Bulwark Takes - Trump Says Strait Is Open, Wants to Cut Iran a $20B Check | Receipts LIVE

Episode Date: April 17, 2026

JVL and Catherine Rampell are going live to cover Trump's announcement that the Strait of Hormuz is open, the potential $20B Iran could get from the U.S., and Catherine's latest reporting on the White House blaming corporate greed for their economic woes.Read more from Catherine's newsletter here: https://www.thebulwark.com/p/when-all-else-fails-just-blame-corporate-greed-greedflationRead more from JVL's Triad here: https://www.thebulwark.com/p/a-trump-madman-theory-of-the-stock-market

Hello, everyone. This is JVL, Future Webby Award winner with my dear friend, Catherine Rampel, author of The Receipts Newsletter, and we're going to talk about economics and the things that are happening in the world of money, because, as we've discovered every Friday, there's always good stuff happening, Catherine. And today's stuff is that the The Strait of Iran is open. It is the straight of Iran, which is what he said right there. You see it right there. He calls it the straight of Iran.

It's like the Gulf of America. Maybe that's part of what they get out of the deal. We're going to remove it for them. I hadn't considered that. That's a good theory. It is fully open, ready for business. We then had confirmation in a follow-up tweet from the president about 20 minutes after that. See, this is art of the deal.

He calls it the Strait of Iran first, and then he calls it the Strait of the Hormuz to keep them off balance, Catherine. That's called negotiation. The art of the deal right there. Naval blockade is still in full force, though, until such time as our transaction with Iran is 100% complete. Is it strange to talk about the negotiation for the end of a war that you start

as a transaction? You don't think this is part of the just war doctrine? I don't believe that's how typically Catholic theologians have talked about just war theory. I mean, Trump knows more than the Pope, so I would defer to his judgment here. Yeah, it does seem quite odd, particularly since once again we don't really know what the objective of this war has been, is or will be, but we just know it is a transaction of some kind. And a transaction, of course, implies, if not something monetary, although there is some monetary transaction that is being discussed here. Certainly something a little bit crasser than national security or the

freedom of the Iranian people or anything else. But look, this is Trump's a dealmaker. You know, it's a deal, it's a transaction, it's a negotiation. It's not about world peace or civil liberties or anything else. Do you remember all that talk about the freedom for the Iranian people that was in the first like 24 hours of this thing? I do. As far as I can tell, it's gone. Yeah. Yeah, I mean, it's been interesting.

I don't know if you've been following any of the shatter from like the Iranian diaspora. I am not. I'm curious. Yeah, but I mean, I'm far from an ex-exam. expert on this, but I have read some, I've talked with some, you know, friends who are, who are part of that, uh, who may or may not be representative, but there's also been news coverage about it, uh, about how there were a lot of members of the Iranian diaspora who were very hawkish, you know, advocating for war, thought that Donald Trump would, uh, would help their people

and are now disillusioned, understandably, because that, perhaps, That felt that objective, if it ever was, one fell by the wayside long ago. Perhaps like the people who had been struggling for freedom in Venezuela. Yes. Or the people who wanted prices to go down here. I mean, there are a lot of people who thought they had, they thought that they had something nice coming to them because Donald Trump said as much. And now we've moved on.

So let's talk about the money. It's all about the money. What will this mean? And partly I ask because it seems to me like financial markets had already priced in the straight being reopened and the war being over. Because for the last week, we've had a series of like all-time highs in the S&P 500. And we even had oil futures go backwards a little bit while the straight was closed. And so is that the market's just pricing in already? the idea of this or

honestly I am genuinely perplexed by what is happening in markets in that it seems much more euphoric certainly than reality thus far pardon

than more euphoric than rational well I mean markets there's this idea of like animal spirits in the in the stock market and irrational behavior and things like that this is not entirely new but it it does

seem particularly untethered to real developments on the ground. And I've seen other people who are, you know, like full-time market reporters kind of try to puzzle through this as well. And the general pattern seems to be that when there's bad news, there's a relatively muted reaction to the downside. And then when there is maybe good news or the prospect of good news at the very least, there's a huge upside overreaction. And it's a little bit, I think somebody, I forget who it was, somebody Bloomberg wrote something to the effect of, you know, it's, it's FOMO. It's like market participants have been conditioned to buy the dip and that they don't want

