1 00:00:11,160 --> 00:00:15,360 Speaker 1: Hello, and welcome to another episode of the Odd Lots Podcast. 2 00:00:15,440 --> 00:00:19,360 Speaker 1: I'm Joe wisn't Thal and I'm Chasey Alloway. You know, 3 00:00:19,480 --> 00:00:22,360 Speaker 1: we're kind of like at the point, Tracy, where I mean, 4 00:00:22,400 --> 00:00:26,079 Speaker 1: obviously we recently sort of hit the one year anniversary 5 00:00:26,160 --> 00:00:29,280 Speaker 1: of the markets bottoming, but we talked to a lot 6 00:00:29,360 --> 00:00:33,800 Speaker 1: of people around this time last year, and you know, 7 00:00:33,880 --> 00:00:37,120 Speaker 1: the world was just everything seemed an absolute chaos and 8 00:00:37,320 --> 00:00:40,000 Speaker 1: markets were, you know, still incredibly volatile. We had no 9 00:00:40,040 --> 00:00:42,040 Speaker 1: idea where things are going. So I feel like it's 10 00:00:42,120 --> 00:00:45,000 Speaker 1: kind of time to uh revisit, revisit some of those 11 00:00:45,040 --> 00:00:48,640 Speaker 1: discussions a year later, like what have we learned? Yeah, 12 00:00:48,920 --> 00:00:51,960 Speaker 1: I think it's been pretty much exactly a year since 13 00:00:52,159 --> 00:00:55,840 Speaker 1: we had the first All Thoughts episodes on what was 14 00:00:55,880 --> 00:00:58,760 Speaker 1: going on at that time, and I think the consensus 15 00:00:59,120 --> 00:01:02,600 Speaker 1: back in March or April of was that this was 16 00:01:03,000 --> 00:01:07,280 Speaker 1: an unprecedented crisis that was going to lead to these big, 17 00:01:07,640 --> 00:01:13,760 Speaker 1: permanent changes, and I think some of that still holds true. Um, 18 00:01:13,800 --> 00:01:16,720 Speaker 1: it's an unusual crisis, that's for sure, But I think 19 00:01:16,720 --> 00:01:18,600 Speaker 1: the thing that no one was expecting was that we 20 00:01:18,640 --> 00:01:23,039 Speaker 1: would basically see a recovery this quickly and that we 21 00:01:23,080 --> 00:01:27,120 Speaker 1: would have a business cycle that was compressed basically in 22 00:01:27,560 --> 00:01:32,200 Speaker 1: less than a year. Yeah, there's no question the recovery, uh, 23 00:01:32,360 --> 00:01:35,000 Speaker 1: especially for the US, but also I would say the world, 24 00:01:35,080 --> 00:01:38,880 Speaker 1: even in areas that are still struggling with the vaccination rollout, 25 00:01:39,160 --> 00:01:42,720 Speaker 1: has been much faster than people expected. And then of course, 26 00:01:42,760 --> 00:01:44,920 Speaker 1: like the other thing that was really going on at 27 00:01:44,959 --> 00:01:48,160 Speaker 1: this time behad besides just like you know, the pure 28 00:01:48,440 --> 00:01:51,080 Speaker 1: health and economic shock, was just this idea that like 29 00:01:51,520 --> 00:01:55,040 Speaker 1: all of the world's big institutions were like really being 30 00:01:55,120 --> 00:01:57,880 Speaker 1: stress tested at once, whether it's the U S. Congress, 31 00:01:57,880 --> 00:02:00,920 Speaker 1: whether it was the sort of institutional passively of the 32 00:02:01,040 --> 00:02:04,240 Speaker 1: US to roll out testing which was pretty abysible for 33 00:02:04,320 --> 00:02:07,200 Speaker 1: the for several months, whether it was the ability of 34 00:02:07,240 --> 00:02:11,720 Speaker 1: politicians to deliver fiscal support and find a way to 35 00:02:11,960 --> 00:02:15,680 Speaker 1: essentially um keep businesses on ice or create a bridge 36 00:02:15,720 --> 00:02:18,680 Speaker 1: to the other side through economic policy. Like there was 37 00:02:18,720 --> 00:02:22,280 Speaker 1: this feeling everything was being tested at the seams all 38 00:02:22,320 --> 00:02:27,919 Speaker 1: at once. Yeah, tested with really really tight deadlines as well, 39 00:02:27,919 --> 00:02:30,919 Speaker 1: and everyone's sort of working under pressure. I remember talking 40 00:02:30,960 --> 00:02:35,160 Speaker 1: a lot about the FED response back in March and April, 41 00:02:35,400 --> 00:02:38,000 Speaker 1: and looking back on it now, it's sort of amazing 42 00:02:38,040 --> 00:02:42,120 Speaker 1: how much they actually got done within a few weeks. Yeah, no, 43 00:02:42,240 --> 00:02:45,840 Speaker 1: it's incredible, And you know, uh, the US fiscal performance 44 00:02:46,480 --> 00:02:49,080 Speaker 1: in retrospect turned out to be massive and probably a 45 00:02:49,080 --> 00:02:53,000 Speaker 1: big contributor to the strong US recovery. So anyway, it's 46 00:02:53,000 --> 00:02:55,560 Speaker 1: been a year lessons learned. I'm sure in ten years 47 00:02:55,600 --> 00:02:58,080 Speaker 1: from now will also be even learning more lessons as 48 00:02:58,080 --> 00:03:01,400 Speaker 1: people study this period. Uh ear there, but I wanted, uh, 49 00:03:01,639 --> 00:03:03,919 Speaker 1: I wanted to revisit one of our guests at the time, 50 00:03:03,960 --> 00:03:07,440 Speaker 1: who is probably one of the best thinkers and sort 51 00:03:07,480 --> 00:03:10,440 Speaker 1: of synthesizing big things in the world. So we are 52 00:03:10,480 --> 00:03:14,320 Speaker 1: going to be speaking with Adam Two's who teaches history 53 00:03:14,320 --> 00:03:18,600 Speaker 1: at Columbia University, also the director of the European Institute there. 54 00:03:19,080 --> 00:03:22,600 Speaker 1: He wrote a sort of magisterial book about the financial 55 00:03:22,639 --> 00:03:28,560 Speaker 1: crisis called Crashed, which everyone was reading back in He 56 00:03:28,600 --> 00:03:31,680 Speaker 1: has another book coming out later this year on COVID, 57 00:03:31,720 --> 00:03:35,440 Speaker 1: specifically called shut Down, How COVID Shook the World's Economy. 58 00:03:35,720 --> 00:03:38,360 Speaker 1: We'll have him back on later this year to talk 59 00:03:38,400 --> 00:03:42,080 Speaker 1: about it. But in terms of understanding lessons learned from 60 00:03:42,120 --> 00:03:45,280 Speaker 1: this year, wanted we had Adam on I think exactly 61 00:03:45,320 --> 00:03:47,800 Speaker 1: this time a year ago, so it's a good time 62 00:03:47,840 --> 00:03:50,520 Speaker 1: to catch up with him. Adam, thank you so much 63 00:03:50,560 --> 00:03:54,400 Speaker 1: for joining us. I supposure to be back. Well, let's 64 00:03:54,400 --> 00:03:57,960 Speaker 1: just start with like your big headline, like what has 65 00:03:58,080 --> 00:04:01,240 Speaker 1: let's start here, what has surprised and most the single 66 00:04:01,280 --> 00:04:04,680 Speaker 1: most surprising thing to you over the past year. Well, 67 00:04:04,680 --> 00:04:06,880 Speaker 1: it's it's kind of banal, but it's it's simply that 68 00:04:06,960 --> 00:04:11,120 Speaker 1: it happened, right, that all of those Cassandras, all of 69 00:04:11,120 --> 00:04:14,200 Speaker 1: those folks that had for a long time, we now know, 70 00:04:15,120 --> 00:04:18,159 Speaker 1: perhaps we weren't paying attention before who had been saying 71 00:04:18,240 --> 00:04:22,840 Speaker 1: that a pandemic of this type could cause mayhem. We're right, 72 00:04:23,560 --> 00:04:25,520 Speaker 1: and it seems to me that that has to shift 73 00:04:25,600 --> 00:04:31,239 Speaker 1: our assessment of probabilities going forward quite fundamentally. That has 74 00:04:31,360 --> 00:04:34,279 Speaker 1: really had been since the nine eighties and then with 75 00:04:34,360 --> 00:04:37,719 Speaker 1: increasing force from the nineties onwards, like global preoccupation in 76 00:04:37,720 --> 00:04:41,240 Speaker 1: the global public health domain. Some economists were involved with this. 77 00:04:41,279 --> 00:04:44,200 Speaker 1: Larry Summers wrote the paper about the potential economic costs 78 00:04:44,240 --> 00:04:47,320 Speaker 1: of the World Economy of of a pandemic. That all 79 00:04:47,320 --> 00:04:50,360 Speaker 1: of those warnings were there, and you know it happened, 80 00:04:50,600 --> 00:04:52,679 Speaker 1: and in fact, I mean, Joe, I've seen your stuff 81 00:04:52,680 --> 00:04:55,320 Speaker 1: on Twitter and I've been been following the same graphs. 82 00:04:55,360 --> 00:04:56,920 Speaker 1: I mean that the fact of the matter is, from 83 00:04:56,960 --> 00:04:59,240 Speaker 1: the US point of view, we almost begin to think 84 00:04:59,279 --> 00:05:01,279 Speaker 1: of this in the past tense, especially if we think 85 00:05:01,279 --> 00:05:03,600 Speaker 1: of it as a business cycle. But if you actually 86 00:05:03,600 --> 00:05:06,599 Speaker 1: look at global infection rates, last week was the worst 87 00:05:06,600 --> 00:05:09,440 Speaker 1: one of this pandemic, and the mortality rate now is 88 00:05:09,839 --> 00:05:11,880 Speaker 1: much higher than it was in what we think of, 89 00:05:11,920 --> 00:05:15,960 Speaker 1: as it were, the North Atlantic crisis of of COVID 90 00:05:16,080 --> 00:05:18,839 Speaker 1: in March April when we first spoke a year ago. 91 00:05:19,240 --> 00:05:21,880 Speaker 1: The you know, the the pandemic is now being driven 92 00:05:22,440 --> 00:05:25,560 Speaker 1: in India and Brazil, but also still by very elevated 93 00:05:25,600 --> 00:05:28,200 Speaker 1: mortality in Europe. So this is not a done deal yet. 94 00:05:28,680 --> 00:05:31,960 Speaker 1: The really terrifying possibility is that out of those cauldrons 95 00:05:31,960 --> 00:05:34,880 Speaker 1: of infection that we begin to get really dangerous mutations. 96 00:05:34,920 --> 00:05:37,279 Speaker 1: We've not seen those yet, right the so far, the 97 00:05:37,360 --> 00:05:40,479 Speaker 1: mutations increased the risk to young people, increase the risk 98 00:05:40,520 --> 00:05:43,520 Speaker 1: of infection, but they haven't fundamentally breached the firewall that 99 00:05:43,560 --> 00:05:46,480 Speaker 1: the vaccines are putting up for us. But that's I 100 00:05:46,520 --> 00:05:49,679 Speaker 1: think for me, the single you know, the single biggest 101 00:05:49,720 --> 00:05:52,480 Speaker 1: takeaway is sure, there's a fascinating story about the economic 102 00:05:52,480 --> 00:05:55,039 Speaker 1: policy response and everything else. But I think we have 103 00:05:55,160 --> 00:05:57,479 Speaker 1: to treat this is a wake up call for the 104 00:05:57,520 --> 00:06:01,000 Speaker 1: sort of risks we might be facing in future. So 105 00:06:01,120 --> 00:06:04,280 Speaker 1: one thing I wanted to ask just on that note is, Um, 106 00:06:04,320 --> 00:06:06,760 Speaker 1: you know, the crisis is still sort of ongoing, but 107 00:06:06,920 --> 00:06:09,800 Speaker 1: you have the book coming out later this year, your 108 00:06:09,960 --> 00:06:13,720 Speaker 1: first book, which you know, Joe rightly has characterized as 109 00:06:13,720 --> 00:06:16,640 Speaker 1: a magisterial work on the two thousand eight financial crisis. 