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- [00:08]
A
Welcome to the Dispatch Podcast. I'm Steve Hayes. On today's roundtable, we're joined by Kyla Scanlon, author of in this Economy How Money and Markets Really Work and a New York Times opinion contributing writer. We'll discuss her latest newsletter for Dispatch Markets about the rise of wearable technology and specifically questions of privacy concerns with the regional recording technology like Meta Glasses. Then we'll turn to the economy. Is the US Economy as strong as the stock market suggests? And how do we know? Finally, not worth your time. Five cups of coffee a day. I'm also joined by my Dispatch colleagues, Mike Warren, our politics editor, and John McCormick, senior editor. Let's dive right in. Hey everybody. Before we get started today, I just want everybody to know from the get go that I should be particularly good on this podcast today because I woke up with an 85 readiness score on my Oura Ring. So I should this should be top performance for me. It probably won't be, but the fact that I checked my Oura ring is something I would never have guessed when I got it as a gift this past Christmas from my wife. I don't think of myself as a wearables person. I certainly have not religiously tracked my health information very carefully, as one glimpse at me can tell you. But I'm all in now and I check my Oura ring scores throughout the day and I've become a little bit of an obsessive. And Kyla, according to your most recent Dispatch Markets newsletter, for us a lot of other people are doing the same. Wearables is certainly a major trend. However, we want to define wearables. So first of all, welcome. We're very happy to have you. And second, can you tell us a bit about your newsletter from last week and what inspired you to write about wearables?
- [02:19]
B
Yeah, I mean, as I sort of talked about in the intro, similar to you, I have a Garmin watch that tracks everything and I actually had to take it off for a little bit because I was getting a little too into the data and into my sleep score and all of that stuff. And so now I just use it to track my bike rides. But wearables are sort of this next category that everybody's trying to figure out because it seems like the next logical step after the cell phone, right? Like you can either have the meta glasses that you wear on your face and that allows you to interact with the world or you have this thing that tracks your every movement with your body. And so I was really curious to understand that a bit more especially now that Kylie Jenner is partnering with. Of the Kardashian family is partnering with Meta to sort of promote these glasses and she has her own Starfire brand. Like, it felt like the first time that wearables were really entering into almost like pop culture celebrity status. And so I just wanted to understand that a bit more and had the chance to pitch it and to write it.
- [03:22]
A
Yeah, excellent. Well, I mean, the unfortunate thing is you stole that piece right out from under John McCormick, who was gonna write about Kylie Jenner. Oh, and he was gonna jump in. No, I'm just kidding. I'm just k. Oh, okay.
- [03:35]
B
Well, I mean, it's interesting. Like, she's, she's a force of nature. I think people tend to underestimate her. And so she does something like. I feel like it's important to understand where the Kardashians are going because they do direct, like, you know, the shape of their bodies influence other people's bodies. Like, they are so powerful. And I don't know if we totally understand their power. And so I just was very curious to understand why she was doing what she's doing. And I don't totally get it yet, but. Yeah, a little closer.
- [04:03]
A
No, I mean, I mean, I found so many different parts of this piece that you wrote fascinating and we'll of course post it in the show notes for anybody who hasn't read it yet. But that was one of them, you know, the ability of Kylie Jenner to move markets and to change the way everyday people behave. I think you said at one point in the piece that she has 380 million Instagram followers, more than the population of the United States, which is. That was a good thing to help put it in perspective, because I don't follow everything Kylie Jenner does. It won't surprise you, but the reason that she was important for this piece, and I want to use this to sort of jump into the broader discussion, is because after several false starts from various companies introducing these wearable glasses, these high tech glasses, she is now a part of what, what Meta is doing. And part of your thesis is that is likely to change things. Can you explain that to us?
- [05:07]
B
Yeah, I mean, I think for her, she is this sort of. Well, she's not even sort of. She is a force of pop culture. And one of the theories is she's giving Meta that status now. So Meta was having. So, you know, these glasses were selling well, but it was a bit hard to convince people to wear a camera on your face. And now that she's. She has this ad that's really flashy, you know, the glasses themselves are the glasses that she wears. The ad is her voice. You know, she shows how she's using them. So she's lending her status to Meta, which is really very powerful because she does have this huge influence in pop culture. And so that's the interesting thing is that Meta went that route to sell the glasses rather than making better ads or whatever. They actually just, you know, borrowed her and borrowed her star power.
- [05:59]
A
Yeah, right, right. And Mike, you probably remember a piece from our old colleague, current friend Matt Labash when we were at the Weekly Standard about his Google Glasses experiment. And one of the things I thought was notable about the sort of the way that especially the glasses piece of the Wearables universe has changed is that when Matt wrote that piece, and we'll put that piece in our show notes as well, as Kyla points out, sort of the initial introduction of the Google Glasses, everything was sort of facing inward and now you have this whole world of glasses. Snap has glasses that are unbelievably ugly, deserve the mockery they get, at least in terms of appearance. But Google has now got these outward facing glasses. Meta has these outward facing glasses. Are you a Meta Glass wearer? Are you tempted to be a Meta Glass wearer?
