Prof G Markets - Davos Dispatch: World Order on Edge

Episode Date: January 26, 2026

Scott Galloway and Ed Elson break down the key takeaways from Davos, with Scott sharing what it was like on the ground. Ed highlights the speeches that stood out most, while Scott describes the mood among political leaders and CEOs. They also debate how they think Europe may respond to President Trump’s remarks. Subscribe to the Prof G Markets newsletter  Order "Notes on Being a Man," out now Note: We may earn revenue from some of the links we provide. Subscribe to No Mercy / No Malice Follow the podcast across socials @profgmarkets Follow Scott on Instagram Follow Ed on Instagram, X and Substack Send us your questions or comments by emailing [e-mail] Learn more about your ad choices. Visit podcastchoices.com/adchoices

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get your podcasts. Today's number, $43. That's the cost of a hot dog at Davos, where I am. Ed, I like to think that every place is like a human and the more successful an event, the sex here it is. And this place has the sex appeal, Ed, of a Marriott lobby. The only way you get anyone hard here is you tell them you can introduce them to the Saudi delegation. Is the Saudi delegation there? Oh, yeah. There's a lot of people from the kingdom here. Yeah.

You know who's not here? Is the people who are benefiting from threats to invade a block of ice is the Chinese. There aren't there many Chinese people here. Who do people most want to hang out with? Like, I remember you were saying on your Instagram that certain people have different colors, which represents your status, like on your badge. Like, who's the highest status, most high value type of individual at Davos? Even the PG-13 version of what I said.

Essentially, whenever mammals congregate, there's going to be a hierarchy. And the way you sniff the butt of other mammals here at Davos is you look at the color of their badge. There's like vendor badges, partner badges, which means you paid your way in, nonprofit badges, which means they tolerate your wokeness to pretend that, You know, Adavis is full of people who are, like, claim to be socialist and then have to piece out in their talk about income inequality to catch a helicopter. Are you part of this group? Where do you stand in this? Yeah, I was just saying, wait, is that me?

Is that me? Wheels up at 930, just in case you were wondering. But I'm very concerned about the climate. This is our planet. Yeah. Anyways, back to me. And the ultimate badge is a white badge. And I figured out what it's like to be a woman,

because first people looking in the eyes, and then they look at your chest to see what kind of badge you have. And a white badge is the equivalent of big tits. That's what I figured out here. People look at me in the eyes and like, oh, I think I know. I think he's that weirdo online. And then they look at my badge and they're like,

I love your content. Oh, so you've got a good badge. What's your badge? I got the white badge. I'm all accessed because... And what does the white badge mean? It's just like your VIP. I don't know what it means. It means that you're in the main Congress. Friends with Larry Fink?

Yeah, I think that's what it means. It means you're in the main Congress hall and you're not one of the satellites roaming around. It's, I was last here, I know you want to know about this. I was last year in 1999. I don't know. I peaked very early. And then I went to, I've just figured out what happened, why I've been invited back in 26 years. I went, Klaus Schwab, who was the chairman and founder of the World Economic Forum, invited me to have lunch with him at his. his new office in the hills of Zurich. And I went up there and I'm like, Jesus Christ, this is like a bond layer. And I wrote about it and said, no nonprofit should have an office that nice. And someone from Wef, the World Economic Forum, emailed me and said,

class did not appreciate those comments. Did not get invited back for 26 years. And then the year he steps down, I get invited back. So anyways, I'm back at DeVos. You want to know the difference between the vibes between 99 and 2025 or 2026? Is that what you were going to ask?

Uh, please. Well, in 1999, it was about the internet. And America, Bill Clinton gave the biggest speech when I was here the last time. It was about kind of cooperation and alliances and also competition, consumerism, using a lot of seas. And now it's about AI and the biggest speech was again from the president of the United States, but it's about chaos and coercion. And I would argue with a smattering of corruption. I've sat next to the guy from Biden. finance last night. Chang Peng Chao. Yeah. He got pardoned by President Trump for now his kids are in fact. Anyway, so things have changed dramatically. The tone and the vibe, I would say that generally speaking in 99, everyone kind of wanted more.

It was more optimistic. Now everyone's sort of like, I hope it doesn't get worse. Meanwhile, everyone's making a lot of money. I was at a dinner. I spoke at the BlackRock dinner, and they had, I don't know if it's off the record. Anyways, they had a bunch of AI masters in the universe. And everyone, every startup here, in 99, I was pitching everyone on my startups. And now everyone's really like, come to the EnY House and learn about my AI platform

that's helping optimize a workflow for manufacturing company. I mean, it's just everyone has an AI startup. It feels very reminiscent of 99 on a business level in terms of the hype cycle, which is different is America's role in the world and how people, receive our role in the world. But anyways, I'm here. Well, we're going to keep on unpacking this. I'm going to get us started with this episode. We are going to be talking about Davos this week. So the World Economic Forum, as we are just discussing, convened in Davos last week, and this time people were actually paying attention. Unlike many recent years, the conference has been

dominating headlines. Top political and tech leaders have all gathered in one place. President Trump has obviously made a splash, walking back to earlier positions on Green. He ruled out the use of force to acquire Greenland, and then he walked back tariff threats against European countries standing in the way. That, of course, sent markets rallying in the U.S., in addition to Trump's speech, which covered everything from relations with Europe to his affordability plans. The conference also featured remarks from Canada's Prime Minister Mark Carney, which we will get into. Also France's president, Emmanuel Macron, who is wearing a strange pair of glasses and EU President Ursula von der Leyen. in total nearly 65 heads of state and government attended alongside some of the most powerful figures in tech and finance, including Jensen Huang, Jamie Diamond, Satya Nadella, and others.

