Bulwark Takes - Receipts Live: Trump Has Absolutely No Idea How Trade with Canada Works

Episode Date: August 28, 2026

Sam Stein and Catherine Rampell give their takes on Trump’s escalating trade war with Canada and why Canada may be looking to China and other countries as more reliable partners.Plus, Trump says the Strait of Hormuz is “open.” So why does the actual data tell a very different story? Watch Catherine break it down and share what the administration doesn’t want you to look at.Read more from Catherine's reporting: https://www.thebulwark.com/s/receiptsTickets for our Good Fight Tour: https://www.thebulwark.com/events

Hey, everybody. It's me, Sam Stein, managing editor at the Bullwork. I'm with Catherine Rampel. We got receipts live. And look, usually Catherine would drive this when she's with JVL, but she's with me today. And I know nothing. And so I'm going to have to pepper her with the questions. Before we begin, we're going to be talking about a couple things. Canada, the day after the Lake Ontario, I'm not calling it Lake America, press conference. We're going to be talking about the Strait of Ramos. There's like a big thing underway. I'm sure. people have seen it to assure folks that the street is totally clear and fine and we should just go through it. It seems a little bit too on the nose. And then we'll have a couple of topics. Kevin Warsh had a speech this morning at Jackson Hall. That was where it was, right?

Okay, yeah. Where I, in classic Kevin Warsh fashion, I'm not sure he said anything, but he may have, and I just can't tell. Catherine's going to break that all down for us. But before we do that, Tim always does this. So I'm going to do, too. You guys got to subscribe to our feed. We're doing like robust economics as well as silly MAGA stuff.

It's the whole potpourri of contents. So boost the feed, subscribe, hit like, do all that stuff. We got to catch up with the MAGA grifters and all them who have figured out the YouTube algorithm. All right, Catherine, let's start with Canada. How are you feeling a day after we changed the name of Lake Ontario? You know, pretty much the same. Oh, no. Pretty much the same.

Yeah. I mean, it's still, it'll always be like Ontario to me. Although maps are going to get a lot more confusing, I feel like, if Donald Trump really starts cracking down. Didn't he crack down on who, he got mad at the AP? He got mad at the AP for Gulf of America because they were like, we're not going to do it. But then Google Maps, I think, did change Gulf of Mexico to Gulf of America. So it is, there's like a bit of a who's going to do it. And I'll tell you someone who hasn't done it yet.

Who hasn't changed the name on the map? Who's that? The government. The government itself has not yet changed the name up. I've been checking out this page on the government, which is where they denote and map out the Lake of Ontario. And there it is. That is the government website. It's from the FWS, which is why am I blank.

Fish and Wildlife. Yeah. So I was looking through all the federal government databases and looking and searching for Lake Ontario. And as of this morning, there it is. still like Ontario on our own federal government's website. I'm sorry for putting spotlight on the poor people at the FFWS. You're going to get somebody fired. You're going to get some poor career civil servant who is just doing their job fired.

I know. Look at that beautiful lake. Oh, I feel for it. Look, my feeling about all of this is it's incredibly stupid. Obviously, it's also something of a distraction from the much worse stuff that he is doing to destroy our relationship with Canadians to make affordability worse, to destroy lots of economic opportunities on both sides of the border. So it's like, yeah, it's fine. Yeah, that's fair enough. But, you know, that actually raises a question. And I copped to sort of ignorance here. Why are we

fighting with Canada? Like, what was, what was, but I'm not saying that rhetorically. Like, I know No, I think that's a valid question. Like, that's not a dumb question. I don't think Donald Trump goes. What happened over the past week that, like, made us do this? Really unclear. Donald Trump had been, okay, to back up a little bit, we have a trade deal with Canada. He negotiated it, exactly.

He said it was the best deal that America ever got, the USMCA, although in Canada, they call it the CUSMA or something like that. whatever. He said that it was a great deal. It was not appreciably that different from NAFTA, which it replaced. It had some other language cribbed from the Trans-Pacific Partnership, which was another trade deal that Donald Trump tore up that he said was terrible. But like, really, he just smushed together these two prior trade deals and slapped his name on it and said it was fantastic. Now, for whatever reason, he has decided he wants to go back to the drawing board. He's slapped a bunch of different tariffs on Canada in the past year, allegedly for sending fentanyl over the border. He's also accused them of facilitating imports made of forced labor or whatever, like a bunch of bullshit stuff, basically.

And so the United States and Canada have been negotiating, basically, with a gun held to Canada's head, how to get rid of some of these tariffs and come up with a new trade deal, which, again, was sort of apropos of nothing. It's not like there was something that happened that made us need to get this done. These negotiations have been going on for a little while. Allegedly, both sides, I think, had said that they were very close to a deal, a new deal. And then according to Mark Carney, the United States came in at the last moment and basically threw a bunch of poison pills in there, including demanding that some of the French cultural requirements get stripped, even though those are in the Constitution, the Canadian Constitution.

