Your friends on Wall Street, are they going to wake up in a panic this morning? Are they going to wake up and think, OK, well, maybe we've got normal service resumed? What's their reaction going to be?

I think we're just looking at some of the pre-trading right now and stock futures are declining.

And I think the main concern that a lot of people on Wall Street are going to be panicking about is that the AI trade is going to start to come to a stop.

And the reason they're going to be so worried about that is that they're going to believe that because the Democrats have swept we're going to see a massive crackdown on data center construction.

I think one of the more important elections was the gubernatorial election in Texas, where HOSA won that election.

And one of her policies is that she wants to have a pause on data centers before we come up with sensible regulation.

A lot of people think that the Democrats are going to be extremely stringent on AI.

Ed, what do you think happens to the party?

How do you define corruption?

Profiting one and a half billion dollars from crypto projects, trading one and a half billion dollars in stocks, telling agencies who try to investigate your trades, which seem very obviously to be insider trading, telling them that they're not allowed to investigate you anymore.

pushing out officials who work at those agencies altogether, such as Margaret Ryan at the SEC, having bribery scandals for Tom Homan, for Kimberly Guilfoyle, having your teleprompter operator making insider trades and gambling.

I mean, there are so many ways that we can we can indict this president and his history of corruption.

So to be frank, I don't really care what our definition is.

But if you believe that there isn't corruption, I don't know what to tell you.

So are they tying it to the cost of living, that corruption stuff? And is that going to be what shifts the balance of power in this election?

I think it's definitely going to be a big problem.

when you have a number as large as we just mentioned a moment ago, saying that Republicans are the ones giving tax breaks to tech companies, you would think that that second number of who's for the working class would be more skewed toward Democrats.

Well, it is a little bit.

And I think that what we're seeing is that the reality is that the tax breaks.

I mean, the Republican Party has done a good job of saying, hey, we want lower taxes.

But ultimately, when you look at what happens when they implement their plans, it results in lower taxes for the very top 1%.

And we see that in the corporate tax code.

We see that in individual personal income tax code.

The costs are just too high.

What's the deal with this? Has it always been the case that just the kids of these billionaires inherit everything their, their parents built?

We've always had inheritances.

This is something that has existed for a long time i- in America as well.

I just, I think what we haven't seen is, uh, inheritocracy of this scale.

And I think what really opened my eyes to this was that acquisition, uh, of Warner Brothers Discovery, which closed a couple of weeks ago, where you had David Ellison, who went and bought Paramount last year, remember, and then Paramount this year goes and buys Warner Brothers Discovery.

And the reason any of this was possible is because David Ellison's dad is Larry Ellison, who is the founder of Oracle and p- who put up nearly $50 billion in order to close this thing.

And as a result, David Ellison now controls CBS News, CNN, HBO, HBO Max, TNT, TBS, MTV.

I, I guess what happens? Does, do we expect these, these kids to do a good job with these industries and grow them more and hang on to this power, or do we get ourselves into a situation where it, it, again, it atrophies?

So I do have an answer for this puzzle.

Well, I think the savings rate piece is important and explains part of it, but I think there's another very important element that Hassett is not recognizing.

I mean, he's talking about consumer spending as if the number going up shows that this is a signal of underlying health among American consumers.

There's a very important thing about consumer spending that we have to also recognize, which is that the top 10% of Americans today now account for roughly half of all consumer spending.

That's the highest number we have ever seen.

And so this indicator is increasingly becoming not a very helpful one, similar to the stock market as another example, where the top 1% of Americans control roughly half of the entire stock market.

So when they say, oh, look, the number's going up, it must mean that everyone's doing great.

Like, are these jobs going to be around in the next few years, next five, 10 years even? If people felt as gloomy as I think they do about the future or worried, why keep spending? Why not pull back spending? Why not save more, cut down on everyday stuff as much as you possibly can?

... that he's, that he puts himself into by saying this.

But Dario's been saying this f- that's why they started the company.

They've been saying this for years and years and years.

That's what I think, too.

I think that, I think that the Jacob...

I think these people have a lot of sort of recency bias where they're very involved in this stuff, and so they think that it's gonna blow up the world.