- [06:59]
C
You're young.
- [07:00]
A
I mean, these are particularly popular among young people. Young and wealthy people. You're young, you're wealthy. Is this your next purchase?
- [07:08]
C
I'm neither young nor wealthy. What are you talking about, Steve? Unless you're. You've got information I'm unfamiliar with. No, look, I, I do not have these glasses. I never, I never bought the Google Glass that Labash wrote about, gosh, now, 12 years ago for us. I do think it's interesting and Kyla, you get into this a bit in the piece is just the difference in these two companies. Google, you know, who developed this over a decade ago and now Meta. And it does strike me that there's something interesting happening there with the, you know, the. What the whole purpose of these companies is. Google is a company that was, you know, it's about, it started off as a search engine and then it really kind of became a personal services emailed. Right. Gmail was such a huge part of Google's business model and all of these other elements that tried social media here and there, but they sort of had all of this power in terms of their programmers and in terms of their sort of ability to develop new products, but they didn't quite understand and I don't want to cast Aspersions on Google, I think they're doing lots of different things now than they were even 10, 12 years ago. But they didn't quite understand sort of marketing the product to a product like this to a mass audience. And what Meta, of course is. Is so much different. You know, you point out that it's. It's about videos, right? It's about. It's about demonstrating to an audience that is the sort of currency of social media, the currency of our age. And Facebook understands that better than maybe any other company. They bought Instagram, however long ago. That was in many ways to anticipate this. And I think it's an interesting marriage that you describe in the piece. And I think it's like, worth diving into even more of sort of that knowledge from. From its origins of as Facebook, in which people are posting, you know, on each other's walls way back in the day, posting pictures, then videos, trying to sort of gather people together for events, for parties, that sort of thing, into the sort of Instagram era of Facebook and WhatsApp as well. So it's all about connecting and demonstrating to others about your life. So it's interesting that Facebook and Meta have sort of understood that element of it and then gone to their, their look, I don't know, maybe somebody has more followers than Kylie Jenner, but I. It's hard to imagine what like individual person does, which individual person has greater cultural cachet. And the fact that, like, it's a joke that John or I would sort of be interested in this is like a testament to that because we are not young people. We're not, you know, we are not cool, we are not hip, but lots of people are who follow her. And so it's a fascinating sort of business story and where technology and business are not always in sync. And perhaps, and I think your piece makes a good case that they are in sync. I think in terms of a broader discussion about what this means, it does bring to mind that idea. Yes, these glasses cost what, $399 if you get the Kylie Jenner version of them, $399. But as you break down, there are other costs, including the privacy cost. And I just always think about that saying, which I can't remember who first came up with it, but, you know, the idea is if the product is free, and I know this costs a little money, but essentially all the other gizmos and gadgets and awesome features of this glass, of these glasses, after you buy them and buy the name brand, you know, if the product is free, then you are the product. And that is what is clear. And sort of what you're trying to grapple with in this piece is like, well, what does it mean if all of this information about ourselves that we are freely giving, we are not only giving out to the world and our audience, but to the company that owns it so that they can, what, go around and sell that information in some or otherwise monetize it? I just, I don't know if the people buying these meta glasses are sort of fully thinking through the implications of that.
- [11:06]
A
Yeah, I think that's one of my big questions is, you know, I mean, you could, you can lump these wearables into several different categories. Right? I mean, I think the glasses that we're talking about now are sort of taking advantage of this, you know, life on display trend that I think is particularly prevalent among younger demographics and people who want to broadcast all different moments of their lives, some of them quite literally. And then on the other hand, you have these wearables that are sort of more focused on health and telling you about yourself that are more inward facing. But what they have in common is the prevalence of the technology and the use of technology by these companies. What's your sense, Kyla, of how much people are aware of what these companies are getting from them when they use these products?
- [11:56]
B
Yeah, I mean, in the piece I talk about the three prices. So there's a sticker price, you know, if you paid the 300 bucks or 400 bucks depending on what glasses that you get. And then there's the social price. Like people tend to be upset with you if you're wearing the glasses, if they notice that you're wearing the glasses, that's a big cost. And then I think there's also the privacy price that I think people tend to discount in general because we're so used to, you know, anytime you go outside, there's a chance that somebody's going to be filming you and that you're going to end up on the front page of TikTok for reasons that you might not be totally signing up for. So I don't know if we totally understand what our data is worth because we don't get to really get any value from it other than than free products that we spend our time on, which do have some value. Perhaps not as much as the value that we're giving the companies when we use their products. But yeah, I think it's something that people are just now starting to figure out. And that's why the social price of the glasses is so high because people don't want to be monitored all the time. They don't want to feel like anytime they go outside, there's a risk of somebody, you know, totally corrupting them and the life that they want to live. So I think it's something that we're still trying to figure out. I think the glasses themselves are going to expedite that process because now it is so intense where you don't know if you're being recorded. So yeah, I think it's something that we don't totally know, but people want to find out.