So there were things like that, and like the United States wanted to basically have kind of veto power over Canada's trade negotiations with other countries, essentially turning Canada into a vassal state of the United States. Was that confirmed? Because that seemed totally, totally ridiculous to me, that the United States would get veto power I mean, there are more nuances to it than that, but basically they had to follow whatever our trade policies were, at least. Why would they ever forfeit their sovereignty in that sense?

Donald Trump thinks that they, I mean, he's been saying for what, the past year plus that they should explicitly forfeit their sovereignty and become the 51st state. Yes, that's a good point. So it's intellectually consistent, I guess. I don't know that that's really the motivation here. I think they were just trying to bully the Canadians. And then there's been a bunch of reporting in the Times and I think the journal and some other places about how these were poison pill. Like maybe they didn't really expect Canada to accept any of this, that maybe this was all intended to blow up the deal because like the steel lobby of the United States was not happy with some of the terms there.

I don't have my own original reporting on any of this. So I don't actually know. But there are a bunch of theories about what happened. In any event, Donald Trump has escalated the situation rather than just like not coming to an agreement. he has said we're going to have tariffs on first it was it was a bunch of stuff related to like iconic canadian goods hockey sticks and things like that but also also stuff that americans buy you know furniture and lumber and we're already tariffing their steel and aluminum so there was that then he raced it up a notch and said we're going to start tariffing Canadian automobiles and

auto parts that stuff as i recall has not gone into a effect yet. The hockey stick basket of things, those tariffs have officially gone into effect. Okay. Auto stuff, that would be much more damaging, particularly if you look at how integrated the supply chain is over the U.S. Canadian border because of NAFTA and the USMCA, it would just like dramatically raise the cost of doing business and the race and the cost of making a car and buying a car because it would cross those borders. so many times. So all of that's, yeah. But Trump's been out there posting or talking about or

offering up a bunch of statistics around how lopsided U.S. trade is with Canada to begin with. And I would love for you to sort of put some truth serum out there. Yeah. So he's claimed that Canada conducts 95% of its business with the U.S. and that it's utterly dependent on the U.S. market. Is that like, I mean, I don't know. Is that remotely true? It doesn't seem possible about 95% of Canada's businesses with the United States? You know, to be honest, I don't know the numbers off the top of my head. That sounds high to me. 95%?

It would be like, I'm stirred. Well, I mean, I believe that we are by far their biggest trading partner. That makes sense. That's reasonable. Particularly because their most important export to the United States is energy. And so we have pipelines going between. So have they said they're going to cut off energy supplies to us? I know that there's something about the Alberta oil fields and concerns about that.

And I know there's a lot of politicians, U.S. politicians in states that border Canada who are deeply concerned about that. But is that yet taken effect? No, I mean, it hasn't happened, but Donald Trump certainly seems to be egging them on. Like he said, I think we have footage of this, but he said yesterday he was complaining about the size of our trade deficit with Canada. And he's tweeted similar stuff. Matt, can we play that clip? Yeah, let's play that. What would you say to those who are concerned of trade dispute with Canada could affect American affordability ahead of midterms?

Well, ultimately it's going to be very good for us because we're losing, when you talk about affordability, we're losing $62 billion a year on average with Canada. And if you really look at it, we're losing more than that. It's too much. It's too much. We can't lose that. We don't want to lose that. We don't want to lose it anymore. 62%? Is that right?

He says $62 billion is what he's saying. $6,000. Okay, I got you. Okay. So what he's saying there is that we lose money to Canada because we have a trade deficit with them. Oh, got. So this is wrong on so many different levels.

It's like the inception. Does he think we need to have trade surpluses with the entire globe? Is that? Yes. Yes. He clearly does. That he does, which is idiotic for lots of different reasons. I mean, the fact that you have a trade deficit with another country does not mean you're losing to them, does not mean that they are ripping you off.

As other people have pointed out, like, I have a trade deficit with the supermarket. I have a trade deficit with my dentist. It means that I am buying things from these counterparties and sending them money. And that's normal. We are not just sending $62 billion, which is not the right number, by the way, to Canada. we are getting stuff in exchange. Specifically, we are mostly getting oil. So that number that he cited is about the deficit in goods. If you actually include goods, services, all the things that go back and forth that shrinks it quite a bit. In fact, I think the numbers that I had looked up suggested that, yeah. So our overall trade deficit is like somewhere 20. something billion dollars. Okay. With Canada.

With Canada. Excuse me. Okay. With Canada. Now. I can't believe we're sending them $20 billion for nothing. Unbelievable. Well, I'm joking.

