Unchained Podcast, Ep. 814 — Bits + Bips: Why a U.S. Recession May Be Coming — And Still Isn’t Priced In

Date: April 9, 2025
Host: Laura Shin
Panelists: James Seyfert, Alex Kruger, Noel Acheson, Matt Hogan, Rahm Aliwalia

Episode Overview

This episode explores heightened volatility in U.S. markets, largely driven by the Trump administration’s sweeping new tariffs and the global response, and discusses why a potential U.S. recession may still not be fully priced in. The panel examines historical analogies, the impact of tariffs on inflation, trade, and crypto, and navigates the shifting narratives in both traditional finance and the digital asset space. Throughout, the conversation weaves together trader vs investor mindsets, policymaker intentions, global retaliation, and the challenge of finding safe havens — including the uncertain role of Bitcoin.

Key Discussion Points & Insights

1. Market Turmoil and Recent Volatility

[03:00–05:00] Matt Hogan:

• Describes April as “insane,” with a “bloodbath” in markets — S&P 500 down 17% since Feb; “Mag 7” down 25–26%; volatility (VIX) hit 60 (extremely high).
• Blames new Trump tariffs for the panic and notes unprecedented ETF trading volumes ($650B in one day).
• Quote:

  “All these numbers… are kind of off the charts. Volatility is really high — not absurdly high, but we hit a VIX of 60 today, which is extremely elevated.” [03:51]

Comparison to Past Crises
[04:39–09:05] Alex Kruger:

• Contrasts current environment with 2020’s pandemic crash (more chaotic, VIX at 80 for weeks, but with rebounds) and 2022’s drawn-out decline driven by Fed hikes and Russia/Ukraine.
• Emphasizes the speed and man-made (policy-driven) nature of the current drop.
• “By the time people get bearish, it’s too late. That’s why most people should not be trading.” [06:45]

2. Bear Market or Opportunity? Paradoxes and Policy Shocks

[09:06–13:51] Noel Acheson, Rahm Aliwalia:

• Noel: Markets displaying classic signs of capitulation (and normally such conditions would tempt tactical ‘buy the dip’ trades), but broader fundamentals are deteriorating: earnings, CEO confidence, inflation, supply chains.
• Rahm: Worries what’s not priced in is future inflation and a coming leg down as hard data deteriorates.

Quote:

“It’s a policy Molotov cocktail… there’s no win here. There’s no win for Nike. There’s no win for American consumer. There’s no win for a shareholder. There’s no win for American taxpayers.” — Noel Acheson [10:38]

3. Tariffs: Economic Logic & Real-World Fallout

[27:05–34:10, 49:58–52:53]

• The panel is unified: the administration’s justification for tariffs is built on flawed economic reasoning, with trade deficit math “nonsense” likened to Orwell's 1984 (“two plus two is five”).
• Alex Kruger explains empirical evidence: “60% to 100% of tariff costs get passed on to U.S. consumers/corporates — not foreigners.”
  • “The problem is they tell you they believe in an alternative reality… It’s very hard to negotiate with someone who believes in a parallel universe.” [31:42]
• Blanket tariffs are seen as damaging; supply chains can’t be reconfigured overnight, and the U.S. simply can’t domestically produce everything it imports — notably basic goods like coffee, avocados, bananas.

Memorable Moment:

“If the government says two plus two is five, then it’s five.” — Rahm Aliwalia [01:26 & 27:41]

4. Trader vs Investor: Who's Buying?

[20:47–23:08]

• Noel: “This is a trader’s market now… the real money buyers — Buffett-style — aren’t buying… The real money buyers will step in when the [S&P] P/E is around 17 times. That puts the market priced for recession.”
• Panel notes that policy used to be a ‘fixer’ in 2008/2020; now, policy is the driver of problems.

5. Global Retaliation and De-Globalization

[23:10–24:28, 38:40–39:45]

• Cross-retaliatory tariffs announced by China and the EU. “Only Europe and China matter,” Alex notes; Argentina is “irrelevant.”
• U.S. is purposefully, recklessly, “severing the link between the U.S. and the rest of the world.”
  • “If you want no trade deficits, you have no money coming in. Period.” — Alex Kruger [39:45]

6. Crypto, Bitcoin, and Safe Haven Narratives

[40:47–46:15]

• Bitcoin showed relative strength during the selloff, but then broke down alongside other “safe haven” assets like gold and staples.
• Rahm: Bitcoin’s medium-term case remains, but "correlations rise to one" in true panic; people liquidate risk assets.
• Alex: “Even gold was down today. Sometimes things just don't make sense because they're not driven by logic; they're driven by flow.” [43:52]
• The global view: U.S. policy has made the dollar less attractive, raising the question — where will capital flow in a deglobalizing world?