- [13:27]
D
Kyle, as the wearer, when you were wearing them, testing them out, did it actually make you cognizant of the fact that you were already giving away all this information? I mean, Google already has our locations and every single transaction you make is, is already recorded. Or did you really have a sense that you were actually giving up new information to meta when you were wearing these glasses?
- [13:46]
B
Yeah. So when you set up the glasses, they tell you that your data is going to be used to train their AI models. And so it was something that, I mean, I kept the, I kept the glasses in my sock drawer because I really didn't want. I just was so nervous because even when you put them away, they like sing to you a little song, like a little when you put them away. And I was like, I don't think you're totally off. Like, I think you're still listening to me. And so I'm, you know, I do social media videos as my full time job and explain the economy that way. So like my life is already pretty public in that sense. So I'm pretty used to having some loss of privacy because of the choice that I made with the career I have. But with these glasses specifically, I wore them once and I wore them inside the house and then I put them back in the drawer. And that is, I think, probably not what Mark Zuckerberg wants me to be doing with classes. But yeah, I got too nervous because I don't want stuff to be trained on. Giving data to an AI model directly, it feels like a bad trade off. Yeah.
- [14:49]
D
What's the best case to a normie skeptic of these things, that there's actually some benefit to it? I mean, as Steve mocked my 41 year old uncoolness at the beginning of the show, I want the best case scenario here. I mean, you talked about on your bike ride. I can't really think of, of like a good example of where I would want this in my life. I want, you know, to be. To be less smart. I want to dumb down my technology and walk out of the house with like, basically a dumb flip phone these days. So what do you think is the best case for these?
- [15:15]
B
I mean, the best case for the consumer or best case for meta?
- [15:18]
D
Consumer. Consumer. Yeah.
- [15:20]
B
I mean, I think the best case for the consumer is that the recording light gets brighter. You know, I think there's like two ways that you can view it from the consumer. Like the people who are being recorded without knowing it through the glasses and then the people using the glasses. I think using the glasses, like what you see people using them for on Instagram is recording bike rides, is recording. Like, you know, that's a lot of lifestyle influencers that are getting a lot of value out of this cooking videos, like those sorts of things where it might be hard to have a phone be involved. Like, they're able to use the glasses. The video quality is pretty good, you know, if you. They play music, actually. So if you want, like over the ear, earbuds, it's a pretty good value proposition. And yeah, from the consumer being recorded, I think more disclosure that the recording is happening, you know, rules and regulations around when you should be wearing the meta glasses or not. We don't have any really big rules around recording in general, so I don't feel like that's going to happen. But yeah, I think there's two angles that you could view the consumer from and two different outcomes.
- [16:19]
C
Yeah, but, Kyle, is there a risk here for meta that, like, what you've just described in terms of a value proposition for influencers? I mean, what you're ultimately talking about is a pretty small market. And I get the sense that Meta views this as, like, they really want this to be sort of adopted at a mass scale. That's what they expect. That's sort of what they're betting on. Isn't there a huge risk that everybody responds the way you did, puts it, like, wears it once, like, gets, you know, kind of tickled by the novelty of it, and then puts it in their sock drawer and puts it away and goes, I don't need this for my life. That seems like a big risk. Along the lines of the metaverse, where the metaverse was like, oh, this is going to be the new virtual reality way that everybody interacts. And of course, nobody used it. It was a disaster.
- [17:08]
B
Yeah, they changed their name and everything for it. Yeah. I mean, I think that there are, like, what the companies, Snap included, Google, Meta, they all seem to be betting that These glasses are going to be the next phone. And I think that's interesting. Like what is the next phone? It's probably going to be something at some point, right? Like we're going to probably keep innovating on that. The phone is pretty archaic as a tool. Like it is pretty clunky, it's pretty heavy. So I think they're thinking that the consumer is going to want to wear the phone on their face and they're like, hey, this is going to be the same thing as the AirPod. Everybody made fun of AirPods when they first came out. Look at these goofballs walking around with, you know, sticks in their ears and now everybody does it. So I think that is their bet. Are they going to be right? I don't know.
- [17:54]
A
And there's reason, I mean they have, these glasses have many of the same capabilities as a phone. I mean you can. My wife, my wife bought a pair of the Meta glasses. This is probably a year and a half, two years ago maybe. And she wanted to have a pair because she thought it would allow her, as you say, Kyla, in sort of a hands free way to stay in touch. They, she gets an alert when she has them turned on, she gets an alert that she's got a new email and she can speak back to the glasses and tell it to read her email. And I mean it really does take some of the capabilities of the phone kind of to the next level. There are all sorts of questions about the trade offs and I think that's what I found so interesting about your piece is there are sort of personal questions, as Mike suggests, about like the actual users and the trade offs and how widespread these glasses can become given those user trade offs. But then there, there are other, I think sort of knotty, thorny societal issues that you made mention of and that you spend some time on in the piece you made reference to. I think it was in Britain, but I may be wrong. An incident where I believe a young man was filming a young woman, a 21 year old woman with his glasses without her, I think initially knowledge without her permission. And this became a huge video on TikTok and she basically had nothing to say about it. And that it seems to me, is a real potential challenge for these companies, for us as a society. I mean, are you going to be in a position where you can say to people like, you can't film me, I don't want you to film me.