110 00:06:16,720 --> 00:06:21,880 Speaker 1: But that took I think ten years to actually come out, 111 00:06:21,920 --> 00:06:25,560 Speaker 1: and you sort of waited and digested, um, everything that 112 00:06:25,640 --> 00:06:28,800 Speaker 1: had happened in the years since then. Why have you 113 00:06:28,839 --> 00:06:31,000 Speaker 1: been able I'm trying to think how to phrase this correctly, 114 00:06:31,040 --> 00:06:35,799 Speaker 1: but like, why publish this book now? Why not wait 115 00:06:36,000 --> 00:06:39,279 Speaker 1: and see how everything plays out? Like what's different here 116 00:06:39,400 --> 00:06:43,160 Speaker 1: compared to the two thousand eight crisis? Well, I think, 117 00:06:43,200 --> 00:06:46,080 Speaker 1: I mean, you're absolutely right, it's it's it's a risky 118 00:06:46,080 --> 00:06:48,479 Speaker 1: a book to write from that point of view. You know, 119 00:06:48,520 --> 00:06:50,760 Speaker 1: you vote them in the financial markets. You're interested in 120 00:06:50,800 --> 00:06:52,160 Speaker 1: this kind of thing, and you know, I'm kind of 121 00:06:52,200 --> 00:06:56,039 Speaker 1: building a portfolio of different types of intellectual projects, some 122 00:06:56,120 --> 00:06:59,440 Speaker 1: of which have you know, risky profiles and others and 123 00:06:59,440 --> 00:07:02,080 Speaker 1: this is death that lear riskier one, and I don't 124 00:07:02,120 --> 00:07:05,680 Speaker 1: mean that glibly. It's quite a deliberate exercise and risk 125 00:07:05,720 --> 00:07:07,840 Speaker 1: taking in a sense. It's driven by a sense of 126 00:07:07,960 --> 00:07:09,880 Speaker 1: urgency that I think a lot of us feel. That's 127 00:07:09,920 --> 00:07:12,080 Speaker 1: why I'm on this podcast with you folks this morning, 128 00:07:12,080 --> 00:07:13,840 Speaker 1: like we have to try and make sense of this. 129 00:07:14,600 --> 00:07:16,720 Speaker 1: And frankly, in two thousand and eight nine, I wasn't 130 00:07:16,720 --> 00:07:19,320 Speaker 1: part of the conversation. I was. I was a Ivory 131 00:07:19,400 --> 00:07:23,200 Speaker 1: tire academic but working at the time largely on fifteen 132 00:07:23,240 --> 00:07:26,800 Speaker 1: sixteen World War One, and this time around, like it 133 00:07:26,880 --> 00:07:29,240 Speaker 1: or not, I mean, you know, and being Advitage on 134 00:07:29,280 --> 00:07:31,520 Speaker 1: your podcast a year ago was indicative of this, Like 135 00:07:31,560 --> 00:07:33,800 Speaker 1: I didn't have any time to do anything else, Like 136 00:07:33,840 --> 00:07:36,480 Speaker 1: all I was doing along with you folks and you know, 137 00:07:36,560 --> 00:07:39,200 Speaker 1: everyone else in our broader intellectual community. And that's how 138 00:07:39,240 --> 00:07:42,200 Speaker 1: I think about it now, all we were doing, everyone 139 00:07:42,280 --> 00:07:45,200 Speaker 1: was laser focused on on the current event. So I 140 00:07:45,240 --> 00:07:48,040 Speaker 1: literally had to shelve another book project, and so this 141 00:07:48,160 --> 00:07:51,560 Speaker 1: is kind of, you know, this crowded out other other 142 00:07:51,600 --> 00:07:54,560 Speaker 1: activities I was engaged in at the time. And I 143 00:07:54,560 --> 00:07:56,800 Speaker 1: think another thing that's happened is I think maybe we've 144 00:07:56,880 --> 00:07:59,280 Speaker 1: learned something. I mean, part of the lesson you know, 145 00:07:59,360 --> 00:08:01,520 Speaker 1: for me of the twenties after all that some of 146 00:08:01,560 --> 00:08:03,960 Speaker 1: the learning that we did out of two thousand and 147 00:08:04,040 --> 00:08:07,480 Speaker 1: eight nine has come back to benefit us, right, I mean, 148 00:08:07,560 --> 00:08:09,720 Speaker 1: some of the things were actually a bit more transparent 149 00:08:09,840 --> 00:08:12,120 Speaker 1: this time than they were the last time around. We 150 00:08:12,120 --> 00:08:15,120 Speaker 1: we perhaps didn't quite foresee the tremors in the treasury 151 00:08:15,160 --> 00:08:18,560 Speaker 1: market in March, but you know, once they began to happen, 152 00:08:18,640 --> 00:08:21,640 Speaker 1: folks really did have some of the analytical tools necessary 153 00:08:21,680 --> 00:08:24,560 Speaker 1: to grasp that immediately. More or less, and as you 154 00:08:24,600 --> 00:08:27,840 Speaker 1: were saying in your intro, you know, the FED snapped interaction, 155 00:08:27,920 --> 00:08:29,680 Speaker 1: and that's in part because we in fact did have 156 00:08:29,720 --> 00:08:32,160 Speaker 1: a bit of a playbook. So in a sense, part 157 00:08:32,200 --> 00:08:34,400 Speaker 1: of the wager of writing this book is to say, well, 158 00:08:34,400 --> 00:08:36,800 Speaker 1: how does the playbook of OA O nine extent and 159 00:08:36,840 --> 00:08:39,599 Speaker 1: to that extent, as it were, the intellectual overhead is 160 00:08:39,679 --> 00:08:42,440 Speaker 1: less because we've done some of that analytical work. It 161 00:08:42,520 --> 00:08:45,120 Speaker 1: may turn out five ten years from now that new 162 00:08:45,160 --> 00:08:47,760 Speaker 1: perspectives open up. They would be surprising if they didn't. 163 00:08:48,280 --> 00:08:50,400 Speaker 1: It's definitely a wager, but that that's that's what it 164 00:08:50,400 --> 00:08:52,000 Speaker 1: consists of. For me, Like you know, I didn't really 165 00:08:52,000 --> 00:08:53,839 Speaker 1: have much choice because this is what I've been doing, 166 00:08:54,440 --> 00:08:56,760 Speaker 1: and and be it seems to me that we actually 167 00:08:56,800 --> 00:09:00,240 Speaker 1: have kind of collectively moved the ball on how we 168 00:09:00,360 --> 00:09:03,080 Speaker 1: understand macro financial risk. And this is basically a macro 169 00:09:03,160 --> 00:09:07,280 Speaker 1: financial book again, all macro finance plus g policy plus politics, 170 00:09:07,480 --> 00:09:09,400 Speaker 1: which is a train we've really a lot of folks 171 00:09:09,440 --> 00:09:11,959 Speaker 1: have been mapping. Right. Well, you know, this actually brings 172 00:09:12,000 --> 00:09:15,600 Speaker 1: me to a sort of broader question about your particular 173 00:09:16,160 --> 00:09:19,400 Speaker 1: approach to combining the study of history with the study 174 00:09:19,400 --> 00:09:22,480 Speaker 1: of economics with also real time. People are like kind 175 00:09:22,480 --> 00:09:25,600 Speaker 1: of amazed by your output. I mean, you had this 176 00:09:25,840 --> 00:09:31,200 Speaker 1: huge book in but previously you had been studying history 177 00:09:31,240 --> 00:09:34,959 Speaker 1: for the early nine hundreds. Meanwhile, you have this book 178 00:09:35,280 --> 00:09:38,160 Speaker 1: that's gonna come out in a few months. You have 179 00:09:38,480 --> 00:09:42,040 Speaker 1: a sub stack newsletter where you're like take on current events, 180 00:09:42,040 --> 00:09:43,800 Speaker 1: and you have all kinds of charts. It's much more 181 00:09:43,840 --> 00:09:46,480 Speaker 1: writing than most people can do in a week. You 182 00:09:46,559 --> 00:09:50,280 Speaker 1: wrote a recent London review of book Story, essentially cataloging 183 00:09:50,280 --> 00:09:55,760 Speaker 1: the intellectual arc of Paul Krugman's career. Like it's really impressive, 184 00:09:55,920 --> 00:09:58,760 Speaker 1: Like how much work you're you managed to get done 185 00:09:59,080 --> 00:10:01,440 Speaker 1: on quite a range of things. How do you sort 186 00:10:01,440 --> 00:10:05,000 Speaker 1: of generally like approach like what I guess the autom 187 00:10:05,120 --> 00:10:08,520 Speaker 1: two project, what do you see as your sort of 188 00:10:08,679 --> 00:10:11,560 Speaker 1: lend that then sort of refracts into all of these 189 00:10:11,920 --> 00:10:15,280 Speaker 1: the spectrum of output. Well, thank you. I think I'm 190 00:10:15,320 --> 00:10:17,960 Speaker 1: producing at the pace more like that of a journalist currently. 191 00:10:18,520 --> 00:10:21,040 Speaker 1: I have huge admiration for you know, folks in the 192 00:10:21,080 --> 00:10:23,360 Speaker 1: media who you know, have to have to crunch you 193 00:10:23,360 --> 00:10:26,320 Speaker 1: know the what we all know, the names you too 194 00:10:26,360 --> 00:10:28,360 Speaker 1: in particular, but you know, all the all the people 195 00:10:28,400 --> 00:10:30,520 Speaker 1: that we read on a daily basis, we're all involved 196 00:10:30,559 --> 00:10:33,880 Speaker 1: in this real time effort to to try and make 197 00:10:33,960 --> 00:10:36,000 Speaker 1: sense of things. What I guess I bring to the 198 00:10:36,040 --> 00:10:38,520 Speaker 1: party in the sense is, you know, in a sense 199 00:10:38,679 --> 00:10:42,120 Speaker 1: of a drama. I think that's something that I've consistently 200 00:10:42,120 --> 00:10:45,200 Speaker 1: tried to do, is to inject not in the sense 201 00:10:45,240 --> 00:10:47,920 Speaker 1: that we simply take lessons from history in that naive 202 00:10:48,000 --> 00:10:50,640 Speaker 1: way of looking back to previous periods to say, how 203 00:10:50,800 --> 00:10:53,840 Speaker 1: is the presence similar. It's more in a sense the 204 00:10:53,880 --> 00:10:56,959 Speaker 1: approach that says, look, let's take the current realities as 205 00:10:57,000 --> 00:11:00,640 Speaker 1: seriously as we do nineteen fourteen, the record World War 206 00:11:00,679 --> 00:11:03,240 Speaker 1: one or nine, or the dramas of World War Two. 207 00:11:03,280 --> 00:11:07,400 Speaker 1: Let's try and figure say the global lockdown or the 208 00:11:07,400 --> 00:11:09,920 Speaker 1: global shotdown as I prefer to call it, in March April, 209 00:11:10,000 --> 00:11:13,280 Speaker 1: as an epic event, like the outbreak of a war. 210 00:11:13,360 --> 00:11:16,520 Speaker 1: It was something that, after all, affected literally practically everyone 211 00:11:16,559 --> 00:11:19,320 Speaker 1: on the entire planet. And that's a novel experience. And 212 00:11:19,360 --> 00:11:21,160 Speaker 1: if you as a historian, it seems to me, don't 213 00:11:21,240 --> 00:11:23,320 Speaker 1: if that doesn't get your juices going, it's hard to 214 00:11:23,640 --> 00:11:26,080 Speaker 1: see what would, right, I mean, And it's there in 215 00:11:26,160 --> 00:11:28,079 Speaker 1: front of us, and I happen to have ended up 216 00:11:28,600 --> 00:11:31,679 Speaker 1: networked in with some of the smart folks who are 217 00:11:31,720 --> 00:11:35,080 Speaker 1: kind of doing immediate, real time at the cold face 218 00:11:35,160 --> 00:11:38,240 Speaker 1: type analysis. I mean, I'm in that kind of meta space, right, 219 00:11:38,240 --> 00:11:41,559 Speaker 1: because I'm not and not somebody in either a government 220 00:11:41,600 --> 00:11:44,640 Speaker 1: department or a you know, a data hub like Bloomberg 221 00:11:44,720 --> 00:11:48,040 Speaker 1: or EXAMTI where people are actually crunching the data in 222 00:11:48,080 --> 00:11:50,760 Speaker 1: real time. So I guess the role is that of 223 00:11:50,800 --> 00:11:55,880 Speaker 1: a of a kind of framing analysis. And their history 224 00:11:55,880 --> 00:11:57,959 Speaker 1: really does help. I mean, I don't think it's very 225 00:11:57,960 --> 00:12:00,640 Speaker 1: helpful to go back deep into history to look for analogies, 226 00:12:00,679 --> 00:12:03,880 Speaker 1: but I think if you want to understand, say Krugman's trajectory, 227 00:12:03,960 --> 00:12:06,600 Speaker 1: or more generally the trajectory of macro economics. It really 228 00:12:06,640 --> 00:12:08,880 Speaker 1: helps to go back to n seventies m I t 229 00:12:09,160 --> 00:12:12,000 Speaker 1: to understand the kind of context that macro economics came 230 00:12:12,040 --> 00:12:15,360 Speaker 1: out of, and then, as it were, the story since 231 00:12:15,400 --> 00:12:18,040 Speaker 1: you know, I've been lecturing on global economic history for 232 00:12:18,200 --> 00:12:21,720 Speaker 1: decades now, then the pieces fall into place quite smoothly 233 00:12:21,760 --> 00:12:23,880 Speaker 1: in a way, because you know, if you if you're 234 00:12:23,880 --> 00:12:26,360 Speaker 1: steeped in the works of Barry Iching Green or somebody 235 00:12:26,440 --> 00:12:29,439 Speaker 1: like that, then you have take a pre shaped, a 236 00:12:29,559 --> 00:12:31,720 Speaker 1: preformed It's like a model. You know. I like Krugman 237 00:12:31,800 --> 00:12:34,000 Speaker 1: in part because he's a to me. You know, he's 238 00:12:34,040 --> 00:12:35,959 Speaker 1: the sort of macro economist I get. I had a 239 00:12:36,040 --> 00:12:38,600 Speaker 1: lot of macro as an undergraduate, and his I s 240 00:12:38,800 --> 00:12:42,440 Speaker 1: LM simple building block kind of models. You know, I 241 00:12:42,480 --> 00:12:44,240 Speaker 1: can wrap my head around, and in a sense, what 242 00:12:44,280 --> 00:12:47,040 Speaker 1: I'm trying to build as almost the historical analogy to that. 243 00:12:47,120 --> 00:12:49,880 Speaker 1: It's not going to be a perfect and totally subtle description, 244 00:12:50,360 --> 00:12:51,880 Speaker 1: but in a sense, what you're trying to do is 245 00:12:51,920 --> 00:12:54,960 Speaker 1: get those two basic curves on the on the map right, 246 00:12:55,000 --> 00:12:58,120 Speaker 1: and the basic parameters which determine those and move your 247 00:12:58,160 --> 00:13:00,560 Speaker 1: way around them. The try Lemma models that people use 248 00:13:00,600 --> 00:13:03,319 Speaker 1: in international political economy are super helpful for that kind 249 00:13:03,320 --> 00:13:05,880 Speaker 1: of thing too. So that's the that's the kind of 250 00:13:06,040 --> 00:13:10,319 Speaker 1: m O. So shall we talk about the past twelve 251 00:13:10,360 --> 00:13:14,040 Speaker 1: months then? I remember when you came on in April. 