to be the ones missing out on the rally. And so that seems to be feeding some not super, rationales of the wrong, you know, know, I feel weird calling it rational or irrational, but it seems to be feeding some more over-optimistic behavior at the very least. And it's not just me that is saying that because, you know, I have TDS or whatever. If you look at long-term patterns, if you look at Bob Schiller, who was a Nobel economic prize winner, he has this long-running measure, called CAPE. It's the cyclically adjusted price to earnings ratio. And it's basically a way of looking at do stocks seem overvalued or undervalued relative to how much the underlying companies are

making? And right now they seem way overvalued. Like the level of the stock market relative to how much the companies in the stock market are actually earning looks way out of whack. Like it hasn't been this high since the 2000.com. Early 2000. Yeah. Yeah. I have that chart in my newsletter today, actually. Oh, did you?

I'm sorry. Just as we, no, it's okay. It was published. I haven't seen it yet. I haven't seen yet. I'm sorry. No, it's okay.

Because I actually, I mean, I didn't mean for us to talk about this, but I actually have my own theory as to what's going on. Oh, what's your theory? Tell me, tell me. I'll stop. It is madman theory.

And it is the, in the way that Trump supporters said, actually, it's good that he's such a crazy person in foreign relations because this keeps everybody else off balance. That turned out not to be true, as we've discovered with Iran. But what if that was true for financial markets? And what if having a guy who creates chaos constantly, right? What is chaos? Chaos is risk. And if there's risk everywhere all the time, then there isn't actually any risk, right? And so, you know, if everything is risk,

then when he does something crazy and things look bad, you would get a muted reaction, right? I mean, the markets would be like, it's not great, but also there's always stuff like that. And then when you had your moments of non-chaos, your moments in normalcy, you'd expect the markets to go gangbusters. So this is, anyway, I've explicated it's some greater length

in the triad, Anybody who is watching this might want to go. Who's a better colleague to JVL will read it. Yes, I will read it immediately after this. I'm sorry. That's okay. No, literally it came out as we were hopping on. Okay.

I want to talk to me about where do you think this optimism holds and do we think this version of the ceasefire holds? I kind of do. I have assumed that we were at the end game and that Trump just had to basically drag out the negotiations because the initial reactions were so like, holy shit, Trump caved. And he had to make it look like, no, I didn't actually cave. Don't worry.

Do you have any thoughts on that? I don't know. I've kind of given up making predictions about this. I feel like we've been hearing for a couple of weeks that certainly the administration and Trump himself will say this thing is almost over. generally these statements are made when markets are having at least their muted reaction to the downside or oil markets are spiking or whatever. So I feel like we've kind of heard this before. I don't really have a good enough sense of the players involved to know if it's credible this time.

I think the real question going forward is that even if this ceasefire does not expire, I forget the exact date, but sometime next week and that it persists and that there is some kind of indefinite detente. What does that mean for global supply chains going forward? Because now that we have seen that the straight can be closed, it is a known risk that it can be closed again, if that makes sense. Can't unsee it, yeah, you can't. Exactly.

You can't unsee it. And so what does that mean for insurers who may be worried about their ships, you about backing ships that are going through. What does it mean for other parts of the supply chain? I think there'll be some adaptations like more pipelines coming out of the Gulf as opposed to relying on a strait that can again be closed. Maybe the pipelines are harder to blow up or whatever, you know, harder to disrupt. So I think there will be some adaptation that maybe is fine.

It will be costly in the near term. but maybe it'll be fine. But I think that I do wonder, like, even if this is the end, it's not really the end and how much damage have we done in the meantime. So it's like it's almost a, not that it's a moot question about whether this is it, but it's, I think there is no way for this to ever be it because we have now permanently disrupted supply chains in that region. We have once again tarnished our relationships with allies around the world, not just those in Gulf states that have sustained attacks, mostly from Iran through all of this, and from Israel, of course, but also like our allies in Europe. There was a story in, what was it, CNBC yesterday,

about how the IEA warned that, yeah, exactly, Europe may have just six weeks left, of jet fuel. Yeah. Like that's, that's insane that they might run out of jet fuel, which is obviously a critical component for jets, for, for any kind of commercial air travel. And again, maybe the straight reopens and maybe that disruption goes away, at least temporarily.