I think that it's genuine.

Everything.

Who is it a golden age for?

Yeah, I would agree that we are in a golden age, but I would be a little bit more specific and qualify that.

I would say that we are in a golden age of fraud.

And you talked about that in the previous segment.

But, you know, we can look at the millions of dollars that Trump has made trading individual stocks or the billions that he's made scamming American households with crypto meme coins.

or the hundreds of prosecutors and investigators that he has laid off.

So, you know, yeah, it's a great time to be an American, but only if you are a very specific person, only if you're already extremely rich.

And like, what are we doing? Is this is this who's going to be in charge? Are we all is this a simulation of democracy and choice? And when, in fact, these guys out there are the ones controlling everything now?

I mean, just premiums skyrocketed for so many people who had to cancel their health insurance because they could no longer afford it because Donald Trump's Republicans in Congress would not extend the subsidies for the ACA.

Yeah, I'm not sure why they think that we would believe that this is a good faith attempt to identify fraud and corruption, given the history of fraud and corruption that this administration has exhibited themselves.

I don't know why they would think that we would believe that they are even competent enough to correctly identify fraud and corruption in the health care system if there were any.

I mean, the whole... notion of this is so dishonest to me, this idea that they're worried about wasting government money on things like healthcare, but then at the same time, they are simultaneously exploding our national deficit to $2 trillion a year.

They are simultaneously suggesting that we write a $1.4 trillion check to bribe Americans to vote for their party, and also extend tax cuts for the rich, and also increase estate tax exemptions for billionaires.

I mean, they wouldn't be doing any of that if they actually cared about this issue.

So I don't see any world in which people are actually moved by this in any way, or find this to be compelling in any way.

How does kicking out journalists help with gas prices? How does it help with the cost of living? How does it help with the things that people are saying right now they are most concerned about?

meme.

And this is a perfect encapsulation of the problem, which is that no one is actually accountable.

for any of this.

Everyone is saying, you know, in the case of Anthropic, Dario is saying, we think that the government needs to step in and regulate this stuff.

And then on the case of the government or the president is saying, no, it's not my job to regulate you guys.

You guys should figure it out on your own.

Everyone's trying to point fingers here.

I find that confusing.

So, Ed, what are you hearing about who the public is going to be holding accountable for this?

Well, based on his approval ratings, they hold Trump accountable.

And this is good news because he is the one who is accountable.

I mean, this is the thing that is so fascinating about our economic problems today.

Usually you have situations where exogenous external events happen and then cause problems later down the line.

For example, COVID, which caused a supply chain shock, which resulted in the inflation.

And then we can have debates as to how we handled that.

That's a whole lot of money, Ed.

all the people I speak to tend to be kind of Republicans and Democrats in the political world, and I'm just wondering what people in the financial world, what investors make of a statement like that, of a promise like that, that they know is not going to happen, but which is so counter-effective in dealing with America's economic problems anyway.

Yeah, I think for a while at the beginning, you heard a lot of excuses or a lot of, "It's not that big of a deal.

He's just kind of, he's kind of funny.

He's just saying stuff, uh, but ultimately it's about American businesses.

He's the pro-business president, and everything's fine." I think that we w- we saw that reflected in the stock market.

There was obviously the giant [laughs] hiccup of the original tariffs where everyone went, "Oh my God, maybe this guy is truly off his rocker.

He's truly insane." And then he started to walk things back when he saw the market's reaction, and then the stock market slowly went up.

Interesting

How are the markets handling these prevarications on the war from the administration?

Well, it's not great.

We're seeing that yields are rising on long-term bonds in America.

And the reason that they're rising is because this inflation situation is getting out of control.

And we've seen that Kevin Walsh has been saying as much.

He's been issuing some of his most hawkish statements in a long time.

But I think the number of lies that we heard in that briefing was kind of unconscionable.

How is the registering for a potential draft going over?

But does it matter to investors, or is it just sort of a side light weirdness?

I, I don't think it does matter to investors, and I think the reason it doesn't matter is quite interesting.

