IN GOOD FAITH WITH PHILIP DEFRANCO
Episode: America Is In Stagflation Feat. Ed Elson
Date: September 22, 2025

Overview

In this episode, Philip DeFranco sits down with Ed Elson, co-host of the Prof. G Markets podcast, to dissect the realities behind the U.S. economy's current stagflation, exploding wealth inequality, national debt, and the difficult future facing Gen Z and the broader American public. The discussion blends economic analysis, generational critique, and hard questions about what the U.S. must do to avoid a deeper crisis, all delivered in an accessible and candid conversation.

Key Discussion Points & Insights

Is the U.S. Economy "Screwed"? (00:57–05:49)

• Surface-level optimism vs. underlying trouble:
  Ed explains that while indicators like the S&P and NASDAQ are at record highs and consumer spending appears strong, these only reflect the financial health of the wealthiest Americans.
  • "The top 10% of earners are making up half of that spending… The top 3.3% are making up 25%." (Ed, 02:11)
• Wealth concentration:
  The top 1% own half the S&P 500’s market cap. Just 19 households control 2% of all U.S. wealth, up dramatically from 0.1% in 1982.
• Governmental misjudgment:
  Policy makers and the public are misled by metrics that mask growing economic inequality.

Unsustainability of Wealth Inequality & the "Inheritocracy" (05:49–10:06)

• Historical lessons:
  Ed points out that rising inequality has always led to societal fracture or revolution.
• Younger generations disenfranchised:
  One-third of Gen Z still lives with their parents, fueling a brewing sense of frustration.
• Wealth transfer amplifies inequality:
  $6 trillion will be inherited this year, and over 200 new billionaires were minted in 2024, over half by inheritance.
  • Example: David Ellison—the son of Larry Ellison—now owns Paramount, soon possibly Warner Bros., consolidating vast media power in one inherited fortune.

Gen Z: Online Activism vs. Real-World Action (10:06–14:11)

• Gen Z is vocal but inactive in votes and business participation:
  • 42% voter turnout in presidential elections—lowest of any generation.
  • Lowest participation in shareholder votes.
  • "Active with our opinions, lazy with our actions." (Ed, 11:27)
• One bright spot:
  New York mayoral primary—Gen Z supported Zoran Mamdani after a savvy online campaign, showing digital engagement can translate to real outcomes.

The Lure and Limits of Populism (14:11–15:43)

• DeFranco notes the rise of populist appeals that cut across ideological camps (AOC and Trump on same ballots) as possible unifiers for young, cynical or nihilistic voters.

America’s Stagflation: Causes and Outlook (15:43–23:43)

Key explanation:
Stagflation is stagnant growth plus inflation.

• Recent developments (Fed outlook):
  • Job market slowing (“not the administration’s fault” entirely).
  • Inflation ticking up again (from 2% to 2.9%).
• Tariffs as a trigger:
  • Recent tariffs (15–20%) are now feeding higher consumer prices, with companies like Walmart quietly raising prices.
  • "This is going to continue... we have essentially dug ourselves into this hole for no reason whatsoever." (Ed, 18:33)
• Undoing inflation:
  • Removing tariffs could mitigate inflation, but whether companies would drop prices is uncertain.
  • Ed's UK: "One of the dumbest, most...shoot yourself in the foot moves of all time"—Brexit as a cautionary example. (Ed, 21:29)

U.S. Debt Addiction & Fiscal Reality (23:43–33:25)

• The dollar’s advantage:
  As the world reserve currency, the U.S. can “just print money,” but this leads to reckless borrowing—now risking global standing.
• Exploding national debt:
  • The recent “big beautiful bill” adds $4T in new debt.
  • Net interest payments already >$900B/year, soon to reach $1.8T, crowding out other necessary spending (defense, Social Security, infrastructure).
  • "All of it's going to come due right when we are of age… when I'm trying to buy a house and build a family..." (Ed, 28:33)
• Addressing the 'it’s not a real problem’ crowd:
  Ed compares complacency over the debt to climate change skepticism—slow-moving but ultimately catastrophic.

Will the Dollar Lose Its Reserve Currency Status? (33:25–38:04)

• Short answer: Not anytime soon.
  • The Euro is the closest challenger, not China.
  • BRICS nations are unlikely to successfully launch a realistic alternative soon.
• Long-term risk:
  If the U.S. fails to control its debt habit, the dollar’s status could eventually erode—but it’s a “decades-long” horizon.