Our energy deficit, our energy trade deficit with Canada is like three to four times that. It's somewhere around $85 billion. So what that means is that outside of energy, the U.S. actually runs a solid net surplus. Ah. Okay. across all goods and services. They're mostly buying more stuff from us than we are from them, which we should not care about, but because Donald Trump does, I'm pointing it out. The issue is that the whole story behind the trade imbalance, if you've cared about it, is energy.

When Donald Trump is complaining about we are sending money to Canada and not getting anything forward or whatever, we're clearly getting something for it, but it's because of energy. So what he is basically doing when he complains about that deficit is he's inviting Canada to stop selling us energy. Right. Because that's what we depend on. And by the way, it's not just oil. Well, hold on. Yeah, go on.

So we've looked up the stats. Canada's exports to the U.S. are not 90-whatever percent. It's about 70 to 75 percent of all Canadian exports are to the U.S., which is a lot. It's a lot. But if Canada were to say, hey, all right, you don't want a trade deficit, we won't sell you oil. It's not that simple, right? I mean, they need other customers. Yeah.

Yeah. I mean, it would be painful for them, absolutely. Right. But Donald Trump seems to have no qualms about inflicting lots of pain on Americans so that he can. It would be painful for us, too, because we'd lose a, an incredible employer. They would lose out. This is what economists mean when they say there are mutual gains from trade. right, that we are all better off if we continue trading with each other and we have,

you know, collectively there are some, you know, individual winners and losers, but collectively we are better off if we can continue to buy the energy from Canada. We continue to sell, to pay money to Canada for the oil, for the hydropower. That was the other thing I was going to mention. New York City, where I live most of the time, is largely powered by hydropower from Quebec. actually there was a big new transmission line that was built or opened earlier this year about that. So like a million New York City households would lose their power potentially if they cut off that pipeline or that transmission line as well. So we're dependent on them, but we come out ahead.

Like we benefit, they benefit mutual gains from trade. Sure. Donald Trump has basically said he wants to punish everyone. Well, I mean, that's not what he thinks he's saying. He thinks, like, we're just punishing Canada if we put tariffs on them. No, we are hurt and they are hurt. If they cut us off from this very important product that we import, that they export, we are hurt and they are hurt. The question in all of these trade wars is basically who is willing to endure more pain. Well, yes and no. Well, yes and no, right? Like, now we're going away from the economics into the sort of geopolitics, which is, I mean, you tell me if you think my, I'm wrong here, but it does seem like world leaders have kind of wised up to this in two ways. One is they, a lot of them just assume that he'll taco and that when it comes down to it, he'll cut some deal that's basically status quo and say he's a great negotiator.

But the other thing is, I don't think they take the threat, and maybe relatedly, I don't think, I think they've prepared their economies better for the possibility that there's going to be some sort of, you know, friction with the United States. that, you know, Carney would give a pretty remarkable speech not so long ago where he talked about reorienting the Canadian economy away from the United States. And he had a tweet up, and I don't know if we can get it, if we can find it. It had to do with the renaming of Lake Ontario. But really, there's a part of it about how the United States was changing and that they had to realize that. And so I think it's just the reaction, the global and political reaction to what's happening now strikes me as fundamentally different than what we saw in, say, April 2025.

Yeah, I think that other countries, well, it's some combination of they are trying to figure out, can they wait him out, right? Like, are they going to make whatever concessions he wants them to make? And it's not even clear what concessions he wants to make. Here's the Carney tweet. Yeah. So it's the third graph that really stood out to me. We know that America is changing.

their trading relationships, their foreign policies, their national monuments, their hydrogonyms, which is a fancy word for bodies of water, names of bodies of water. So, yeah, I mean, he's just like, yeah, we know that this is. And it was almost like in a way he was just there saying, I'm not bothered by this. Like, this is just the reality that we live in, and I'm not shocked. And I feel like that's just fundamentally different than where we were a year ago. Yeah. I think you are seeing other countries, including Canada, reorienting.

themselves to other trading partners. As I've mentioned several times when I've talked with Andrew Eger about the U.S.-Canada trade war, it's been a little disturbing to me that favorability among Canadians for China has gone up so much. So at the same time that Canadians have a less favorable attitude towards Americans, that's been going down. The attitude towards China has been going up. And it's not like China has, you know, developed a more democratic system or less authoritarian policies or better human rights record or whatever. But they do maybe look like a little bit more reliable of a trading partner at the very least than the United States does, which is a horrible thing to say. And I do wonder like, so just in this example, I mentioned before that

Trump is trying to or has announced that he's going to tariff. automobiles and auto parts from Canada. I wonder, like, what does this mean in the long run for the Chinese EV business, which has been, you know, like BYD, for example. They make these, I've never been in one, but I've heard that these are, like, actually quite good, pretty, very cheap EVs. They're just churning them out. There's been this fear that they're going to, like, take over the global market because they're just so much better and so much less expensive than a lot of the competition. And to date, Canada has been, has, you know, had some hesitation about letting BYD or other Chinese automakers come in and sell freely to the Canadian market.