- [19:34]
C
Steve, isn't it already the case that if you're in public, I mean you have no. If you're in a public space, at least in the United States, you have no expectation of privacy. Somebody can, you know, ever since they had, you know, cameras and then, you know, the video cameras people used to put on their shoulders, like you don't have an expectation of privacy, that you can't go up to somebody in a public space and say, stop filming. Right, right. Am I, am I wrong on the kind of the legal regime on that question?
- [20:00]
A
No, I think that's right. The question to me is if it becomes so much easier to capture people because you're wearing this on your face. I mean, you know, if you have a camcorder, you know, back 30 years ago, people see you using a camcorder if you have a phone. Not all the time. You know, I know kids who are very adept at being able to sort of surreptitiously use their phone to take video. But yeah, if you're just wearing a pair of glasses that look like any other pair of glasses and you're recorded and suddenly you're on, you know, you have million views on TikTok doing something. You know, maybe it was a silly thing that, that you did that you didn't want to be captured. I mean, I do think that is a pretty strong counter pressure on these companies who hope to scale these products. And we've seen reactions to some of this. Remember the controversy over the ring camera ad at the super bowl where they, you know, sort of announced that if you lose your dog, we can. I don't want to mischaracterize it. And I didn't pay careful attention to the details at the time, but basically it was this like, you know, surveillance web that they were inviting you to become a part of. And people kind of freaked out at
- [21:15]
C
the time they were selling the Panopticon and then everybody said, no, we don't want to buy that.
- [21:20]
A
Yeah, Kyle, you mentioned that at the end. You know, so you're saying, like I didn't necessarily realize or I wasn't comfortable with the fact that I was sort of buying the Panopticon.
- [21:30]
B
Yeah, I mean, there's all sorts of technology popping up too, like the reflectacles that are actually sold out, where they're anti recording glasses, so you'll wear them and then people can't capture you. So I think we're going to see the rise of stuff like that. Like people trying to develop some sort of, you know, barrier against the. Yeah. The surveillance state that we've sort of bought into as consumers and yeah, the ring camera, that's a big thing. They've had partnerships that people have not agreed with. And then, yes, the ad with the dog was very, very controversial. People did not like that. You have to ask, like, why, you know, why do we need the glasses? Why do we need to be constantly recorded? And I think for some people, it's a feeling of safety, this feeling of control, but then the other people involved lose control. So it's sort of like there's a really big trade off that I don't know if we totally know how to calculate.
- [22:21]
A
I mean, you could make a good argument that with these reflector things, that's the market working. Right. You don't want to be captured by this. You go, and there's a product that helps you push back on that. I just wonder if that sort of stunts the growth. And I mean, the growth in wearables, again, outward facing and the inward facing has been explosive. If you look at the surveys on this, it's more likely that somebody you're standing next to on the subway or driving next to in a car is using one. They're not. And that growth has been sort of rather dramatic. Are there public policy implications? Are states looking at regulating the use of these glasses along the lines that Mike suggests, where you'd have either state government or even the federal government take a look at restricting the use of these things?
- [23:14]
B
Yeah, I mean, Meta got in a lot of trouble because they were trying to add facial recognition to the glasses to identify people and their information. And so consumer advocacy groups got together and they were like, don't do that. And the meta. I think it's a bit unclear if they actually stopped or if they just said that they stopped. So I think there's a lot of stuff like that where a lot of organizations are saying, like, hey, don't do that. And then once organizations start saying something, then you start seeing policy response. So I think we are going to see sort of a push towards consumer protection. There is this. You know, John, you were talking about the dumb phone. A lot of people are wanting that sort of lifestyle right now that is becoming increasingly popular. So I do think we'll start seeing policy movements just because we haven't, you know, in all the years that we've had social media, all the years that we've had Bones, there really hasn't been a big public push towards protecting people. Yeah.
- [24:08]
A
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- [25:22]
C
I have a question about the for anybody here, I do wonder about if there is a generational change afoot because, and I'm thinking about this in the context of, like, phones and schools, right? That there has been this big push in the last couple of years to change the rules in public schools so that kids can't have their phones in class. And there was some pushback to that, even from parents who said, well, I need to be able to reach my kid when he's at school and these sort of things. And as a millennial who kind of grew up with technology and saw it, and this is somewhat anecdotal, but I am hearing from more of my peers who have kids like myself who are getting into that age where technology is a part of their lives or could be a part of their lives, a lot of pushback to even the idea of getting a phone as early as some kids just in the last five, 10, 15 years were getting them, there's a kind of backlash to it, and I do wonder about that. With regard to wearables, I think about the way that a lot of families with kids who are now grown adults but who kind of grew up with this technology still keep track of each other and where each other's phones are. And that's something that sort of like, as somebody who, you know, is not yet 40, like, kind of offends my sensibilities. I thought I wouldn't want my parents to know where I am and I don't need to always know where my kids are. I don't know. I just, I wonder if there is going to be some kind of backlash. And millennials are a gigantic generation of people and they have a sort of a different relationship with technology than say Steve's generation or your generation, Kyla. I mean it's just, it's a different. I wonder if that will change consumer attitudes about this kind of technology.
