Podcast Summary: Smart Girl Dumb Questions

Episode: Will The Market Crash in 2026?

Host: Nayeema Raza
Guest: Andrew Ross Sorkin (journalist, author, co-creator of DealBook and CNBC Squawk Box)
Date: January 6, 2026

Episode Overview

This episode dives into the possibility of a market crash in 2026, drawing rich parallels between today and past financial crises, especially 1929. Host Nayeema Raza candidly interrogates Andrew Ross Sorkin—fresh off his new book "1929"—about the patterns underlying market bubbles, the failures and successes of economic safety nets, the psychology of financial power, and whether lessons from history can help us anticipate the next big crash. The conversation is wide-ranging, touching on media trust, American inequality, the logic of bailing out "too big to fail" institutions, AI, crypto, and the persistent anxieties of both billionaires and journalists.

Notable Timestamps and Segment Highlights

01:06 – On Creative Work and Imposter Syndrome

• Andrew Ross Sorkin: “Writing, it’s not. It’s not my way. I’m sort of in pain most of the time."
• Sorkin dispels myths about effortless genius, describing the discipline, preparation, and pain behind his output (contrasting, e.g., himself with Michael Lewis).

03:11 – Introducing the Book "1929" & Its Modern Parallels

• Sorkin explains the cultural and technological boom of the 1920s, likening it to today's tech revolution.
• [04:47] “This was the first time that ordinary Americans could trade stocks for real... Wall Street decided we’re going to lend people money so they can buy into this dream.”

05:46 – Are We in 1929 All Over Again?

• Nayeema: “You never want to say if we’re—"
• Sorkin: “I don’t think we’re in 1929. I don’t think it’s preordained that we have to have a crash... It’s more like we’re in the 90s. Maybe we’re like 1996 or 97... The question is, does it have to be cataclysmic?”
• Draws parallels to the Dot-Com Bubble era (late 1990s).

07:45 – Social Contexts: Roaring Twenties vs. Today

• The 'roaring' boom was localized (NYC, big cities)—not truly national, like current divides.
• [09:10] Sorkin: “If you just look on the ratios of inequality, 1920s are very, are very much like now.”

12:18 – Shifting American Values (1998-2023)

• Cites a Wall Street Journal poll: Patriotism, religion, “having kids,” and community involvement have steadily declined in perceived importance, while “money” rises.
• [13:07] “Clearly the money side, yes [is the same as 1920s]. ... Part of it, FOMO. They didn’t call it FOMO in the 1920s, but that’s what it was.”

16:41 – Money, Social Media, and FOMO

• Sorkin reflects on how visibility of wealth via technology alters the culture of envy, aspiration, and resentment.

The Future: AI, Robotics, Universal Income

[16:41] Clip: Elon Musk asserts that AI and humanoid robots “will actually eliminate poverty,” make work optional, and eventually render money “irrelevant.”

• Sorkin (17:54): “Here’s my concern... I imagine the spoils of all of this going to the shareholders and owners... unless you genuinely believe it’s all going to get redistributed... I think most of [these AI leaders] are capitalists.”
• Skepticism about UBI’s practical likelihood; worries about concentrated benefits.
• Musk and Altman’s visions contrasted with historical shifts in access to credit and leverage (pivot back to Rasco and consumer lending in the 1920s).

21:19 – The Birth of the Five-Day Workweek

• Sorkin details how John Rascob catalyzed the two-day weekend—not out of benevolence, but to fuel consumerism.

22:48 – The Rise of the Business Celebrity

• Parallels drawn between 1920s financiers (Rascob, J.P. Morgan) as covers stars and today’s “business famous” tech titans.

Financial Bubbles & Lessons from Crises

24:45 – Anatomy of the 1929 Crash

• Crash was not a single event, but a drawn-out “relentless unraveling.” Leveraged margin buying and policy missteps (tariffs, gold standard) were critical causes.

37:56 – Lightning Round: Recent Crises

Dot-Com Crash (2000-2001)

• Cause: Severe overvaluation, some leverage ("the dream got ahead of the fundamentals").
• What we failed to learn: Continued chase for "story stocks" and neglect of proper incentives.
• [39:09] “Amazon—people didn’t believe in it, didn’t make money... How do you know?”

Global Financial Crisis (2008)

• Cause: Massive housing leverage, incentives, massive moral hazard on both lender and borrower sides.
• Lesson: Improved capital requirements and risk oversight—Dodd-Frank et al.
• Failure: Lack of accountability for individuals; deepened public distrust in 'experts.'
• [42:53] Sorkin: "I believe what happened in 2008 in some ways led to a complete shift in America...a direct line between 2008 and the election of Trump in 2016.”

COVID Recession (2020)

• Different: Universal bailouts meant less finger-pointing ("everyone got a car").
• [44:07] Sorkin: “In the pandemic, we just started sending checks to everybody, so nobody really had a place to complain.”