7. Fed Policy, Rate Cuts, and Misplaced Market Hopes

[53:04–56:16]

• The market is rapidly pricing in Fed cuts (as much as 100bps), but the panel thinks this classic ‘old playbook’ is outdated; the Fed will wait for hard data before acting.
• “Markets got the Fed pivot wrong for the last two years.” — Noel Acheson [55:43]
• Talk of a brewing “Fed independence showdown” as Trump pressures the central bank [56:04].

8. Legal and Political Pushback; Regulatory Silver Linings

[61:41–68:25]

• Congress might curtail some Presidential tariff powers, but only with a veto-proof majority (currently unlikely, but midterms loom).
• Lawsuits challenge Trump’s use of emergency powers (IEEPA) for broad trade policy.
• On the crypto front, stablecoin legislation is progressing, and bipartisan support is forming.
  • “A Stable Act or Genius Act or some combination… would be tremendously helpful… for the crypto market.” — Matt Hogan [67:25]

9. Headline Risk, Uncertainty, and the Trump Risk Premium

[68:26–72:41]

• Panel warns of ongoing “headline risk,” with markets at the mercy of Trump’s tweets or announcements, producing extreme two-day rallies and whipsaws.
• Investor psychology has shifted: from a “Trump bump” last year to today’s “Trump risk premium.”
• “Markets do not like uncertainty and things are more uncertain now than… since 2020.” — Matt Hogan [71:29]

10. Closing Thoughts: Possible Paths Forward

• Alex notes “a little luck” could see tariffs focused on China, with deals elsewhere — a slightly brighter scenario.
• Noel: Regulatory pushback, lawsuits, and legislative action may clip the scale of tariff powers.
• Matt: Advances in stablecoin law and crypto infrastructure offer bright spots amid macro gloom.

Notable Quotes & Memorable Moments

• Alex Kruger on Volatility:

  "This was just down easy, painful. F*** you. Trump is in control. New world order." [08:10]

• Noel Acheson on the policy paradox:

  "It's a policy Molotov cocktail... the number one thing you want to know is will Trump stop tariffs? If so, markets go up 7% and bear market's over. But if you stay the course, then you're set up for bear market." [11:44]

• Rahm Aliwalia on Supply Chains & Inflation:

  "You can't grow bananas, you can't grow avocados... When their coffee is suddenly 80% more expensive?" [12:59]

• On Economic Reality:

  "They're literally saying with math that they believe that the increase in... the cost of tariffs is fully absorbed by foreigners." — Alex Kruger [29:49]

• On Policy-Driven Crisis:

  "Everyone is using the markets to try and win here rather than try and stop the damage." — Rahm Aliwalia [23:10]

• On Crypto:

  "People need to be very careful with the narrative that's being pushed around... Bitcoin going to 250k on stimulus... it can be very risky betting on that." — Alex Kruger [52:28]

• On the Fed:

  "The market is relying on the old playbook... This time the stage is very, very different." — Rahm Aliwalia [55:17]

• On U.S. Victim Mentality:

  “Their focus on victimhood… is ironic because it’s part of the criticism towards the liberal machine… and here we have Republicans doing exactly the same.” — Alex Kruger [65:32]

Timestamps for Key Segments

• Market Meltdown & Volatility Overview: 03:00–05:00
• Comparisons to 2020/2022/2008: 04:39–09:05
• Capitulation vs. Fundamentals — Are We in a Bear Market? 09:06–13:51
• Tariffs: Maths, Logic & Fallout: 27:05–34:10
• Global Retaliation: 23:44–24:28; 38:40–39:45
• Crypto: Decoupling, Safe Havens, Bitcoin’s Role: 40:47–46:15
• Fed Policy, Rate Cut Speculation: 53:04–56:16
• Legal & Political Pushback to Tariffs: 61:41–68:25
• Headline Risk & Uncertainty: 68:26–72:41
• Positive (Hopeful?) Conclusions & Stablecoin Regulation: 68:25–73:43

Summary

This episode serves as both a real-time anatomy of a policy-driven financial crisis and a candid, at times irreverent, exploration of how layered macro, political, and crypto forces collide. The hosts agree a recession is very much on the table, yet few believe it’s being properly priced by markets, in part due to the speed, unpredictability, and outright economic illogic of current U.S. trade policy — raising both philosophical and practical questions about global trust, the bond market, and Bitcoin’s role in a “safe haven arms race.” Amid extreme volatility, investors are flying blind in headline-driven markets, with unpredictability (and not mutual benefit) as the new world order. The hope: perhaps regulatory pushback, more stablecoin adoption, and eventual policy moderation will bring clarity — but until then, it’s a trader’s market and risk premiums are here to stay.