- [27:05]
A
You know, it feels like some of this is almost waiting for a moment because I do think there are these counter trends taking place. On the one hand, more and more people are adopting all of these kinds of technology, using it, making these kinds of purchases, whether it's an oura ring, whether it's just following, you know, your steps on your phone, whether it's wearable glasses, much greater uptake on that. But at the same time, as Mike points out, there's growing skepticism. And I think it is the case that if consumers were better educated about exactly how intrusive this technology is already and what these companies are taking from us, but also what the implications of it could be, particularly with something like wearable glasses, the potential invasions of privacy there, you're likely to see sort of growing counter trends. And I wonder, this feels like a suppose fitting of a culture that's sort of increasingly being filmed or online. If this will come down to a moment where we'll have some big moment or some big issue where like this 21 year old woman who was being filmed, if something even more invasive happens and it kind of goes everywhere and it sparks a broader debate about that.
- [28:20]
B
I think that is true. And then I think to Mike's point about. So one of my hot takes is I think we have too much true crime podcasts content and it's like the number one content category. And so I think it's made people feel like their safety is constantly at risk and that they constantly have to be monitoring, they constantly have to know where their kids are because there is this worry that like, you know, they're, they're going to fall victim. And it's a, it's a worry like I totally get it. I have location, I have an airtag on my dog. Like I worry about this sort of stuff and that's because we live in the woods. But I mean I think that that is definitely a big component is people want to have that sense of control and technology does offer that in a very sleek way. And then I also think the content that people consume gives them this idea that they have to have even more control. And so I think that creates that, that relationship between people wanting to always know where everybody is all about the time. And then I think also there probably is going to have to be some big turning point. I don't know what it's going to look like. I feel like we're getting really, really close to something sort of snapping and people being like, well, why are we opting into this huge data sharing network and maybe not getting so much out of it? I don't know what that's going to look like. But yeah, to Steve's point, definitely something like that feels like it's happening. It feels like it's bubbling up.
- [29:41]
A
Yeah. And it seems like it's in all different aspects of our lives. You know, I drive into Washington D.C. two, three days a week and the prevalence of these both red light and speed cameras. Now again, our Luddite friend Matt LaBash wrote about this literally in 2001 he wrote a series about the growing prevalence of red light cameras and why it was terrible and how governments were monetizing this and making things actually less safe. That piece eventually had to be bumped because it was to be published when 911 happened, but it is now. I don't think I'm a super fast driver, but I routinely go a few miles over the speed limit and I'm not always paying attention. My wife is the same way. And I mean I think it's now a couple times a month I sort of have a sense of where the cameras are. There's of course technology, if you use Waze or other things that help you identify where the cameras are. But a couple times a month we're getting some fine because we've done something we didn't even know we had done. You know, maybe we're going eight miles an hour over and we get a, we get a hundred dollar ticket. I mean Washington D.C. is, is pretty gross. But I do think the more sort of ubiquitous this is, the more questions people are going to ask. And on the, on the true crime point, I mean, so for, for a long time true crime was sort of my guilty pleasure. I have since moved away from it a little bit. I don't think it's great to have that in my head all the time. But as it happens, I was watching a dateline over the weekend and it was a story that at least in part included data that was gathered by a wearable. They were tracking this woman, she was missing, they didn't know where she was. And then all of a sudden whatever her wearable was that tracked her heart rate stopped. And it led investigators to conclude that she had likely been killed because either this thing had gone offline or because it was in the same time frame that they suspected that this crime had taken place. She may have been killed. And eventually that was, I think, what they found. So there's no escape from this. And I think it's absolutely fascinating to track it. We appreciate the piece that you wrote and we hope you will do a follow up as this continues because it's very interesting to, to monitor. We want to take advantage of the fact that you're here with us, Kyla, because you are the author of in this Economy How Money and Markets Really Work. And I want to just ask, I mean, I've got a lot of questions I'd like to put to you about this economy in this moment, but let me ask in the broadest possible way, a lot of economic indicators that are pointing in different directions right now that seem to contradict one another. And I think if you are, for instance, if you're making a political argument and you're a supporter of the president, you can point to, let's say, five or six of them and say this is a really strong economy, things are going great. This is unbelievable. The president deserves credit. If you are a critic of the president, you can point to another set of numbers that say things are really not going well. And among those numbers is the consumer confidence number, which is not in a great place. And if you look at political polling, there's great dissatisfaction with President Trump's handling of the economy. If I were to ask you in the broadest sense today, as we record this, how should people think about the state of the US Economy right now?