Scott, we've been getting a vibe check from you. I think the first thing I would point out and get your reaction to, it seems like this year was a uniquely big year for Davos. this happens every year and usually it's like maybe one or two headlines in the news and you see maybe a clip of someone talking about it but it seems like this was a really big deal

in a way that it hasn't been in the past and in fact we have verified this by just looking at the search interest in Davos it has already double that of last year and five times that of 2022 search interest in the World Economic Forum has almost doubled as well compared to last year, for whatever reason, maybe Trump, everyone cares a lot about Davos this year.

It's actually important, which is kind of surprising because I think a lot of people have been saying with the past few years that these kinds of conferences don't matter anymore. Suddenly this one seems to. Yeah, so first of all, it's easy to be cynical about the World Economic Forum, Asamai and Davos, but I think this kind of stuff is actually important because it gets people together who speak. and I think when you look someone in the eyes and you get to know them, you're less likely to shitpost them or raised hair.

I think it's good to people get together and talk at this level. Even the guy who wrote Davos Man, which is basically kind of shit posting the people are here. They invite him. They're comfortable with that. So what you're talking about,

Davos isn't about the content. It's about having access to the crowd and the people, as is our most good conferences. It's all about the people, not the content. They do a reasonable job. with the content. I think it's fine. The way I don't know, a decent litmus test for how crowded an event is, is the hotel room rates. And as you can see from the background here, I'm in the equivalent of a Swiss days in. This is not luxury. They don't even offer a lunch. I've been living off cereal,

no joke. And it's 2,200 Swiss francs tonight. So what is that about, $2,500 or $3,000? And if Trump gives another speech, the dollar, this will probably be $11,000 by tomorrow. So look, it is packed. The energy is high, but the vibe is like the world order is frang. And it feels, you know, it just feels insecure. There's just a lack of optimism and it doesn't feel like anyone's stepping into the void. And I feel like it was a big opportunity for the Chinese delegation to be here and basically try and say, we are your friends. And by the way, I don't think it's a good idea for all of these Western nations to decide,

oh, we're going to cozy up to China. And I interviewed Neil Ferguson, the historian yesterday. And his whole thing was, yeah, the U.S. may be bullying and pushing around people, but what's the plan B here to go to an authoritarian government? Like, what's the plan B? And I'm like, well, they can work with each other. It's a very weird vibe here. I kind of wish you were here.

I'd be curious to get a young person's take on it. This is the most powerful assembly of people. in the world, I think. And the vibe is unsettled. The vibe is restless. Like, not restless, like, let's get out and do something together. It's restless like the masters of the universe are sitting on companies that are overvalued that also seem to present real externalities, as did the Internet in 99, and we didn't realize it then, but now we realize it now. And the individual that everyone's focused on is threatening invasions, then pulling back, threatening tariffs, pulling back, and there's just a lack. I'll use one metaphor and get your response. Two of the four

most valuable companies in the world. I was saying at 1999, it was Microsoft was the most valuable company of the world, then it was General Electric, then it was Saudi Aramco, and then it was number four, oh, Walmart, and now the most valuable companies are Apple, Nvidia, Saudi Aramco, it was Exxon back then. Now it's Saudi Aramco, so there's still an oil company in there. And number four is alphabet. Two of the four companies that are the most valuable companies in the world basically have operating systems that everyone kind of lives their life on, right, Android and iOS. And when you have the operating system that everyone operates on top of, you get to dictate

terms and building code that naturally advantages your applications and monetization. It's just a great, it's great to own the operating system for all of business, right? And the analogy I was used is that America was really the operating system for the entire West and all democracies. People largely mimicked our laws, our economy, our universities. when we spoke, everyone tried to kind of follow. When we went into wars, people followed us. And now I think people are potentially saying

we might have to switch to Android or another operating system. So definitely a state of flux and unease. It's hard to read the label from inside of the bottle. What are your impressions from outside of Davos? It seems pretty consistent with what you're experiencing to me, and that is everyone's gotten together and they're all saying different flavors of the same thing,

which is we're fucked in some way. Whether it's valuations or more importantly, I would say, just the global order, which, in fact, the Trump administration has expressed the reason that they are going, or at least Howard Lutnik wrote this, the reason they're going to Davos is he said, not to support the existing global order, but to challenge it directly.

And I think he probably thought that he was the one, who is going to go in and have that hot take, it seems like that's pretty much everyone's take at this event. Everyone agrees whatever setup we have right now isn't really working. And I think the same thing is true of the inequality problem that we keep on talking about. I notice that was one of Larry Fink's big points

is that the inequality that we're experiencing is untenable. And it is interesting to have the CEO of BlackRock saying that to all of the most powerful and probably richest people in the world, and they're saying it, you know, in the mountains of Davos, while everyone's wearing their Lorapiano coat. It's visually quite interesting.

And, yeah, I think unsettling is a good way to put it. I think one thing else that's been interesting, I want to hear if you have been around for this, it sounds like a lot of beef is just exploding over there. I think one example would be, that I read that Howard Lutnik got heckled at a dinner. Apparently he was like talking and people in the audience were literally heckling him. And then the president of the European Central Bank gets up and leaves while he's talking. I'd be curious to know if you were there for that, if that's true.