Well, now that we are, but that's partly because that that relationship between Ontario and Detroit was so tight. That supply chain was so tight. Now that we look less reliable, now that that supply chain is going to maybe have some more friction in it, maybe that's an opening. for China, for B-YID. Like there are so many longer-term implications about how our partners, including Canada, may be reorienting the choices that they make, the economic choices that they make and the diplomatic choices that they make because we have just thrown a grenade in what had been a very stable, mutually beneficial relationship. And the auto sector is just one example of all of this. Like, who knows what other kinds of opportunities.

opportunities Americans are going to miss out on and maybe China or other adversaries of the United States will benefit from. For folks who are interested in the EV portion of this conversation, Jonathan Cohen's written a lot about this, even prior to this, how we were shooting ourselves in the foot with EV competition in China. This will hurt it more. I am curious, two questions. One is, where's your cat? Like, why is the cat? Two is. He's upstairs. Okay. If you had to put your crystal ball, take it out, like, how does this get resolved? I mean, the most, I think the logical resolution is some sort of taco type. We got a deal, and it's just really the status quo. But what do you anticipate? I think that's the best possible scenario. There are a lot of ways in which this can go haywire, right? Particularly because, because, we are antagonizing China so much about energy. Like I don't know. Maybe Canada will do something dumb and or maybe it's strategically smart.

I don't know, but something painful at the very least like Korea. Cut off New York? I hope not. I live in New York. You know, that would be bad. First of all, when you said New York runs on, I thought you're going to say bagels. And then you went with Quebec energy. So, yeah, that would be bad.

That would be a definite middle finger. There are a lot of ways that this could go pretty badly. And one thing that I think I've talked about before as well is the fact that the feedback loop that has tempered Trump that has caused him to Taco in the past has been the market. Right. Like Trump does something catastrophically stupid like Liberation Day or whatever. Markets freak out. And then he pulls back. He moderates somehow.

How are the markets handling this? Fine. And I think it's because it's now this is the status quo. Right. And I think it's because there is this anticipation that he will taco. But because there is an anticipation that he will taco that may reduce the likelihood that he tacos. It's like a self-negating prophecy or whatever. That's what I'm worried about.

that it's like Trump is not getting the signals that he needs to demonstrate to him that this is really dumb. And he's obviously not getting that advice from his advisors because it's a bunch of yes men who just tell him everything he does. Although you do you do pick up some stuff here and there. Like I saw Jameson Greer, the U.S. Trade Representative von Fox. And they were, you know, they're talking. I think they're asking about the toilet paper crisis, which is actually not really a crisis. We looked into it. But what was interesting about Greer was he was just being like, you know, this isn't a big deal. Like we're not even really doing it on that many goods. Like he was trying, if you read the subtext, I know it is a big deal.

But if you read the subtext, he was really trying hard to be like, we're going to get this resolved. Don't worry. Like, we got to figure this out. And you get the sense that some people there understand the severity of it. It doesn't mean that Trump does. Yeah. My recollection is that Greer made those comments on CNBC or wherever some cable news channel. And then almost immediately afterward, Trump tweeted something to escalate, like said that they should be the 51st state.

whatever. The next day, Trump renamed Lake Ontario. So there's that. Speaking of, and we're going to move on from the segment, we did, because we, again, folks, we're doing all the hard work in journalism here. We are not leaving any stone unturned. We went to all the online maps of the lake to see if they have changed the name yet. So let's put them up one by one. Let's start with Google Maps. They've got Lake on, they haven't changed it yet. They haven't changed it yet. They haven't changed to get somebody in trouble, Sam. This is, I'm, this is a private company. I'm not trying to them in trouble. They can make their own decisions.

Yeah, no, but last time Trump yelled at all of these companies. Okay, well, and I will get them in trouble because now we have Apple Maps. Let's go. It's a little bit hard to read, but that definitely says Lake Ontario. First of all, what's your preferred online map? Well, hold on. Last one. MapQuest for the

traditionalists. Wow. Lake Ontario. They haven't changed it yet. Okay, what's your preferred online map? You know, I'm a MapQuest guy. I got to be honest. Really? No, I'm a Google Map guy. Okay, I was going to say. I was going to say, I've lost some respect for you, Sam.

Just the bridge too far. How could you? Yes, literally, a bridge too far. Yeah, I'm a Google Maps. You're Apple Maps? Okay. No, I don't want to, like, drive into the pond or whatever. You're not actually going to drive into the pond.

You might say you're in the pond, but you're not going to drive up. All right. Speaking of bodies of water, look at this transition. Let's talk about the trade of famoose. Okay. Wait, didn't he name this one? Didn't he call it the Strait of America or straight of Trump or something? I forget.