Well, I mean, one, y- yes, things crashing into the Moon, that, that's a spectacular story.

Everyone wants to hear [chuckles] about that.

I'm fascinated by that myself.

But I think if this were five years ago, four years ago, or even three years ago, yes, it would have mattered because SpaceX was a space business.

SpaceX is no longer a space business.

Mm-hmm

Mm-hmm.

And if you opt out, then you are not included in the unemployment rate because it's not that you're out there looking for work and you're unemployed, it's that you're just not looking for work at all.

And so I think this is the concern among economists.

And to be fair, jobs numbers are very, very choppy.

They're constantly revised upwards and downwards.

If we look at the job numbers in May and June, they were revised down by more than 100,000.

There was a question about the World Cup and what it would do in terms of the leisure and hospitality industry, because that sector did see a little bit of a bump before we saw this jobs report, and then we saw that it didn't really materialize, and how permanent was that jobs bump going to be? All of these, these questions, the labor market is one of these very, very finicky things that no one can really nail down.

Well, that's like Trump saying he was bored of Iran.

Do you see this market as somewhat volatile? And if so, do you think investors are starting to price volatility into

their business? This feels to me like the most volatile market of all time.

But I have to be cautious when I say that because...

Most markets feel like the most volatile market of all time, but this market especially feels that way.

I mean, if we just look at big tech earnings, which we saw just last week and the week before, and we look at the way that some of the largest names, some of the largest, most valuable companies in the world, the way they whipsawed up and down.

We looked at Amazon, for example, which literally rose 15% in a single day.

It's kind of unheard of.

And I want you to articulate how that is so.

Do you see this market as somewhat volatile? And if so, do you think investors are starting to price volatility into

their business? This feels to me like the most volatile market of all time.

But I have to be cautious when I say that because...

most markets feel like the most volatile market of all time.

But this market especially feels that way.

I mean, if we just look at big tech earnings, which we saw just last week and the week before, and we look at the way that some of the largest names, some of the largest, most valuable companies in the world, the way they whipsawed up and down.

We looked at Amazon, for example, which literally rose 15% in a single day.

And I want you to articulate how that is so.

Do, do you see this market as, as somewhat volatile? And if so, do you think, like, investors are starting to price volatility into- Into their business?

This feels to me like the most volatile market of all time.

But I have to be cautious when I say that because most markets feel like the most volatile market of all time.

But this market especially feels that way.

I mean, if we just look at big tech earnings, which we saw, uh, just last week and the week before, and we look at the way that some of the largest names, some of the largest, most valuable companies in the world, the way they whipsawed up and down.

We looked at Amazon, for example, which literally rose 15% in a single day.

It's kind of unheard of for a company that's worth literally trillions of dollars.

What's going on there?

Do you see this market as somewhat volatile? And if so, do you think investors are starting to price volatility into their business? This

feels to me like the most volatile market of all time.

But I have to be cautious when I say that because...

Most markets feel like the most volatile market of all time.

But this market especially feels that way.

I mean, if we just look at big tech earnings, which we saw just last week and the week before, and we look at the way that some of the largest names, some of the largest, most valuable companies in the world, the way they whipsawed up and down.

We looked at Amazon, for example, which literally rose 15% in a single day.

And I want you to articulate how that is so.

But that being said, like looking at your peers both in the industry, your peers maybe from your childhood days, like – Does that – are you – how much are you seeing that resonate, not just in the data, not just in the quantitative stats that you and Scott are putting together for this, but in your real life, in the real life of your peers? And maybe before you answer that, just to make this a very complex question, if you could maybe tee up the kind of the two or three basic points about why you believe there is a war on the young and then how – if you're seeing that in your real life.

So, you know, what's going on with the war on the young is basically you just look at the data, which is for the first time in American history, someone who is 30 or just under the age of 30 is not doing as well as his or her parents were at the same age.

And, you know, we can we can look at everything we can look at.

obesity rates we can look at suicide rates we can look at mental health we can look at housing prices we can look at just plain net worth everything is in decline for young people that is what the data is telling us i look at my life people seem fine my age The reason people seem fine my age is because of what you just said, which is I went to an elite university.

