The Soft Landing is a Myth: Here's What's Really Going on in the Economy | Cullen Roche

Join us for an insightful conversation with Cullen Roche, a renowned financial expert from Discipline Funds, as he breaks down some of the most pressing economic and market topics impacting investors today. Hosted by Justin and Jack, this episode of Excess Returns dives into a "fact and fiction" style discussion, where Cullen unpacks complex issues like Federal Reserve policies, tariffs, and the national debt with clarity and nuance. With his knack for simplifying the mechanics of markets and the economy, Cullen offers a fresh perspective on what’s really happening—and what it means for your financial future. Check out more about Cullen’s work at disciplinefunds.com.

Main Topics Covered:

• The Fed and Soft Landing: Cullen evaluates whether the Federal Reserve has successfully managed inflation and engineered a soft landing, reframing the analogy as stabilizing an economy in flight rather than landing it.
• Tariffs and Inflation: A deep dive into Trump’s tariff policies, exploring their impact as a corporate tax, their potential to drive inflation, and whether they can bring manufacturing jobs back to the U.S.
• National Debt Concerns: Cullen shares his take on the U.S. national debt, downplaying immediate risks while acknowledging the long-term inflationary dangers of unchecked government spending creep.
• DOGE and Deficit Reduction: Thoughts on the Department of Government Efficiency (DOGE), its potential to cut waste, and the challenges of moving the needle given the dominance of entitlements and defense spending.
• AI’s Economic Impact: How artificial intelligence might boost productivity, its limits in transforming retail demand, and whether it offsets tariff-related economic pressures.
• Bond vs. Stock Market Smarts: Cullen debunks the myth that the bond market is inherently smarter than the stock market, emphasizing both are efficient in their own right.
• Mortgage Rates and Housing: A look at whether we’ll see ultra-low mortgage rates (like 3%) again, driven by secular trends in technology and population growth.
• Crypto Reserve Fund: Cullen critiques the idea of a U.S. crypto reserve, arguing it diverts resources from productive economic investments.
• Leg Day Economics: A lighthearted yet serious take on why leg day matters—not just for fitness, but for longevity and stability.