Did he? He might have floated. He floated the idea of renaming the Atlantic Ocean yesterday. No, but before that. I know what you're talking about it. They've talked about like, oh, we're going to name it the Strait of America. Yeah, I think they've definitely talked about it. I don't think, well, he can do whatever.

He could try to do whatever he wants. Probably put some executive order out there. Anyways, the straight, is it open? Is it not? So yesterday's set com? puts out some video that was very celebratory and very happy, where they declared that they have demined the Strait. There's some interesting wordage in there that I think you can pick up, but let's watch

the video. And then we're going to talk about whether or not this is just spent. The U.S. military has achieved a major milestone in the Strait of Hormuz. We have successfully cleared sea mines in the straits' international shipping lanes that were laid months ago by Iran's Islamic Revolutionary Guard Corps. Internationally recognized transit routes in the strait are free of Iranian sea mines thanks to the incredible work of the U.S. military. Okay, so I'm not like a total expert on this.

But the people I've read about this have said they have no reason to doubt it. And in fact, they think it's probably true. But it's not the full straight one. Two is it doesn't accommodate for the possibility that they didn't know where every mine was or that there are mines still floating. There are what they call ghost mines. Or that Iran could, in fact, go back in and continue to mine the straight or that there's other ways to go after ships that are trying navigate. Yeah. So it is an achievement, but this fits into a larger context of the administration trying its best to encourage energy companies to use the street.

straight and without fear. And we've seen it in a couple of occasions. Donald Trump has talked openly about it. We have Axios doing reports. Axios has gone from reporting about how close a peace deal is to how open the straight is. They seem to be on the cutting edge of calming the markets. There's the headline that Sucker is open. The U.S. gains the upper hand in the battle for Homoos. And yet the actual data shows that it's not open. Or at least, it's not as open as it once was. So I'll shut up as I get the data oriented. But what are your thoughts on this?

Yeah, well, a few different things. Fewer ships are going through. Less oil is going through. Even if all of that is true that the mines were gone, it doesn't seem to have actually convinced private companies or their insurers that it is worth transiting the strait. And before the war, something like 20 million barrels of oil were transiting the straight every day. The journal had a piece, I think, saying that people who are, like, actually paid to track how much oil is going through are finding, what was it, like, two to six million barrels a day?

Yeah. So the journal has, I don't know, do we have it up? Well, I can read it to you. Yeah, read it. Yeah, they say that the count from comprehensive. commercial ship trackers tells a different story with estimates ranging from roughly 2 million to 6 million barrels a day. Industry figures on the amount of crude oil and oil products being loaded onto ships in the Persian Gulf and delivered to buyers don't corroborate U.S. claims. So what matters is not that Donald Trump and those answering to him say that it's safe and that oil is getting through.

What matters is what private companies and the people that they employ and the companies that ensure them think is safe and possible and worth whatever cost-benefit analysis that they are doing to actually send ships through, send these tankers through this rate. And that does not seem to be happening. And forgive me if people might be a little bit skeptical of the information coming out of this administration, the official statements coming out of this administration. Right. You know, there's a, there's a rule of thumb that I think of quite frequently during this administration that I may have talked about before, but it's, I call it the Gouldsby rule. It's named for

Austin. Austin. Yeah, you know Austin. So he's now the president of the Chicago Fed. He said this beforehand. But he he said basically some version of when you lose your credibility, the things you say start to mean the opposite of what you intend them to mean. And so when you have an administration that has consistently lied about things big and small, crowd sizes, measles counts, you know, voter fraud, everything in between, when they lie repeatedly about things, it means that when you really need the world to trust what they are saying, people won't. And so I think it is quite reasonable that this assurance of,

alone from Centcom, from the White House may not be sufficient to convince private companies that it is worth their while, that they will not get blown up by mines or by drones or otherwise antagonized to go through. And so they'll just say, screw it. I think the private companies are one audience that they're trying to convince, but I don't think it's the full audience. I think they're trying to convince the markets. I think they're trying to present this non-reality that everything is copacetic back to normal and you shouldn't worry about the war anymore, that we can live with whatever the status quo is right now with Iran because we've done the hard work and we've gotten the mines out there and shipping is happening all over again.

So you look at Scott Besson, treasure sector, he puts this tweet up, okay? The blockaded and operation economic outcast will crush the failing Iranian economy. The U.S. has guided 130 million barrels out over the past 14 days while Iran has done zero. And it's like, okay, I look at that. That seems cool and I'm happy and maybe things are growing. And then you actually do the math and it doesn't take much. You're like, okay, but if we're doing 20 million barrels a day, that would amount to about 280. And now they're crowing over 130.

