. There's all
sorts of things that could be happening here that we're
not quite one hundred percent sure of. Right. Why are

(01:32:06):
the large stocks continue to go up? Is this all
due to AI investment? How much of this is due
to people who've gotten who are sort of heavy into crypto.
It got essentially legalized by the government, and they've quickly
got out of crypto and then bought Microsoft, Google, you know,
all the large cap stocks in order to take this

(01:32:28):
imagined money and turn it into a real asset. We
shall see. But there's certainly a lot going on in
this market that for those that are not experts in
it are wondering, are you sure you're not missing something?
Are we sure this isn't a bubble? Are we sure
we're not going to end up in a situation like

(01:32:48):
what we saw in two thousand and eight or what
we saw in nineteen eighty seven. In twenty twenty five,
so the question is, you know what parallels are out there? Well,
we do have an algorithmic parallel, right that you could
be their markets are even more dominated by algorithmic trading,
quant strategies and AI and models, and it raises the

(01:33:10):
risk of algorithmic collisions or systemic feedback loops. We supposedly
are constantly looking to make sure this doesn't happen again,
but so much is automated. Remember we had that flash
crash this is probably about eight years ago now, which
we had that thousand point drop out of nowhere because
of a glitch in one of these automated things, And

(01:33:33):
so you can't help but wonder. And then of course
there's the fact that could a nefarious actor hack into
one of these large private equity funds and sort of
trigger trigger a flash crash of some sort, right, and
trigger a market collapse essentially by redoing an algorithm. I

(01:33:57):
think there's a lot of things here that we ought
to be worried about. The other parallel is the sort
of concentration risk right in twenty twenty. So far this year,
valuations in certain sectors, particularly in tech, are under a
ton of scrutiny. Central banks are worrying about overvaluations, structurally
fragile markets. The equity markets are increasingly concentrated, meaning it's

(01:34:18):
just a few big, mega tech names that carry outsized weight. Right,
if Palenteer is in Navidia, are somehow you know, exposed
to be something that they're not. And I'm not implying
that they are, right, but if they somehow were the
contagion of something like that, right, it would impact your Microsoft's,

(01:34:39):
it would impact Google, it would impact Amazon. I mean,
the contagion effect of this is something that you do
have a lot of people worried about. And then, of
course the other part of this is something we didn't
have in eighty seven that we do have today, concerned
about the politicizing of the FED, which can manipulate mark gets,

(01:35:01):
which in turn could cause a trash, cause a crash. Now,
some of the differences, right, y eighty seven is not
really a corollary to twenty twenty five. Market infrastructure is
a lot more mature. We have a lot more exchanges
that are resilient. There are more circuit breakers in case
there are halts that are baked in in case we
do have a flash crash, in case an algorithm does

(01:35:23):
go haywire. Information is a lot more transparent, it's a
lot more real time. Every investor has more tools at
their own disposal. You know, that's both good and bad.
It means everybody could make their own run on a bank.
You don't have to go find a trader to do
it for you. And in some ways, because the markets
are so global and so interconnected that in many ways,

(01:35:46):
we all either rise and fall together. Right, it's not
as if this would be an American problem, and it
wouldn't be a problem everywhere else. In a weird way,
if we're all in it together, is that a good thing?
Or we'll we somehow take the blame if we somehow
bring down the world, the world economy. But either way,

(01:36:07):
that's the way back machine. Nineteen eighty seven, Black Monday.
It has a particular resonance for me because it was
it was for me sort of the beginning of the
end for my father and for a variety of reasons.
But it also taught me some lessons about the market.

(01:36:30):
And you know, there are people that were close to
my father were very angry about how the market acted
that day and not paying attention to the fact that
if they had just taken a breath, they'd have been
in a better place two years later than they were
on the day of the crash, and it's something I've

(01:36:51):
learned over the years. Never panic right away when it comes.
If you're investing money is don't invest money you need
right way. If you're investing money, it's just that let it,
let it do its work, and you know the long
term rise. There's always going to be volatility in the middle,

(01:37:12):
and you've got to if you have us, if you're
invested soundly, the volatility should should be in some ways minimized.
Sometimes the worst thing we have these days is, uh,
it's too easy to follow all of this right. So
there's your history lesson for the day. So with that,
let me turn to a few questions ask Chuck. Question.

