Podcast Summary: Fresh Air (NPR)

Episode: Can The Lessons Of 1929 Prevent Another Crash?

Date: December 10, 2025
Guests: Andrew Ross Sorkin (NYT financial columnist, author of "1929: Inside the Greatest Crash in Wall Street History and How It Shattered a Nation")
Host: Dave Davies

Episode Overview

This episode of Fresh Air features financial journalist and author Andrew Ross Sorkin, whose new book revisits the 1929 stock market crash and draws lessons for averting future financial crises. Sorkin and Davies connect the conditions preceding the Great Depression to current economic risks, discussing speculative booms, lending practices, regulation, and new threats like shadow banking, AI-driven speculation, cryptocurrencies, and unpredictable tariffs. The episode probes whether modern policymakers have learned enough from history to prevent another devastating collapse.

Key Discussion Points & Insights

The 1929 Crash: Hysteria and Margin Madness

[04:13–13:35]

• Speculative Mania in the 1920s:
  Sorkin recounts stories from his book, including servants anxiously watching a ticker tape in a wealthy banker’s kitchen—illustrating how ordinary Americans became swept up in a nationwide stock frenzy.
  "They actually literally had a ticker in their home. And it was just so emblematic and indicative of the hysteria and the mania around the stock market... the first time in America that ordinary Americans were playing the market." (Andrew Ross Sorkin, 04:59)

• Buying on Margin:
  Brokerages enabled average people to borrow $10 for every $1 invested, magnifying both profits and losses.
  "For every dollar you were putting down, they were often lending you 10 times that so you could buy into the market... when things go wrong, when you're effectively buying stock on margin... when it goes down, boy, do you have a problem." (Sorkin, 07:02)

• Systemic Risk & Bank Runs:
  When markets dropped, margin calls forced people to sell assets, losing everything and jeopardizing banks' solvency, triggering mass bank failures.
  "We got to a point of 25% unemployment in the United States, in large part because all of this came unwound." (Sorkin, 09:59)

Governance and Policy Failures: Hoover and Glass

[13:35–19:10]

• Key Figures:
  The role of financiers like Charlie Mitchell ("the Jamie Dimon of the 1920s") and reformers like Senator Carter Glass (of the Glass-Steagall Act), who warned of reckless Wall Street culture.

• Policy Missteps:
  Sorkin details President Hoover’s reluctance to intervene and his support for austerity and tariffs, which worsened the Depression.
  "He didn't believe that the connection between the stock market and the real economy was real, and that was a big miss." (Sorkin, 15:16)

• Ineffective Responses:
  Hoover’s faith in "jawboning" (messaging over action) contrasted sharply with the later New Deal’s regulatory approaches. “He was putting up billboards to try to change that dynamic... that did not work very well for President Hoover.” (Sorkin, 17:46)

What Actually Works in a Crisis: The Lesson of 1929

[19:10–22:34]

• Injecting Liquidity Is Key:
  Sorkin emphasizes that real historical learning occurred after 1929: in a crisis, the government must quickly inject money to stabilize the system, despite political backlash.
  "You need to throw money at the problem. You need to bail out the system, even if it appears as if you're bailing out the arsonists." (Sorkin, 19:10)

• Contemporary Relevance:
  This logic guided the Federal Reserve during 2008 and the COVID-19 pandemic. However, repeated bailouts grow national debt and could undermine confidence in U.S. Treasuries.
  "...every time we do these bailouts, we add even more debt to our problems. There will be a breaking point..." (Sorkin, 20:37)

Paradox of Capitalism: Public Utility, Private Profit

[21:07–22:34]

• Our Economy Relies on Privately-Run Public Utilities:
  Sorkin likens banks (and now, tech/cloud providers) to public utilities whose collapse would cripple daily life, yet they remain profit-driven and variably regulated.
  "Banks underlie so much of what we do... but all of these things... are run by private institutions..." (Sorkin, 21:39)

New Systemic Risks: Shadow Banking, AI Hype, Cryptocurrency

[24:27–30:49]

• Shadow Banks:
  After post-2008 regulations, much lending migrated to less-regulated entities like private equity and hedge funds ("shadow banking"), masking risks and interconnections.
  "Private equity firms... start to loan money to businesses... those firms are not regulated like banks... we don't really know how large the loans are and how interconnected those loans are." (Sorkin, 25:21)

• Speculative Bets on AI:
  A huge portion of economic growth is currently tied up in investment in AI and data centers, creating a risky concentration and "big bet" dynamic.
  "If you removed the spending on artificial intelligence in America right now, you would have flat GDP in this country..." (Sorkin, 27:30)

• Crypto Leverage Echoes 1929:
  Sorkin warns of parallel margin-style borrowing to buy cryptocurrencies, risking cascading losses if values tumble.
  "There’s a lot of people who have taken out extraordinary loans very similar to 1929 to buy that cryptocurrency... if bitcoin drops... they’re going to owe a lot of money to a lot of other people.” (Sorkin, 28:45)

• Is Crypto Useful?:
  Uncertainty persists over which, if any, cryptocurrencies serve a valuable economic function.
  “That is the million, billion, trillion dollar question about cryptocurrency... Warren Buffett would say, you know, why should you own it? He thinks it's like rat poison.” (Sorkin, 29:35)

Regulation, Tariffs & Political Uncertainty

[30:49–36:28]

• Deregulatory Impulses and Weak Guardrails:
  The Trump administration’s deregulatory stance means fewer protections against new risks.
  "This administration in particular has such a deregulatory focus that they're not putting up guardrails. If anything, they're trying to take them off." (Sorkin, 30:55)

