The Ben Mulroney Show - Why is Tesla Stock crashing? Low Sales or Elon Musk's political affiliation?

Episode Date: March 13, 2025

Guests and Topics: -Why is Tesla Stock crashing? Low Sales or Elon Musk's political affiliation? with Guest: Dr. Eric Kam, Economics Professor at Toronto Metropolitan University -Group of Ontario school boards says lawsuits against social media giants can proceed with Guest: Francis Syms, Associate Dean in the Faculty of Applied Sciences & Technology at Humber Polytechnic  If you enjoyed the podcast, tell a friend! For more of the Ben Mulroney Show, subscribe to the podcast! https://globalnews.ca/national/program/the-ben-mulroney-show Follow Ben on Twitter/X at https://x.com/BenMulroney Enjoy Learn more about your ad choices. Visit megaphone.fm/adchoices

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With Sunwing's first dibs on summer savings, let us curate something stronger than what you've been listening to. Because while your playlist screams, I need a vacation, my algorithm suggests book before March 30th. Remember Sunwing, save more, do more. Book with your local travel advisor or at Sunwing dot ca Welcome back to the show and this story out of the parliamentary budget office that pretty much takes mark Carney to task over the because the social value and the economic cost of his cap on oil and gas

Is I think a pretty big story. And we just talked about sort of the political angle with Alberta MP Michelle Rempel-Garner from the Conservative Party. Now I want to take a look at it from an economics perspective. And joining us to drill down is economics professor from Toronto Metropolitan University, Dr. Eric Kam. Eric, welcome to the show. Thank you, Benedict.

How are you? Well, I'm OK. This, to to me seems like a very big story. And listen, credit to Mark Carney for at least putting something in the window that we can then debate the value of. But it seems to me when an organization like the PBO comes out and says that in order for for this to work, we'd have to, our oil and gas production would have to decline by almost 5% and the difference between cap or no cap is 20 billion dollars less in GDP and almost 55,000 fewer full-time jobs. Like, this seems like if we go for this as a nation, this is doubling

down on the stuff that got us into the problem that we're in the first place. You know, it's in a sense, it's tripling down. And what a sad state of affairs, Ben, that we're applauding transparency on the part of the liberals. I mean, all they had to do was actually say what they're going to do and everybody goes crazy. It's pathetic.

Oh, I'm not, I'm not, I'm just saying at the very least, that's what we're getting. Oh, it's the least all right. So, you know, they say it's the least you can do, and it's the least they can do. I have no time for this. And that doesn't mean that I don't have time for clean air and clean water.

I'm a father like you. The problem is that right now we are mired in potentially, and I know you've heard this before, stop me, the potential for the greatest economic downturn since the Great Depression. If COVID wasn't bad enough, this is the one that could really pull us down. And so all I have to read, all I have to read

is that the projection for this is a decrease in nominal GDP by $20.5 billion and another 41,000 jobs, maybe up to almost 60,000 jobs, wrong policy, wrong time. And this is the thing that the liberals haven't caught on to, and Justin didn't catch on in almost a decade. These are wonderful policies, and what you do when the economy is booming, your GDP is rising, and jobs are rising. But when the economy is teetering on the brink of not just a recession, but a depression. This is the wrong thing to do. Again, these are great policies, but not now. Eric, level set for us. So this is an oil and gas emissions cap. Is it a carbon tax by another name? It's a tax by another name. You can call

it a carbon tax, an environment tax, an environmental tax. You can call it whatever you want. It's a tax on a time that Canadians can least afford to pay a tax, Ben. It's got to be scrapped for the time being. They know it. Conservatives know it. I think almost everybody knows it except for Carney. But I don't know the closet on this, Ben. I don't understand. I don't understand, Mark, how he can come out and say we've got to build pipelines, we've got to get our resources out of the ground and selling them to various markets around the world. I don't know how he can say that simultaneous to essentially throttling the oil and gas