(01:37:39):
First question comes from Brian Chuck. I really enjoy listening
to your show. For some reason, all of our local,
state and even city political parties all seem to be
affiliated with the two national parties. You've had independent candidates
running for governor in certain states that say they can't
be a Democrat or Republican because that brand name is
toxic in that state. Here's my question, would it make
more sense for the Democratic Party of Idaho or the

(01:37:59):
Republican Party Massachusetts and similar situations to change their name
to something different than the Democrat or Republican, or to
carve off the state political party from the national political
party names and run state candidates for legislature for governor
under a different name. Regards Bryant, Well, actually that's the
state of Minnesota. It's the Democratic Farm Labor Party and

(01:38:19):
the Republican Party until recently used to be known as
the Independent Republican Party. Those two state parties, and in fact,
there were two parties at one time in Minnesota that
make up the Democrat and Farm DFL. It was known
as Democratic Farm Labor Party. I have often wondered why
parties haven't done this, and that actually, to me, isn't

(01:38:42):
such a crazy notion to this day. You know, look,
the word independent is totally I can create a halo effect.
And I remember, look, Minnesota always had a different type
of Republican that could win because they were a member
of the Independent. They were I are Independent Republican Party
of Minnesota, and you had guys like Dave Durnberger Rudy

(01:39:05):
Boschwitz that could win in Minnesota probably couldn't have won
in many other places as a Republican. But I think
if I think this would make sense, I think it
would make a ton of sense because, again, especially if
you want to believe all politics is local. Unfortunately all
politics has become national. But all politics should be localized again,

(01:39:28):
and one of the better ways to do it is
to in some ways be your own brand. Say, look,
we're affiliating for fundraising purposes with the National Democrats or
with the National Republicans, but we're kind of an independent organization.
And you know, now maybe the national parties are you know,
don't want their state chapters having that kind of independence,

(01:39:53):
or maybe it's a way to sort of test splintering
off and see how it goes on that front. But
I think it's an app salute worthy experiment. If you're
the Democratic Party in South Dakota, the Republican Party in Delaware.
And here's the thing, you can it's a cheap experiment,

(01:40:15):
you know, because you can experiment in these smaller states,
you know, these smaller sort of one party states, and
see if it does have an impact, See if you're
able to sort of recruit a different type of candidate.
Suddenly you might win more local elections, and ultimately, the
more local elections you win, the more credibility you might
get in statewide elections. And to me, if you really

(01:40:37):
want to grow your state party, the goal is to
win the governorship. The goal isn't to win Senate seats.
The goal is win. Once you prove you can win
races locally in the state legislature and governor, everything else
will take care of itself in the state. So, Brian,
I think this is a great idea, and again it's
actually been done before. The Minnesota was sort of the

(01:40:59):
prime exam in the twentieth century. Both I think now
they're both have gotten rid of those older names, but
they were. They had their own distinct brand and they
prided themselves. You know, you'd have politicians in Minnesota. I'm
not a Democrat. I'm a member of the Democratic Farm
Labor Party, and that was a point of pride. No, no, no, no,

(01:41:20):
I'm not a National Republican. I'm a member of the
Independent Republican Party in Minnesota. That branding helped both parties.
Both helped candidates in both parties in that state. And
Minnesota is no small state, right and they're kind of
swing ish, you know, could be a swing states, not
quite there. I think a non Donald Trump led Republican

(01:41:41):
party could make Minnesota a bit more competitive, and de
versus are. For what it's worth, I think trump is
is just a hard sell in the suburbs of Minnesota
for people. But anyway, I think it's a again. It's
been tried and it probably should be tried again. Great suggestion, Brian.
Next question, I'm from Jason with a Y from California.

(01:42:03):
Hi Chuck. Hearing your take on the two party system
and how big these tents can get makes me wonder
why more small parties are independents haven't emerged you and
me both brother huge overlooked reason seems to be battle access.
Oh yeah, I don't think it's an overlooked reason. I
think it is the reason. But battle access is costly
and time consuming, so only candidates backed by a major
party usually make it. Getting on the ballot. We're easier.