• Tariffs as Political Leverage:
  Unpredictable, individualized tariff policy creates instability and strategic uncertainty for global business.
  "The entire business world now runs through one address, 1600 Pennsylvania Avenue... tariffs... have a huge impact... I think it's just completely scrambled the calculus for how any business operates." (Sorkin, 33:10)
  "Tariffs... are the ultimate chess piece. They're the ultimate piece of leverage." (Sorkin, 34:27)

• Even Legal Challenges May Not Restrain Executive Power on Tariffs:
  Sorkin notes the administration has multiple avenues for sustaining tariffs even if courts intervene.
  "There are ways for this administration to continue to impose tariffs... for sustained periods of time..." (Sorkin, 35:33)

Media & Culture Power Plays

[36:28–40:54]

• Mega-Mergers in Entertainment:
  Mergers like Netflix’s bid for Warner Brothers Discovery have broad social, economic, and political implications—including content availability, media consolidation, and foreign influence via sovereign wealth funds.

• Direct Political Influence on Antitrust Decisions:
  Sorkin is struck by the explicit involvement of the White House in deals that were previously handled (at least publicly) at arm’s length. "The president said maybe the quiet part out loud... plans to be involved in the decision making... These are very unique times." (Sorkin, 39:34)

"Affordability" and the Politics of Economic Perception

[42:02–43:52]

• How People Experience the Economy:
  Political messaging struggles against the personal, "in the moment" feeling of affordability—even when historic metrics (e.g., low unemployment) are strong.
  "It's all relative to where you think your life was six months or 12 months ago... It's hard to say what affordability is. And I think the issue of jawboning... that's a very hard thing to overcome." (Sorkin, 42:21)

Capitalism on Trial

[43:52–47:23]

• Guardrails Are Essential:
  The last century taught that capitalism delivers prosperity when combined with regulation, honest incentives, and real competition.

• Today's Distortions:
  Sorkin describes "state-sponsored capitalism"—public policy steering business decisions and favoring entrenched interests—rather than a healthy, competitive capitalism.

  "Classic capitalism is not classic capitalism... it’s been perverted by all of these other forces... I'm not sure throwing it out entirely gets you to the right answer either." (Sorkin, 44:52)

• The Role of the State in Business:
  Government interventions—subsidies, tariffs, stakes in private firms—shape the economy, sometimes as much as or more than market forces.

  "So much of what businesses are doing is being directed by the state. Literally... it's just, it shifted the balance." (Sorkin, 46:32)

Concluding Thoughts & Personal Finance

[47:23–49:26]

• Tax Cuts, Tariffs, and Buying Political Support:
  Direct payments to farmers, promises of tax relief funded by tariffs—all reflect a transactional approach to policy.

• Investment Advice:
  Sorkin resists giving specific tips but underscores the benefit of a long investment horizon:
  "I hope that the world and the economy is better 20 and 30 years from now than it is today... If you need the money sooner, be more cautious..." (Sorkin, 48:45)

Notable Quotes

"They actually literally had a ticker in their home. And it was just so emblematic and indicative of the hysteria and the mania around the stock market..."
— Andrew Ross Sorkin (04:59)

"You need to throw money at the problem. You need to bail out the system, even if it appears as if you're bailing out the arsonists."
— Andrew Ross Sorkin (19:10)

“There’s a lot of people who have taken out extraordinary loans very similar to 1929 to buy that cryptocurrency.”
— Andrew Ross Sorkin (28:45)

"Classic capitalism is not classic capitalism today. In fact, all of the things we've been discussing feel a lot more like state sponsored capitalism... that may not really be capitalism."
— Andrew Ross Sorkin (44:52)

Timestamps for Major Segments

• Overview of 1929's speculative frenzy — 04:13–07:02
• Mechanics and peril of buying on margin — 08:15–09:59
• Failures of early government regulation — 13:35–19:10
• The role and effectiveness of government intervention — 19:10–22:34
• Rise of shadow banking and new risks — 25:21–27:23
• AI bubble and its macroeconomic role — 27:30–28:41
• Cryptocurrency speculation and systemic risk — 28:41–30:49
• Tariffs as unpredictable policy levers — 33:10–35:33
• Record media mergers and the political/legal landscape — 36:28–40:54
• Defining and perceiving 'affordability' in today's economy — 42:02–43:52
• State-sponsored capitalism vs. market capitalism — 44:52–47:23
• Personal investment philosophy for uncertain times — 48:45–49:26

Memorable Moments

• The Kitchen Ticker Parable:
  The moment when servants gathered around a stock ticker encapsulates the reach of market mania to all social classes. (04:59)

• Parallel to Today’s Speculative Bubbles:
  Sorkin’s warnings about shadow banks, cryptocurrency debt, and the AI boom are eerily reminiscent of the credit-fueled excesses of the 1920s.

• Sharp Critique of Current Tariff Policy:
  The unpredictable, leverage-based tariff strategy is described as a marked departure from the stable policy businesses crave.

Tone & Language

The conversation strikes an accessible, narrative tone—detailing technical financial mechanisms via vivid analogies, historical narrative, and personal anecdotes. Sorkin and Davies maintain a blend of caution, skepticism, and hope, frequently connecting the past to the present in ways that are both educational and urgent.

This episode offers a sobering look at financial history and present risks, underlining the perennial challenge: will we recognize bubble behavior and implement safeguards before a new crash arrives?