But that's a good story. So I think that contributes to why people are so interested in Davos this year. It's funny. So you knew more about what's going on than I did. And it all makes sense now. I sat at a table and I had the ultimate flex. I sat at Larry Fing's table and there was Madame Legarde, the head of the European Central Bank. And she joked that she was called on because so she wouldn't leave. And I didn't understand the joke, but I guess the joke was she left at another dinner with Howard Ludnick. I think people are pretty fed up with Americans. And especially, especially the American leadership. The best speech and the most well-received speech was Prime Minister Mark Carney. I think a key kind of call sign for leadership is to be forcefully yet dignified. He wasn't personal. He didn't, you know, he didn't call Trump names. He didn't, wasn't emotional. He just basically said, look, Canada is not as big as the U.S., but we are a very well-resourced nation. We have a lot of fantastic industry. We have debt capacity. We don't want to lose this partnership, but if we're forced to and we're not being treated like partners,

Canada will take some pain and we'll be fine and that we need to acknowledge we're moving to a new world order. And supposedly, I talked to someone in the Canadian delegation, he wrote the speech himself. And I thought it was very powerful. I remember thinking, so back to in early 90, in the early 90s, my first company had a business school, I started and ran strategy room called Profit. My biggest client was Levi-Strausson Company, and we were just over at what's called the Plaza, the like every day having meetings. And the CMO of the company, a guy named Gord Shank, really thoughtful, you know, smart guy, said the woman running for, for, running the whole engagement for me, basically running the firm because it was like 40% of our revenue. It was a woman

named Connie Hawquist who is like arguably the most competent, impressive person I've ever worked with. And everybody just loved working with Connie. And Gord said, I have this great idea. he called me and I called them back and he said, you know how they have student exchanges? What if we exchange one of our great employees of Levi-Schauss and company with Connie Holquist and she could come here for six months? And I'm like, who do you want to exchange Connie with? And he gave me the name of this woman. And this woman was just so awful in every way. I'm like, so you're trying to take out the trash and take my A-Rod? And the reason I bring this up is, is there any way we can exchange, like, do like a presidential swap for just like six or 12 months? This is the guy, the

West needs right now. And it's just too bad that, I don't know, if he was like Chancellor of Germany. I mean, I like Macron. He's fine. But this guy, this guy, Carney, I wish he kind of commanded a larger economy with a bigger military, so to speak. But I don't know, Canada is still pretty big. But I didn't know that about Ludnik. That makes sense. And actually, I find that kind of encouraging. I don't believe in heckling people at a dinner, but I got to be honest, sort of tickles my censors. What else have you heard that? We'll get to Connie's speech in a moment. You're right. It is unanimously agreed upon that this was the speech of the conference, potentially the speech of the year. People in Canada,

Canadians are calling it the best speech in Canadian history. So this speech is a big deal. Just I want to hit some more kind of drama points, which I just find kind of interesting, as you say, tickles the censors. There was this great clip where Howard Lutnik was speaking on a panel talking about the future of America. And I don't know if you saw this, but the reactions from the others who are on the panel was absolutely hilarious. This will really be for our YouTube crowd. You kind of need to watch it. Let's just play that clip.

Why would Europe agree to be net zero in 2030 when they don't make a battery? So if they go 2030, they are deciding to be subservient to China who makes the batteries. Why would you do that? Why would the United States of America, which has oil and natural gas, try to convert to all electricity? China does not have oil and natural gas. Electric cars make perfect sense to them. That is practical and logical. Okay.

Another clip that has been making the rounds, I think, is pretty important, is when Trump was speaking about the Greenland situation, which was obviously the most important news event in the world. And he confused Greenland with another country. I'm helping NATO. And until the last few days, when I told them about Iceland, they loved me. They called me daddy, right? Last time, a very smart man said, he's our daddy. He's running it. I was like running it.

I went from running it to being a terrible human being. I don't know that they'd be there for us. They're not there for us on Iceland. That I can tell you. I mean, our stock market took the first dip yesterday because of Iceland. So Iceland's already cost us a lot of money. Which was probably the most remarkable event of the week. And then also there was this drama with Gavin Newsom, which Gavin Newsom talked about,

but apparently the White House denied him from anything. entering an event, which he had been invited to speak at. And then a White House spokesperson issued a statement. They said, quote, no one in Davos knows who third-rate Governor New Scum is. So, I mean, it's kind of just reality TV is playing out on the global stage right now. And I guess it's hard to know what to make of that because at this one time it seems like, you know, performance art, it feels like WWE, but then at the same time, we're seeing these massive market-moving decisions, such as the decision to, I guess, not use force against Greenland, or at least that's

what Trump said, which spiked the markets around the world, and then tacoing, which we need to get into. And that is, Trump decides to pull the tariffs on the EU because he says that we have reached a framework of a future deal for Greenland, and then the S&D, and then the S&D and the NASDAQ and the Dow, they all rise. And then you see bond yields, which had jumped to their highest levels since September. It was a big deal when he was threatening Greenland. And then those yields came back down. So a lot of market activity that seems very important, but then you look at what's actually happening in DaVos.