252 00:13:14,840 --> 00:13:19,160 Speaker 1: I think you characterize this as a sudden stop in 253 00:13:19,400 --> 00:13:22,959 Speaker 1: the biggest part of the economy, at least in the US, 254 00:13:23,040 --> 00:13:28,320 Speaker 1: and that services. Given that big stop, how were you 255 00:13:28,360 --> 00:13:31,720 Speaker 1: thinking this would actually play out like in April? What 256 00:13:31,840 --> 00:13:35,880 Speaker 1: was your blueprint for how this would play out in 257 00:13:35,920 --> 00:13:39,560 Speaker 1: the wider economy, and how did that contrast with the 258 00:13:39,600 --> 00:13:43,120 Speaker 1: actual events? I don't think, I mean, I can't honestly 259 00:13:43,160 --> 00:13:45,559 Speaker 1: say that I had a very clear idea. I mean 260 00:13:45,640 --> 00:13:49,360 Speaker 1: I had visions, I guess, of downward multipliers spiraling out 261 00:13:49,400 --> 00:13:52,720 Speaker 1: from the service sector. Living on Broadway the way that 262 00:13:52,760 --> 00:13:54,839 Speaker 1: we do, we could see that, you know, just the 263 00:13:55,520 --> 00:13:59,080 Speaker 1: slaughter of small businesses going on all around us. My 264 00:13:59,080 --> 00:14:01,600 Speaker 1: my wife is in the travel business, and we felt 265 00:14:01,600 --> 00:14:05,400 Speaker 1: the shock directly through, you know, her global network of 266 00:14:05,440 --> 00:14:08,600 Speaker 1: people who are suddenly penniless. And I could see the 267 00:14:08,640 --> 00:14:12,160 Speaker 1: way that kind of multiplier effect would work its way out, 268 00:14:12,840 --> 00:14:15,600 Speaker 1: and what we didn't reckon with I guess, and this 269 00:14:15,720 --> 00:14:18,360 Speaker 1: is you know, one of the shocks of twenty is 270 00:14:18,440 --> 00:14:22,960 Speaker 1: the capaciousness of fiscal policy support that it might be 271 00:14:23,000 --> 00:14:26,800 Speaker 1: possible to roll out. Now that doesn't you know, that 272 00:14:26,920 --> 00:14:30,720 Speaker 1: doesn't deal with the more sexual problems which are still 273 00:14:30,760 --> 00:14:33,320 Speaker 1: affecting large slices of the U. S economy. It's important 274 00:14:33,320 --> 00:14:36,000 Speaker 1: to recognize that right that we're you know, maybe somewhere 275 00:14:36,000 --> 00:14:37,960 Speaker 1: between eight and ten million jobs down and where we 276 00:14:38,000 --> 00:14:42,080 Speaker 1: ought to be um but we didn't anticipate I think 277 00:14:42,120 --> 00:14:44,640 Speaker 1: the scale of that of that support and its effects, 278 00:14:44,640 --> 00:14:48,000 Speaker 1: because again it's complicated. It's not a classic Canesian, you know, 279 00:14:48,120 --> 00:14:50,600 Speaker 1: stimulus story, because we know that folks haven't gone out 280 00:14:50,640 --> 00:14:53,680 Speaker 1: and spent the money because in part his main function 281 00:14:53,720 --> 00:14:56,440 Speaker 1: really was to provide a form of security to households 282 00:14:56,440 --> 00:14:58,760 Speaker 1: in the sense that they had some savings with out 283 00:14:58,760 --> 00:15:00,320 Speaker 1: of which they knew they were going to be able 284 00:15:00,360 --> 00:15:03,240 Speaker 1: to meet essential bills. So I think that's one of 285 00:15:03,280 --> 00:15:06,760 Speaker 1: the elements that we that I didn't anticipate, nor did 286 00:15:06,800 --> 00:15:09,400 Speaker 1: I anticipate on the other side of the equation, just 287 00:15:09,640 --> 00:15:13,920 Speaker 1: the gigantic wealth affect story that we would get through 288 00:15:14,200 --> 00:15:18,440 Speaker 1: the impact of the Central Bank federal reserve measures in 289 00:15:18,640 --> 00:15:22,280 Speaker 1: financial markets and inequity markets in particular, UM, so that 290 00:15:22,320 --> 00:15:24,000 Speaker 1: you know, we come out of the year with those 291 00:15:24,080 --> 00:15:28,080 Speaker 1: American households fortunate enough to have large portfolios of financial assets, 292 00:15:28,520 --> 00:15:31,560 Speaker 1: what twelve trillion dollars up on the year, not just 293 00:15:31,640 --> 00:15:36,640 Speaker 1: relative to the March trough. So those weren't developments which 294 00:15:37,160 --> 00:15:40,160 Speaker 1: I anticipated. I'm not saying that you couldn't have done 295 00:15:40,240 --> 00:15:43,640 Speaker 1: the kind of basic calculus which would have given you know, 296 00:15:43,680 --> 00:15:45,840 Speaker 1: which have led you to that kind of a scenario, 297 00:15:45,960 --> 00:15:50,080 Speaker 1: but it seemed improbable um in March. And after all, 298 00:15:50,120 --> 00:15:53,400 Speaker 1: we did live through a kind of nerve biting period 299 00:15:53,880 --> 00:15:56,400 Speaker 1: in US. And I'm not even talking about the politics, 300 00:15:56,440 --> 00:16:00,320 Speaker 1: but just around the stimulus after that huge fiscal obviously 301 00:16:00,360 --> 00:16:02,480 Speaker 1: pushed in March, which you highlighted in the intro, which 302 00:16:02,520 --> 00:16:05,120 Speaker 1: was a surprise in its own right. We did then, 303 00:16:05,160 --> 00:16:09,320 Speaker 1: after all, go into full on gridlock. And it's worth remembering. 304 00:16:09,360 --> 00:16:12,040 Speaker 1: I think how nervous folks felt in the last couple 305 00:16:12,040 --> 00:16:14,520 Speaker 1: of weeks of December, and you know how nervous in 306 00:16:14,520 --> 00:16:19,840 Speaker 1: particular low income Americans, precarious families that were desperately waiting 307 00:16:19,840 --> 00:16:22,760 Speaker 1: to see whether you know, the protection of tenants would 308 00:16:22,760 --> 00:16:25,680 Speaker 1: be extended and so on. You know, as recently as that, 309 00:16:25,760 --> 00:16:28,520 Speaker 1: there was still a huge sense of uncertainty about the 310 00:16:28,560 --> 00:16:31,120 Speaker 1: possibility of the amount and political system reacting to the 311 00:16:31,160 --> 00:16:49,000 Speaker 1: social crisis in this country. I will be the first 312 00:16:49,040 --> 00:16:52,720 Speaker 1: to admit that nothing I anticipated about this cress came 313 00:16:52,800 --> 00:16:55,320 Speaker 1: right and I got everything wrong. But one thing that 314 00:16:55,400 --> 00:16:58,240 Speaker 1: I remember in particular that I was wrong about thinking 315 00:16:58,240 --> 00:17:01,960 Speaker 1: about to the spring of last year was that kind 316 00:17:02,000 --> 00:17:05,119 Speaker 1: of like, you know, the US was still doing a 317 00:17:05,200 --> 00:17:09,119 Speaker 1: horrendous job seemingly on the testing front by this point, 318 00:17:09,240 --> 00:17:12,040 Speaker 1: didn't seem like there was much consensus on you know, 319 00:17:12,119 --> 00:17:16,679 Speaker 1: sort of lockdowns or mitigation strategies. Meanwhile, the Europeans, uh, 320 00:17:16,760 --> 00:17:19,159 Speaker 1: you know, Germany, but most of Europe seemed to be 321 00:17:19,160 --> 00:17:23,639 Speaker 1: doing very well with suppression, very well with mitigation. And 322 00:17:23,680 --> 00:17:25,359 Speaker 1: so my thought at the time I was like, Okay, 323 00:17:25,440 --> 00:17:27,679 Speaker 1: US as a mess, and Europe is going to suppress this, 324 00:17:28,000 --> 00:17:30,640 Speaker 1: and not only that, they're going to finally like turn 325 00:17:30,720 --> 00:17:33,399 Speaker 1: on the fiscal levers in a way that um we 326 00:17:33,440 --> 00:17:35,800 Speaker 1: haven't seen and Europe is really going to come out 327 00:17:35,800 --> 00:17:38,200 Speaker 1: of this out performing. And I don't even know if 328 00:17:38,240 --> 00:17:42,719 Speaker 1: like comparing different entities like this is useful, but it 329 00:17:42,760 --> 00:17:45,719 Speaker 1: hasn't been like this sort of like clear, Oh, Europe 330 00:17:45,760 --> 00:17:48,160 Speaker 1: shows the way that I kind of might have expected 331 00:17:48,200 --> 00:17:50,399 Speaker 1: around this time last year. Yeah, I mean, I think 332 00:17:50,440 --> 00:17:52,320 Speaker 1: you're completely right. I mean I did. I have the 333 00:17:52,320 --> 00:17:54,240 Speaker 1: benefit of having spent a last part of my life 334 00:17:54,280 --> 00:17:56,440 Speaker 1: in Germany, so on that basis, I have to say 335 00:17:56,480 --> 00:18:00,680 Speaker 1: I was always skeptical about that, that first Way success story, 336 00:18:00,720 --> 00:18:03,960 Speaker 1: because I've seen it off of local government administration in Germany. 337 00:18:04,000 --> 00:18:06,439 Speaker 1: Not to buy that, not to have bought it at 338 00:18:06,480 --> 00:18:09,480 Speaker 1: the time. So I'm not surprised. And it's a grim 339 00:18:09,480 --> 00:18:12,399 Speaker 1: reality that the mortality in Europe is now. It is 340 00:18:12,400 --> 00:18:15,320 Speaker 1: now higher than it was at its peak in March April, 341 00:18:15,680 --> 00:18:17,359 Speaker 1: and it's a disaster, and it's really a kind of 342 00:18:17,400 --> 00:18:20,080 Speaker 1: alternate reality story. If you're if you're in regular contact 343 00:18:20,119 --> 00:18:22,720 Speaker 1: with colleagues and friends in Europe, they are living they're 344 00:18:22,720 --> 00:18:25,200 Speaker 1: still living the lockdown, you know, chaos that we were 345 00:18:25,240 --> 00:18:27,960 Speaker 1: in the US in the spring. I agree that there's 346 00:18:27,960 --> 00:18:31,280 Speaker 1: been a real, real reversal of fortunes there. And if 347 00:18:31,320 --> 00:18:33,720 Speaker 1: you speak to folks around the euro Group right now, 348 00:18:33,840 --> 00:18:36,640 Speaker 1: they are acutely away of the way that the narrative 349 00:18:36,680 --> 00:18:39,760 Speaker 1: has shifted, right they they thought, you know, first of all, 350 00:18:39,800 --> 00:18:41,399 Speaker 1: it looked as though Europe was going to fail on 351 00:18:41,440 --> 00:18:43,480 Speaker 1: the fiscal and monetary side. We had that you know, 352 00:18:43,600 --> 00:18:47,000 Speaker 1: March twelfth gaff by Christine Regard parenting the old German 353 00:18:47,040 --> 00:18:49,439 Speaker 1: line about spreads, and then all of a sudden lurching 354 00:18:49,520 --> 00:18:53,520 Speaker 1: into action. Then did Duly Deal. Then you know, Nerve 355 00:18:53,640 --> 00:18:55,640 Speaker 1: acting months when it wasn't obvious that they could get 356 00:18:55,640 --> 00:18:58,119 Speaker 1: it done. And then this extraordinary package deal they did 357 00:18:58,160 --> 00:19:01,080 Speaker 1: in December with the East Europeans in Poland and Hungary 358 00:19:01,080 --> 00:19:03,040 Speaker 1: and getting rule of law provisions in there. I mean, 359 00:19:03,040 --> 00:19:06,479 Speaker 1: it really looked like the sort of quintessential it's how 360 00:19:06,560 --> 00:19:08,520 Speaker 1: you know, kind of European deal. It's a bit like 361 00:19:08,520 --> 00:19:11,000 Speaker 1: a you know, a marvelous piece of Italian sports car 362 00:19:11,040 --> 00:19:13,199 Speaker 1: engineering or something. And then it just turned out to 363 00:19:13,200 --> 00:19:15,760 Speaker 1: be undersized. It's not big enough, it's too slow, it's 364 00:19:15,760 --> 00:19:19,000 Speaker 1: too complicated, and you get whooked by you know, a 365 00:19:19,080 --> 00:19:21,960 Speaker 1: muscle car from the US piloted by Joe Biden. I mean, 366 00:19:22,000 --> 00:19:26,320 Speaker 1: it's it's it's pretty it's pretty