But like, how much damage have we done in the meantime? So I hope the war, I hope the bombing stops. I hope people stop. all of those things that would be obviously the first order priority but like I don't

I have a pretty believe you of what has yeah okay sorry I've correct myself because I said something it wasn't true I said that you can't unsee this and it turns out that that actually is not the case Matt if you could show us

so Don Trump says that Iran has agreed to never close it again and so guys we don't have to worry problem solved. They've agreed not to do it. Yeah, I'm sure all of the insurers are totally going to take Trump's word for that, right? Or the Iranians word for that, right? Like, this is the funny, you know. So one of the sticking points on the deal seems to be about Iran's stock of enriched uranium.

they have like 400 or so kilograms of 60% or more enriched uranium. It seems from reporting that America might be willing to purchase that from them to the tune of $20 billion, which would be something that Donald Trump criticized the Obama administration for doing. It's okay. But at a much greater scale. You're so snickety, JVL. But it seems to be the fight is over, I'm sorry, the negotiation, the transaction is over how long then Iran would agree to not enrich uranium. And so it seems as though the United States from reporting wants them to agree to not do it for five years. And the Iranians, I'm sorry, for 20 years and the Iranians want to agree to not do it for five years.

As I have said from the beginning, any part of this that is about, any part of this settlement, which is about agreements that one side or the other makes is meaningless because agreements are meaningless. Like, you know, Iran could say 10 years, we won't do it. That doesn't mean they actually won't do it, right? I mean, you have to decide, are we going to have a verifications regime, or we're going to agree to abandon snapback sanctions, in case there are violations. Could the Russians enrich uranium for them and then ship it to them, right? Which is a thing which has been talked about.

But the point of this is that the rationale that this was all about forever removing the possibility of nuclear weapons sort of collapses too. Because even if what we're talking about, even if you take everybody at their word and Trump gets exactly what he wants, we're only kicking the can down the road for 20 years. Yeah, I mean, Trump can barely think past the next 30 seconds. He's kind of like a goldfish. So 20 years may seem indefinite to him. I think the bigger issue is exactly what you pointed out, which is how do you enforce something like this, particularly when we have been proven under this administration to not be able to stick to our word. And a gentleman's agreement, a handshake agreement, a piece of paper, whatever this looks like, it won't be worth anything. if there is not some sort of enforcement mechanism? I'm curious, do you think that, is there an enforcement mechanism that you would trust or that you think should be on the table? What's funny here is that the Iranians must understand that Trump doesn't want to enforce any agreement.

Trump wants to make the agreement and walk away and never think about this again. And he does not want to wind up in a position. where he finds violations and then has to do something about it. For Trump, the binary, if Iran wound up getting a nuclear weapon, like if they test a nuclear device and prove that they have one, he could live with that politically. Like, just like, you know, that wouldn't hurt. What he can't live with politically is having to go in and do this again

after the pain he just, you know, absorbed. And after having seen what Iran can do. So I could very easily see a situation in which we get a deal, the Iranians promise, we will not do anything for X years. And there will be some sort of superficial enforcement mechanism. But again, Trump is incentivized. It's like COVID. If you don't test, there are no cases. If you don't enforce, then they're not doing any enrichment.

Yeah. So, yeah, that's what we're right. It's about it that way. Yeah, but then the question becomes, again, how does everybody else perceive the risk in all of this? I guess I think you were probably right on Trump's motivations. But then what about market participants? What about people like Lindsey Graham, you know, the people who are agitating for this? What does Netanyahu think about all of this to the extent that he continues to have influence over Trump? And I imagine that there's that may be somewhat less effective these days, post-invasion. I don't know. But yeah, the question is, what is like, what do the Saudis think? Yeah, another great point. Would the Saudis be okay with that?