I mean, it's all kind of looks like a joke from the outside. So then we'll get into Mark Connie's speech, but I guess I want to get your reactions to all of that. They're making us and that as Americans look like assholes. There's just no other way around it. And Howard Ludnick at Davos

is a little bit like, you know, a repo man is the valet at your daughter's wedding. It just, he just shouldn't be here. He just, he is, what he says is stupid, that somehow that we've been exploited,

that we're a victim. If you look at 19, 1445 to 2000 in global trade. And every time we increase globalization, America disproportionately, if anyone was going to bitch about globalization in the context of America, it would be our trading partners. As we ship them iPhones and Nvidia chips at 45 to 95 points of gross margin, and they ship us lower margin products. And we massively get much greater shareholder value. I mean, who on earth? I mean, you could argue China over the last 30 years, but who on earth over the last?

who has benefited more from globalization than the U.S. So what he says makes no fucking sense. And they're all over the place. Their decisions are totally sclerotic. Trump looks like a, you know, he doesn't even seem old. He just seems bumbling and like he doesn't do his homework and he doesn't get the name of the place right and doesn't have good aids. He doesn't have good teleprompters. That speech was absurd.

I mean, were you at the speech? You couldn't get in, so I watched it outside. And quite frankly, I know this sounds weird. I didn't want to be in the same room as the guy. I just find the whole idea of him and what he says and the way he represents America is so counter to everything I believe are American ideals of strength, liberty, grace, being the good guys. We're no longer the good guys. That really pisses me off. People used to be cynical about Americans and obnoxious we are.

But I think most people, if they had to point to who the good guys were, they would have said the U.S. and now more people globally think they'd rather be they trust china more which is insane but back to about governor newsome i'm biased because i like the governor but i walked down the hall uh into the main area and there was an enormous crowd around one guy and beaming like fucking riana meets arnold schwarzenegger meets he just like i don't know if it's his height his hair his presence He literally is walking around Davos with this sort of, I am the next president energy, and not in an arrogant way. Everyone is just fascinated with the Chad. Yeah, everyone is just fascinated with the guy.

And his comments are, you know, he's definitely, there's a bunch of presidential hopefuls here. And they, you know, they all look like, you know, they've been pulled out of the bargain bin. And then Governor Newsom shows up. A ton of senators here, what's hilarious is, no one gives us. shit. I literally saw Lindsey Graham, Senator Graham, you know, he's an important man, in a corner trying to find someone to talk to, to speak to, you know, and no one, you know, no one wanted to talk to this old man in the corner. I love that visual. That's amazing. But by far the biggest flex of the best thing. I sat next to Sasha Bear and Cohen last night, and we rolled together. We went and had

drinks together. Wow. And my favorite thing is I got invited to this after party. And he said, can you leave my name at the door? And I'm like, brother, I don't think you're going to have trouble getting in. But I love how Sasha Baron Cohen is worried about getting into an after party at Davos. He's, by the way, middle class two from the suburbs of London, super nice, super intelligent. We went to Justin Trudeau and Katie Perry. Hold your jokes. Had a dinner talking about AI. And they invited us.

And Sasha spoke. He is really, he was like, he's very smart. I mean, he really gets this shit. Yeah, no, he's a legend. His comedy is brilliant, too. There is a sense in which it feels a little bit like celebrity masturbation circle. Like, why is Shasherbanger? Why is this comedian there?

You got asked by Larry. No, exactly. And he adds some spies. He adds some sex appeal to the whole thing, and the whole place doesn't he? That's the thing. It's sex appeal. So does Katie Perry. It's like Katie Perry's there on the arm of Justin Trudeau.

No, she's there for Justin. Right. But it all starts to seem a little bit like pop-cultry. What are we doing? here is this just to hang out with celebrities, which, you know, I agree. I'm sure it's cool. A little bit. I'm leaving early. I was supposed to sleep tomorrow. I'm going home tonight. I'm kind of like, I'm not raising money. I'm not running for office. Why am I here? I'm going to go home. I'll see my boys. But like up until this moment, I remember I was really reminiscing

in 1999 when I was, I don't know, like 30 or 34. It was like the biggest moment of my professional life was getting invited here. And now it's like Vegas for me. It was fine for the first 24 hours now. I just can't wait to get out. But most importantly, the most striking thing is Sasha, I'm sorry, is Justin Trudeau's skin. There's no way he worked that hard as Prime Minister of Canada. He does not look like a man who's ever endured any stress. I think he slept 12 hours a night, got up, did some Pilates, did a juice cleanse. He's an expert on face mosques, right? Yeah, or someone spread the DNA or platelets of some young Honduran boy from the village or something on his face. The guy looks 19. I just, I couldn't stop staring at the guy. And he's been a world leader already.

Like, Lindsey Graham looks like he worries a lot. Lindsay looks like he's endured a lot of stress in his lifetime. But not Justin, not Prime Minister Trudeau. We'll be right back after the break. And if you're enjoying the show so far, be sure to like and subscribe to the Profchi Pod YouTube channel. Support for the show comes from Fundrise. Investing in companies already in the S&B 500 can sometimes feel like you're being served someone else's leftovers. It's still a great meal, but it's hard not to imagine what the food tasted like when it was fresh out of the oven.

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Terms and conditions apply. Right now in the world of AI, two things are happening simultaneously. One, the technology is getting better fast, people are finding new uses for it, it's more popular than ever. And two, every company that makes AI is absolutely hemorrhaging cash. On the Vergecast this week, we're talking about what OpenAI and other companies are doing to try to finally figure out how to make some money off of this technology. Spoiler alert, it's mostly ads. And we're talking about whether any of it's actually going to work.