- [33:20]
B
Yes. This is the question I get asked at dinner parties is should I be worried about the economy? Yeah. I mean, I think that one thing about the economy that's been really surprising over the past couple of years, since the pandemic ended, was how resilient it's been. Like consumer spending has been resilient. Consumer confidence has been really low, but people are still out there. They're spending. The labor market has been relatively strong for a while. Inflation was going down, and we got a pretty good print last month, too, that maybe inflation is headed back in the right direction after a couple of hot months. So it's tough, though, because we have the stock market, which is totally gangbusters. But the stock market doesn't always match what's actually happening in the broader economy, especially because the stock market is so concentrated in the AI Companies in the AI Capex cycle. And so you can feel sort of disappointed about your economic circumstances. And it's pretty rational. The labor market's having a bit of a tough time. Prices have been going, going up. And then you look at the stock market, and you're like, well, that keeps going really well. And that's because it's so concentrated. And so what I tell people is the economy is really resilient. It'll probably continue to be so. But if you're confused, so is everybody else. So that's my answer. Yeah.
- [34:36]
A
And what do you say to people who. They give different answers when they're asked in political polling or surveys about their own economic conditions and their sense that the broader economy is even worse? I mean, there is this sort of discrepancy. There are people.
- [34:49]
D
Right.
- [34:50]
A
To be as nervous as they are about kind of what's in front of us.
- [34:55]
B
Yeah, I mean, that's been sort of like. I do a lot of work around consumer sentiment. That's my primary area of research. And it's been shocking. You know, like, a lot of people feel pretty good about their own economic circumstances, as you said, and then they feel terrible about the national economy. And I think that's partly because people, you know, they see the headlines, they see the news, and they see, oh, inflation went up or the labor market softening or GDP didn't go the way people thought it did. The President's making decisions that maybe I don't agree with, and so therefore, I feel really bad about the economy. But I'm saving money. My retirement account is doing great. The stock market keeps going up, my house keeps appreciating in value, my job's doing well. So that is a pretty big divergence where people look outside their front door and they don't feel good, but inside the house they feel relatively okay. That does vary across age groups. It varies across cities, even. But that is one of the divergences that has been most confusing to parse together. And I think it is because the headlines can be a bit intense sometimes. Yeah. Yeah.
- [35:56]
D
How much do you think the cost of housing rent plays a role in these negative numbers? You know, a lot of people are, you know, they might be locked in a house they don't want to be in, or they've never been able to buy a house in the first place, and rent's gone up, you know, a certain percentage over the last few years. How much does housing play a role in this?
- [36:11]
B
I think that's a big part of it, especially for people that are trying to get into the housing market. Like if you got in during the pandemic here, you have a 2% mortgage, 3% mortgage, you're pretty happy. But if you're trying to get in now six and a half percent, 7%, that's a really tough situation. So I think a lot of people feel locked out of what they assumed the American dream was, and they feel like they don't really know how they're ever going to get on that path. So I think housing is definitely a big part of it. I think gas prices are a big part of the negative sentiment. I think issues in the labor market and sort of career ladders is a big issue. So I think there's a lot of stuff that ends up influencing how people feel, and a lot of it is economic mobility. You know, how do they feel about their chances moving forward. And I think, you know, a lot of people feel kind of stuck, and
- [36:58]
A
that's particularly true of young people. Your most recent piece in the New York Times looked at sort of the difference in housing in particular, at how sort of older demographics are looking at housing as sort of a place, maybe the primary place for their investment, sort of a nest egg. And younger people are increasingly being kept from that because their inability to even get that starter home that so many people have wanted.
- [37:23]
B
Yeah, the Wall Street Journal had a good piece over the weekend about the boomers are upsizing, so they're buying like bigger houses. And so you. The boomers really did benefit from, you know, they weren't the immediate beneficiaries of Post World War II, but they benefited from civilization, all of the growth. And I think that has been great for them. And I think a lot of people look at that and they're like, well, why don't we have that? And that the boomers kind of had like a once in a lifetime chance, I think, to experience a really, really good economy. And they have their own headaches, of course, but I think it is really high hopes that people have for economic circumstances that might not always be realistic.
- [38:04]
C
Yeah. You know, as sometimes I feel like the boomers get a bad rap because they did live through the, the high interest rate 80s. You know, I think here about what my in laws paid for an interest for their first house. It was something like, you know, like 18%. It was like something ridiculous or can't even fathom what that is like now. And of course, 2008 really did. My 401k became a 201k kind of moment. And every generation sort of deals with different things, different kind of shocks to the system. I do wonder about, be interested to know, Kyla, what you think about the long term economic effects or the medium term, like what we're facing now of the pandemic. It does seem contradictory of what you described, right? That actually spending and the economy has been resilient despite this kind of global pandemic, kind of shocking the system. Part of me, a lot of this is just feeling, it's how I feel about my own economic condition. But I wonder if there's this sense that we haven't even felt the full brunt of that terrible thing from six years ago. And are people just feeling economic anxiety in anticipation of something that may or may not ever come to fruition? We just feel like maybe it should have been even worse than it was. I don't know, I'm just speculating. There is something hanging over and I can't figure out quite what it is.
