In This Economy? How Money & Markets Really Work | Kyla Scanlon

✨ Mint the episode on Zora ✨ https://zora.co/collect/zora:0x0c294913a7596b427add7dcbd6d7bbfc7338d53f/7?referrer=0x077Fe9e96Aa9b20Bd36F1C6290f54F8717C5674E ------ Is it all vibes? Always has been. Kyla Scanlon is a writer, podcaster, analyst, founder of financial education company Bread, and an all around brilliant explainer of things hard to explain. Expect to learn why economies are vibe reflectors, Kyla’s “economic kingdom” model and an overview on the current state of economic affairs. Financial literacy is a superpower and Kyla managed to compress this topic that people have been trying to figure out for ages in an easy to understand economics toolbox. ------ 📣 SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium ------ BANKLESS SPONSOR TOOLS: 🐙KRAKEN | MOST-TRUSTED CRYPTO EXCHANGE https://k.xyz/bankless-pod-q2 ⁠ 🗣️TOKU | CRYPTO EMPLOYMENT SOLUTION https://bankless.cc/toku 🌐 CARTESI | APPLY FOR A GRANT https://bankless.cc/CartesiGovernance 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🔗CELO | CEL2 COMING SOON https://bankless.cc/Celo ⚖️ARBITRUM | SCALING ETHEREUM ⁠https://bankless.cc/Arbitrum ------ TIMESTAMPS 0:00 Intro 6:55 The Vibes Economy 12:10 Understanding Money & Finance 17:04 The Economic Kingdom 20:37 The Monetary Castle 28:35 The Fiscal Castle 37:47 Vibes are the Economy 56:23 The Deciders 1:00:55 Housing Market 1:06:58 The Labor Market 1:13:35 Wealth Inequality 1:19:12 Energy 1:23:01 The Economics Toolbox 1:28:03 What’s Next for Kyla 1:33:03 Closing & Disclaimers ------ RESOURCES Kyla Scanlon on X https://x.com/kylascan Kyla Scanlon Website https://kylascanlon.com/ Order “In this Economy?” Now https://www.penguinrandomhouse.com/books/737854/in-this-economy-by-kyla-scanlon/ Kyla’s “AI Can't Plant Corn (Yet)” https://kyla.substack.com/p/ai-cant-plant-corn-yet WSJ “How Gen Z Is Becoming the Toolbelt Generation” https://www.wsj.com/lifestyle/careers/gen-z-trades-jobs-plumbing-welding-a76b5e43 ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures ⁠

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  The tough thing about the economy is when you talk to people about it, like I run into this all the time. Like I tell people that I work on economics education. They're like, I hate the economy. And it's like, well, you're a part of it. Like, sorry, like the coffee that you buy, you know, the microphone that I'm talking into, the computer that I'm staring into, like all of that are components of the economy. And I think it's very similar to how we all know that the mitochondria is the powerhouse of the cell. Like, I feel like we should know something about the economy in a similar sense. Like, we should know what the Federal Reserve does and why they do what they do, because it has such a big influence on our lives.

• 0:36Ryan Sean Adams?

  Welcome to Bankless. With this time, we explore the frontier of the economy. We're not talking about the crypto economy today. We're talking about the broader economy. As usual, this is Ryan Sean Adams. I'm here with David Hoffman, and we're here to help you become bankless. The question today, how many of us really understand how the economy works? I think a lot of us have gotten our education on the economy, on money, on these sorts of things through crypto, myself and David included. But there's still gaps in our knowledge, like the labor market, or the housing market, and also the reflexive nature of consumer sentiment. How do all these things fit together? Our guest today is Kyla Scanlon. She's wrote a book on all of this called In This Economy that explains how markets and money really work. I think this is a shortcut episode to

• 1:20Ryan Sean Adams?

  leveling up your knowledge on the economy and finance in general. A few things we talk about. Number one, Kyla's term, the vibe session. She coined this term. What do vibes have to do with the economy? We talk about that first. And also, her mental model for how this all works. She calls it the economic kingdom, how the deciders like the Fed and the government tweak the dials of our economy. We also talk about the housing crisis, wealth inequality, the labor market, energy prices, and how all this ties into the economy. And finally, we end with financial literacy, the superpower, how you can apply what you learn to make your life better, and also to help those around you.

• 1:56David Hoffman?

  We've been watching Kyla since she, I think, just started doing some financial skits, some financial jokes about markets and the economy on TikTok. And that ultimately blossomed into just a full-blown career as an educator. But specifically an educator, I think, towards younger generations. I remember when we were starting the Bankless Podcast, Ryan, we would frequently talk about how there's just a complete lack of education around money and finance in the world. Like, it's not taught in primary school, it's not taught in college. And even people that take business and finance, like, degrees are still left with, like, big gaps of knowledge. And Kyla is contributing to, like, filling those voids that are left in our typical education paths.

• 2:38David Hoffman?

  And she's doing it, meeting people where they are, which is on TikTok, on Instagram, on Twitter. And so she's been extremely successful in just raw education of the masses about things that I think have been neglected in typical educational settings. And so it's pretty cool to have been able to watch Kyla's arc grow and crescendo into this book that we are going to cover a portion of here on the podcast today.

• 3:03Ryan Sean Adams?