(01:42:24):
We'd likely see more options and less polarization. It's California.
I am weary of a race with one hundred plus candidates.
Hello twenty ozho three recall election. Ah, yes, remember we
had Gary Coleman Arianna Huffington. I think there was at
least one prostitute in that race as well. Some might

(01:42:45):
argue that if you're elected official, you've already prostituted yourself.
But I will leave that there. Anyway, I keep injecting
my own commentary into Jason's question. My apologies there. Back
to Jason's question, but our system right now, where parties
serve as king makers and create rules that block other
parties from gaining access or individuals from getting on the ballot,
seems like an understated cause for increasing polarization. What best

(01:43:07):
practices would use suggest to reform ballot access and open
the field? Thanks is from California. Well, look, I'd like
to try some better legal strategies. I think that there's
an equal protection argument, and that it is if you
can't you know the fact that there that that a
third party doesn't have an equal shot at making the

(01:43:28):
ballot as the two major parties doesn't. There's no there's
no mention of a political party in the constitution. I
also think taxpayer funded partisan primaries are likely unconstitutional because
they they leave out they intentionally leave people out from

(01:43:49):
participating unless you're a member of this private club known
as either the Republican Party or the Democratic Party. So
I look, I think there are legal arguments to make.
But here's here's the problem, right, you want to talk
about a system that's rigged. Even the judiciary is rigged
by the two party system. Why they're all appointed by

(01:44:09):
members of the two parties. But I do think a
high profile effort to make this argument. I think banning
partisan primaries is probably if you could ask me, what's
one thing we could do to chip away at polarization

(01:44:30):
in America? Banning partisan primaries, pure and simple, having none
of it. I mean, I go back to what David
Holt said. I'm guessing you guys devoured that entire episode
with the mayor of Oklahoma City. The least polarizing executive
elected officials in the country are mayors, and it's because
of how mayors are elected. They're not Most of them

(01:44:52):
are not elected in partisan primaries. They're elected in all
party primaries. They don't run with a party I D
next to their name. Yes, people know who's liberal or conservative,
but they don't run with a party, ID, etceter name,
and they don't end up governing as polarizing as now
partisan governors do or partisan presidents. And here we are,
so partisan primaries is the virus. It's a big one,

(01:45:17):
and we need to it's one of those things. There's
a lot of things I'd like to do to open
up the ballot, but you know, in some ways, let's
singularly focus on what would help in the very very
very near term banning partisan primaries. So let's start there.
Chris K from South Carolina Rights, is it un American

(01:45:40):
to feel that control of TikTok may be less risky
in the hands of China than in the hands a
few powerful of a few powerful Americans. Eke, I know
where you're going here. The current risk is unregulated propaganda
and data harvesting. Than I am not sure Corporate America
has made the case they would be better actors to
shay to add to the turmoil. Fourteen billion dollars sounds shady,
by the way, Go hawks, Do we know who is

(01:46:03):
good yet? Maybe? Or oh this is a separate question,
and he has a separate question, do you know who's
good at yet? On college football? I'm gonna get to
college football in a minute, So it was a two
part question. Thank you, Chris. I appreciate that, But look
the TikTok thing.

Speaker 2 (01:46:20):
I I.

Speaker 1 (01:46:22):
Don't understand why TikTok's legal Congress passed the law, and
somehow Donald Trump is going to agree to an ownership
structure for TikTok. That doesn't solve the initial problem, which
is China controls the algorithm, hard stop. China controls the
algorithm concentrated. Look, we're now going to have the Ellisons

(01:46:47):
owning CBS News, perhaps CNN and TikTok. That's a pretty
large chunk of the news. I mean, the public information
systems shouldn't be owned by a select few people. And
yet the concentration of power in our in the in

(01:47:08):
the ownership of platforms, right, I mean, look at we
talk about independent media. Most of us though, are basically
on two platforms, Google owned YouTube or substack. Right, there's
there's not a diversity per se of platform there are
you know, we probably need to diversify. There's no doubt

(01:47:29):
there is too much monopolizing of the distribution system, let
alone on the content side. We're starting to see consolidation,
and it's quite a bit of consolidation on the content side.
So I think both of them ought to concern us.
And with TikTok, it is you're right, it's the but
I mean that's always what made the It was really

(01:47:52):
frustrating to hear many members of Congress correctly point out
the propaganda of TikTok, and frankly the propaganda accomplishment of TikTok. Right,
you know, you know if you somehow point out what
the Chinese do with the wigers, you know, nobody ever
sees that the fact that it seems to the algorithm

(01:48:17):
rewards anti Israel messaging just automatically, no matter what it is.
How do I know this? We did our own polling
on this, where TikTok users between eight and eighteen and
thirty had a unfavorable rating of Israel. Israel that was
twenty points higher than if you didn't regularly use TikTok.