All that, plus some stories. about the Chinese company that appears to be beating Tesla on the Vergecast, wherever you get podcasts. We're back with Profi Markets. Let's talk about this Mark Kani speech because this was probably the most pivotal moment

at the conference. I mean, the central message is basically that the American hegemony doesn't really work anymore, that America's abusing its power and that this era of globalization that seemed to work isn't working. Let's just listen to us.

some of the highlights. We are in the midst of a rupture, not a transition. Great powers have begun using economic integration as weapons. Tariffs is leverage. Financial infrastructure is coercion, supply chains as vulnerabilities to be exploited. The middle powers must act together because if we're not at the table, we're on the menu. This is not sovereignty. It's the performance of sovereignty while accepting subordination.

So it seems like the takeaway, and I'd be interested to know if everyone agrees with this at Davos. But the way the world is set up, our globalist world where we have all of these relationships and we all kind of get along with these trade alliances and we're part of these communities and, you know, we're shipping stuff over from China and shipping stuff over to China and everyone's sharing each other's stuff that that no longer works, that we're transitioning into a more nationalist world where it's sort of every man for himself. And I guess, guess the thing that is striking is that this is the thing that the U.S. has been pushing, like, we want this. And then the president of Canada comes out and says, well, yeah, if you guys are

bailing on this, then, okay, we can't do this anymore. This doesn't work if you guys don't sign up for it. What has been the reactions from Davos? What did you make of that speech? Like I said, I thought it was the best speech of Davos. I love that line. He said, this is not a transition. It's a rupture. What was the line there? He's, I thought it was, He's just an incredibly impressive eloquiment. I hope at some point, one of the things about America is it does tend to like ping back and forth between different parties and different sort of thought leadership. And I'd like to think the next president is going to be incredibly intelligent. And Mark Carney is that kind of guy.

He wrote that speech himself. To be fair, though, and this is kind of Neil Ferguson's whole thing was, I mean, and I think there's some truth to this. The EU has been free riding off the U.S.'s defense spending, assuming they don't have to spend for military for defense. I mean, to a certain extent, we're by far the largest contributor to NATO. And I get that a war on Europe would be bad for everybody, but it'd be really bad for the Europeans. And the fact that the U.S. has been providing this defense umbrella so they can spend more money on their seniors and social citizens. And, you know, quite frankly, that that is not, that's asymmetric, that is not fair. I think Trump got that right. I just hope that the music matches the words here, and they begin coordinating and commanding the space they occupy. And one of the masters of the universe in the finance world said something really powerful last night, he said, look, difference between Europe and the U.S. is, I said, simply put, is our capital markets. And the EU is just not holding its own from a economic standpoint.

in France, from an incentive standpoint, in France now, pensioners make more money than working age people. We keep talking about how the U.S. keeps voting seniors more money, that old people can voting themselves more money. Take that times two or three, and that's what Europe is like. And talking a big game about Ukraine, I mean, I think some of the nations have really stepped up, but others have not. And so I think there's some truth. There's a kernel of truth. Now, the question is, is it going to help anybody? The way I think of it is just economically. The most powerful nation will be the one with the biggest GDP.

I think we're about 25% of the world's GDP. But we were the operating system for 60 or 70% of it, which made us unchallengeable. The biggest mistake I believe that Trump administration is making is believing that a power that controls 25% of the world's GDP or 30% even, maybe it's a third, can muscle around everyone. Our ability to muscle around everyone was to check with our other limbs,

other great democracies where they would take our lead. But if they say we're out and you're now just a third of the world's GDP and a third is somewhere in the middle not knowing what the fuck to do based on your blood sugar level and a third is quote unquote is our adversaries, whether it's China or Russia, that's a terrible place to be. I feel like they just don't understand that kind of the basics of math and game theory. Well, I think that you can point out the EU's reliance on the US for defense spending without threatening to invade their territories. Like, you can make that point and get somewhere with it without pissing everyone off and further than pissing everyone off, literally threatening military action. And then obviously

going back on it because we saw Taco and Trump appears to just in the middle of that speech, realize, oh yeah, maybe I shouldn't invade, maybe that's not a good idea. But in terms of the consequences of this behavior and this delivery of that point, it does seem that this is, I mean, we've said this before. This is sending our allies, allies into our adversary's arms. This is basically pitting the rest of the world against America. Canada and China just struck a new deal. So did the UK. They're preparing a new deal with China. EU and India just struck a deal. The EU and Mexico have a new deal. As we've said, like, deals are happening.

They're just not happening with us. And I think the question becomes, what's next in this story? Like, agreed. Europe and the relationship with America, questions should be asked, as they always should be asked. You know, we should be investigating

what is the real dynamic here? Who has the leverage? Is someone getting more out of the relationship than the other? But now that we're, we've escalated things the way we have, it could be that the rest of the world just decides, you know what, we can't trust these Americans. And in fact, you know, Neil Ferguson makes the point, like, well, who you're going to trust China? It's like, maybe. In fact, that appears to be what these nations and these nations leaders are doing right now. That appears to be what

Kirstorma is pursuing with China at the moment. And then there's the question of what power do they actually have over us. And this is the big question. I'm not sure they have much, but people are asking the question. There's this question of a coordinated attack on our debt, which is more and more relevant because just this past November foreign holdings of US treasuries hit a record high. And the holders that had the biggest increases were the UK, Japan, Belgium, Canada. People are asking the question, could they just sell our debt as China was doing earlier on? And just to explode our interest rates. Maybe they could. Could they just sell their holdings of US stocks? Again, I don't think they will, because as you say, US stocks are very important. I don't think you can

just back out of that and expect things to be all right. So I guess the question would be, what could Europe do in response to America? Or what could the rest of the world do? Could they coordinate with Canada and could they coordinate with Japan and perhaps China and launch an attack on America in some way? Is that even probable or likely? Is that even worth talking about? What do you think? It's hard to even imagine or outline something to damage America, but they're not core. Europe is still not a union. And this is unionizing them, so to speak. But the prime minister, I think he's the prime minister, president of Finland, very powerful voice. But okay, who speaks for the EU? I just don't, is Macron with his cool glasses? We know it's not starry.