confusing for the Europeans 367 00:19:26,440 --> 00:19:29,120 Speaker 1: right now. Um, and then the vaccine story on top 368 00:19:29,160 --> 00:19:31,600 Speaker 1: of that, which which which they've managed to turn into 369 00:19:31,640 --> 00:19:35,600 Speaker 1: a disaster. Um. So yeah, in terms of the transatlantic balance, 370 00:19:35,680 --> 00:19:39,359 Speaker 1: it's been a real roller coaster whiplash, and I think 371 00:19:39,480 --> 00:19:42,239 Speaker 1: the awareness of that in Europe is quite intense. If 372 00:19:42,280 --> 00:19:45,080 Speaker 1: you speak to the decision makers over there, there is 373 00:19:45,119 --> 00:19:48,840 Speaker 1: a real sense that they don't understand quite how they 374 00:19:48,880 --> 00:19:51,480 Speaker 1: lost the plot and how they've ended up looking like, 375 00:19:51,760 --> 00:19:53,600 Speaker 1: you know, it looks like a revender two thousand to 376 00:19:53,680 --> 00:19:56,080 Speaker 1: day after all, in the sense that the US pulled 377 00:19:56,119 --> 00:19:58,239 Speaker 1: out of that. As you know, as many complaints as 378 00:19:58,280 --> 00:20:00,720 Speaker 1: we may have about the slow recover from two thousands 379 00:20:00,720 --> 00:20:02,480 Speaker 1: and eight nine in the US, at least it was 380 00:20:02,560 --> 00:20:06,000 Speaker 1: all going one way at least through the fifteen sixteen 381 00:20:06,040 --> 00:20:07,960 Speaker 1: and that wasn't true in Europe, of course, and I 382 00:20:07,960 --> 00:20:09,760 Speaker 1: think they fear that they're go and going to end 383 00:20:09,840 --> 00:20:13,720 Speaker 1: up there again. So just on that note, Adam, what 384 00:20:13,800 --> 00:20:19,120 Speaker 1: do you think accounts for the US's ability to get 385 00:20:19,160 --> 00:20:22,000 Speaker 1: its act together when it comes to fiscal stimulus? And 386 00:20:22,040 --> 00:20:24,960 Speaker 1: I mean we've already talked about how it wasn't necessarily 387 00:20:25,320 --> 00:20:28,639 Speaker 1: a perfect execution and there was a lot of uncertainty 388 00:20:28,720 --> 00:20:30,760 Speaker 1: over whether they would get it done or not, but 389 00:20:30,840 --> 00:20:33,760 Speaker 1: in the end they did. So why in your opinion 390 00:20:34,480 --> 00:20:37,240 Speaker 1: was that able to come together. I think it's a 391 00:20:37,320 --> 00:20:41,399 Speaker 1: story of several different phases that the continuous through line 392 00:20:42,080 --> 00:20:44,439 Speaker 1: is that America has to act right. A lot of 393 00:20:44,440 --> 00:20:46,480 Speaker 1: this is forced action, and this is the comeback you'll 394 00:20:46,520 --> 00:20:48,919 Speaker 1: get from any European you talked to, Like they've got 395 00:20:48,960 --> 00:20:53,479 Speaker 1: automatic stabilizers, they have sophisticated labor market institutions, so they 396 00:20:53,520 --> 00:20:56,879 Speaker 1: didn't see the surgeon unemployment. The United States did, and 397 00:20:56,920 --> 00:20:59,680 Speaker 1: that was clearly critical in March and driving it. I 398 00:20:59,680 --> 00:21:02,439 Speaker 1: mean those terrifying Thursday mornings when we would get that 399 00:21:02,520 --> 00:21:05,480 Speaker 1: hit of data at eight thirty with you know, six 400 00:21:05,520 --> 00:21:07,600 Speaker 1: million Americans losing their jobs in a week. I mean, 401 00:21:07,600 --> 00:21:10,359 Speaker 1: it was staggering stuff, and that clearly was crucial to 402 00:21:10,400 --> 00:21:14,520 Speaker 1: pushing I think that very surprising consensus in Congress. Then 403 00:21:14,640 --> 00:21:17,000 Speaker 1: we had the coincidence of it being an election year 404 00:21:17,040 --> 00:21:20,280 Speaker 1: and the Republicans having their guy in the White House, 405 00:21:20,359 --> 00:21:23,040 Speaker 1: which which was which was crucial, not crucial enough, it 406 00:21:23,080 --> 00:21:26,840 Speaker 1: turns out to actually drive a stimulus through over the summer, 407 00:21:26,920 --> 00:21:30,399 Speaker 1: which which may have cost Trump the presidency. Then I 408 00:21:30,440 --> 00:21:33,120 Speaker 1: think in the fall, again it was the fact that 409 00:21:33,280 --> 00:21:36,040 Speaker 1: the social crisis in the United States that was looming 410 00:21:36,160 --> 00:21:39,639 Speaker 1: was just so severe that the Republicans felt that in 411 00:21:39,760 --> 00:21:43,040 Speaker 1: light of the upcoming you know, Senate elections in January, 412 00:21:43,080 --> 00:21:46,439 Speaker 1: they had to do something. The really surprising moment, I 413 00:21:46,480 --> 00:21:48,560 Speaker 1: think most of us agree is what's happened under the 414 00:21:48,560 --> 00:21:51,240 Speaker 1: Biden administration, right because we we could have seen a 415 00:21:51,320 --> 00:21:54,280 Speaker 1: rerun of of Obama two thousand and nine UM and 416 00:21:54,359 --> 00:21:57,040 Speaker 1: instead what we've almost seen as a kind of escalatory logic, 417 00:21:57,080 --> 00:21:59,000 Speaker 1: at least in so far as we're talking about the 418 00:21:59,000 --> 00:22:02,640 Speaker 1: immediate response to to to the COVID crisis. I think 419 00:22:02,640 --> 00:22:06,000 Speaker 1: the American Job's plan is a much is a different 420 00:22:06,000 --> 00:22:10,119 Speaker 1: beast altogether. It's much more modestly proportioned, but to deliver 421 00:22:10,200 --> 00:22:15,639 Speaker 1: another huge hit of essentially you know, reliefs. It's almost 422 00:22:15,640 --> 00:22:19,639 Speaker 1: like a fiscal security blanket for families which are still struggling, 423 00:22:19,640 --> 00:22:21,560 Speaker 1: and there are millions of them. And j Power has 424 00:22:21,600 --> 00:22:24,160 Speaker 1: done and I think it remarkable job as FED chair 425 00:22:24,240 --> 00:22:27,240 Speaker 1: and consistently pushing the fact that the labor market is 426 00:22:27,320 --> 00:22:29,360 Speaker 1: much weaker than it looks in some of the numbers. 427 00:22:29,920 --> 00:22:32,359 Speaker 1: That that I think is really the surprising thing, and 428 00:22:32,520 --> 00:22:34,840 Speaker 1: it has to do with a shift in logic inside 429 00:22:34,840 --> 00:22:37,720 Speaker 1: the Democratic Party. I think they've they've abandoned the search 430 00:22:37,840 --> 00:22:41,680 Speaker 1: for bipartisanship. That means that they need every single vote 431 00:22:41,680 --> 00:22:44,560 Speaker 1: from within their own caucus in both houses. And all 432 00:22:44,560 --> 00:22:48,440 Speaker 1: of a sudden, then the left has Leveridge too, and 433 00:22:48,880 --> 00:22:52,160 Speaker 1: we know where they've you know, progressively moved in recent years, 434 00:22:52,280 --> 00:22:55,080 Speaker 1: in part under the influence of radical political economy of 435 00:22:55,119 --> 00:22:57,720 Speaker 1: different types, whether it's classic Caynesianism or m M T 436 00:22:58,680 --> 00:23:02,040 Speaker 1: in any case, towards a aggressive assertion of the need 437 00:23:02,119 --> 00:23:06,160 Speaker 1: for large, large fiscal action. And I think that's where, 438 00:23:06,320 --> 00:23:08,880 Speaker 1: you know, that's how we've We've had this really rather 439 00:23:08,960 --> 00:23:11,720 Speaker 1: remarkable moment that is an acute social crisis that isn't 440 00:23:11,720 --> 00:23:16,119 Speaker 1: addressed by robust institutions. There's an uncertain recovery, there's a 441 00:23:16,160 --> 00:23:19,480 Speaker 1: massive political imperative to do something that demonstrates the Biden 442 00:23:19,480 --> 00:23:22,480 Speaker 1: administration has controlled of the situation, to give them a 443 00:23:22,520 --> 00:23:25,120 Speaker 1: hope of not failing in the mid terms. And then 444 00:23:25,200 --> 00:23:28,440 Speaker 1: I think there is a serious rethink going on within 445 00:23:28,600 --> 00:23:31,160 Speaker 1: the ranks of the Democratic Party, and perhaps the pivotal 446 00:23:31,200 --> 00:23:34,720 Speaker 1: people here are folks like Schumer who've moved from you know, 447 00:23:34,800 --> 00:23:37,880 Speaker 1: a relatively cautious position to an open advocacy of really 448 00:23:37,960 --> 00:23:41,040 Speaker 1: large scale fiscal spending, and so then the balance hinges 449 00:23:41,160 --> 00:23:43,920 Speaker 1: very much on the on the swing votes between mansion 450 00:23:44,000 --> 00:23:46,280 Speaker 1: on the one side and on the left on the other. 451 00:23:46,520 --> 00:23:49,000 Speaker 1: You know, I'm curious you sort of you sort of 452 00:23:49,080 --> 00:23:51,040 Speaker 1: hinted at it there, and I mentioned earlier in our 453 00:23:51,080 --> 00:23:55,840 Speaker 1: discussion you recently wrote a very long essay about Paul 454 00:23:55,920 --> 00:23:59,760 Speaker 1: Krugman's career intellectual trajectory. And at the same time that 455 00:23:59,800 --> 00:24:02,960 Speaker 1: they interesting things happening within the Democratic Party, there's also 456 00:24:03,040 --> 00:24:06,040 Speaker 1: interesting things maybe sort of mirroring it in the world 457 00:24:06,119 --> 00:24:10,199 Speaker 1: of sort of economic thought. And you have some you know, 458 00:24:10,280 --> 00:24:13,679 Speaker 1: as you say, some some high profile like thought leaders 459 00:24:13,720 --> 00:24:16,399 Speaker 1: economists moving much more towards the sort of like old 460 00:24:16,440 --> 00:24:21,240 Speaker 1: school Keynesie and MMT style thinking, whereas some of the 461 00:24:21,280 --> 00:24:25,560 Speaker 1: old defenders of maybe Obama and clinton Omics, like Larry 462 00:24:25,600 --> 00:24:28,919 Speaker 1: Summers and Olivia Blanchard don't seem to be at the 463 00:24:29,720 --> 00:24:32,919 Speaker 1: at the forefront or at the center of influence right now, Like, 464 00:24:33,080 --> 00:24:35,480 Speaker 1: how do you see that sort of like parallel track 465 00:24:35,560 --> 00:24:38,359 Speaker 1: hang out within this sort of like economics world. And 466 00:24:38,400 --> 00:24:42,520 Speaker 1: also as you describe in the Democratic Party, Yeah, it's 467 00:24:42,560 --> 00:24:45,240 Speaker 1: it's a fascinating scene. And and and you know, I 468 00:24:45,280 --> 00:24:48,120 Speaker 1: think we're only really beginning to sketch it's it's it's 469 00:24:48,200 --> 00:24:50,840 Speaker 1: outlines at this point. And I have to say my 470 00:24:50,880 --> 00:24:55,000 Speaker 1: opinions shift almost certainly weekly, if not daily, given given 471 00:24:55,040 --> 00:24:58,040 Speaker 1: the chain of events. But I think one story here. 472 00:24:58,080 --> 00:25:00,960 Speaker 1: I think there's maybe three different lines that are worth pursuing. 473 00:25:01,359 --> 00:25:05,600 Speaker 1: One is, indeed, a sort of intellectually justified shift to 474 00:25:05,720 --> 00:25:08,360 Speaker 1: the position that says inflation is not a serious risk. 475 00:25:08,400 --> 00:25:10,639 Speaker 1: The Phillips curve isn't what it used to be. In 476 00:25:10,680 --> 00:25:14,359 Speaker 1: any case, we have the monetary policy tools necessary to stabilize, 477 00:25:14,880 --> 00:25:17,400 Speaker 1: you know, let's go for it. Then I think there's 478 00:25:17,440 --> 00:25:21,480 Speaker 1: the even more radical position, which is Krugman's at times, 479 00:25:21,520 --> 00:25:24,800 Speaker 1: which said, you know, this is all about politics. I 480 00:25:24,840 --> 00:25:27,400 Speaker 1: don't actually care that much whether or not there might 481 00:25:27,440 --> 00:25:30,080 Speaker 1: be some inflation risk. The far bigger risk to the 482 00:25:30,080 --> 00:25:34,719 Speaker 1: American Republic is the prospect of the Republicans gaining power again, 483 00:25:35,119 --> 00:25:37,120 Speaker 1: and so anything it's a sort of, you know, an 484 00:25:37,119 --> 00:25:41,800 Speaker 1: overt embrace of political priorities over all other priorities. So 485 00:25:41,880 --> 00:25:43,880 Speaker 1: one is, as it were, a technocratic argument that says, 486 00:25:43,880 --> 00:25:46,280 Speaker 1: you know, the economic risks and not that severe. Another 487 00:25:46,320 --> 00:25:49,160 Speaker 1: position is to say, even if they were severe, even 488 00:25:49,240 --> 00:25:51,800 Speaker 1: more severe is the prospect of a Republican comeback. We 489 00:25:51,880 --> 00:25:56,560 Speaker 1: have to prevent that at all costs. And they're sitting slightly. 