And then you add on to that all the efforts that have gone into and still go into ensuring that ships can get into and out of the street. and upholding that blockade and monitoring the Iranians so they don't mind the straight again. And you're talking real investments here. And on top of that, the Strategic Petroleum Reserve is at incredible lows. And they're just leaving all that stuff out for obvious reasons. And I think they're just doing it because they want to convince the markets not to crash. Yeah, but that's not going to work. It's worked so far.

It's worked so far. I mean, oil prices are high. Yes, but the markets are not like, I mean, we all thought that. That is the market. What market are you talking about? I'm talking about the stock market. Okay, the stock market. Like the larger markets, sorry.

Because I'm going to say, I don't know what oil prices are right now. We can look that up. But one second. Crude prices. This is the beauty of life. Yeah, I mean, they're still not that high. 88. Yeah, this is nothing like it was at the peak during the Iran.

Yeah. It's not as bad as the peak. Yeah. I think it's still above where it was pre-war. if I recall correctly. Sure. In any event, yeah, there is this real question about why stock markets have held up, and is it because of faith in Trump and the economy,

is it despite deteriorating faith in Trump and the economy? And I think it's mostly the latter. I think that the AI boom slash bubble is doing a lot of the hard work. in pushing up prices. But I agree. It's like I have not really understood, candidly, why equity markets have been so copacetic throughout all of this. Again, not just the war, but the trade wars and all of the other erratic behavior and threats to rule of law and tainting of statistical data that traders rely on. Like, there are so many reasons why I feel like all of these problems, should be reflected with bigger pain in the stock market.

And you haven't seen it. And I don't entirely know why. I will say that the bond market is a different story. All right. Expamining that. So the bond market is freaking out more than the stock market. And I think that's some combination of like we have a lot of debt. And so if we have a lot of debt, we have a lot of inflation still that the Fed has not been able

to ring out of the economy. And I think that there is actually a kind of a credibility crisis that Treasury and potentially the Fed are going through right now. And the bond market, maybe there's like less dumb money floating around. I don't know than in the stock market. You know, maybe there are fewer like whatever, you know, retired dentists and and other like casual like retail traders. I don't know. And maybe they're just more professional types in the bond market, but you do see yields higher, certainly than they were a few months ago when Scott Bessent tried to intervene in the bond market and bring those long-term rates, those bond yields down. It backfired. So you do see more jitters, if not outright panic in the bond market than you do

in the stock market. And maybe that's something like, I don't, I don't want to say. say it's comforting, but maybe it feels a little more rational than what's happening in the stock market. But, like, again, I don't know how much of this is AI and how much of this is just like people are still playing music until, you know, while the, I don't know what the metaphor is, but it's like they're dancing while the party is still going up. I think it's part of that. I think it's part of that. I think it's part of that. Something like that. Well, it is, I guess it is kind of crazy to me how much we basically, it's not that we've backburned it, although I guess it is because the war obviously is still going on, but no one really, nothing's happening. We're just in this moment.

Strategic Patrol and Reserve, lowest since November, 1982. We can put up the graph there for folks watching. You can see, it's, and that downward turn right at the very end, that's, that's all, that's all the war. Yeah, I mean, I'm old enough to remember when Donald Trump was, yelling at Donald Trump and other MAGA people were yelling at Biden, right, for drawing down the Strategic Petroleum Reserve, which they did, in part because there was a different war that's still ongoing, the Russia-Ukraine war, and that was screwing up global oil markets. And so, like, they did draw on the Strategic Petroleum Reserve at the time, in part to, like, equilibrium, you know, to, like, counteract the fact that there are all these supply disruptions. And

Republicans were like, oh, that's too political. Like, we need to say. And, you know, to say, that for a real emergency. And now obviously Donald Trump is going a few steps beyond. Yeah. Just taking a big straw and sucking it all up. As for the cost of career pre-war was $72. There you go. So it is up, but it was over 100 and definitely not there now.

All right. Last topic before I'll let you go. There's like a slew of corruption stories. And it's kind of, you know, these are like a dime a dozen. But I do think it's incumbent upon us. commentary on the world. I know. I do think it's incumbent upon us to actually talk about them.

There was three that we spotlighted. I have my favorite. I don't know if you have yours from the doc that we're working out of. There's two really that I really want to talk about. One is the crypto bank, which is basically this Abu Dhabi Royal has invested insane amounts of money in World Liberty Financial, which is the company that the Trump family more or less runs and operates. The other one that I thought was really.

really crazy was the prediction market story. So basically Don Jr., who has a stake in, was a Calci. I think he must take Calci and in Polly Market. He goes in front of the attorney generals, the state attorney generals, and he starts berating them to like not, you know, not crack down on these prediction markets and overregulate them. And it's just, you can read it there. Mr. Trump, in this case, is not the president. It's Donald Trump Jr. So it says, and I'll read it to the people who are listening and are watching. Sitting on stage for question-and-answer session with Montana's Attorney General, Mr. Trump, that Donald Trump Jr., suggested that state leaders were being led astray by vested interest,

gambling firms that wanted to protect their monopolies by attacking prediction markets for people familiar with their remarks said. In reality, he said the markets already had robust oversight, describing them as a sophisticated financial tool overseen by federal officials, not state attorneys general. Mr. Trump's tone was friendly. that people said, but his comments which have not been previously reported dovetield, where the message his father's administration has sent to state leaders back off.