Who is it? Is it LaGarde? I mean, who... Is it Mark Carney? Fair point. He seems to be representative of the whole movement. If I were of them, I would have stood on stage with Mark Carney and said, you know, Mark has shown real leadership around this issue and have the head of the, you know, the EU and all the member nations saying, these are the actions we're taking. and we've decided to divest 10 to 20% of our holdings of treasuries. We've decided, as we no longer can count on this as a reserve currency, we're creating a new trading block of Western nations that doesn't include the U.S.

But they, how you defeat an enemy is you atomize them, you fragment them, and the EU is already fragmented. Also, the EU has not shown a willingness to sacrifice. They've not, they're like, oh, wait, cut pensions such that, we can increase our military budget? No way. I mean, you know, and so look, the core competence of Russia and the reason why they're invading Europe, and we might end up with a terrible peace that just schedules the next war, is while there is financial support, you know, if somebody was invading Canada and threatening, if Cuba all of a sudden invaded another nation proximate to us,

I think we would put American troops on the ground. So I think the EU is, you know, Europe is not a union. They do not speak with one voice. They need to. Then they need to identify that leader. And two, and you're right, it might be Carney. They need to massively increase the military spending. They claim they're doing it. So far, there's not a lot of evidence. They're actually doing it. And then I would outline a series of, you know, a series of responses. A lot of people say they've been more mature. they haven't responded. I don't know. I think the only thing that the Trump administration understands this point, and the only way you treat a bully is at some point you just got to turn around and kick him in the nuts, even if he's bigger than you and see what happened. So unification, picking one voice to speak with

and outlining a series of actions that are sequential, not all at once. But I think our vulnerability is around our debt. You can't be in this kind of debt without vulnerabilities. It isn't, everyone says China is the biggest owner. It's not its Japan, but combined, but combined the EU is in Britain. But these guys cannot command the space they occupy because they're not the largest, they're not the second largest economy in the world, which they would be in aggregate. There's a series of kind of one-off economies.

There's the seven dwarves. None of them can, you know, it's like the fourth, the sixth, the ninth, the 14th, the 22nd economy. they don't, it's as if if we get split up and New York decides to become a finance hub with its own currency and Texas becomes an energy economy and the Midwestern states become a manufacturing economy, trading with Canada, none of those nations would be able to dictate or strike back at China, but we have a United States of America with one military, whether you like them or not, one president that speaks for us and commands, you know, our economic policy and our military, EU is just theoretically a union. Yeah, I think that definitely comes out at conferences like this,

where, you know, Trump is swinging his dick around in various ways. And then everyone from Europe kind of gets together and they get up on a stage and they stand in front of a podium and they say, this will not stand. This is not acceptable. And Emmanuel Macron gets up there with his aviated glasses and sort of waves his fist around and talks about these ideas about how this is a problem. And I agree, like, at a certain point, is that, okay, what are you going to do about it? Is it just going to be another speech in front of another congregation of white people in suits and ties? Or are you actually going to take some action? You know, I think a similar thing could be said about Trump, where he makes these threats and he does move markets because he's so erratic and also because he's so

more powerful than anyone else on this stage. But then ultimately, he doesn't, he doesn't really do much about it. For example, this taco situation, he says, I'm going to put these tariffs up, we're going to take Greenland, we're going to use any means necessary. And then he shows up to the conference and he says, no, no, we won't use force. And actually, no, we figured out a framework of the deal. And so actually, no, it's fine. We're not going to do the tariffs anyway. You could make the argument that even he is not really getting anything done himself. We'll be right back. And for even more markets content, please sign up for our newsletter at profiteymarkets.com slash subscribe.

This week on Networth and Chill, I'm breaking down the essential money tips for every stage of your relationship. From the first date to forever. Who actually pays on the first date? How do you split rent when you move in together if one of you makes way more than the other person? And yes, we need to talk about pre-ups. Plus, I'm sharing why I believe in equity over equality when it comes to splitting costs. Whether you're single and swiping, moving in with your partner, or planning your wedding, this episode will help you navigate the uncomfortable money conversations that can make or break your relationship.

Listen wherever you get your podcasts or watch on YouTube.com slash your rich BFF. We're back with Profty Markets. If you look at the polling data right now, and I think this is probably really, relevant to what we saw in Davos, Trump currently has the worst approval rating of any second term president in history except for Nixon. So people do not trust him right now. And I don't think the kinds of things he's doing in Europe, where not only does he look untrustworthy, he also looks weak because he's chickening out. That's how everyone is describing it. And then we're seeing similar numbers coming from the Gen Z group, which I also think is.

interesting. Trump's net approval rating among Jane Z is now at negative 32%. Compare that to February of last year, about a year ago. The number was plus 10%. So we're seeing just a decimation of his favorability on various issues. And I think a big question going forward is like, what did that speech in Davos and what did this taco do to his legacy? What did it do to his popularity in America? Are people watching what's happening in Switzerland and do they care? It seems like they probably do. Yeah, and we're closer to it than most people, but I mean, a couple observations. One, I think people are incorrectly saying that this is the end of globalization and it's a retreat to like regional or spheres of influence.