Because they have to live with this shit. Right, right, exactly. This is across the street for them. Yeah, yeah. They're like the enthusiasts like Lindsay Graham, and then there are the people who might actually bear the consequences of, not enforcing this agreement. And I don't know.

I don't, yeah, that's an interesting analysis. They may, they may discover, it's possible, they may discover that Donald Trump doesn't really care what they think and that he'll have him to take care of his own problems. Weird. That's improbable. Weird. I'm just looking at the, for the CNN report on this,

is that the administration is considering unfreezing $20 billion of Iranian assets. And this is after Trump went crazy because the J. J.POC, how do you? JPOA. The JPOA was, I think, we unfroze $1.2 billion. So, you know, only 20X. Yeah, whatever. I mean, there's been some inflation since then.

It's a cost of living. You know, when you're, when you. Cost of living increase. Exactly. Good in real dollars. For the payoff to Iran. Do it in real dollars. You're right.

You're obviously right. On some level, the hypocrisy, lack of consistency. It's caring about it almost feels quaint. I wish that we're not the case. But I just take it for granted. Yeah, it is where we are. There's a double standard. Yes, exactly.

It is where we are. So I would like to talk with you about your truly wonderful newsletter yesterday. Again, if you are not receiving Catherine Rempel's receipts newsletter, go sign up. I'm sure we have a link down in the YouTube description or go to the bulwark.com and sign up. It was about the very funny sort of socialist stuff that is coming out of this super-duper free market administration where you have the president and the Secretary of Treasury saying that they are really keeping an eye

on people selling gas and people selling fertilizers to make sure that they only sell those goods at prices that the government approves of. Yes. Yes. You talked through a little bit about this. Yeah, not from Comra. God bid. If Zohan Mamdani opens up five community-run grocery stores, that's socialism.

Yeah. However, again, it's like I realize it. I realize it's like almost a little bit quaint to fixate on the hypocrisy here. But I am old enough to remember that when Kamala Harris proposed as part of her economic policy launch, a version of what certainly seemed like price controls, and when Joe Biden jawbone oil companies or really retail gas stations to try and get them to lower their gas prices, anything that's that smacked of not understanding supply and demand of intervening in markets. in suggesting that the government should exert pressure or even control over how markets price things was mocked. I mean, I mocked some of it because I thought it was economically illiterate and basically, you know, early sloppelism.

And certainly that was the case with a lot of the greedflation stuff that we saw even prior to that, not just from Biden and Kamala Harris, but kind of led by people like Elizabeth Warren, that it was much easier to scapegoat corporate greed than to give, well, certainly the more technical analysis of like why prices are rising because supply and demand are out of whack, but also that might implicate some of the policies that Democrats had adopted that on the margin, I think, worsened that mismatch between supply and demand and therefore worsened inflation, which was already going to happen anyway. In any event, there was a lot of criticism of that line of rhetoric from economic commentators like me,

but also from Republicans because they, I know, surprise, because this was supposed to be a sign of socialism, of the economic illiteracy of Democrats, et cetera, et cetera. And lo and behold, Donald Trump is suggesting pretty much the exact same policies. I mean, in some cases, it's, I almost have deja vu because it's like almost the exact same complaints and rants and jawboning from Trump, from Scott Bessent, from other people in this administration that I heard from Biden, that I remember arguing with people in the Biden administration about rockets and feathers, which is this concept about gas prices shoot up quickly on the way up. and then they fall down slowly on the way down. And this is a known phenomenon and we can get into

why it happens. But it's a known phenomenon that always drives presidents crazy and they just yell at the gas stations and that's not going to do anything. And lo and behold, Scott Bessent said basically the same thing that Donald Trump is going to yell at the bad actors who don't cut their prices quickly enough. So it's exactly the same stuff. And Republicans, of course, are not nowhere to be found in critiques of this alongside, you know, any critiques of other, uh, whatever you want to call it Trumpian socialism or command and control style instincts for the economy that Donald Trump has adopted. This is certainly not the first of those that, that he has done or that they have remained silent on, but they are nowhere to be found. And Democrats are in this