- [39:32]
B
Yeah, I mean there's a lot of support during the pandemic, both fiscal and monetary policy. So I think that it's often the blow in a way that we're still not totally free from. Not free from. That's not the right word. We still totally haven't figured out exactly how to grapple with that like the big policy response. I think there's, you know, I think people saw what the government did and they're like, well, why can't you always do that? And I'm not sure what the right answer to that is, but I think that's been one of the things and then it has sort of been like one thing after another. So like I was born into dot com bubble, you know, I was like 10 when the great Recession happened. And the pandemic happens right after I graduate college. And so I think for a lot of younger people it's kind of like, oh geez, when is other shoe gonna drop? Like all this stuff keeps happening and it's like you said, it's been like that for every single generation. But I think because of the media aspect, like the constantly being online as we were talking about the meta glasses, like there is this connectivity that I think can exacerbate how people talk about these situations, how we process them and it can create effects that we don't totally know how to deal with. So I think it's a lot of stuff that comes to head when we talk about how people feel about the economy and we super don't understand it. And people have all sorts of reasons. And I'm not saying Anyone should feel a certain way about the economy. Like however they feel is how they feel. But we don't totally understand why people feel so bad. Jared Bernstein, who is the former chair of Biden's Council of Economic Advisors, did this paper trying to understand this disconnect between consumer sentiment and economic data. Why do people feel so bad despite the economy being okay? And he's like, oh, it's price level variability. Prices have fluctuated so much over the past couple of years because of the pandemic. That's one of the reasons why other people point to structural affordability, like John said, like housing, childcare, elder care. Everything's gotten so expensive and it feels like there's no way out. So we just. It's been a total mystery. A total mystery. Yeah.
- [41:30]
C
And you don't have the answer. Come on.
- [41:32]
A
I know.
- [41:33]
B
I wish I did. Yeah.
- [41:34]
A
Some of that is because some of the things that we've seen have been truly unprecedented. I mean, the scale of the global pandemic. Like we haven't seen that before.
- [41:41]
B
The lockdown.
- [41:42]
C
Yeah.
- [41:43]
A
Before we take an ad break, please consider becoming a member of the Dispatch. You'll unlock access to bonus podcast episodes and all of our exclusive newsletters and articles. You can sign up@thedispatch.com join and if you use the promo code Roundtable, you'll get a month for free. Speaking of ads, if they aren't your thing, you can upgrade to a premium membership, no ads, early access to all episodes, two free gift memberships to give away, exclusive town halls with the founders, and much, much more. Okay, we'll be right back. Welcome back. Let's return to our discussion. So let me end on this question before we jump to Not Worth youh Time. You know, for generations we've been told that a diversified US Stock market portfolio is one of the most reliable strategies for building long term wealth. It's sort of always up and to the right, occasional downturn, sometimes hiccups, but it's going to return to that trajectory. And anytime, if you ever talk to an investment advisor, you know, people who are making investments, they will say that to you. Sort of, you know, wisdom passed on generation to generation to generation. If you're in a position to be able to make those kinds of investment. Is that still true? When you look at the debt to GDP ratio today and the, I would say growing instability in the US economy, whether we're talking about that, whether we're talking about $, whether we're talking about people looking elsewhere in ways that they have in sovereign wealth funds, Maybe looking elsewhere, is it still the case that people who are making those investments are working, want to start building for retirement, should just make that same assumption? Or is there a point at which we say, yeah, you know what, we can't make that assumption anymore, that the
- [43:33]
B
stock market will always go up?
- [43:35]
A
Yeah,
- [43:37]
B
I mean, it's, it's tricky because like, if you believe in the American experiment, right, like, you should think that the stock market always goes up because it's a reflection of the companies in the United States, the decisions that these companies make. It historically does go up. I think somebody should fact check this, but I think it goes up 53% of the time. So it tends to go up most of the time. I think right now, as we were talking about a bit earlier, the problem with the stock market is so concentrated, right? Like The S&P 500 is so concentrated in these AI companies. So you're really betting on AI working. Like if you think the stock market is going to continue to go up. And I think that's a big concern for a lot of people, like if they don't necessarily think AI is going to totally revolutionize the economy, like maybe it doesn't make sense to think the stock market's going, going to go up. I mean, my, my answer to questions like, like this is if you believe in the American experiment, you should assume the stock market goes up over time. The debt to GDP issue is a huge one that we don't seem to have any answer for, especially with interest payments being so high. So I, I think it's, it's a tough one to answer. There's no better alternative. That's the other problem. So. Yeah, yeah, yeah, yeah.
- [44:47]
A
No, I, I, it's funny that your answer ends there because I talked to somebody who's involved in a sovereign wealth and he would sort of walk me through all of the difficulties and all of the challenges and all the risks to the US Economy. And that was where he ended up, was there's no better alternative. We're not going to China.
- [45:04]
C
The stock market is the worst option for investment. Except for all the others.
- [45:10]
A
Exactly. Well, finally today, some really good news from my perspective. There is a new study, it's being published in the journal Circulation and the Wall Street Journal review of it begins this way. There is good news for coffee drinkers. Up to five cups of the brew a day are safe for most adults and may even have benefits from heart health, according to a new scientific statement by the American Heart Association. So, question for the panel and I'll Start with you, Kyla. Are you a coffee drinker? Do you care? And at what point, if you are a coffee drinker, what was the maximum number of cups of coffee you would have on a daily basis?