490 00:25:56,600 --> 00:25:59,320 Speaker 1: It's as aside from this R and D, the Blanchards 491 00:25:59,320 --> 00:26:00,879 Speaker 1: and the Summers of the world, And I have to 492 00:26:00,880 --> 00:26:03,120 Speaker 1: say that I've struggled with their position that a bit 493 00:26:03,240 --> 00:26:05,560 Speaker 1: and actually feel that a greater degree of sympathy now 494 00:26:05,560 --> 00:26:07,960 Speaker 1: we've seen the American Jobs Plan than I did before, 495 00:26:08,520 --> 00:26:11,040 Speaker 1: because I think their position, after all has always been, 496 00:26:11,080 --> 00:26:13,080 Speaker 1: you know, right, we don't need to worry about debt 497 00:26:13,160 --> 00:26:15,000 Speaker 1: quite so much, and no one has made that case 498 00:26:15,040 --> 00:26:17,800 Speaker 1: more consistently than Blanchard. But Summer as well, working with 499 00:26:17,840 --> 00:26:20,800 Speaker 1: Furman and people like that, has consistently said that their 500 00:26:20,880 --> 00:26:24,760 Speaker 1: main criticism of the you know, the first Biden stimulus 501 00:26:24,800 --> 00:26:26,639 Speaker 1: was simply that it was a sugar high right, that 502 00:26:26,720 --> 00:26:30,879 Speaker 1: this was delivering stimulus in a highly inefficient way, whereas 503 00:26:30,920 --> 00:26:34,959 Speaker 1: the priority needed to be investment. And furthermore, this large 504 00:26:35,000 --> 00:26:39,919 Speaker 1: initial injection of as it were, immediate stimulus would prejudice 505 00:26:40,000 --> 00:26:43,760 Speaker 1: the chances of a large investment program in future, and 506 00:26:43,840 --> 00:26:47,240 Speaker 1: so it was you know, dangerous from that point of view. 507 00:26:47,280 --> 00:26:49,880 Speaker 1: And furthermore, with a view to two if the aim 508 00:26:49,920 --> 00:26:51,320 Speaker 1: of the game is in fact to be in the 509 00:26:51,359 --> 00:26:54,639 Speaker 1: best macro position possible ahead of the midterms, then coming 510 00:26:54,640 --> 00:26:57,239 Speaker 1: off a sugar high from this immediate hitter stimulus may 511 00:26:57,240 --> 00:26:58,760 Speaker 1: not be the best place to be. I don't think 512 00:26:58,800 --> 00:27:00,560 Speaker 1: they said that out loud, but I think one can 513 00:27:00,600 --> 00:27:03,560 Speaker 1: in further. And if you look at the jobs plan, 514 00:27:04,600 --> 00:27:08,080 Speaker 1: you've got to say, you know, it is massively undersized. 515 00:27:08,320 --> 00:27:10,320 Speaker 1: And when it comes to the Job's plan, it turns 516 00:27:10,320 --> 00:27:12,439 Speaker 1: out that they are doing pay fors, which to me 517 00:27:12,560 --> 00:27:15,000 Speaker 1: is sort of really topsy turvy because presumably it's an 518 00:27:15,040 --> 00:27:17,320 Speaker 1: investment program, so that's precisely the kind of thing you 519 00:27:17,359 --> 00:27:19,600 Speaker 1: would borrow for. But all of a sudden we're back 520 00:27:19,640 --> 00:27:22,200 Speaker 1: in the pay for territory. And why because of politics, 521 00:27:22,280 --> 00:27:25,720 Speaker 1: because basically they think that's what mansion will buy. And 522 00:27:25,760 --> 00:27:28,119 Speaker 1: then you run the social justice argument that says, well, 523 00:27:28,119 --> 00:27:30,040 Speaker 1: if we're going to have pay fors, what should they be, Well, 524 00:27:30,040 --> 00:27:32,320 Speaker 1: they should be corporate tax increases, which is, you know, 525 00:27:32,400 --> 00:27:35,200 Speaker 1: nothing wrong with that, it's just that there's only so 526 00:27:35,280 --> 00:27:38,080 Speaker 1: much corporate tax increase that you can get through, and 527 00:27:38,160 --> 00:27:41,000 Speaker 1: that then caps the overall size of your investment program 528 00:27:41,080 --> 00:27:43,960 Speaker 1: at two trillion odd and to trillion odd over eight 529 00:27:44,080 --> 00:27:46,960 Speaker 1: to ten years, is you know, doesn't address any of 530 00:27:47,000 --> 00:27:49,359 Speaker 1: the big ticket icons You've addressed it too. It doesn't 531 00:27:49,400 --> 00:27:52,159 Speaker 1: allow you to, you know, mount a credible challenge to 532 00:27:52,240 --> 00:27:55,160 Speaker 1: China in the high speed rail stakes, and it doesn't 533 00:27:55,160 --> 00:27:59,640 Speaker 1: allow you to address climate change really consistently. So I'm 534 00:27:59,680 --> 00:28:01,920 Speaker 1: actually the you know, in a space of it doesn't 535 00:28:02,000 --> 00:28:04,800 Speaker 1: doesn't negate what happened with the one point nine trillion, 536 00:28:04,800 --> 00:28:07,520 Speaker 1: and it doesn't negate the historical significance of that move. 537 00:28:08,160 --> 00:28:11,120 Speaker 1: But I'm beginning to worry that there isn't more wisdom 538 00:28:11,359 --> 00:28:14,159 Speaker 1: in you know, some ass intervention on the question of 539 00:28:14,200 --> 00:28:17,360 Speaker 1: the relationship between the initial stimulus and the investment part 540 00:28:17,400 --> 00:28:20,119 Speaker 1: that's followed, and the way in which the political argument 541 00:28:20,160 --> 00:28:23,439 Speaker 1: has shifted between those two components. And I am very 542 00:28:23,520 --> 00:28:28,119 Speaker 1: much focused on on this question of how America establishes 543 00:28:28,160 --> 00:28:31,120 Speaker 1: itself as a credible contributor to let alone leader to 544 00:28:30,800 --> 00:28:33,280 Speaker 1: the to the to the global fight on on climate 545 00:28:33,480 --> 00:28:36,880 Speaker 1: and this, this American jobs pan doesn't do it. It's 546 00:28:36,960 --> 00:28:41,120 Speaker 1: it's far too small. So I'm trying to think how 547 00:28:41,160 --> 00:28:44,160 Speaker 1: to phrase this next question. But I think a lot 548 00:28:44,160 --> 00:28:47,560 Speaker 1: of people you know, listening to that would agree that 549 00:28:47,560 --> 00:28:50,360 Speaker 1: there has been some sort of shift on the Democrat 550 00:28:50,520 --> 00:28:55,680 Speaker 1: side two becoming more willing to embrace phiscal stimulus, you know, 551 00:28:55,720 --> 00:28:57,400 Speaker 1: of one sort or another. There's still a lot of 552 00:28:57,400 --> 00:29:00,000 Speaker 1: debate over exactly what that looks like, but in general 553 00:29:00,400 --> 00:29:03,440 Speaker 1: they seem more willing to do it than they were before. 554 00:29:04,520 --> 00:29:09,520 Speaker 1: What does a world where governments you know, embrace fiscal 555 00:29:09,600 --> 00:29:13,560 Speaker 1: stimulus more frequently actually look like to you? And how 556 00:29:13,600 --> 00:29:17,720 Speaker 1: does that change your existing understanding of the way the 557 00:29:17,720 --> 00:29:21,840 Speaker 1: world or the economy works. Well? It it's tempting to 558 00:29:21,920 --> 00:29:24,360 Speaker 1: imagine it as a return to a utopia. There was 559 00:29:24,400 --> 00:29:26,800 Speaker 1: a lot of talk last year of you know, new 560 00:29:26,880 --> 00:29:30,920 Speaker 1: social contracts. People who know some economic history were invoking 561 00:29:30,960 --> 00:29:34,960 Speaker 1: the example of wartime exigencies and mobilization. I mean, it 562 00:29:35,000 --> 00:29:36,959 Speaker 1: could be that kind of a world. That was the 563 00:29:37,120 --> 00:29:39,480 Speaker 1: sort of vision, after all that the Green New Deal 564 00:29:39,680 --> 00:29:42,560 Speaker 1: sketched for us, that we would, as it were, identify 565 00:29:42,800 --> 00:29:46,320 Speaker 1: grand strategic targets and then head for them in a concerted, 566 00:29:47,200 --> 00:29:52,880 Speaker 1: a concerted way, I mind, rather jaundiced. Disillusions sort of 567 00:29:52,920 --> 00:29:55,720 Speaker 1: take on last year is that that that was sort 568 00:29:55,720 --> 00:30:00,440 Speaker 1: of sugarcoating um the story rather in act, I mean, 569 00:30:00,440 --> 00:30:04,200 Speaker 1: we saw policy of a very improvised type, or rather 570 00:30:04,320 --> 00:30:08,680 Speaker 1: Frankenstein variety really, in which we stitched together a variety 571 00:30:08,720 --> 00:30:12,120 Speaker 1: of emergency crisis responses, whether they were to the hiccup 572 00:30:12,120 --> 00:30:14,760 Speaker 1: in the in the treasury market, which one shouldn't underestimate 573 00:30:14,840 --> 00:30:17,600 Speaker 1: the significance of, or as it were, to the weakness 574 00:30:17,600 --> 00:30:21,200 Speaker 1: of American social institutions which required, you know, the distribution 575 00:30:21,280 --> 00:30:24,200 Speaker 1: of of checks. I mean people talk it about talk 576 00:30:24,400 --> 00:30:27,640 Speaker 1: talk about it as the wealth welfare without the state right. 577 00:30:27,680 --> 00:30:31,680 Speaker 1: So it's, as it were, a sort of unmediated relationship 578 00:30:31,760 --> 00:30:35,880 Speaker 1: between the fiscal apparatus and American citizens without actually any 579 00:30:35,960 --> 00:30:39,960 Speaker 1: intervening administrative apparatus that provides the security of a government 580 00:30:40,200 --> 00:30:44,840 Speaker 1: apparatus administration. So in some senses, despite breaking with the 581 00:30:44,920 --> 00:30:48,480 Speaker 1: old conservative fiscal rules such as they were, and in 582 00:30:48,520 --> 00:30:51,720 Speaker 1: America they were always observed, in the breach, it still 583 00:30:51,800 --> 00:30:54,520 Speaker 1: has a slightly Reaganesque feel to it. Look, you know, 584 00:30:54,560 --> 00:30:57,160 Speaker 1: it's you know, it isn't really the government that's showing up. 585 00:30:57,200 --> 00:31:01,080 Speaker 1: It's just a check um. So think there are there are, 586 00:31:01,120 --> 00:31:04,640 Speaker 1: there are many different worlds that could unfold within an 587 00:31:04,680 --> 00:31:08,120 Speaker 1: era of fiscal disinhibition, and they could in fact be 588 00:31:08,320 --> 00:31:11,720 Speaker 1: the program for concerted state building with you know, essentially 589 00:31:11,720 --> 00:31:14,640 Speaker 1: social democracy in America. That is, indeed, as it were, 590 00:31:14,640 --> 00:31:16,880 Speaker 1: what as it were the left of the Democratic Party 591 00:31:16,920 --> 00:31:19,680 Speaker 1: would love to see, but it could also be something 592 00:31:19,840 --> 00:31:22,720 Speaker 1: much more ambiguous in its politics, in which, you know, 593 00:31:22,800 --> 00:31:26,760 Speaker 1: we compensate for the huge shocks suffered by the most 594 00:31:26,760 --> 00:31:31,120 Speaker 1: precarious population with the delivery of occasional checks which arrived 595 00:31:31,160 --> 00:31:33,440 Speaker 1: depending on whether the president feels like signing or not, 596 00:31:33,480 --> 00:31:37,840 Speaker 1: as we saw in December. Meanwhile, the monetary apparatus does 597 00:31:37,880 --> 00:31:41,160 Speaker 1: the job of sustaining those of us who have financial 598 00:31:41,200 --> 00:31:45,680 Speaker 1: portfolios and keeps that wealth growth ticking over by by 599 00:31:46,080 --> 00:31:49,200 Speaker 1: keewee and other types of intervention. That's a very different 600 00:31:49,240 --> 00:31:53,240 Speaker 1: scenario in terms of the future of America, indeed global society. Yeah, 601 00:31:53,480 --> 00:31:55,960 Speaker 1: I think that's a that's a super fascinating point and 602 00:31:56,160 --> 00:31:58,000 Speaker 1: one of the things I've been thinking about in the 603 00:31:58,080 --> 00:32:00,480 Speaker 1: last year. And again, I know, or ago we were 604 00:32:00,520 --> 00:32:02,920 Speaker 1: talking about the testing crisis and all this sort of 605 00:32:02,960 --> 00:32:07,040 Speaker 1: like failure of U S institutions. One set of institutions 606 00:32:07,040 --> 00:32:10,360 Speaker 1: that seem to hold up extremely well weirdly, and people 607 00:32:10,360 --> 00:32:15,040 Speaker 1: will probably get upset. It's like large corporations executed their 608 00:32:15,080 --> 00:32:17,200 Speaker 1: business extremely well. I mean, if you look at the 609 00:32:17,240 --> 00:32:19,120 Speaker 1: Amazons of the world, of the wal Marts of the world, 610 00:32:19,240 --> 00:32:21,840 Speaker 1: or the grocery stores of the world in the you know, 611 00:32:22,120 --> 00:32:26,440 Speaker 1: in a period of incredible sort of crisis and stress 612 00:32:26,520 --> 00:32:29,840 Speaker 1: to supply chains like there really weren't like massive shortages. 