kind of odd situation where there should be a layup for them, right? They should be able to say, God, Donald Trump is responsible for raising prices in a way that is much truer today than was ever true of Democrats a few years ago. Even if, as I said, Democrats were not completely blameless, much easier to pin the blame on Donald Trump today for raising prices across the board. And yet, he's trying to scapegoat corporate greed as this, you know, sort of, it's an easy out for him, right? because he doesn't he wants to deflect from what he's actually done but democrats can't say that because they do the same thing and they're in this tricky situation and i i just hope that there is like some enlightenment about all of this um not only because it's like on enlightenment no i know if if the bet is enlightenment or not enlightenment i will always take me under

yeah that's fair uh and and my i guess the more serious point i should make is that This is not just about silly rhetoric. I think the real problem is when you have policymakers who get kind of high on their own supply. And then they actually do try to impose price controls or similar measures. It's one thing if they say a bunch of silly stuff and they launch a bunch of performative antitrust investigations, which, by the way, both Trump and Biden did have done prior presidents have as well every time there's like a increase in gas prices, prior administrations or other politicians have sick to the FTC to do a, like a meaningless anti-trust investigation. That's wasteful and it won't do anything, but it's much less harmful

than actually imposing some form of price controls in these kinds of, you know, these commodity markets. So that's what I'm more concerned about. And again, maybe enlightenment is too much to hope for. But at the very least, greater caution against taking their own, their own bullshit so seriously. A better response might be government investment renewables or something like that. Yeah. That is like if you want a policy response to, ooh, energy now, it doesn't help in the near term, because this is a long tail spix. Yeah. Yeah. But the problem with that is you can do that the way the Biden administration does. And then the next administration comes in as Trump has done and just takes it all away. And so I do think just as a matter of politics, there's a pretty obvious answer for Democrats,

which is we are in favor of using the power of the government to make life easier for consumers when there are exogenous shocks. Yeah. Not when there are shocks that the president causes, right? This is, you know, like this shock is because he decided. you want to fix prices, stop the war, right? Don't, don't go. So I mean, that's a reasonable thing. I mean, there are other things that. I was going to say there are other things that Democrats could do on the price front

that are, you know, not related to the war, but are related to stuff that Donald Trump has done. So I'm thinking things like Trump and the Republicans allowing the enhanced premium tax credits for people who are on marketplace insurance plans to lapse. And that's not a market that I think it resembles anything like a free market. I don't want to suggest that like all of these markets, if left to their own devices, would be, you know, would be perfectly competitive or anything. Health care is totally screwed up. But this is a case where you could do a lot of good. This is a core competency and strength of the Democratic Party.

You could hone in on things like that and not actually, in my view, do much damage. Do any damage, really. Or you're going to say, sorry. Last thing from your, you had a Trump bleat from earlier this week. I am watching fertilizer prices closely during our fight for freedom in Iran. The United States will not accept price gouging from the fertilizer monopoly. American farmers, we have your back. I do, is it freedom we're fighting for in Iran again?

Is that, it's all so confusing. It is very hard to keep track. I don't know what we're fighting for. But price gouging is bad. decided that. And I know I'm going to get a bunch of angry comments. People are like, price gouging is bad. And yeah, it sucks when prices go up, but nobody can ever define what price gouging is. Price gouging is just like prices that are higher than feels right, right now. And again, this is like an easy scapegoat. And the other thing I will point out about some of

this is that Trump is actually not wrong that the fertilizer market in the U.S. is pretty concentrated. This has been like a known issue for a while. So it's not like, I think, more antitrust enforcement is bad. Antitrust enforcement is, I'm generally in favor of it, certainly much more than this administration has been today. It's just that antitrust is sort of like diet and exercise. It's like, you know, it's generally helpful to you in the long run, but it will not solve an acute problem, like acute crisis, like the one we are dealing with right now, where we have supply chains completely. be severed in the fertilizer industry. So it's, you know, better competition policy, better competition enforcement, pro-competition enforcement, a good thing. It's not going to solve, it mean, not only will it not solve this problem. It also has like very little to do with some of the other things we're talking about, like retail gas stations are incredibly diffuse.