industry. I can't square that circle. You can only square the circle if you like the who because they taught you to meet the new boss same as the old boss and that's exactly what we're going to get if this guy ever god forbid becomes prime minister legitimately prime minister i don't mean what's going to happen tomorrow yeah hey uh the bank of canada cut rates again amid what they say is the new crisis of the trade war with the united states i think it's a i mean i i haven't looked at at the interest rate in a long time but it's getting down

there are you surprised we got another rate cut? No, why would you be surprised? This government has one game to play in terms of economics, right? They keep cutting the rates. They keep using monetary policy to make money cheaper so that you'll spend. As we've said before on your show, Ben, this used to be a two-pronged approach. Make money cheap, make immigration large. They finally realized that the larger you make immigration, you pull down all the per capita statistics, so they've closed that off. So there's proverbially one bullet in that gun and they're going to shoot it. They're going to make money as cheap as possible to try to prop up the economy on spending. And as I've said before, as a short run solution, you can do that because you can have an increase in the business cycle

and it looks good and you can sell that to Canadians. But as soon as Canadians pull back the curtain and they say, Mr. Carney, what does this do for long-term economic growth? The answer is nothing. So I'm asking Canadians keep their eye on the prize because if all you do is stimulate short run spending, you're also at the same time asking to stimulate long run inflation, Ben. Look, Donald Trump was elected on a promise that as soon as he got into office, don't worry, you vote for me, and the second I get into office, everything is going to be great. That was the promise. And now it looks like consumer confidence. And we know in Canada, it's very low with 40% of Canadians worried they might lose their job because of this tariff war. But in the United States, the

fear of recession is on the rise. The president had to admit that there could be an economic slowdown, potential downturn, and now people are genuinely worried about a financial crisis. What do you make of this? What do you think an ongoing terror war is going to plunge us, possibly the Americans into recession? Yes, I do. So the only question we have left, you know, one thing about Trump, first of all, at least he was elected. That's number one. But number two is he's not stupid. I don't care what anybody says to you. You don't get to be Donald Trump and be an idiot.

You at least have smart people around you. He knew going into this that it was going to push his own country into recession and he knew it was going to push his own country into some inflationary effects. So if you know that then why are you doing it? And that's the only question in this we really don't know. We don't know what his end game is. We know the middle game, we don't know his end game. So what you've gotta do is try to put the pieces together, follow the money as they say, and try to figure out where he's going with this. And frankly, hope he gets there

in the not too distant future before he pulls the whole world into recession. And that's actually a possibility right now because of their size and because of the number of their trading partners. Now, when you look at what's happening with the stock market and you I'm sure you're aware of what key indicators to look at. Where are we on a roadmap on our if the optimum destination is a recession. Where are we on that roadmap. Oh like Springsteen said we're going down.

If you look at all these you know I love these pop culture down. If you look at all these, I love these pop culture references, but if you look at all these macroeconomic indicators, they don't look terribly different today, sadly, than they did a year ago. They are kind of teetering around zero or pointing downward. I mean, that's what's gonna happen to consumption, to investment, to Canadian exports. It doesn't really matter which one you look at

and you can play with them in real terms or nominal terms, but they're all still pointing downward and again not to be too repetitive, Trump knows this, right? He knows he's put the fear of God into North America. He knows that prices can only go up in a trade war and GDP can only go down. So I keep asking myself, Mr. President, what are you trying to do? And maybe he'll tell us one day, but he sure hasn't told us yet. But you've got to keep your eyes open because nothing positive can come out of this, and especially for a small open economy like Canada. I am speaking with economics professor Dr. Eric Kam.