(01:48:39):
So this was already and so I think what was
so frustrating hear you're worried about TikTok, but you're doing
nothing about X or YouTube or Instagram or anything meta owns, right,
And I think that that was why there was plenty
of TikTok users are going, well, geez, I mean Amazon

(01:49:02):
and Google take my data and sell it. I'm certainly
not crazy about that, But how is that any more
or less nefarious than what the Chinese government is doing
at least that was the user experience. So look, I
think you bring up a lot of important points. But
I also think that we've that this is another thing

(01:49:24):
that you have elected Republicans who were the biggest drivers
of this, who are suddenly looking the other way. Even
though Donald Trump is literally ignoring the rationale for why
the TikTok ban was put in in the first place,
which was control of that algorithm. We still don't know
anything about it. Then Ellison's are not going to hear

(01:49:46):
know anything about it there apparently is just going to
be the data will be housed here. It's not about
the data to me, it's about the propaganda and about
that algorithm and how it's used to dial up or
dial that what China cares about when it comes to
public opinion. All right, I'll do one more question here.

(01:50:07):
The next one comes from Warren. Hey, I haven't heard
any status about infrastructure projects that were started before the
current administration where they defunded as part of BBB or
are they still in progress? Thank you well, Warren. Some
of them have been sort of interrupted, you know, a
lot of it the Biden administration try to move a
whole bunch of money out the door before January twentieth,
but some of it has been cut via the recisions,

(01:50:31):
which is arguably a part that has triggered the real
shutdown showdown between Democrats and Republicans here. So that's one.
The second is you've had some of the money the
Trump administration has enough authority over that they've essentially redirected
it to projects that they would prefer as opposed to
some of it is, for instance, going to be I

(01:50:53):
think some of these projects pushed to building some of
these data centers and things like that. And then some
of it is is projects that the Trump administration is
claiming are their ideas and they actually come from from
what was passed by the Biden administration in the Bipartisan
Infrastructure Act. But for the most part, a lot of
particularly the energy projects in particular, this is what Russell

(01:51:15):
Voight's been targeting. This is the goes back to my
introduction in this in the in the full episode here today,
the political targeting, you know, using what was legally passed
legislation and essentially only trying to cut off Democratic funds.

(01:51:35):
I guess right. And you know he pulled funding of
certain clean energy projects from any state that was carried
by Kamala Harris, sort of ignoring the fact that there
were a lot of Republicans in those states. You know,
more people. I think more people voted for Donald Trump
in La County than I think in all of Idaho

(01:51:57):
or certainly all of Wyoming and if other states like that.
So it is not very smart how they do this,
but it is all about getting the headline and owning
the Libs and feeding the MAGA base. Who thinks this
kind of weaponization of the democracy is somehow healthy and
the right thing to do because they have convinced themselves

(01:52:19):
that the Democrats have governed this way. And again, it's
just because your feedback loops says they did this, doesn't
mean the facts actually match your feedback loop. But either way,
if what you think the Biden administration did was wrong,
why are you cheerleading the same behavior on the right.

(01:52:56):
I will pivot to my little rants of the weekend
in college football. It was sort of a relaxed weekend
for me personally or Miami Hurricanes were idle. But here's
my favorite stat of the week when it comes to
college football. Nine of the top seventeen teams in the
preseason AP pole are unranked this week? How about that

(01:53:21):
nine essentially the more than half of the top seventeen teams.
So of course your first reaction may be, well, why
do they bother with a preseason AP pole. Well, if
AP didn't do it, somebody else would do it, and
there'd always be somebody trying to do preseason polls. And
if nobody was doing a shoot, I'd be doing it, right.
We'd all want to do it. We all think we're
we all think we're we follow this stuff enough. By

(01:53:43):
the way, I have a correction from my Thursday podcast
courtesy of my son I kept talking about. I said, hey,
you should make a bet on Justin saying for the Heisman.
And I'm guessing that you couldn't find a Justin saying
to make a bet on for the Heisman because his
name's Julian. And those of you that knew his name
was Julian when I was saying it, we're probably going