This is not a concentrated industry. There are like 150,000 or some odd retail gasoline stations in the country. Most of them are only. by single owner operators, you know, independent owner operators. There, a lot of them are like losing money on the gas that they sell, or at least it's very, very low margin. It's really just about getting people in the door to buy the beef jerky and the, you know, slushies and stuff like that. So it's, I don't even understand the logic behind like, oh, if only we had more competition

in the retail gasoline industry, which is notoriously cut through it. We would have lower prices. No, it's just, it's just. it's a supply shock and you got to accept that. I feel like a crazy person just baying at the moon, but it drives me insane. The president who is gutting antitrust, then when he has a problem says,

I mean, he's monopolists over here. I know. Well, also, when he has a, it just drives me crazy. When he has, let's do antitrust. Yeah, or for that matter,

a political enemy. that he wants to exact revenge on. He's also weaponized antitrust authorities against, for example, when Time Warner was merging way back in the day with AT&T and CNN was involved, he was mad about that. You know, there's some question about if Netflix had successfully bought Warner Brothers, this time around, there were, you know, at least the suggestion of threats that the administration would try to block it,

even though they don't seem so interested in blocking the other merger that does seem to be going through with Warner Brothers. So yeah, no, there's no principle here. It's all corruption all the way down. All right, a little something, little pallet cleanser. Your friend in mine, Scott Besson, who I think is in the running for the most

just sort of superficially detestable person in administration. It's between him and J.D. Vance, I would say. Like the question being, the person you would least like to have to sit next to you for an hour, like at a dinner or like, or be seated next to on an airplane, right? He's certainly the person most likely to threaten to punch you in the face. There have been a bunch of stories about that. Yes, I've heard that about him. Boy. But he had, Matt, we can throw that up now.

Something sort of thought. Aren't we seeing the sentiment? Why are people feeling better? Well, I, you know, I, when I was in the investment business, there are consumer surveys, but I used to look at what are the people really doing. So at Treasury, we have loads of CEOs come through, whether they're in retail, credit card, the banks, and the consumer, while they may be sounding grim, is actually quite buoyant.

So we are seeing spending has been very solid across most categories. So they might not feel good, but... Well, look, in their heart of hearts, they feel good. I'm not sure what they're telling the survey. God help me, Catherine. I think actually... I think actually... Yeah, that's what I was going to say.

I was like, I know we're in a dunking on Scott Besson. That's why I set that all up. This is the, that onion meme with like the worst person you know just made a good point. So I went crazy during the Biden years when... the consumer sentiment was the lowest it had been since the Great Recession, and yet boat sales were at an all-time high. Never had more Americans bought boats than during, like, the period from 2021 through early 2023.

Another marker that was the appearance of the $400 Home Depot Halloween skeleton, the long skeleton. I don't know if you remember this, but everybody was buying Jack Skellington maybe. I forget the name of this. The Home Depot people had a cutesy name for it. And you know, you just drive around in every fucking house, every third house had one of these things on their lawns. $400 for a stupid thing that you put on your lawn for one week a year. And I was just like, I am sorry, but this country does not act like they believe things are terrible. And so I listen to Scott Bessentere, and I'm like, yes, people's, what they're actually doing with their lives does seem different than what they're saying in the surveys.

And you know, I've talked about this before. Like the consumer sentiment in the surveys, things are not great in the economy. But consumer and sentiment responses are like it's the middle of the 1930s or something. Yeah, economists refer to this as revealed preferences, the idea that stated preferences. and revealed preferences are different, and generally we would maybe place more weight on revealed preferences. And the consumer sentiment numbers in particular, lots of polling, actually, really, has gotten less reliable in the sense that it is more likely to be mediated through a partisan filter. And so when people are answering us questions about how good they think the economy is,

in various aspects of the economy. If they are Democrats and there's a Republican in office, they are more likely to say that the economy sucks than a Republican is if there's a Republican in office. And so you do kind of have to take things with a grain of salt and maybe pay more attention at least to what the independent voters are saying. But yeah, there's been this disconnect. It's partly about partisanship.