613 00:32:29,960 --> 00:32:33,360 Speaker 1: Businesses managed to figure out a way to transition their 614 00:32:33,360 --> 00:32:36,600 Speaker 1: workers to remote work very quickly. So you could sort 615 00:32:36,640 --> 00:32:40,480 Speaker 1: of like imagine this nexus where we trust corporations for 616 00:32:40,560 --> 00:32:45,360 Speaker 1: sort of governance of things, and then the government supplies 617 00:32:45,400 --> 00:32:48,320 Speaker 1: the cash so that we have the spending power. Yeah, 618 00:32:48,360 --> 00:32:50,560 Speaker 1: I mean couldn't essentially even in the financial sector r 619 00:32:50,560 --> 00:32:53,280 Speaker 1: at this time, the banks weren't the proprim um, so 620 00:32:53,320 --> 00:32:55,360 Speaker 1: that in an instance of that. But I completely agree 621 00:32:55,400 --> 00:32:58,680 Speaker 1: that the the you know, the emergence of Amazon as 622 00:32:58,720 --> 00:33:02,880 Speaker 1: a de facto public service provider was was an extraordinary phenomenon. 623 00:33:03,240 --> 00:33:05,800 Speaker 1: But I guess the crucial thing is not to romanticize it, right, 624 00:33:05,880 --> 00:33:08,880 Speaker 1: is the not to buy the corporate and to recognize 625 00:33:08,920 --> 00:33:13,680 Speaker 1: the extraordinary inequalities that operate within those organizations, such that 626 00:33:13,760 --> 00:33:17,320 Speaker 1: you know, there were hundreds of thousands of workers put 627 00:33:17,480 --> 00:33:19,440 Speaker 1: in various types of risk as a result of our 628 00:33:19,440 --> 00:33:22,400 Speaker 1: own ability to shield them properly, and I think that's 629 00:33:22,440 --> 00:33:25,320 Speaker 1: the crucial thing. Absolutely, there's no there's no denying the 630 00:33:25,400 --> 00:33:29,280 Speaker 1: affair efficacy of those organizations, and many of us, all 631 00:33:29,320 --> 00:33:33,240 Speaker 1: of us on this call right now, rely on that infrastructure, 632 00:33:33,600 --> 00:33:36,400 Speaker 1: you know, for the normality that prevailed in many of 633 00:33:36,400 --> 00:33:38,120 Speaker 1: our lives throughout last year. I mean, we stayed at 634 00:33:38,160 --> 00:33:40,840 Speaker 1: home and our relatively comfortable accommodation and got on with 635 00:33:40,840 --> 00:33:43,680 Speaker 1: our jobs based on an electronic infrastructure that worked for 636 00:33:43,760 --> 00:33:46,640 Speaker 1: us because we had access to it, whilst you know, 637 00:33:46,800 --> 00:33:50,360 Speaker 1: hordes of workers took the risks of supplying us with 638 00:33:50,400 --> 00:33:52,440 Speaker 1: the groceries that we needed and so on and so forth. 639 00:33:52,840 --> 00:33:56,800 Speaker 1: Those inequalities I think that were were absolutely massive last year, 640 00:33:56,800 --> 00:33:58,680 Speaker 1: and they took on a visceral quality. Right. It moves 641 00:33:58,720 --> 00:34:02,280 Speaker 1: from being an inequality of just status or income to 642 00:34:02,400 --> 00:34:08,080 Speaker 1: being to being a really immediate material reality of those 643 00:34:08,120 --> 00:34:10,839 Speaker 1: who have to take risks and those who don't, those 644 00:34:10,880 --> 00:34:14,120 Speaker 1: who those who have incredibly comfortable setups. You know, I've 645 00:34:14,160 --> 00:34:16,960 Speaker 1: been more productive than ever in part because I stopped 646 00:34:16,960 --> 00:34:19,400 Speaker 1: traveling and just sat at home, you know, in my 647 00:34:19,440 --> 00:34:23,200 Speaker 1: comfortable domestic surroundings and cracked um. And I was able 648 00:34:23,239 --> 00:34:25,480 Speaker 1: to do that because those surroundings are comfortable, and my 649 00:34:25,600 --> 00:34:27,960 Speaker 1: university went on functioning as normal, and I didn't have 650 00:34:28,040 --> 00:34:30,880 Speaker 1: to scrabble around like my my wife and her colleagues 651 00:34:30,920 --> 00:34:33,600 Speaker 1: in the travel sector to just kind of keep things 652 00:34:33,640 --> 00:34:38,040 Speaker 1: going and make ends meet. So the divisions, the divisions 653 00:34:38,120 --> 00:34:42,600 Speaker 1: within the division of labor become very stark, even in 654 00:34:42,719 --> 00:34:45,920 Speaker 1: one in which those corporations go on functioning the way 655 00:34:45,960 --> 00:34:48,200 Speaker 1: they do. I think that could be also part of 656 00:34:48,239 --> 00:34:51,520 Speaker 1: the agenda and the you know, the forcefulness around corporate taxation. 657 00:34:51,560 --> 00:34:54,279 Speaker 1: I mean, if that discourse of inequality and just the 658 00:34:54,400 --> 00:34:58,000 Speaker 1: streaming inequality and inefficacy, inefficacy of a tax system which 659 00:34:58,040 --> 00:35:01,359 Speaker 1: doesn't manage to reach corporations, um. You know, it has 660 00:35:01,400 --> 00:35:04,680 Speaker 1: become politicized over the last ten years. I think it's 661 00:35:04,760 --> 00:35:07,920 Speaker 1: quite significant that there's really a convergence on both sides 662 00:35:07,960 --> 00:35:13,400 Speaker 1: of the Atlantic behind going after corporate tax strategies UM 663 00:35:13,440 --> 00:35:17,279 Speaker 1: and modes of corporate tax evasion, because because that is 664 00:35:17,320 --> 00:35:20,319 Speaker 1: a crucial node UM in the in this new in 665 00:35:20,360 --> 00:35:22,560 Speaker 1: this new in this new political economy, this new this 666 00:35:22,640 --> 00:35:40,080 Speaker 1: new order. Adam, you mentioned the banks just then, and 667 00:35:40,280 --> 00:35:43,959 Speaker 1: the idea that for once banks were not the problem, 668 00:35:43,960 --> 00:35:48,719 Speaker 1: and I think the robustness of the financial system in 669 00:35:48,760 --> 00:35:51,839 Speaker 1: this instance probably surprised a lot of people. Is that 670 00:35:52,080 --> 00:35:57,680 Speaker 1: vindication for the post two thousand eight regulatory regime that 671 00:35:57,880 --> 00:36:01,920 Speaker 1: was put in places, that why banks and other financial 672 00:36:01,920 --> 00:36:06,759 Speaker 1: institutions were able to whether the crisis reasonably? Well, well, 673 00:36:06,800 --> 00:36:09,000 Speaker 1: it's a counter factual. So we'll never know for certain 674 00:36:09,040 --> 00:36:10,960 Speaker 1: how they might have behaved without the rules, but we 675 00:36:11,000 --> 00:36:13,400 Speaker 1: know the rules were absolutely pushing in the right direction. 676 00:36:14,160 --> 00:36:17,000 Speaker 1: And I certainly would oppose the efforts by you know, 677 00:36:17,120 --> 00:36:20,480 Speaker 1: prominent and articulate and well, you know, well backed up 678 00:36:20,960 --> 00:36:25,680 Speaker 1: spoke people from the corporate banking side that argued that, 679 00:36:25,800 --> 00:36:28,279 Speaker 1: you know, if the regulations had been lighter, we might 680 00:36:28,320 --> 00:36:30,799 Speaker 1: not have experienced the treasury market termoil that we did 681 00:36:30,800 --> 00:36:32,800 Speaker 1: in March. Because you can kind of see that argument 682 00:36:32,840 --> 00:36:36,839 Speaker 1: coming a mile off. I, I, broadly speaking, think that, yes, 683 00:36:36,960 --> 00:36:39,319 Speaker 1: you know, these are all experiments we don't know counter 684 00:36:39,360 --> 00:36:41,680 Speaker 1: of actually what a system without those kind of interventions 685 00:36:41,680 --> 00:36:43,839 Speaker 1: would have looked like. But as a first cut, yes, 686 00:36:44,040 --> 00:36:46,640 Speaker 1: forcing the banks to accumulate more capital, which they no 687 00:36:46,680 --> 00:36:49,160 Speaker 1: doubt would probably have done anyway because they don't actually 688 00:36:49,200 --> 00:36:52,440 Speaker 1: want to fail, but forcing them to do so and 689 00:36:52,520 --> 00:36:55,560 Speaker 1: exercising the macro prudential oversight that we do is surely 690 00:36:55,560 --> 00:36:57,759 Speaker 1: a step in the right direction, and what I think 691 00:36:57,760 --> 00:36:59,960 Speaker 1: has also been remarkable as the extent to which it's 692 00:37:00,040 --> 00:37:03,400 Speaker 1: been rolled out worldwide, the extent to which major e 693 00:37:03,560 --> 00:37:08,560 Speaker 1: ends now also practice various types of macropodential supervision, and 694 00:37:08,280 --> 00:37:11,560 Speaker 1: the new frontiers I would I would submitt has got 695 00:37:11,560 --> 00:37:16,000 Speaker 1: to be to extending that to other actors and um 696 00:37:16,040 --> 00:37:18,959 Speaker 1: the share obscurity of what happened in March. The fact 697 00:37:19,000 --> 00:37:21,000 Speaker 1: that it's you know that that so many people have 698 00:37:21,040 --> 00:37:23,960 Speaker 1: had the puzzle so long to find out who sold 699 00:37:24,000 --> 00:37:27,560 Speaker 1: what when to whom in March is an indication of 700 00:37:27,600 --> 00:37:30,120 Speaker 1: the fact that we need more and more transparency and 701 00:37:30,360 --> 00:37:33,920 Speaker 1: more regulation of non bank financial actors, which are clearly 702 00:37:33,960 --> 00:37:36,560 Speaker 1: at the forefront of new developments in the financial and 703 00:37:36,600 --> 00:37:39,200 Speaker 1: then in the financial system. So yes, in broad brow 704 00:37:39,239 --> 00:37:41,359 Speaker 1: broad terms, I think that is another area where we've 705 00:37:41,400 --> 00:37:45,440 Speaker 1: seen progress. There was a great economist actual calculation of 706 00:37:45,520 --> 00:37:47,239 Speaker 1: you know, what would have happened if the banks had 707 00:37:47,239 --> 00:37:50,520 Speaker 1: been as poorly capitalized in twenty as they've been in 708 00:37:50,880 --> 00:37:53,080 Speaker 1: two thousand and eight, And even if that was a 709 00:37:53,160 --> 00:37:55,920 Speaker 1: sort of alarmist calculation done on the basis of some 710 00:37:56,000 --> 00:37:58,920 Speaker 1: of the worst scenarios in the spring of twenty that 711 00:37:58,920 --> 00:38:02,759 Speaker 1: that fact alone, you know, it would have been the 712 00:38:02,800 --> 00:38:05,359 Speaker 1: fact that one could see the collapse of several large 713 00:38:05,360 --> 00:38:08,120 Speaker 1: banks coming, would enough by itself have been enough to 714 00:38:08,239 --> 00:38:11,520 Speaker 1: create a panicky situation in that spring. And and we didn't. 715 00:38:11,560 --> 00:38:12,960 Speaker 1: We didn't have to deal with that. We didn't have 716 00:38:13,000 --> 00:38:14,920 Speaker 1: to deal with a lot, you know, a truly massive 717 00:38:14,960 --> 00:38:17,640 Speaker 1: imploding balance sheet like not I'm not even thinking of 718 00:38:17,719 --> 00:38:20,560 Speaker 1: believing in that city or somebody like that, the really 719 00:38:20,640 --> 00:38:23,840 Speaker 1: the really big, the big boys in A nine speaking 720 00:38:23,880 --> 00:38:27,200 Speaker 1: of eight o nine, I mean, your your last book, Crashed, 721 00:38:28,040 --> 00:38:30,960 Speaker 1: really talked about the sort of central role of the 722 00:38:31,080 --> 00:38:35,040 Speaker 1: dollar system and the importance of the FED extending swap 723 00:38:35,080 --> 00:38:37,759 Speaker 1: lines and sort of if there was any ambiguity, if 724 