(01:54:05):
you dumb and that or how do you not know
it's Julian not just In, etcetera, etcetera. Well, just so
you know, my son was on the case, So thank
you Harrison for that correction. I said I would give
him credit for that correction. But here's where where we
are in college football. When you have essentially fifty programs

(01:54:25):
spending somewhere between fifteen and twenty five million dollars for
roster construction, you are now professional league right among this
top forty. So among those sort of seventeen, you know,
among the top twenty five, pretty much everybody. Indiana spends
money on roster construction. Okay, maybe they don't spend as
much money yet as Oregon or Penn State, but they're

(01:54:46):
spending a lot of money. I know, Miami spends a
lot of money. Florida spends a lot of money, Clemson
spends a lot of You get the drift, the rules
of change, but in some ways, everybody's spending. And so
the first couple of years, not everybody spent, and it
allowed your TCUs to sort of come from nowhere and
jump up right and bite everybody. And then they immediately

(01:55:08):
disappeared because suddenly more people, more entities, started spending. And
now now we're sort of almost already at at at
a major power parody in spending. And so what that
means is just like it's just like the NFL, which
which is a year to year league, and you know

(01:55:30):
everybody's spending about the same amount of money. It is
really hard. Yes, you have two or three or four franchises,
are you know, can can can be in the can
be in the top tier of the league for four
or five years at a time. But you're going to
have teams go in and go out, and you're also

(01:55:51):
going to have sort of chapters to your seasons. Like
I also think it's a little early for us to
assume we know that two loss teams now are terrible
and that the undefeated teams now are going to be
the ones that make the playoff, right, You now have
a situation where you're gonna have ebbs and flows right
and one and you can you know, teams may lose. Look,

(01:56:14):
Florida State's lost three in a row. Penn States lost
three in a row. I didn't see it coming. With
Florida State, by the way, that has not been very
popular in my household, as some of you may be aware.
But they also certainly had some holes in their roster construction,
and nobody should have expected them to go from a
two and ten season to playoff contention right away. But

(01:56:35):
they pull an early upset and so everybody sort of
got over enthused, kind of like you know what happens
to a two and oh team, You're like, oh wow,
Like last year the New Orleans Saints for two and oh,
they suddenly were terrible. Right, So, just like in the NFL,
you don't know who's good early, right. Are the Chargers
a good team or not? I'm not sure. They almost

(01:56:56):
lost to the Dolphins today. They did lose last week,
but they started off to and Ow and looked amazing.
My Packers looked amazing the first two weeks. Then they
lost a game to Cleveland ty Dallas. We'll find out
how they do the rest of the season. So I
do think that college football now is going to look
more and more like the NFL. There's more parody. So

(01:57:19):
you're going to have a year where a couple of
years where in Indiana is contending and then they may,
you know, fall short on their ability to find the
right defensive lineman and offensive linemen they need to sort
of keep in the top tier and so they may
slip back. Right, That's what happened to Florida State, That's
what's happened in to a Clemson. You know, I've got

(01:57:40):
to sort of prepare for that with Miami. And I
think this idea that you can expect your team in
college football to win ten games or more five, six,
seven years in a row is totally unrealistic because nobody
has depth anymore. Right, Georgia and Alabama, Miami and it's heyday,
they could stock bile talent. The greatest college football team

(01:58:00):
of all time might be the two thousand and one
Miami Hurricane National championship team. I say, might I accept
the twenty nineteen LSU team as a contender for that spot? Right?
Miami had a third string running back named Frank Gore
on that team. Right. The first string running back was
Clinton Portis, his backup was a guy named Willis mcgahey,

(01:58:21):
and the third string one was Frank Gore, who's going
to be in the NFL Hall of Fame. So the
point is is that in this day and age of nil,
Frank Gore doesn't stit at Miami for two years waiting
his turn. He's probably in another roster. And I think
that's what you're going to see with college football, and
that's probably why we're seeing where because you cannot, you know,

(01:58:45):
you don't have the depth and it's really now a
war of attrition. The teams that can stay the healthiest
or the ones that are going to be there, and
the teams that sort of end up with some injuries
or bad luck or the wrong You know, turns out
somebody just wasn't as good of a quarterback as they
thought they were going to be, or wasn't as good

(01:59:05):
of a receiver as you thought they were going to be.
There goes your season because there isn't a guy waiting
in the wings that you could just tap into. And
I think in some ways that's what we should be realizing,
is that that college now that college football has been professionalized,
it's going to resemble the quirks of the NFL. And

(01:59:26):
in many ways I would argue that college football in
the sort of the top forty programs looks a heck
of a lot like the NFL, more like the NFL
than it does what college football look like even six, seven,
eight years ago. As for who's good, I think everybody
agrees that Ohio State and Miami seemed to be good.