- [45:54]
B
Oh, I am a really, really big coffee drinker. Yeah, I drink coffee and I drink gyromates. So, I mean, man, I probably have five cups a day, to be totally honest with you. Yeah. So I. That's good news.
- [46:09]
A
So this is unqualified good news for you?
- [46:12]
B
Yeah, I've been trying to cut back because it makes me sweaty, but. But it's. Yeah, I don't know, I get so sleepy and. Yeah, I'm Pacific coast too, so, like keeping up with the east coast in the morning. I work east coast hours most days, so I'm up quite early and I super need a cup of coffee to be able to do that.
- [46:31]
A
Yeah, well, the good news is you can keep having your cup of coffee if you can handle being sweaty. The upsides there, John, do you drink coffee and do you ever have five a day?
- [46:45]
D
Never quite five a day. I, I pretty much need about 210 milligrams of caffeine. So I get that a lot of days that is three shots of Nespresso. Other days it's iced coffee, but I basically know the precise number of milligrams.
- [46:59]
A
Yeah, how do you know that?
- [47:00]
D
Morning.
- [47:00]
A
You're not a wearables guy. Like, how do you know how?
- [47:03]
D
I have Google. Yeah, I have Google. I don't, I don't need a ring to tell me that. I can just type it in with my thumbs and, you know, and figure out what it is. But yeah, most days it's about 200 to 230 milligrams of caffeine, Mike.
- [47:15]
C
So I do drink coffee. I would say we make it in our standard drip coffee maker. We make it relatively strong in my house and we drink it black, both my wife and I. And so basically three cups of coffee is my limit. You know, I don't wear an OURA ring, I don't measure my caffeine intake. I just kind of, I just kind of go with what, with what my gut tells me. And so maybe it averages out to that. Five cups of normal coffee a day. So if I have my three cups of coffee in the morning, I'm pretty good to go for the rest of the day. I don't know. Back when my kids were younger, if I had to get up in the middle of the night, I might need that fourth cup sometimes right after lunch and you know what, I just always felt terrible. Probably like three or four hours later I could tell, like I'm too awake at this point in my day and I'm going to be awake longer tonight. And I got into this vicious cycle. So I really try to not have coffee after noon. I have no scientific strictures here. It's just like, well, I got to have my coffee in the morning and I can't have it after 1pm and I should be good to go. So those are my rules and it works for me.
- [48:29]
A
It's funny, I, I don't think I'm very much affected by coffee at night. Doesn't keep me up. I can have a cup of coffee at 10 o' clock at night and, and I'm, I can go to bed just the same time.
- [48:40]
C
You'd fit in well in Sweden then.
- [48:42]
A
Yeah, I, I've gotten my coffee intake to roughly two, maybe three cups a day and I feel pretty good about that. Although with this news I may expand my coffee consumption and have that late afternoon cup of coffee. There was a time when I first graduated from journalism school. I was working at the hotline for National Journal and My hours were 5:30 in the morning until 2:30 in the afternoon. And then I would usually do a lot of freelance reporting and writing in the hours after that. So it was a really long day, sort of beginning of my career. But I would get to work and I would just start pounding the coffee at 5:30 in the morning because it was 5:30 in the morning. But then the problem was that we also had, it was one of these like, you know, this is like 2000. So it was this moment where all of these companies were putting ping pong tables and pool tables. They wanted a cool office environment. And so one of the things that National Journal put in was a soda fountain. So I would drink probably like seven, eight cups of coffee before 10 o' clock in the morning. And then at 10 I would switch to Diet Coke and I would have, you know, those huge Big Gulp containers of Diet Coke, like three of them after that. And I got to the point where I was having these horrible, horrible headaches and I couldn't figure out why. I went to the doctor and the doctor said, I want you to do this like you know, food and beverage diary for a week. And so I did that and I went back, I can't remember what the actual like number of ounces was that I reported to the doctor. But he was like, well that's problematic because it was, you know, a hundred plus ounces or something a day.
- [50:26]
C
It was think what your aura ring would have said.
- [50:28]
A
Yeah, it would have probably would have driven me, driven me crazy. But I'm glad to report that I'm no longer doing it at that pace. But I take this as very good news and I am going to end the podcast so that I can go get one more cup of coffee before lunchtime to make my way through. Thank you to John and Mike for joining us as always. And Kyla, this was a delight. Thanks so much for spending time with us. Very interesting conversation and we hope you'll come back.
- [50:55]
B
Yeah, thanks for having me.
- [50:59]
A
Finally, if you like what we're doing here, you can rate, review and subscribe to the show on your podcast player of choice to help new listeners find us. And as always, if you've got questions, comments, concerns or corrections, you can email us@roundtabledispatch.com we read everything, even from people who are surreptitiously taping us through their glasses. That's going to do it for today's show. Thanks so much for tuning in and thank you to the folks behind the scenes who made this episode possible. Noah Hickey and Peter Bonaventure, thanks again for listening. Please join us next time.
- [51:35]
C
Sam.