00:38:37,760 --> 00:38:39,640 Speaker 1: there are two thousand and eight two thousand nine about 725 00:38:39,640 --> 00:38:42,399 Speaker 1: the importance of the dollar, there really shouldn't have been. 726 00:38:42,640 --> 00:38:45,799 Speaker 1: Um And then you mentioned earlier on the conversation in 727 00:38:45,840 --> 00:38:49,200 Speaker 1: the comparison between US and Europe, there's still this sort 728 00:38:49,200 --> 00:38:52,759 Speaker 1: of idea that the US, as as particularly the U 729 00:38:52,840 --> 00:38:56,520 Speaker 1: S consumer is just there's no comparison. Uh, there's sort 730 00:38:56,560 --> 00:38:59,120 Speaker 1: of the consumer of last resort. The US has to spend, 731 00:38:59,520 --> 00:39:02,160 Speaker 1: and if you look at US the US trade deficit, 732 00:39:02,200 --> 00:39:05,279 Speaker 1: it's absolutely blowing out. Something I'm curious about, though, is 733 00:39:05,400 --> 00:39:08,240 Speaker 1: um like the future of China and how you see 734 00:39:08,800 --> 00:39:13,040 Speaker 1: China fitting into your thinking right now, because obviously the 735 00:39:13,080 --> 00:39:16,680 Speaker 1: economy has recovered pretty rapidly in China seems to have 736 00:39:16,719 --> 00:39:20,160 Speaker 1: done a very good job by any measure of suppressing 737 00:39:20,680 --> 00:39:24,480 Speaker 1: the virus. Where do you see it's role and it's 738 00:39:24,560 --> 00:39:26,440 Speaker 1: standing and in the sort of the thing, you know, 739 00:39:26,480 --> 00:39:30,239 Speaker 1: as you compare the different performance of different entities and 740 00:39:30,320 --> 00:39:33,040 Speaker 1: thinking about it for your book, the trajectory that China 741 00:39:33,120 --> 00:39:36,359 Speaker 1: is now, yeah, I mean this is this is I'm 742 00:39:36,400 --> 00:39:39,880 Speaker 1: sure the most important issue really longer term and and 743 00:39:39,920 --> 00:39:42,880 Speaker 1: also for European American relations because increasingly those will be 744 00:39:42,880 --> 00:39:47,040 Speaker 1: defined by the stance that they respectively take towards China, 745 00:39:47,640 --> 00:39:50,839 Speaker 1: and the China story frames everything that happened last year. 746 00:39:50,880 --> 00:39:53,839 Speaker 1: I think, after all, this should have been an absolute 747 00:39:53,880 --> 00:39:58,440 Speaker 1: disaster for Shijing Pings regime, even if let's just allow 748 00:39:58,680 --> 00:40:00,799 Speaker 1: that they actually managed to ConTroll it in the way 749 00:40:00,800 --> 00:40:04,680 Speaker 1: that they did. If the Western States had acted, you know, 750 00:40:05,080 --> 00:40:08,000 Speaker 1: as one would ideally have imagined they would have acted 751 00:40:08,040 --> 00:40:11,279 Speaker 1: in February and March and contained this. If China had 752 00:40:11,320 --> 00:40:14,000 Speaker 1: simply taken the hit that it did in February and March, 753 00:40:14,640 --> 00:40:16,520 Speaker 1: this would have been the most severe shock that the 754 00:40:16,560 --> 00:40:20,279 Speaker 1: regime has suffered since nine because it was a very 755 00:40:20,320 --> 00:40:22,520 Speaker 1: serious blow to the Chinese economy, where you know, the 756 00:40:22,560 --> 00:40:26,080 Speaker 1: unemployment numbers for China are very contested, but that the 757 00:40:26,160 --> 00:40:28,120 Speaker 1: labor market blow was at least as severe as that 758 00:40:28,160 --> 00:40:31,200 Speaker 1: suffered by India, the other giant e m and in 759 00:40:31,239 --> 00:40:34,239 Speaker 1: other words, absolutely catastrophic for the vast you know, the 760 00:40:34,320 --> 00:40:38,000 Speaker 1: vast force of migrant workers fifty six seventy. I mean, 761 00:40:38,120 --> 00:40:40,120 Speaker 1: it's really a it's a it's a it's a guessing 762 00:40:40,120 --> 00:40:42,239 Speaker 1: game as the how severe. But we're talking about one 763 00:40:42,239 --> 00:40:44,879 Speaker 1: of the biggest labor market shops in history, far worse 764 00:40:44,920 --> 00:40:48,000 Speaker 1: than that in two thousand and eight. But we handed 765 00:40:48,040 --> 00:40:51,120 Speaker 1: them a huge victory, right they've they've the failure of 766 00:40:51,120 --> 00:40:53,240 Speaker 1: the West, the failure of Europe and the United States 767 00:40:54,400 --> 00:40:58,200 Speaker 1: has if de facto handed the Chinese a giant propaganda victory, 768 00:40:58,200 --> 00:41:01,080 Speaker 1: and also not just propaganda, but victory in terms of 769 00:41:01,080 --> 00:41:05,080 Speaker 1: political legitimacy domestically, which should not have you know, which 770 00:41:05,080 --> 00:41:07,719 Speaker 1: which is the obverse of what should have happened, And 771 00:41:08,040 --> 00:41:09,680 Speaker 1: on the basis of that, I think we've seen a 772 00:41:09,760 --> 00:41:14,160 Speaker 1: pretty concerted push by Shijing Pings regime to assert itself 773 00:41:14,280 --> 00:41:19,640 Speaker 1: and to do so at the expense of stressing its 774 00:41:19,680 --> 00:41:23,759 Speaker 1: relationships with Let's forget America for a second, because the diet, 775 00:41:23,840 --> 00:41:26,000 Speaker 1: the pressure to and had to to escalate on the 776 00:41:26,040 --> 00:41:28,360 Speaker 1: American side was so extreme in the late phases of 777 00:41:28,360 --> 00:41:31,839 Speaker 1: the Trump administration, but with Europe as well, right, they've 778 00:41:31,880 --> 00:41:37,160 Speaker 1: adopted an increasingly bullying attitude, culminating in the extraordinary events 779 00:41:37,160 --> 00:41:39,920 Speaker 1: of the last couple of weeks where remember and December, 780 00:41:39,960 --> 00:41:44,200 Speaker 1: the Chinese pulled off this coupe diplomatically by getting a 781 00:41:44,320 --> 00:41:47,160 Speaker 1: Macron Meracle and fonder Layan to sign up to an 782 00:41:47,160 --> 00:41:49,480 Speaker 1: investment deal with China, which was widely seen as a 783 00:41:49,520 --> 00:41:51,960 Speaker 1: slap in the face to the incoming Biden administration and 784 00:41:52,040 --> 00:41:55,319 Speaker 1: assertion of European autonomy that was heading in towards an 785 00:41:55,320 --> 00:42:02,120 Speaker 1: increasingly uncomfortable relationship with appeasement with China fundamentally driven business interests. Then, 786 00:42:02,320 --> 00:42:06,719 Speaker 1: as you as only predictable, the Europeans impose sanctions on 787 00:42:06,800 --> 00:42:10,360 Speaker 1: some mid level Chinese officials directly involved in the grotesque, 788 00:42:10,360 --> 00:42:12,960 Speaker 1: repressive regime and Shinjang and how does Beijing react. It 789 00:42:13,000 --> 00:42:15,040 Speaker 1: could have just played it cool and said, well, whatever, 790 00:42:15,040 --> 00:42:17,880 Speaker 1: that's a different issue. Investment is the priority. No, they 791 00:42:17,920 --> 00:42:21,160 Speaker 1: slap sanctions on European parliamentarians, who are the people who 792 00:42:21,160 --> 00:42:24,120 Speaker 1: actually have to ratify the investment treaty. So it's dead. 793 00:42:24,680 --> 00:42:27,319 Speaker 1: So there's something going on on the Chinese side which 794 00:42:27,360 --> 00:42:30,200 Speaker 1: I don't think we have a really good grip on yet, 795 00:42:30,280 --> 00:42:32,479 Speaker 1: and that is going to be dispositive because I think 796 00:42:32,520 --> 00:42:35,560 Speaker 1: the I think that the Biden administration would like to 797 00:42:35,640 --> 00:42:38,600 Speaker 1: silo to as the Europeans were proposing. I think one 798 00:42:38,600 --> 00:42:41,360 Speaker 1: of the shifts were seeing from the Trump administration to Biden. 799 00:42:41,360 --> 00:42:44,800 Speaker 1: Trump was fusing all of aspects of American policy towards China, 800 00:42:45,440 --> 00:42:48,520 Speaker 1: certainly by the summer, into an aggressive front. What you 801 00:42:48,600 --> 00:42:52,000 Speaker 1: see with climate diplomacy particularly is carry wanting to say, look, no, 802 00:42:52,120 --> 00:42:54,279 Speaker 1: we'll take Climbate off in a silo separately and do 803 00:42:54,520 --> 00:42:58,240 Speaker 1: you know, do amicable policy interaction cooperation with the Chinese 804 00:42:58,280 --> 00:43:00,759 Speaker 1: in that domain and then allow blinked in the State 805 00:43:00,800 --> 00:43:04,320 Speaker 1: Department and the Defense for Hawks to run their policy 806 00:43:04,360 --> 00:43:06,759 Speaker 1: towards China on a separate track. And Beijing has said 807 00:43:06,800 --> 00:43:09,520 Speaker 1: to the Americans. I think on that too, that's not happening. 808 00:43:10,040 --> 00:43:13,759 Speaker 1: So that forces a sort of continuous rearrangement of strategies 809 00:43:13,760 --> 00:43:17,840 Speaker 1: in the West because it's not clear whether siloing and 810 00:43:17,920 --> 00:43:22,120 Speaker 1: separating out policy domains. So you could separate out investment 811 00:43:22,360 --> 00:43:27,240 Speaker 1: treatise or climate policy from issues of to do with values, 812 00:43:27,360 --> 00:43:30,640 Speaker 1: to do with human rights, or just flat out geopolitical 813 00:43:30,640 --> 00:43:33,400 Speaker 1: confrontation in the South China Sea, it's not obvious that 814 00:43:33,440 --> 00:43:35,680 Speaker 1: Beijing will allow either the Europeans or the Americans to 815 00:43:35,680 --> 00:43:38,200 Speaker 1: play that game. And I think that comes my guess 816 00:43:38,200 --> 00:43:41,239 Speaker 1: and by no means like an inside China specialist, but 817 00:43:41,800 --> 00:43:43,759 Speaker 1: my guess is that that comes from the sense on 818 00:43:43,800 --> 00:43:45,920 Speaker 1: the part of Beijing that really now is the time 819 00:43:45,960 --> 00:43:49,040 Speaker 1: throughout the anti the West is you know, is in 820 00:43:49,080 --> 00:43:52,719 Speaker 1: a mess. China has come through this crisis relatively coherently, 821 00:43:53,320 --> 00:43:55,399 Speaker 1: and they're going to push, and they're going to push 822 00:43:55,480 --> 00:44:00,200 Speaker 1: quite assertively and set terms themselves. And that that makes 823 00:44:00,239 --> 00:44:03,560 Speaker 1: obviously for a very precarious, very dangerous, very uncertain situation 824 00:44:03,640 --> 00:44:06,440 Speaker 1: going into into this year and into the into the 825 00:44:06,520 --> 00:44:10,840 Speaker 1: into the medium term future. So Adam, I'm looking at 826 00:44:10,880 --> 00:44:13,480 Speaker 1: your Twitter feed at the moment and there's one tweet 827 00:44:13,520 --> 00:44:16,600 Speaker 1: that I think sort of sums up the contrast between, 828 00:44:16,760 --> 00:44:19,400 Speaker 1: you know, twelve months ago during the depths of the 829 00:44:19,440 --> 00:44:22,760 Speaker 1: market sell off of versus where we are now. And 830 00:44:23,080 --> 00:44:27,840 Speaker 1: it's a chart that shows changes in forecast GDP for 831 00:44:27,960 --> 00:44:33,560 Speaker 1: the major economies versus pre pandemic, and the US is 832 00:44:33,840 --> 00:44:36,880 Speaker 1: I think the only major economy that's expected to have 833 00:44:37,040 --> 00:44:41,320 Speaker 1: higher GDP UH than before the pandemic. And you tweeted 834 00:44:41,719 --> 00:44:44,719 Speaker 1: in it turned out a crisis in the US could 835 00:44:44,719 --> 00:44:48,080 Speaker 1: be so severe that it triggered policy responses so massive 836 00:44:48,120 --> 00:44:51,319 Speaker 1: that they raised the GDP outlook four years later, And 837 00:44:51,360 --> 00:44:53,719 Speaker 1: I think that really encapsulates some of the surprise of 838 00:44:53,760 --> 00:44:57,560 Speaker 1: all of this. But is there a sort of implication 839 00:44:58,080 --> 00:45:01,840 Speaker 1: that the US has in some way overdone it on 840 00:45:02,000 --> 00:45:06,440 Speaker 1: the policy response versus other countries or is it just 841 00:45:06,520 --> 00:45:09,120 Speaker 1: that other countries haven't been able to get their act 842 00:45:09,160 --> 00:45:13,160 Speaker 1: together like the US. Yeah, I know, that's a great chart, 843 00:45:13,200 --> 00:45:15,120 Speaker 1: And first of all, shout out to Daily Shot, who 844 00:45:15,160 --> 00:45:18,760 Speaker 1: is one of my regular sources of chart data. Fantastic newsletter. 