And I think it's also partly about just kind of like this hangover effect almost from the great inflation that we saw a few years ago. So like the things, so I think it's not like it's completely made up or that it's completely about partisanship. I do think it is true that many of the economic indicators that we look at, things like inflation, don't necessarily capture the ways that people think about their financial status. So just as an example, inflation is usually calculated like month over month or year over year, but it's, It's not as if people have completely forgotten what prices used to look like two years ago or three years ago. That's not what economists pay attention to, but consumers have longer memories.

And so they're still mad about the fact that things were so much cheaper a few years ago than they are today, even if they have stopped getting even more expensive. So I think it's partly about, you know, there just is a difference in perspective and how consumers think about things. Selective memories, though. I'm not sure I would say it's longer or shorter, right? Because consumer memories become incredibly long on some things and like stupidly short on others. And it becomes harder. And here's what I was trying to get out that the disconnect I worry about is the political disconnect between politics and economics.

Right. So in economics, we can still say, well, you have stated preferences, but we can see your revealed preferences and your behavior is based on that. In voting, people have basically just gone to voting their stated preferences, right? Like, they vote their feelings and their vibes. Yeah. And it doesn't matter what their actual real life experiences like. You know, like they can have their brand new boat and their giant Home Depot skeleton.

And still, they're going to vote because like, oh, it's terrible here. And there's, I'm forever linking to this. The Ellie Reeves did a piece on CNN, I don't know, two years ago, maybe three years ago, which she went to a Trump boat parade. And she was talking to all these Trump people. And so she's just like really so into the boats. You're maybe over indexed that boat. No, very important economic indicator.

The boat index. And so she's talking to this, this big. dude in a toga and he is just going on and on about how the country is going to hell and nobody can afford anything and it's awful and nobody can make a living and Ellie in a really very non-threatening way says no I hear that I really I hear that although a lot of people are really worried about that it does seem like you have a really big boat here though and so he pivots to well I'm doing great. Yeah.

Like, you know, I'm doing great. And the reason I'm doing great is because I worked hard and I did everything the right way and I deserve it and blah, blah, blah, blah, blah. And so Ellie says to him, totally understand. So it's really more worried about the future and for your children. And he goes, I know, my children are doing awesome. My children are actually better off than I am.

They're making even more money than I make. And, you know, but that's because I raise them the right way and showed them. And so she's like desperately trying to figure out, way, you know, some way, she, earnestly, she's looking for,

but where's the hardship in your life after he's going on and on about how he's living in Mad Max world, you know? And, uh,

that's the disconnect. Yeah. You know, you get these people who's lived experience is one thing, but who's just preferences and vibes or another. Yeah.

And to be fair, this phenomenon, I forget what it's called. Somebody who's watching, we'll remember, but there's like a specific name for this phenomenon in political science when people like,

love their own congressmen but hate Congress. They love their local school, but they hate school. You know, they think schools in general are bad. And there is a version of this for finances that people are much, I don't know if this is still the case, but at least a couple of years ago when I had last looked at this. People rated their own financial circumstances much more positively. Yeah. Yeah, than that of the overall country. But I do actually think, well, I'd have to look at the data. I don't want to, you know, make this up. But I do think it is possible that people, well, yeah, actually, if you look at the numbers from, like, the University of Michigan Consumer Sentiment Index, there are much more people who are saying today that their finances are worse off, their own finances. So not just, like, general impression of the overall economy.

And I think that's partly, I think that's actually not intention with the example that you gave because one reason of why people really, hate inflation is that even when their wages rise, which is often happening, like you may have this what's called a wage price spiral that like wages rise in response to high prices and then prices rise further, et cetera. People think that their wage increases, their raises are because of their own hard work and they deserve them. And inflation is something that happened to them. They are actually in a broad sense. Everybody's above average, Catherine. In a broad sense, it's like, Bobagon. Exactly. In a broad sense, you know, these these things are linked, wage growth and price increases, and maybe people are more likely to get able to move to a better paying job

or get a promotion or whatever when the economy is so hot that you do have rapid price increases. But that's not how people interpret what's happening to them. So like boat guy, I'd be interested and re-interviewing him, does he feel like maybe he's doing, you know, he thinks like he's bringing, he's raking in money so much so that he was able to get this boat, but the boat costs more than it should have. Or other daily things that he purchases cost a lot more than they should have, and it is robbing him of his well-deserved higher living standards that he thinks he has earned. And, you know, it's not wrong that people who, are making more money or who got into a promotion, like may have done a lot of things to earn that.

