Slate Money: Money Talks – The Business of Black Markets

Date: February 17, 2026
Host: Felix Salmon
Guest: Mariana Van Zeller (Host of Nat Geo’s Trafficked and the podcast The Hidden Third)

Episode Overview

This episode of Slate Money dives into the complex and hidden world of black and gray markets, featuring veteran investigative journalist Mariana Van Zeller. The conversation explores the scale, dynamics, and surprising normalcy of the underground economy—estimated to make up about a third of global economic activity—as well as its embeddedness in both developing and wealthy nations. The episode unpacks the incentives, business parallels, risks, and human stories driving these markets, and grapples with the systemic issues, such as corruption and inequality, that perpetuate their existence.

Key Discussion Points & Insights

The Scale and Scope of Black Markets

• Definition and Size:
  • Van Zeller explains the “hidden third” refers to the estimated 30–35% of the global economy that operates in black and gray markets—including drugs, guns, untaxed commerce, and informal labor.

    “It's estimated 35% of the global economy are black and gray markets, and yet we know very little about them.” – Van Zeller [00:36]

• Global vs. U.S. Context:
  • Felix assumes the U.S. has a relatively small black market due to its wealth and institutions, but Van Zeller dispels this:

    “No, I mean, we're the number one consumer of drugs in the world. Our drug business here in the United States alone brings in $150 billion a year.” – Van Zeller [05:10]

The Parallels Between Legal and Illegal Markets

• Operational Similarities:
  • Illegal organizations, like drug cartels and immigrant smuggling operations (“King Coyote”), mimic legitimate businesses with marketing, legal advice, and HR departments.

    “These are businesses that we tend to think as, you know, small and underground… but if you look at them, they operate... very parallel to the legal economy.” – Van Zeller [05:45]

  • Use of social media and messaging apps (e.g., WhatsApp) for marketing, relying on word-of-mouth and success stories to build “brand reputation.” [07:11]
• Employee Management:
  • HR is critical even in criminal organizations—retaining employees is based on trust and reputation instead of legal contracts, and employee/client satisfaction ensures survival.

    “If you're not treating well your employees, there's a high risk. Trust is incredibly important because there are no court systems...” – Van Zeller [13:39]

Why People Work in Black Markets

• Lack of Opportunity:
  • Most people in black markets aren't inherently criminal; they are driven by circumstances, family ties, and scarcity of legal alternatives:

    “I've interviewed, you know, dozens of people... who started selling drugs or became sicarios or became scammers because of lack of opportunities.” – Van Zeller [09:10]

• Occasional Entrepreneurship:
  • Some, like the sports bookie in the Shohei Ohtani scandal, are drawn to the business by choice, preferring the thrill or profit over legal alternatives. [14:50]

The Incentive Structure & Risks

• Compensation vs. Risk:
  • Riskier activities yield higher rewards, reminiscent of legal markets. Gambling, even when legal, has an illicit sector because people want privacy, higher earnings, or tax evasion.

    “The higher the risk, the more generally you are paid. I mean, particularly in the world of black markets...” – Van Zeller [10:43]

• Quality Control Issues:
  • Black markets can fill unmet legal needs (e.g., cheaper medicines for uninsured Americans), but without safety regulation, they’re dangerous. Cartels can infiltrate even legitimate pharmaceutical channels.

    “A lot of the pharmaceuticals being made in Mexico are actually made by the cartel… there's little quality control and it can end in, you know, a lot of harm, sometimes death.” – Van Zeller [11:28]

• Laundering and Asset Management:
  • Laundering money from illegal markets remains difficult; solutions range from basic (stashing cash in tires) to complex (networks of debt and counterbalancing informal IOUs). [15:33]
  • Cartels keep U.S. distributors perpetually indebted, ensuring ongoing cooperation.