(01:59:48):
They look good statistically, and they've looked good on the field.
I could make an argument, if I really if I
really want I don't want Miami to be ranked number one.
I don't like the statistic that's out there already that
says Miami is the best chance of finishing undefeated. Look,
I am well aware despite what the SEC thinks, everybody's

(02:00:09):
conference road games are hard. It's not just in the
SEC conference. Road games mean more in every conference and
they're very difficult. And Miami has only had to play
one road game so far. So I am fully on
upset alert for the rest of the season. If we
can just get through the season with one loss, we'll

(02:00:30):
be fine, thankfully. That's how the college football playoff system
has now made it where you don't have to be
perfect if you're not a member of the SEC like
you were even when we were our top four, right,
And sometimes perfection only doesn't work if you lose your
starting quarterback, as Florida State found out. Because the ESPN
Invitational is just that, it is an invitational, and even

(02:00:54):
at twelve teams, it's still an invitational, and clearly what
the matchups are, etc. Are going to have the networks
are going to have to say on all that. But
I think we know this much. We know Ohio State's good,
we know Miami's good. Is Indiana in that top three
or not? Right you start doing the you know, I

(02:01:15):
think Indiana has looked impressive. I think they do. I
think they're part of it. But if you want to
question Indiana by saying, well, Oregon beat a Penn State
team that turned out to be terrible, are they terrible?
Are they just missing Tyler Warren? I do think that's
something we have to realize, right, Tyler Warren was so
good at Penn State, and without him there, it's it

(02:01:39):
is set Drew allerback. Obviously, now he's injured, so he's
totally set back for the season. But even before he
got injured, he didn't look like the same quarterback. Tyler
Warren made every made that team, made that offense incredibly
hard to stop. He was a unicorn. How good is he?
He's turned He's helped turn the Indianapolis Colts into a

(02:02:00):
top tier NFL team this year. So clearly they miss
him and miss him a lot. But I think those
are the you know, you look at those three teams
and then after that, Ole miss almost lost to Washington State,
a group of five team. You know, I guess there's
still you can say they're still technically member of the
PAC two right now, but this is a team that

(02:02:20):
has just been devastated by the portal. Right They've lost
their last two starting quarterbacks, cam Ward to Miami, John
Mitteer to Oklahoma, and they lost their coaching staff. They're there,
they're great offensive coordinator to Oklahoma as well with Matier,
and yet they went into Oxford and almost beat Ole Miss.
I guess the good news is, if you're a long

(02:02:41):
time Lane Kiffin watcher, you could argue the way I
argue so far with Mario, which is, hey, Lane Kiffin
blows that game two years ago. At least he didn't
blow it this time. And that's kind of the way
I look at it. I still think Old Miss is
going to be there at the end, and I think
Texa and m is the best team in the SEC.

(02:03:01):
And I think they're better than Ole missed by a
by a little bit more than than than the than
The rankings indicate Alabama is certainly vulnerable. They're not. They're not.
And and can I just say this, Georgia only won
because of the officials in that Auburn Georgia game that
was an atrociously officiated game. And you know, normally, normally

(02:03:28):
most games where fans complain about any officiating, myself included,
you know, you're only seeing the calls that go against you.
You're not really processing the calls that go for you
or the calls that go against the opponent. You don't
really sort of have the same emotional And I do
think it's sort of like, you know, those that judge
officiating as fans are like partisans trying to claim they

(02:03:51):
can identify media bias. Right, no partisan. I always laugh
at people that accuse me of bias. It's always somebody
from the from hard lefter hard right, And I'm like,
how do you guys know what bias looks like? Right?
You're upset if people aren't biased in your direction. That's
what you view as political bias. Like those that clowns
show that the Bozell family that has turned into a

(02:04:14):
family grift some sort of grifting business, that that thing
in the entire Bozell family makes money off of this
off this group that claims there's somehow left wing bias
hidden everywhere in America, and a whole bunch of right
wingers like Bozell who thought Nixon didn't commit crimes. The