Hey, Eric, why is Tesla's stock doing so poorly? It is one of the worst performing stocks in the United States right now. Elon Musk lost $29 billion in the United States right now. Elon Musk lost $29 billion in value in a single day. Donald Trump vowed to buy a car. He got a little bit of a bump, but by and large, that stock is in the toilet. Can you believe what you just said? I mean, if I misplace a Tooney, I lose my cool. And this guy just lost a small nation's GDP. I would love to tell you, Ben, that this is pure economics. I do, because I like when things are pure economics. I can explain things

that involve demand and supply. And if you want to stretch the argument, I guess you could say that this involves those things too, because demand's going down, supply's going up. But I do think there's a bit of a Tesla take down, for lack of a better term. I think people are, especially in countries not called the United States of America, kind of tired of this guy's act. And I think that they're trying to send a message. Sometimes when you can't send it through one market, you send it through another and people are trying to tell Musk, you know, enough is enough and you're not really helping us. So I think there is a piece of that. But yeah, if you want to look at

it in terms of economics, this is strictly, they haven't changed the number of them that they are making, but demand for them has really gone through the floor since this whole thing has started. But now the question of course is, will that threaten Elon Musk? Is he nervous? And my guess is given the amount of net wealth the man has, probably in a short run, he probably couldn't care less. You know, we all have a boss, Ben. We all have a boss. Yours is super nice, by the way, if he's listening. But he has

a boss too. He has to make his boss happy and that's exactly what he's doing right now and he's not concerned about anything else. Dr. Eric Kam, always appreciate your honesty on this show. I hope you come back soon. If invited, stay healthy, Ben. Take care. Let's first start with the F-15 fighter jets that Canada has bought from the United States. We've spent billions on this over the course of their life. It's going to cost about $70 billion. It's a huge investment in Canada's airborne military. And I'm happy to see that we got that commitment

out of this liberal government. But the defense, our defense staff is warning that the U.S. will control key systems on these F-35s because of software patches and over the air updates and that sort of thing. To the point that if they wanted to, they could just turn off the lights and our F-35s would be bricked. And so to talk about this and much more Francis Sims joins

us. He's the associate dean in the faculty of applied sciences and technology at Humber Polytechnic. Francis, thanks so much for being here. Great to be here with you always been. Is this an overinflated worry or is this a genuine concern? I think it's a genuine concern. What we don't really understand is the scope of control, right? But what we did see with somebody like Musk is months ago when a Chechen warlord was driving a cyber truck and thanking Musk for giving him the cyber truck, he just turned it off remotely. Right.

So definitely any of these devices, whether it's military devices or software devices like your phone that are connected to some server at some point, maybe for a software update, have the ability to be stopped. And it may be as simple as maybe it can't connect to the US radar systems. Maybe it won't get that maintenance update at some point in the future if the relations are sour. I would imagine the Canadian military, the German military is having the same issue, are thoroughly having these kinds of conversations and doing what they can to prevent it. But what we don't really know is at the deep code level how much control they actually have.

That's not disclosed. We may never find out. And so I think the concerns are real. If we don't have a supply chain in Canada to build these spider jets ourselves, we're reliant on somebody else. And everything now these days is connected to some sort of internet or network outside of the actual device itself. Yeah, if you if you told me that this was an issue, if you told me 15 years ago, 10 years ago, five years ago, that the Americans had this sort of ability over our military hardware, I don't know that it would have raised the same alarms in my head as it does today. But watching sort of this realignment that the Trump administration is hell-bent on, sort of marginalizing democracies in favor of cozying up to autocrats,

what happens if Canada's military priorities do not align with the Americans? What would stop him from telling the manufacturer of the F-35, you know what? We don't like the fact that they're sending their F-35s to say, Ukraine. So we're going to have you brick them for a little while. And that's exactly Germany's concern right now. What happens if they go into Ukraine and you know Trump's not aligned with it. What happens to those F-35s? So we are witnessing the rise of AI as we know, but it's physically manifesting in robots.

I mean we saw Optimus, the Elon Musk robot, which looks incredible. And now Google is getting in on that with their DeepMind AI models that are gonna power physical robots. We saw a video of it that Google released. To me, the robot looked like a generation behind Optimus, but the potential for it is still there. And it's, I gotta say, it's giving me Shades of I, Robot, the Will Smith movie.