    “You keep somebody on the hook… always offering him more product than he is able to pay for.” – Van Zeller [17:17]

The Role and Scale of Violence and Corruption

• Corruption as an Enabler:
  • Corruption is the “multiplier” for organized crime. Black markets thrive where law enforcement and civil servants are poorly paid and susceptible to bribery. [26:11]
  • Smuggling (e.g., fentanyl) largely occurs through legal ports of entry, facilitated by complicit officials, not unnoticed traffic across remote borders. [26:11]
• Varied Risk Perception:
  • Personal danger in black markets is proportional to activity—small-scale gamblers face minimal jail risk, but traffickers or scammers must remain vigilant. Many remain anonymous even during interviews due to fear of exposure. [21:29]

Why Black Market Operators Talk to Journalists

• Motivations:
  • Ego—wanting recognition for their skills;
  • Impunity in corrupt environments;
  • A desire to be understood as people, not just criminals.

    “A very human characteristic that we all share of wanting to be understood.” – Van Zeller [22:24]

International Perspectives: China, Myanmar, and Beyond

• Chinese Money Laundering Networks:
  • Chinese operators have become global leaders in laundering for black markets due to high demand for dollars and low fees.

    “These operations with Chinese folks ready to launder your money… it's become much easier. They take a much smaller share and that they're everywhere.” – Van Zeller [29:22]

• Myanmar Scam Cities:
  • Massive scam compounds run with total impunity, often employing forced labor—workers’ passports seized, subjected to torture for compliance. [23:55]
• Corruption Crackdowns:
  • Examples from China and Indonesia are referenced to highlight that some countries have managed to curb corruption with stricter reforms and better civil servant pay. [27:25–28:23]

The Fundamental Issue: Inequality and Systemic Breakdown

• Humanizing the “Criminals”:
  • Van Zeller’s reporting underscores that most are driven by necessity and circumstance, not inherently criminal motives.

    “It’s the systems that are broken. It’s not so much human beings… knowing that even when I'm meeting face to face these sicarios and traffickers and scammers, that they can still find humanity and that there is still redemption possible there.” – Van Zeller [30:33]

• Inequality as the Root Cause:
  • Both agree that persistent, rising inequality will perpetuate black markets:

    “Half of the world's population with less than $7 a day and that's just unattainable. As long as there's inequality, there's going to be violence.” – Van Zeller [32:11]

Notable Quotes & Moments

• On market size:

  “It's estimated 35% of the global economy are black and gray markets, and yet we know very little about them.” — Mariana Van Zeller [00:36]

• On the scale in the U.S.:

  “We're the number one consumer of drugs in the world… $150 billion a year.” — Van Zeller [05:10]

• On incentives and entrepreneurship:

  “Most of what has shocked me… has been the talent and the entrepreneurship and the creativity behind many of people, these black market operators.” — Van Zeller [09:01]

• On risk and pay:

  “The higher the risk, and that's very similar with the legal economy as well. The higher the risk, the more generally you are paid.” — Van Zeller [10:43]

• On corruption’s role:

  “Corruption has fully seeped in into the United States … every single interview I did pointed to corruption as being the multiplier.” — Van Zeller [25:13]

• On why interview subjects talk:

  “It's ego… impunity… and wanting to be understood.” — Van Zeller [22:24]

• On inequality:

  “Biggest problem of our time, I really believe, is inequality. We have half of the world's population with less than $7 a day … As long as there's inequality, there's going to be violence.” — Van Zeller [32:11]

Important Timestamps

• Defining the "hidden third" and scope of black markets: [00:36–03:58]
• American black markets and how they function: [05:10–08:25]
• Human stories and why people enter black markets: [09:01–10:10]
• Risk-reward, illegal pharmaceuticals, gambling: [10:43–12:15]
• Organization/HR in criminal enterprises: [13:16–15:52]
• Handling and laundering money: [15:33–18:05]
• Risk awareness among operators: [21:09–22:19]
• Motivations for talking to journalists: [22:22–23:39]
• International case studies and impunity: [23:55–24:51]
• Corruption’s multiplier effect: [25:13–26:11]
• Systemic causes and inequality: [31:48–32:28]

Conclusion

This episode offers an unvarnished look at the economic realities and personal stories behind black and gray markets. It underscores that the problem is not simply criminal intent—but a web of broken incentives, inequality, and corruption that gives rise to a vast underground economy, intimately connected to and reflective of the legal world above.

Listen to Mariana Van Zeller’s podcast The Hidden Third for deeper dives into these topics.