845 00:45:18,800 --> 00:45:22,440 Speaker 1: Everyone who has subscribed that chart is remarkable, and I 846 00:45:22,440 --> 00:45:26,000 Speaker 1: don't think it shows overshooting or exaggeration. What it shows 847 00:45:26,160 --> 00:45:29,480 Speaker 1: is this shift in politics is shifting the political economy 848 00:45:29,480 --> 00:45:31,759 Speaker 1: of the United States that we've been talking about, which 849 00:45:31,800 --> 00:45:35,080 Speaker 1: changed the parameters. And we know and we know how 850 00:45:35,120 --> 00:45:38,399 Speaker 1: far below really long run trend if you project back 851 00:45:38,400 --> 00:45:40,680 Speaker 1: to two thousand and eight, the United States has been 852 00:45:40,719 --> 00:45:44,480 Speaker 1: it's been languishing below its long run growth trend. And 853 00:45:44,600 --> 00:45:46,400 Speaker 1: so to that extent, no, I'm not I'm not in 854 00:45:46,440 --> 00:45:50,120 Speaker 1: the overshooting camp. I'm definitely in the running the economy 855 00:45:50,160 --> 00:45:54,240 Speaker 1: hot camp. I think through a whole variety of different reasons. Political, 856 00:45:54,400 --> 00:45:57,759 Speaker 1: it's a matter of social justice, and I think it's 857 00:45:57,760 --> 00:46:00,680 Speaker 1: an experiment that the United States should under take because 858 00:46:00,719 --> 00:46:03,280 Speaker 1: if it's correct that we can, as it were, shift 859 00:46:03,360 --> 00:46:09,520 Speaker 1: the envelope of potential productivity growth by keeping the economy 860 00:46:09,640 --> 00:46:13,359 Speaker 1: on that high track, then this is a huge possibility 861 00:46:13,440 --> 00:46:16,800 Speaker 1: for further you know, for for for for future growth. 862 00:46:17,080 --> 00:46:19,520 Speaker 1: And this is the moment in a sense, this crisis 863 00:46:19,560 --> 00:46:22,360 Speaker 1: has opened the door to that that possibility. In American 864 00:46:22,400 --> 00:46:25,799 Speaker 1: policy thinking, it is it is a gamble as I 865 00:46:25,840 --> 00:46:29,839 Speaker 1: think any conclusions that we draw from r but we've 866 00:46:29,920 --> 00:46:31,840 Speaker 1: got a pretty good idea that we can contain the 867 00:46:31,920 --> 00:46:34,040 Speaker 1: risks if they should arise in the form of inflation. 868 00:46:34,680 --> 00:46:38,520 Speaker 1: And we have a political configuration in which at least 869 00:46:38,520 --> 00:46:42,279 Speaker 1: one party is motivated to make this, to make this experiment, 870 00:46:42,400 --> 00:46:46,279 Speaker 1: and I think it's it's it's it's fascinating um and draw. 871 00:46:46,320 --> 00:46:48,680 Speaker 1: Broadly speaking, it makes me optimistic as that chart should 872 00:46:48,680 --> 00:46:50,880 Speaker 1: truly do. It shouldn't distract us from the fact the 873 00:46:50,920 --> 00:46:54,839 Speaker 1: pandemic everywhere else is ongoing. So those data, it may 874 00:46:54,840 --> 00:46:57,680 Speaker 1: need to be revised even further downwards for other parts 875 00:46:57,680 --> 00:47:00,200 Speaker 1: of the world, because that's the other shocking thing that graph, right, 876 00:47:00,200 --> 00:47:03,720 Speaker 1: it's the downward adjustment for the emerging markets for Europe, 877 00:47:04,160 --> 00:47:08,480 Speaker 1: and so we may see polarization coming out of this. Adam, 878 00:47:08,600 --> 00:47:11,120 Speaker 1: it was It was absolutely great catching up with you, 879 00:47:11,200 --> 00:47:14,120 Speaker 1: Absolutely great chatting with you, and we definitely got to 880 00:47:14,160 --> 00:47:17,320 Speaker 1: do it again later this year. I think this is 881 00:47:17,320 --> 00:47:19,440 Speaker 1: a story to follow, so that is an absolute peas 882 00:47:19,560 --> 00:47:22,160 Speaker 1: as always, guys, thank you very much for having me on. Awesome, 883 00:47:22,200 --> 00:47:37,200 Speaker 1: Thanks Adam, Thanks Adam, it's great catching up with Adam. 884 00:47:37,239 --> 00:47:39,880 Speaker 1: I don't think there's anyone who like quite seems to 885 00:47:39,960 --> 00:47:42,799 Speaker 1: have his knack, uh, and it's why he's had the 886 00:47:42,840 --> 00:47:45,359 Speaker 1: success he's had, clearly, but his neck to sort of 887 00:47:45,680 --> 00:47:49,839 Speaker 1: synthesize the combination of big ideas with current events quite 888 00:47:49,840 --> 00:47:53,200 Speaker 1: the same way. Yeah, he's sort of like the most 889 00:47:53,280 --> 00:47:56,760 Speaker 1: macro of all the macro people out there. UM, definitely 890 00:47:56,800 --> 00:47:59,200 Speaker 1: able to range across a bunch of different things. You 891 00:47:59,239 --> 00:48:01,000 Speaker 1: know what I was thinking when we were talking about 892 00:48:01,000 --> 00:48:05,280 Speaker 1: this idea of corporations taking on more responsibility for social services. 893 00:48:05,920 --> 00:48:10,600 Speaker 1: Did you ever read Margaret Atwood's Ricks and Creek, No, 894 00:48:11,320 --> 00:48:13,719 Speaker 1: tell me about it. Yeah, it's like a science fiction book, 895 00:48:13,760 --> 00:48:19,000 Speaker 1: but in there social services are provided by companies, and 896 00:48:19,120 --> 00:48:21,800 Speaker 1: from what I remember, everyone sort of, you know, instead 897 00:48:21,800 --> 00:48:24,760 Speaker 1: of being loyal to a country, they're sort of loyal 898 00:48:24,840 --> 00:48:28,080 Speaker 1: to their employer and rely on them for protection and 899 00:48:28,440 --> 00:48:32,000 Speaker 1: healthcare and food and things like that. So maybe that's 900 00:48:32,040 --> 00:48:35,000 Speaker 1: the direction we're heading. I gotta read that now, and 901 00:48:35,200 --> 00:48:38,160 Speaker 1: I really do think there is a lot there, because 902 00:48:38,400 --> 00:48:40,480 Speaker 1: I think, you know, if you look at what the 903 00:48:40,560 --> 00:48:43,160 Speaker 1: US government really delivered well in the last year, it 904 00:48:43,239 --> 00:48:47,160 Speaker 1: was clearly the checks and writing being checked book the household, 905 00:48:47,560 --> 00:48:50,799 Speaker 1: but also writing checks to companies and also writing big 906 00:48:50,880 --> 00:48:54,879 Speaker 1: checks to pharmaceutical companies so that they would be able 907 00:48:54,920 --> 00:48:59,759 Speaker 1: to safely or aggressively pursue the vaccination research. But then 908 00:48:59,760 --> 00:49:01,719 Speaker 1: if we look at sort of like who I think 909 00:49:02,120 --> 00:49:05,879 Speaker 1: performed well in terms of delivering I do think that 910 00:49:05,960 --> 00:49:08,120 Speaker 1: you know, people would say, oh yeah, Amazon, A lot 911 00:49:08,120 --> 00:49:11,920 Speaker 1: of people, particularly stay at home people who work from 912 00:49:11,920 --> 00:49:15,400 Speaker 1: home and others would say that in terms of like performance, 913 00:49:15,480 --> 00:49:19,680 Speaker 1: companies like Amazon and other like large corporations did their 914 00:49:19,760 --> 00:49:22,719 Speaker 1: jobs very well. And you know, I think also, you know, 915 00:49:22,760 --> 00:49:25,920 Speaker 1: you think about like the political splits in this country, 916 00:49:25,960 --> 00:49:30,000 Speaker 1: like the increasing like sort of like alliance I would say, 917 00:49:30,000 --> 00:49:32,920 Speaker 1: between the Republican Party and not business per se, but 918 00:49:33,000 --> 00:49:37,480 Speaker 1: like small business specifically as this sort of like entity 919 00:49:37,520 --> 00:49:41,280 Speaker 1: that doesn't quite you know, not did most small businesses 920 00:49:41,280 --> 00:49:44,600 Speaker 1: did not quite thrive nearly as well as Amazon. A 921 00:49:44,640 --> 00:49:48,560 Speaker 1: lot of resentment among small businesses for the expanded unemployment 922 00:49:48,600 --> 00:49:51,279 Speaker 1: insurance that the government delivered. And so you could see 923 00:49:51,280 --> 00:49:53,759 Speaker 1: how there's sort of like this, uh, you know, how 924 00:49:53,840 --> 00:49:56,200 Speaker 1: how this ends up splitting politically. But I think it's 925 00:49:56,200 --> 00:49:59,080 Speaker 1: a really interesting thing to think about. Absolutely. And the 926 00:49:59,160 --> 00:50:01,839 Speaker 1: other thing is that chart that we were talking about 927 00:50:01,880 --> 00:50:06,520 Speaker 1: at the very end showing pre pandemic GDP forecast. That 928 00:50:06,560 --> 00:50:08,960 Speaker 1: one just sort of summarizes the whole situation to me, 929 00:50:09,320 --> 00:50:12,520 Speaker 1: which is that the pandemic is ongoing in a lot 930 00:50:12,520 --> 00:50:15,200 Speaker 1: of places in the world. But also if you got 931 00:50:15,239 --> 00:50:18,360 Speaker 1: the policy response or the policy mixed right, there's a 932 00:50:18,480 --> 00:50:22,160 Speaker 1: chance that you came out of on a better footing 933 00:50:22,480 --> 00:50:26,160 Speaker 1: than you would have without COVID, which is pretty amazing. Again, 934 00:50:26,200 --> 00:50:28,960 Speaker 1: contrasting that with where we were in our sort of 935 00:50:29,000 --> 00:50:33,160 Speaker 1: mindset back in April or March of last year. Yeah, no, 936 00:50:33,520 --> 00:50:36,719 Speaker 1: it really and you know, really shows uh how malleable 937 00:50:36,880 --> 00:50:40,120 Speaker 1: the future is. And we had this really terrible recovery 938 00:50:40,560 --> 00:50:44,360 Speaker 1: post Great Financial Crisis, and we had a fairly small 939 00:50:44,400 --> 00:50:46,879 Speaker 1: fiscal stimulus of two thousand nine and then never really 940 00:50:46,920 --> 00:50:51,040 Speaker 1: did anything further. But I think in retrospect, clearly we 941 00:50:51,080 --> 00:50:53,279 Speaker 1: could have probably come out of it much faster with 942 00:50:53,320 --> 00:50:55,799 Speaker 1: more aggressive action. And I think this time, due to 943 00:50:55,840 --> 00:50:59,040 Speaker 1: sort of like maybe some luck the way the things 944 00:50:59,080 --> 00:51:03,040 Speaker 1: happened politically, we obviously had way more aggressive action and 945 00:51:03,280 --> 00:51:05,080 Speaker 1: we're seeing it, and I think it sort of speaks 946 00:51:05,120 --> 00:51:08,480 Speaker 1: to how much the future can really just be be 947 00:51:08,560 --> 00:51:13,160 Speaker 1: taken for granted, is like we know what it's gonna be. Yeah, absolutely, 948 00:51:13,760 --> 00:51:17,040 Speaker 1: all right. Uh on that note, shall we leave it there? Yeah, 949 00:51:17,120 --> 00:51:19,920 Speaker 1: let's leave it there. This has been another episode of 950 00:51:19,960 --> 00:51:22,960 Speaker 1: the All Thoughts podcast. I'm Tracy Alloway. You can follow 951 00:51:22,960 --> 00:51:26,640 Speaker 1: me on Twitter at Tracy Alloway and I'm Joe Wisenthal. 952 00:51:26,680 --> 00:51:29,680 Speaker 1: You can follow me on Twitter at the Stalwart, and 953 00:51:29,719 --> 00:51:33,280 Speaker 1: definitely follow our guests on Twitter. Columbia professor Adam Two's 954 00:51:33,400 --> 00:51:38,520 Speaker 1: He's at Adam Underscore Two's and his forthcoming book, shut Down, 955 00:51:38,560 --> 00:51:41,520 Speaker 1: How COVID Shook the World's Economy. It comes out in September, 956 00:51:41,520 --> 00:51:43,919 Speaker 1: but you can preorder it now to definitely check that out. 957 00:51:44,440 --> 00:51:48,400 Speaker 1: Follow our producer Laura Carlson. She's at Laura M. Carlson. 958 00:51:48,680 --> 00:51:52,480 Speaker 1: Follow the Bloomberg head of podcast, Francesca Levi at Francesca Today, 959 00:51:52,640 --> 00:51:56,040 Speaker 1: and check out all of our podcast at Bloomberg under 960 00:51:56,080 --> 00:52:05,279 Speaker 1: the handle add Podcasts. Thanks for listening to