I went – all my friends who I hung out with went to elite universities.

They got great jobs at big banks and consulting firms, and now they're starting companies, and they're living in New York.

And, yeah, you know, they're spending – 40% of their income on rent because rent in New York is crazy but they're making a lot of money, and they're living in pretty decent apartments.

But we also have some pretty cool advantages I think people sometimes miss.

Yeah.

They're really cheap right now.

That, that's not the case.

So what we have to do, if you wanna actually get an understanding of how to value these companies, is y- you need to subtract out the gains that they have registered in OpenAI and Anthropic and SpaceX.

You need to create basically a new metric, and we did that, and we found that the true multiple for Amazon when you adjust for that is actually 30 times earnings, and for Google it's 31 times earnings.

So no, the, the, these stocks are not cheap right now.

Now a lot of people will say, "Well, are you factoring in the fact that maybe there is some value in those companies, and did you put that in the numerator?" Blah, blah, blah.

Yeah.

Help me understand fighting inflation, but levying more tariffs.

I just want to be clear on what he inherited.

He inherited an economy where inflation was going way down and where actually inflation was at a level that was sustainable.

And the person who's responsible for that is Jerome Powell.

We can argue about how he handled inflation when we saw the levels in 2021 going into 2022.

But when you look at what Trump inherited, I mean, pre-tariffs, we had inflation of just above 2%.

And our target rate, the Federal Reserve's target rate, the rate that they want that is a healthy level of inflation is 2%.

Ed, can you help me understand how Don Jr. can perform so much better, so much better than everyone else?

Oh, and they have to raise all of that through the banks.

They have to do it, they have to do it through the banks.

So they have to do th- there was the debt offering that they recently did, which was somehow people bought, but now we're seeing that SpaceX bonds are absolutely tanking, but they're gonna have to raise more equity and they're gonna have to raise more debt.

That's close to, I think it was $200 billion of, of more financing that they'll need later down the pipeline, which means that's tens of billions of dollars in future revenue for the investment banks.

That's revenue that they have literally a fiduciary, fiduciary obligation to pursue.

So when you ask me, "Okay, w- why is everyone smoking crack when it comes to SpaceX?" This is why.

And the only analysts who have said that the company is a sell, Morningstar, for example, their analyst who I've had on my show, uh, Nicholas Owens, the only analyst who is saying that this isn't worth what it is currently Uh, are analysts who don't have a financial incentive.

... someone seems to get ahead of oil prices every time that there's, Donald Trump says there is or is not a ceasefire.

What does this say about where Americans are financially?

It tells us that consumers are struggling right now.

But you wouldn't know that from Trump's comments, who literally said, he said, inflation is way down.

He said, that means prices are coming way down.

That was his quote about the inflation report that we recently got, which is a lie.

The reality is that prices are still up.

They are continuing to rise.

What's the forecast from him? What can consumers expect out of this? I

Who are we handing the keys to or who is the Democratic Party handing the keys to Democratic voters to find these candidates?

Yeah, I mean, it's really disappointing and it's a real shame because I think you also have to acknowledge that until we learned everything that we learned, he did run a pretty great campaign because he did focus on the real issues.

He did focus on wealth inequality, how it's rising, how it's only getting worse.

He was dialed into this issue of the oligarchic class.

The fact that basically ever since Citizens United, billionaires have essentially hijacked our politics, mostly to enrich themselves.

These were all missions of the campaign, and they're all true statements.

The trouble is what we know now.

How do you find somebody and how do you how do you develop new talent, Ed, who knows what they're doing, but can push back against against the quote unquote establishment?

Forgot the football

... other thing that everyone's talking about.

But I noticed China isn't in this year's World Cup, and I was kind of wondering, what's gonna happen with the Chinese football team? Surely, that needs to show up and become a real player because they're so successful in the Olympics, but then they just...

I guess they haven't gotten their act together on football.

So that's maybe another conversation for another time.

SpaceX IPO.

Yeah, I think you said it right.

But Ed, what's your take on just the, the news that has come out in, in heaps and, and leaps and bounds over Anthropic v. Washington?