It does strike me as like, the son is basically giving them a warning. My dad's going to come down on you. Yeah. And in this case, it's probably pretty intimidating. There is a real conflict. I mean, there are legitimate issues here about whether states or the feds should be regulating these markets. And the prediction market companies like Kalshi and Polymarket and others have argued like, well, we shouldn't have this patchwork, regulatory regimes. It shouldn't be different in Texas versus Idaho versus Vermont or whatever.

Yeah. The problem, and I understand that, the problem with that argument is that that is how gambling is regulated right now. Like if you talk about sports betting, for example, that's done at the state level, those regulations. generally. The federal government has a relatively light hand. And there's some conflicts between how states have regulated, again, this form of gambling, like sports betting or slot machines or whatever, and what is allowable on these sites. Now, the sites will say that, like, they're a sophisticated commodity market. It's not the same thing as gambling, whatever. But, like, I don't know if you're making a bet on the outcome of an athletic match. I don't know that it's really that different

from a consumer's point of view at the very least. And so there are a lot of states. I think it's I looked it up before. There are, I don't know, in all but a few states, no one younger than 21, for example, can play sports bets. But on Kalshi, the app is available to anyone over the age of 18. So like, how do you reconcile those things if you're in a state that says you can't place a sports bet, but you can do it on Caltech. It just seems like there's some, at the very least, regulatory arbitrage that's going on that needs to be resolved. And I'm not a lawyer. I don't have very strong informed opinions about the right way to resolve it. I will tell you that I would not go to Donald Trump Jr. for advice on the right way to resolve it because he clearly has a vested

interest. You know, in that quote that you read where he's talking about like all of these vested interests or trying to influence the outcome. It's like you, buddy. It's like, yeah, most of them don't have daddy in the White House. I know. It's a remarkable thing. It's very stinky, yeah. Think about it like in a more traditional setting.

Like, let's say Donald Trump Jr. was not, you know, was on the board of a, you know, defense company. And he went to all the lawmakers and not the attorney generals on the, you know, defense Appropriations Committee. And he told them, you shouldn't buy any of the other companies because they're bad. But so just don't buy them. We'd be like, that's insane behavior. Like, you're basically using your ties to your father to benefit yourself.

And that's what's happening here. Just to be clear, the Trump administration has already started cracking down on this stuff. Like they didn't need DJTJ to weigh in and suggest it openly. So the Trump administration has said that the CFTC, which regulates commodities, should be the only game in town for regulating prediction markets. And the CFTC was set up in 1974. This is something else I think I pulled from, I forget if it was a journal article. I think it was a journal article. In the half century since it was set up, the CFTC had never sued a state over regulatory issues.

This year it has sued nine states, all led by Democratic governors. And twice, the agency has instructed prediction markets to sidestep court orders invoking emergency powers that it had not used for decades. And so they're coming down on the side of less regulation, I presume. Yeah. Yeah, they're basically saying only the feds can regulate, by which we mean not regulate at all, these markets. The states cannot. And when the states try Donald Trump senior, the guy in the White House, will sue via the, the CFTC. And so Don Jr. is like basically saying, my dad's going to come after you,

which is credible because his dad is already coming after them. I've never heard you use DJTJ before. I like it. Oh, DJT. I should use that. Don Jr. Yeah, I get it. I'm aware of the acronym. It's nice. I like it. Anecdotally, I don't know if you've experienced this, but I've way more friends who are like just casually betting on things these days. Do you?

I mean, it's mostly sports, honestly. I don't know, to be honest. I think... I have friends who are like in the middle of games will like re-bet on the games and the outcomes and weight. And they're like, you know, they're admittedly like, yeah, I'm kind of addicted to it. And it's weird. It's like it's an addictive thing, obviously. But obviously this stuff is proliferating in ways that I don't think we appreciate.

And I'm seeing it in my own life. I stay away from that shit. I'm too anxious to do that. Yeah, I'm not a gambler. And also, I don't really, I'm not invested in anything athletic. So maybe that shields me from some of this stuff. You can bet on a bunch of shit. I know, I know.