I would argue Trump's rhetoric is expediting globalization just without us. And that is free trade barriers are coming down. It's making for strange bedfellows. I got to think that the EU and Latin America and the nations and Africa are really like looking to trade right now, to establish alliances, free trade zones, political alliances across border.

People aren't saying, well, the operating system of America is weakening, so we should withdraw and go inward. They're saying, no, we just need new partners. And I think this has created a level of promiscuity and willingness to say, okay, we won't place taxation on your wine here in Chile, France, because you have a wine industry you're trying to protect. We want to have more free trade.

And we want to be less dependent on selling our wines into America. And the way you do that is by both of us lowering trade barriers and agreeing to get along. And so I think globalization is actually out super-dry. or overdrive right now because there's so much economic benefit to it. It's just that all the supply chains are being rooted around us. And then the thing I would push back on a little bit, though, I mean, one, Trump is hugely unfavorable. This doesn't appear to be working.

But every time we take a poll, everything goes down. It just seems like people are just getting disgusted with institutions and power. The Democrats aren't doing much better. And the reality is, and I hate to admit this, this isn't just a rogue Trump because he's got 53 Republican senators who all of them seem to be kind of, I mean, we celebrate one of them maybe saying, you know, Bill Cassidy, I'm a doctor.

He realizes how dangerous and stupid RFK Jr. is. He doesn't actually fucking do anything about it because he's still scared of Trump. So the majority of U.S. senators are still kind of walking in step with the president, and they're elected. But don't you think people, are beginning to see that, like, quite viscerally. Don't you think the cowardice is becoming

almost too big to ignore, too obvious to Americans? And I think someone who's doing a great job of pointing that out is Gavin Newsom. I mean, you look at his speech at Davos compared to, you know, these other leaders who seem to kind of tiptoe around the problem. I mean, he's being bold. And as you say, you know, I forget the words you use, but I think the word that I would use would be aura. His aura is big, it's strong. He presents as powerful now because he actually is standing up. And it seems that that actually is a winning move now, not this cowardice and sycophantry that we've gotten so tired of and so used to. I mean, Scott Besson, every time he gets on stage, he looks like a total fool that I think people are seeing that because it's so obvious how weak these people are.

So to see someone present a vision of strength to have an actual spine, to have stones, to have balls, that's quite interesting. That's quite compelling right now. Yeah, I see it on the Democratic side, at least in some form. I would still argue they haven't shown real testicles. I'd be drawing up all sorts of criminal indictments and reminding people the statute. The statute of limitations for murder is never. And I would be coming out and saying, I believe the following ICE agents are probably guilty of reckless endangerment of life and perhaps second-degree murder. And I plan to try and encourage our Department of Justice to investigate them when we have a real Department of Justice. I want to remind our ICE agents that the statute of limitations on

murder is never. And there's no such thing as absolute immunity. It doesn't exist. But I haven't heard a Democrat do that or propose it in a way and show up at Minnesota or a lot. large gatherings of ice and say, hey, guys, I just want to communicate something about this, this law I'm planning to pursue on January of 29. So just think about, you know, just think about what you're doing. Anyways, and I don't see a lot of it. I still don't see a lot of it on the Republican side. I don't see the backbone. We celebrate small instances of it and we highlight it, but I don't, unfortunately yet, I don't see a lot of, the cracks we've all been. waiting for, in my view, if you're honest about this, they're not. I mean, if I believe what he's

done has shown that he's reckless, putting us in real harm's way, physical danger, increase the likelihood of a nuclear conflict, bad for the economy. I think corrupt, he's increased his net worth by $1.2 billion. I think under any other president, a Democratic president, this would be caused for an impeachment. And you would need, we have 47 senators. It would get through the House probably. Would it now? I don't know. But then you need 66 senators. You would need 19 Republican senators. If eight or ten Republican senators showed up and said, boss, you are fucking out of control and you need to dial it back or if they bring up impeachment, we'll be eight or ten of the 16. I think he would, I think Susie Wiles would whisper in his ear, okay, you need to dial it back.

All of them were scared to do that. Because if one or two states, he's like, I'm priming marrying you and I'm still the man and I'll get you kicked out and you won't get reservations at your favorite place in D.C. So I see an incredible, I see, you know, if you were to write a book about Republican leadership right now in the Senate would be profiles and cowardice. I mean, supposedly they're all saying behind the scenes, this guy's off the rails, but they won't fucking do anything about it. I mean, well, boss, that's why you're elected. You're elected to do the hard things when it's hard or to the right, you know, to do the right thing when it's I think one interesting question. You actually are behind the scenes. I mean, Davos is as far into the

swamp as you could perhaps get. I mean, I'm astounded by the cowardice on both sides. I'm astounded by the cowardice in business leadership as well. I'm sort of astounded, you know, sometimes I'll do like a media hit and they'll be like, oh, like, is it okay if we talk about Trump? Like, can we talk about something that he said, I'm like, yeah, obviously, like, that's totally fine. I'm very surprised with the, with how scared everyone is, with the extent to which people seem to want to tiptoe around these issues. You're in the room right now. Is that the vibe in the room? Are people being kind of hesitant and concerned and holding themselves back when it comes to expressing their true opinions on the issue?