Major Risks and The "Wildcard"

49:03 – Today’s Financial Risks

• Excitement (and risk) in newer financial products: SPACs, private credit funds for retail investors, "semi-liquid" vehicles with redemptions gates ("marks to make believe").
• Sorkin's wildcard: The US’s unprecedented sovereign debt. If rates spike and global lenders lose confidence, the “solution” of just printing money during crises could backfire hard.
  • [52:19] "At some point...the investor class that buys Treasuries...says, 'Excuse me, I see what you're doing...you're going to have to pay us a lot more for the risk.'"

55:00 – Are We in an AI Bubble?

• Sorkin: “We’re probably in an AI bubble, and the AI bubble probably will pop, but that doesn’t mean that AI will not be with us 20 years from now.”
• Risks in the infrastructure underneath (datacenters, energy commitment).
• [55:43] On crypto: "It’s a belief system...but it’s still a small piece of the puzzle."

Too Big To Fail, Redux

• Banks, cloud computing firms, even some cities and states—the list of “too big to fail” entities has grown.
• [57:26] Sorkin: “Cloud computing, oddly enough, has become too big to fail. If they were to fail, we would have—it’s like electricity.”

Culture & Power: The Psychology Behind the Markets

Who Holds the Power—Really?

• [61:28] Sorkin on J.P. Morgan: “He doesn’t think he has power. That’s pretty much how I think most people feel, even the people who have the most power in the world.”
• Billionaires often don't view themselves as powerful—they’re still striving, still insecure despite apparent achievements.

Generational Shifts

• New money (Altman, Zuckerberg) is "still trying to prove themselves". Philanthropy often comes with age; Sorkin wonders if responsibility increases with time.

Media Trust and Access

• [66:16] Sorkin: "I think my job is to be the ultimate fair-weather fan...If you do something good, I’m happy to say attaboy. If you do something bad, my job is to hit you over the head."
• On media trust: More trust in 1929, despite being “bought and paid for,” because people lacked informational alternatives.

Lightning Rounds & Listener Questions

(Sample questions and responses for flavor):

• First sign of an AI bubble bursting?
  [70:11] Sorkin: "Some AI company ... announces they’re having to pull back on spending ... or their plans to build more data centers slows down."
• Who is DealBook’s most surprising reader?
  [75:48] “LeBron James reads DealBook.”
• Bobby Axelrod of "Billions" based on whom?
  “[Multiple inspirations, but honestly a singular character.]”
• Sorkin’s dumb area?
  “[77:06] I’m uniquely dumb about music. People talk about music around me and I’m like a dunce.”

Best Quotes & Memorable Moments

• On creative pain:
  "[Writing] is not my way. I’m sort of in pain most of the time." – Andrew Ross Sorkin [00:57]

• On technology and FOMO:
  “You pick up TikTok and you see all of these things and it’s constantly in your face. And so I think it creates both a FOMO and a resentment.” – Sorkin [16:13]

• On American inequality:
  "If you just look on the ratios of inequality, 1920s are very much like now." [09:10]

• On AI liberation:
  “Here's my concern... I imagine the spoils of all of this going to the shareholders and owners... unless you genuinely believe it’s all going to get redistributed.” – Sorkin [17:54]

• On future financial risk:
  “We are always fighting the prior war and we’re missing the next one.” – Sorkin [47:38]

• On billionaire psychology:
  "I don’t think the money is emotional armor. In fact, I almost think it’s like anti-armor..." – Sorkin [63:20]

Final Takeaways

• There WILL be another financial disruption, but its cause and magnitude are impossible to time or pinpoint—bubbles are frequently visible only in hindsight, and each new crisis is shaped by innovations (and regulations) spawned by the last.
• Society’s growing wealth gap, celebration of financiers, media skepticism, and the sheer speed of technological innovation echo the Roaring Twenties, but with critical differences: inequality is now globally visible, and America's unique power is less assured.
• The wildcard now is not just leverage or policy missteps, but the massive build-up of sovereign debt and global trust in the U.S. dollar.
• Even market movers and billionaires do not feel secure or powerful—ambition and insecurity drive their relentless pursuit and fuel societal anxiety.
• The media and finance are more transparent than ever, but not necessarily more trusted; historical cycles show both progress in policy and persistent risk-taking in new forms.
• Will there be a market crash in 2026? The guest declines a clear prediction, but warns that we’re always “fighting the last war” and must remain vigilant, especially as new financial products, AI, and mounting sovereign debt reshape the landscape.

For Listeners Short on Time

Key Sections:

• History repeating? (03:15-06:00)
• Parallels with the 1920s: inequality, financial innovation, values shift (08:49-12:18)
• The wild card: sovereign debt & global trust (52:19-55:00)
• Are tech titans the new "too big to fail"? (56:39-58:01)
• On the psychology of power & billionaires (61:28-63:20)
• Media trust, then & now (64:45-67:54)

Podcast’s Tone & Style:
Frank, humorous, and highly accessible—even when covering dense financial material. The conversation is peppered with moments of levity (fancy dentists, Burning Man, and balloon pants!), but consistently returns to core economic and societal concerns with both skepticism and curiosity. Both host and guest are deeply aware of their “insider/outsider” roles probing the logic and ethics of money and power.