(02:04:34):
old Man is somehow an arbiter of neutrality anyway. I'm
not saying there's not biased in different places. I'm saying
the Bozells don't have the qualifications to identify it. And
it's that way with many fans. We don't have the
qualifications to identify. I didn't really have a I didn't

(02:04:55):
really have a rooting interest in Georgia Auburn. I've got
a lot of in laws that are Auburn fans, so
I want to see Auburn do well. But I hate
Hugh Freeze. I don't like that guy, I'll admit. So
I struggle with you know, with my with my in
laws on that. I'm like, yeah, okay, but why Hugh Freeze.
But you know what, ask any Auburn fan and they
sort of like, yeah, you Freeze. They're not they know it, right,

(02:05:19):
But those were just some terrible calls, and I, you know,
Georgia gets I certainly hope the following isn't happening that
somehow SEC officials, because this is not a great year
for the SEC. It doesn't appear they have four or
five great teams. Appeers, they might have one great team
in Texas A and M and a couple of good teams.

(02:05:41):
No different than the Big Ten, no different than the ACC,
no different than the Big twelve. They just look like
another conference this year. They don't look like the SEC. Right,
But how badly does the SEC want to protect its
big brands? Right our Alabama and Georgia are going to
continue to get calls for the rest of the year
like this. You know in is Texas and Oklahoma sort

(02:06:03):
of in that same category where those teams will get
calls more likely, right, Oklahoma got it against Auburn. Now Auburn,
you know, didn't get a call against Georgia. I hesitate
to see how the refereeing looks when Auburn has to
play Alabama. But my goodness, the refs decided that game
when they didn't award that touchdown to Jackson Arnold and

(02:06:23):
they gave it a turnover that it flipped the game completely.
Instead of seventeen to nothing at halftime, it was ten
to three. And that was a massive, massive swing by
what was again? I mean you break the plane period,
right it is? And by the way, guys, in this

(02:06:46):
day and age, can we please create some sort of
new barrier right where and a chip in the ball
so that the second it crosses that goal lines, you
know right that you know what you see it. You
can't tell me we don't have the technology to be
able to do that rather than having all of these days.

(02:07:08):
Because here's the other thing you have is that not
every every NFL game has every camera angle that you
would want for replay, but not every college game has that.
The big time college games, right that are going to
get covered in primetime by your Fox, your NBC, your NBC,
and your Fox at CBS and ESPN, there's about six

(02:07:28):
or seven games that'll have seventeen eighteen different cameras, But
most of the other games don't have that many cameras
because the networks are want to spend that kind of
money for what might be a streaming game or what
might be an ESPN two or CBO Sports Network or
if this one peacock you get it right. So, like
I was watching the Florida State pit game, they didn't

(02:07:51):
have a camera angle right down the goal line, so
they couldn't tell for sure. They did a review of
a touchdown that I'm pretty sure was a touchdown, but
they didn't it's because they didn't have a camera angle
to dispute it, even if you wanted to dispute it.
That seems like, look, if you're gonna do replay and

(02:08:12):
we have the ability, my god, we can put GoPros everywhere.
Now this is not a high cost the way it
even was just five or six years ago. If you
do care about the outcomes of these games and you
want to make sure we always get it right, let's
make sure we have all the equipment at all the
games that are getting televised and that are going to

(02:08:33):
use replay. You can't just sort of be glad that,
oh well, hey, because believe it or not, I don't
know if we would have had that camera angle that
Georgia Auburn had which showed Arnold the ball crossing the
goal line before it was punched out. I don't know
if you would have had that at the UMass Can
State game. Then again, maybe we didn't need any replay

(02:08:56):
officials for the U mass Can Stay game. All right,
there's my college foot all rant for the week. So
there you go. Appreciate it. Appreciate you here. I hope
you enjoy If you have a holiday today, I hope
you're enjoying it. For those that are nervous about getting
their paycheck due to the government shutdown. I'm sorry. I
hope this podcast and the attention that we give to

(02:09:16):
it serves as at least something that can be done
there and maybe at worst or at best, my podcast
is a distraction for the day. So with that, thank
you for listening, thank you for liking and subscribing, thank
you for all those five star reviews, And with that,
I'll see in forty eight hours.

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}Full Episode - Trump Has Weaponized Every Part Of Government + Will Trump’s Tariffs Drive The Economy Into Recession?