Oh, I remember that. I like that movie. Yeah. But what's interesting about what Google is doing is they're taking the chat GPT concept and they're applying it to robots. So what does that mean? So you can tell a robot, go over there and pick that thing up that looks like a yellow circle and the robot will do that. Five years ago in order to do that you had to spend hours and hours and hours coding the thing to get it to do it. But now Google is going to provide this tool so that software developers can actually start to communicate with it like you and I are talking today and to walk down the street and pick up that thing or help that lady cross the street

or go to the store and pick up my medicine. Yeah. Right, you can imagine scenarios like that. Simple, what the robot might seem as simple commands, you know, will be able to be done by programmers like you and I, right? We'll be able to buy something off the shelf, maybe at Best Buy, and then start to tell it what to do.

So it's really revolutionary, because what it's doing is it's bringing chat GPT off of the computer and into the physical realm. And watching the video as it demonstrated what it could do in the kitchen for example and said hey pack my lunch for me and don't forget my trail mix and it puts the trail mix in the bag and then at the last minute he says oh and give and that there was a bowl of fruit with three different types of fruit and he said oh and and and give me one of the oranges as well and it was able to determine which the orange was and put

it in the bag. There is there is absolutely a use case for this type of robot, perhaps not this generation, but it could be three or four years from now where we see these popping up more and more in people's homes, I think so. And what Google is saying is they have three key things that they're trying to do. They're trying to focus on generality

so that the robot can adapt to new situations, right? So say if there's a box in front of it and able to walk around, interactivity so you can talk to it, right? That's like we do with chat GPT and dexterity. That is going to be able to pick up things, right? That's been very difficult for robots is to be able to, you know, have that fine motor skills. That's really what it's focused on. And so I think if it can solve those three things, it's gonna be exciting. Yeah, I'm speaking with Francis Sims.

He's the associate dean in the faculty of applied sciences and technology at Humber Polytechnic. And we're talking tech stories that will affect your life. And one of them is gonna affect a great number of people in the province of Ontario. Is this lawsuit that a number of Ontario school boards have brought against social media giants. And what's interesting today is we're learning

that the courts have given permission for these lawsuits to proceed. And what's interesting about the claims in it is the school boards are claiming that the platforms are negligently designed and they're designed for compulsive use and they have rewired the way children think, behave and learn.

Now, I believe that that is a case that should be tried in court. However, I got to wonder what you think because unless these school boards can prove that they have done everything they possibly can to keep the phones and therefore those platforms out of the classroom, they don't have clean hands. And for example, in the area I live,

the Toronto District School Board has what has been referred to as a toothless policy on cell phones. So if you're not willing to take the extraordinary steps of keeping them out of the classroom, how can you then criticize the platforms themselves when you yourself are still allowing them to fester in your classroom? Mm hmm. I have a slightly different perspective though. I have a daughter that's in grade

12 at the TDSB and they use Instagram, her and her other college students to plan, you know, group projects and communicate in the classroom. Right. And so I think, I think the issue is I have is that phones are part of our lives. They're part of our lives inside school, outside school, in the workplace, everywhere you go. And I think it's a difficult situation to ban phones entirely. Providers like Meta, what they could do

is they could do things like geofence, right? Or time of day. They could turn off certain features so that when the students are in the classroom, they're not getting a feed with all of this, you know, what's happening to your friend down the street, what's happening in another country, what's happening to your social media favorite person, influencer. What they could do is focus on limiting access to those tools during school time, I think, right? That's a very simple thing because the reality is

that if a student is, you know, in five years from now, everybody's going to be running AI on their phone, they're not doing it already. So these tools aren't going anywhere. And so if we take these tools away from our students in the classroom, it takes an opportunity for the teachers to tell the students how to use those phones to make their lives better, faster. Francis, I'm thinking maybe with the solution here is for the phone producers, Apple and Google, who should be cutting off access once they know that it's geolocated inside a school.

There's no limit to how far criminals will go to cover their tracks. But investigators will go even further to uncover the truth. I'm Nancy Hicks, a senior crime reporter for Global News. This season on Crime Beat, I'll take you from the crime scene to the courtroom, and inside some of Canada's most high-profile cases, and some you've likely never heard of before. Search for and listen to Crime Beat on Spotify, Apple Podcasts, Amazon Music, and wherever you find your favorite podcasts.