I think American senators and special interests are afraid because Donald Trump, like any strong man, has figured out the algorithm is to reward your allies

with monetary compensation, whether it's the kids of Howard Lutnik who get an investment in their shit coin from the UAE after we agree to let the UAE

have our most sophisticated chips. I mean, just I can't even, I just can't even imagine what would have happened to Obama tried a fraction of this shit. Unbelievable.

So, And then also to punish your enemies, to go after them and really try and make their lives miserable, including threatening prison, having FBI agents raid your house at early in the morning if they don't like, you know, former security advisor, John Bolton, what you've said. So that's working. I think people are really intimidated. The Europeans, I would describe the meetings I've been in, they're just so damn polite. They don't. There's so many Americans in the room. It's the end of them.

They're also trying to curry favor with a lot of these startups to, to be. offices in their regions. They don't want to cut off their nose despite their face. So they're incredibly, I won't even say, you know, they just demonstrate a lot of grace and they're very polite.

But I wouldn't describe it as their cowtowing or scared of them. They're just, these people are just very dignified. These people, like, all went to prep school in Switzerland and are, you know, they eat with the right fork. Isn't that the problem, though?

It's almost like that's the problem. It's like these people, they're too polite, they're too sheltered, and we've got this wrecking ball who's fucking everything up wherever he goes, and everyone's too polite to do anything about it, to confront the problem, to say things as they really mean it. That's got to be one of the biggest obstacles in the way of Europe is their own politeness, that they're not willing to just say what they think. They could have said, look, Carney, you're, you, you, you, you, you, you, you, you, you, you, you, You've captured the moment.

We want you to turn up the volume. And during your speech, we want two things. One, at the end, we want you to outline a series of actions, and we're going to have all 27 member states of the EU sitting behind you. That's what I would have done. But, yeah, it's all sort of, they're polite and atomized, and all trying to get Anthropic to open their next office in Helsinki. That's the problem.

So, and it's true. Also, you got to give it to, you got to, right now, American innovation doesn't seem to be sputtering. It doesn't, you know, it's people. I was with Hamantaneha, the guy who runs general catalysts. They're making enormous bets, enormous bets. I mean, these guys, these guys have balls the size of fucking Mars. They're making multi-billion dollar bets on things and in different areas and healthcare and defense tech and, you know, and it's like, okay, what, you know, Germany feels like it's paralyzed by the fact that it's waking up to the notion that it's getting the shit kicked out of it on a manufacturing level from China. I mean, they're just like, okay, how do we deal with that? That's probably a bigger threat to Germany right now is China. Anyway, this is, I mean, just saying it, my blood pressure goes up. This is very, very unsettling. I do think this might be a pivot point that, that, okay, we've kind of had it with these guys. Christine Lagarde walking out on the Commerce Secretary is a pretty big deal. You know, so anyways. Anyway, I'm not supposed to say anyways. I like anyways. We will be discussing this more on another episode, but you've got more to do at Davos.

So let's take a look at the week ahead. We will see consumer confidence in January. The Federal Reserve will make its first interest rate decision of the year on Wednesday. it's also a huge earnings week. We will see reports from Microsoft, Meta, Apple, Tesla, ASML, United Health, Boeing, Starbucks, Lockheed Martin, Blackstone, ExxonMobil, and Chevron. Scott, this is the part where I ask you for a prediction.

I would love for a prediction on what is going to happen with this Greenland Europe situation, but I get that it's fresh, so you can pass on that. But if you have one, I'd love to hear it. I think Greenland Europe is nothing but just unnecessary, self-inflicted injury that further cements our brand as chaotic and coercive versus alliances. I also think it's a bit of a distraction from what is a more significant action,

and this is my prediction. I think the U.S. is going to strike Iran imminently. I think if you look at ship movements and things like boring stuff, like movements of the aircraft that refuel bombers and fighter aircraft. I think there's a lot of military movements in the Middle East right now, and this is all public information. The USS Abraham Lincoln Aircraft Carrier Strike Group is transiting from the South China Sea towards the U.S. Central Command Area.

I have 15 fighter jets and high Mars have been repositioned in the region. And this might just be because it's hot there right now. They want to be ready, but I think that I think Trump loves the flex and the recognition and the macho Riz he earned from his actions of Venezuela. And also Neil Ferguson said something I agree with, and that is if there aren't military strikes from the U.S., and we don't weigh in against the regime with probably coordinating with Israel, he put the likelihood that the regime stands at 90%. And just given the opportunity, given that we have a president who loves the flex, the military, and given the vulnerability right now of the regime.

And if Trump can take credit for toppling the Islamic Republic, I think that's a pretty significant win. So whether you think it's a good idea or not, I happen to think it's a great idea. and just infuriates me that no one seems to give a shit about Iran in the U.S. when they have been one of the most oppressive, misogynistic cultures of the last century. So anyways, in some, I think that we're going to see military strikes against the Islamic Republic in the next couple of weeks. This episode was produced by Claire Miller and Alison Weiss. Mia Silverio is our research lead. Our research associates are Isabella Kinsel, Dan Chilan, and Chris Nodanahue.

Benjamin Spencer is our engineer. Andrew Burrough Burroughs is our technical director and Catherine Dillon is our executive producer. Thank you for listening to Profty Markets from Profitory Media. Tune in tomorrow for a fresh take on the markets.