You could bet on the Tony Award winners and shit like that. Yeah, they have markets on all of that stuff. But I am not partaking. Okay. Before we go to the cleanup stuff in the tour dates, because we have a tour coming about on and announce the details. Kevin Warsh did speak this morning, and I'm sorry that you have to cover this, man. I really genuinely feel bad for you because people understand in journalism,

it's great to cover the crazy figures, and I guess that's partially why Trump is, you know, he gets pressed, but it's like people genuinely like covering Trump, even though he's horrible. Kevin Warsh is the antithesis of that. He says nothing. It's like reading like a scroll in a different language that you're not familiar with. So what do you say? That's the job of every Fed official. Their job is to never make news. That's their job.

He's very good at it. He's screwing up. Well, he isn't. He's good at not making news. I don't actually think that's true. I think he is trying to not make news. But if you look at his last press conference, he made quite a bit of news unintentionally by suggesting, for example, that the Fed was maybe going to change the yardstick that

uses for measuring inflation. That would be like a very big deal. He kind of said it in an offhand comment. Maybe going to. Maybe. Yeah, well, but that's like freaked out markets because they're like, well, is this a backdoor way to like not be as tough on inflation. I mean, there are a bunch of things that I think he didn't mean to say. The best Fed officials are the ones who have very control, I mean, from the perspective, not from a journalist's perspective, from the perspective of like what's good for markets and the economy. The best Fed officials are the ones that like stay on message that like project calm seem like they know what they are doing.

And I don't know that Warsh did that at least at his last press conference. Today he kind of said nothing. And I guess that I mean, the thing that I was hoping. He said inflation was still worrisome. Okay. Great. And he made one little cutesy joke about like, you can. call what I'm about to tell you, I'm going to tell you what my speech is about. You can call it an

outline. You can call it a framework, but don't call it forward guidance, which is a joke for econ nerds because they've, they've not been giving forward guidance between something else. I mean, I did you chuckle. I did not, but it's, it made it into every write-up of the speech. So I guess he did his job that he distracted people from like the actual potential credibility crisis that our financial policy. Oh, that Kevin Warsh with his one-liners. I know. Well, the thing that I wanted him to address and that I think a lot of other people were hoping that he would address is how the Fed is viewing these Bessent bond buybacks because it really seems like the Treasury, you know, Scott Besson is his Treasury Secretary, it seems like Treasury is kind of like homing in on the Fed's turf because the Fed is supposed to be the one that's like setting interest rates, mostly the short-term interest rates, but they also do things to affect long-term interest rates.

like buying and selling long-term bonds. And now Besant is getting in on that. And so, like, there's this question about who's in charge, and he didn't get into any of that. So a lot of unresolved questions. Well, we don't need to belabor it and try to figure out or divine what he was trying to say. It's just the world we live in.

But for folks who do want to get a better understanding of the economy, they should subscribe to your newsletter. You had a great one, let the fuck around, find out economy. Of course, because you're too polite. Like saying the word fuck in the text. So I'm going to say, I'm not going to make you say it. F-A-F-O. Catherine doesn't like to swear.

And every time I try to put a swear in her text. No, it's true. Let's be honest. Every time I try to put a swear in your copy, you're like, take that out. So I'm not going to do it anymore. It's true. Are you denying it? I've definitely said bullshit a bunch of times.

I swear, Catherine. You know, it's interesting. So I used to work at the Washington Post. Right? And I was a columnist there for many years. And I was kind of used to this world where like, I could say outrageous things in my initial draft and knowing that editors would pull me back. And that doesn't. It's the opposite here. So I have to like be a little bit more careful because it's like sometimes I'll put in something like bullshit in my draft figuring that I'll change it. You know, like, oh, I'll come up with some better or less crass way to say the thing that I'm trying to say. And then it just lives there and that's okay. It lives there and I'm like, actually, can we go a little harder? Yeah, all right, I'll stop doing that.

All right, quick note before I let you go, this is for folks who are the real sickos out there who like seeing us in live as opposed to on YouTube. Actually, I will say having done a couple of these, the live shows are awesome. Like they are totally different experience, so much energy in the room. It's fun. You get like to be around others. We do different segments, have different games. It's a genuinely fun experience.

And we're always hanging around and you got a chance to talk to us on occasion. So if you're in these three cities, Columbia, South Carolina, Charlotte, North Carolina, and Atlanta, Georgia, those are the three stops on what we are calling the good fight tour. It's this October. Catherine's going to be in one of those. Which one are you going to be in? Do you remember? Charlotte. Yeah, you're in Charlotte.

So we got Columbia, South Carolina, on October 16th. Charlotte, North Carolina on October 18th, and Atlanta, Georgia. On the 20th, you can get tickets right now. You can see it on the website, the bulwark.com slash events. I would highly recommend if you can make it to come and do one of these events. It's a great way to ramp up for the midterms, meet the gang, have good evening. Tickets at sale, the bulwark.com slash events. All right, Catherine, thanks so much.

Really appreciate it. Take care. We'll see you soon.