Solutions: Getting Out of Debt (38:04–46:24)

• Raise revenue—tax the rich:
  • "Trickle-down economics was one of the greatest lies ever told to America." (Ed, 38:28)
  • Wealth doesn’t trickle down; it is hoarded—buying assets, not goods/services.
  • The answer: Wealth tax, higher capital gains tax, a real estate tax with minimal exemptions ("no reason your kid should get $50B, $100B…"), or at least raise the estate tax threshold only modestly (suggested $5–$10M).
• Why not let the ultra-wealthy keep it all?
  • “You can only become psychopathic ... with that amount of money.” (Ed, 44:01)
  • Happiness maxes out at around $10 million.

The Penalty for Success vs. Collective Solutions (46:24–47:48)

• Is taxing the rich penalizing success?
  • Debate over whether people vote against their own interests in the hope of joining the 1%.
• National service—pro and con:
  • Ed likes the community-building aspect but insists young Americans must have a better deal in return (housing, education, healthcare access).

The Dire Economic Reality for Young People (47:48–53:15)

• Modern hardships:
  • Housing prices are six times annual income (was 3x for grandparents).
  • College costs and asset inflation far outstrip what prior generations faced.
  • A third of Gen Z still live with parents.

AI, Jobs, and Survival Strategies (53:15–61:53)

• AI displaces young/entry-level jobs:
  • Jobs exposed to AI (mainly information work) are vanishing—13% drop in entry-level openings.
• Advice for Gen Z:
  • Fully embrace AI as a tool to magnify value.
  • "If you're not using AI… you should be using all the tools… to be more productive." (Ed, 54:00)
• Three Cs to stay relevant:
  1. Curation — Human discernment; pulling signal from AI noise.
  2. Curiosity — Exploring new ideas, following interests AI can’t.
  3. Connectivity — Real-world relationship building (“Meeting someone for coffee… that’s not something AI can do.” Ed, 58:39).

Should Young People "Eat Shit"? Work, Internships, and Modern Hustle (61:53–68:30)

• Ed’s blunt advice:
  • The hardship today (living with parents, isolation, low opportunity) is worse than previous generations' corporate “hazing.”
  • "Go eat that corporate shit. Go do it." (Ed, 63:18)
• Hard truth:
  • "You're going to have to work even harder than your parents did...twice as much discipline." (Ed, 66:41)

Ed’s Personal Philosophy and What’s Next (68:30–73:10)

• His career arc:
  • Went from Galloway’s intern, “eating shit,” to co-host of a top finance podcast.
• Work ethic:
  • Focus on delivering value every 24 hours, control only what you can.
  • "Within the next 24 hours… be really good at my job… string enough of those days together and something starts to happen." (Ed, 71:18)

Notable Quotes & Memorable Moments

• On inequality:
  "The stock market... is not a good indicator of our financial health. It's a great indicator of rich people's financial health." (Ed, 02:51)
• On generational frustration:
  "You have growing inequality, you have the decimation of the middle and lower classes… and then you have upset and dissatisfaction from… young people." (Ed, 06:32)
• On U.S. debt:
  "We have become drunk on our ability to borrow to the point where it is becoming totally nonsensical." (Ed, 25:25)
• On real solutions:
  "You need to tax that wealth. You have to get some way...to get that money out." (Ed, 41:18)
• On the future of work:
  "You need to do the really hard work of figuring out what are my talents, what am I good at, how can I monetize my talents?" (Ed, 66:57)
• On dealing with uncertainty:
  "The best thing that you can do is control the next 24 hours..." (Ed, 71:18)

Timestamps for Important Segments

• 00:57 – Ed Elson on misleading economic signals
• 05:49 – The inevitability of inequality leading to social rupture
• 10:50 – Gen Z: activism vs. (in)action
• 15:43 – Defining and diagnosing stagflation
• 23:43 – National debt, U.S. exceptionalism, and the consequences
• 33:48 – Reserve currency: will the dollar fall?
• 38:17 – Ed's prescription: tax the rich, fix the system
• 47:48 – The social contract for national service
• 53:15 – AI and the future employment landscape
• 61:53 – Work, internships, and the modern “eat shit” debate
• 68:30 – Ed’s story, career strategy, and concluding advice

Tone & Takeaways

The tone is candid, data-driven, and laced with both tough love and optimism. Ed Elson mixes stern critiques of U.S. policy and generational habits with practical advice for navigating economic headwinds. Listeners are invited to recognize uncomfortable truths, admit their situation, and take tangible steps—the "three Cs", hard work, constructive use of technology, and meaningful political engagement.

Those who haven't listened will walk away understanding why the rosy headlines don't reflect the reality for most Americans, why Gen Z faces unique, unprecedented challenges, and concrete ways to regain agency in a rapidly changing world.