But when you have rising prices across the board, that's also a factor. It's just not how people think of things. There's a term for this called the money illusion, which is about, you know, how people think about inflation, nominal prices versus real prices and things like that. And so I know you always want to crap on the voter for all of these things and they're imagining problems and I'm just I'm sorry I'm sorry I'm sorry okay I'm overstating the case uh I do think on I think you have a point in this disconnect and about partisanship and everything else but I don't think people are like totally making up the fact that they feel strapped or that they feel like

life is becoming unaffordable I don't think they're making it up and I also don't think it's particularly productive to argue with them about how how they're feelings. So the question is, like, how do you, if you're a policymaker, whether an elected official or otherwise, how do you respond to it in a way that does help people's lives materially and helps them feel better about it too? So my response to that would be absolutely, I understand people feeling stressed. And the reason they feel stressed is because the entire American economic system is set up to have very little slack in it. And We have been chasing efficiency in America, like at a fantastic rate since at least like the early 1970s.

This is what like the entire idea of just in time delivery is, right? We're going to ring all the slack possible out of the system. This was the move from the one income household to the two income household. And another word for slack is safety. And as societies and economies become more efficient, you get greater returns, right? And so like standard living, but also it means. that people are working without a net. And this is true for most people in America, like even very high up on the wage scale, you can be in the 85th percentile and still be one medical disaster, one one

job loss away from like real trouble. So that is not made up. It's real. Yeah. But the thing is that that has been real every week of every month of every year for decades. And it drives me a little crazy when people are like, I mean, just think about it. When's the last election where the people running were like, things are really good. And we got to make sure that we protect our gains and we don't have too much uncertainty in the markets. We want to make sure that we're staying on and even keel because things are good right now. No, everybody's always like, things are terrible. This is, you know, we're going backwards.

It's the everything is always bad. And the same way that nobody ever says, you know what, gas prices are really cheap right now. Nobody ever says this. I was like, even when it's 250, like, you know, you might stop caring about gas, but nobody ever says, looks around and says, yeah, you know what, actually. Housing prices are actually quite reasonable right now relative to the cost of rent. You know, nobody does that. Yeah.

These are bigger systemic problems with the American economy and the way that we've chosen to order ourselves or the way our oligarchs have decided to order it for us, depending on how pink you are. Yeah. I think this could be a much longer conversation. I think the media coverage is not blameless in any of this either. Politicians certainly. Yeah, there's a great.

Yes, exactly. Politicians certainly benefit if they're out of office in particular from the change election type model. Everything is crappy now. I can deliver something better. But there's also a bias in the news media to cover things that way, too, even when they're great. So, but anyway, that's a rabbit hole.

We can fall down another time. Some other time. Hey, friends, tickets for the Bullwork Live shows in Los Angeles and San Diego next month are on sale right now. They just went on sale right before we came on here. Go to the bulwark.com slash events. Don't sleep on these things. They sell out faster than they should for any reasonable.

I don't understand. I don't know why people are so determined. determined to go see Sarah and Tim, but they are. And everywhere Sarah and Tim go, they get mobbed. And so you should, you should go to. These shows are fun. They're a lot of fun. Catherine, thank you for sitting down.

I look forward to doing this again next Friday when I'm sure we'll have more good news. Maybe we'll be in a partnership with Iran to collect tolls paid in World Liberty Financial Stable Coin on the Strait of Iran. I mean, it just seems like there's. so many possibilities there. There are. The future has infinite possibilities. That is always the case. Thanks, J. V.L. It's always wanted to chat with you.