  Well, let's get right to the episode with Kyla. But before we do, we want to thank the sponsors that made this possible, including our number one recommended crypto exchange and the way to get into the crypto economy that is Kraken. Go create an account.

• 3:16David Hoffman?

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• 4:01David Hoffman?

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• 5:53Ryan Sean Adams?

  Bankless Nation, Kyla Scanlon is a writer. She's a podcaster. She's an analyst. She's the founder of a financial education company called Bread. She's also a friend of Bankless. I gotta say that. And she's been on the Bankless podcast before. And I would say an all-around brilliant explainer of things that are hard to explain, like the economy, it's kind of hard to explain, or money. And she wrote this new book. It's called "In This Economy." I actually have like an early edition of the book. So the edition that you can go buy pretty soon is going to be even better than this. And the subtext is it's how money and markets really work. And if I were to... Give a synopsis of this book. It's kind of like an econ textbook that you can actually

• 6:33Ryan Sean Adams?

  read. It's almost like Ray Dalio for Gen Z, I would say. And I would say it's literally the best resource for getting up to speed on these topics. You know, money, finance, the economy, all these things. I'm gonna say some more good things throughout the episode, but let's just bring her on. Kyla, welcome to Bankless.

• 6:51Speaker 00

  Oh, thanks for having me. Excited to be here.

• 6:54David Hoffman?

  Yeah, it's been, it's been a long time, Kyla. And kind of just making sure listeners know a little bit of your lore. You introduced the term vibe session, I think around 2021, 2022. And this term vibe session has become so widely accepted, understood, and just leveraged in both mainstream media, financial media, even in academic settings, I've heard this word be used. And to the point of which, like, I kind of consider this, like, the vibes economy, the vibe session, as like successfully contributed knowledge to the archive of just like human knowledge.

• 7:26Ryan Sean Adams?

  David uses this term all the time, Kyla. Stop using the term.

• 7:30Speaker 00

  That's awesome.

• 7:31David Hoffman?

  It's, I think, yeah, right. It's in the dictionary, you know, it's fully merged with like human consciousness. The idea of the vibe session, I think, really helped people understand the state of the financial world post-COVID. And its adoption as a term has also kind of risen alongside yourself as a rise of a financial and economics social media educator. Can you just like talk about this experience, the rise of this like vibe session idea, and why you think it was actually so helpful in the mainstream conversation about like helping people understand the state of the economy and just like understand the economy at large?

• 8:03Speaker 00

  Yeah, yeah. So I wrote the piece in July 2022. And then New York Times Opinion picked it up, which is kind of when it all started. And the idea of that piece was to explain the disconnect between consumer sentiment and economic data. So people were feeling pretty bad, even though like GDP was going up and inflation was going down and the labor market was okay. And for me, I had like hundreds and hundreds of comments every day on all my videos of people telling me that like they were feeling pretty bad, even though I was telling them that the economy was good. And they were like, are you a psyop? Like, what's happening? And I was like, am I? And so I wrote this piece to try to

• 8:48Speaker 00

  explore that. And

• 8:51Speaker 00

  The vibes really do matter, and it sounds so silly, but it's just the same idea as reflexivity, which is coined by George Soros, or animal spirits, which was coined by Keynes, is that like, human beings are not rational, right? Like, they're not rational, and we can't expect them to be so, which is the, you know, what economic models rely on. And so, the vibe session is just sort of like, how people feel matters. Like, inflation expectations really matter. How people feel about their economic circumstances really matter. And then, alongside the vibes, there is a structural affordability crisis, right? Like, housing is so unaffordable. And, you know, student loan debt is really bad. People feel like they're not able to maybe get the jobs they want. And so, I think all of those go hand in hand with like, the negativity that we've been seeing.

• 9:36Speaker 00

  And there's a lot of other reasons for the negativity. But like, how people feel matters is the sort of the takeaway from the vibe economy.

• 9:45David Hoffman?

  I think one explanation as to like, why this term got so well-received by people is that it made people feel really heard. And there's like, a big disconnect from the world of money, finance, economics, and like, the average person who just goes to work every single day. People don't enjoy feeling like a metric. They don't feel like enjoying like, being like a number. But this, the vibe session vibe economy, I think, also really helped people understand, like, exactly the relationship between people's like, emotional sentiment state and the economy. And I think that this term really helped to bridge those two things. And I'm wondering if that had any sort of influence in like, how you wrote this book, why you wrote this book, and the contents of this book? Because I think one, one theme of the book is connecting, connecting vibes to markets.

• 10:31Speaker 00

  Yeah, no, definitely. I mean, I think I tried to, the way that I describe my work is like, a human-centric analysis. Because I try to always center people at the forefront of economic analysis, because they can sort of get left behind in some of the economic models. And a lot of researchers have done a great job at this, like Stephanie Stanchew over at Harvard, Isabella Weber, Amherst. And so, I think like, a lot of people have sort of reconsidered the idea that people are the economy and have put them at the forefront, even like, way before I was doing it, right? But yeah, I mean, I think that was the idea of the book is- How do you write something that's fun? Like, there's 60 illustrations. It's sort of structured with each chapter being a standalone chapter. Like, you don't have to read the book in succession. And there's a lot of charts.

• 11:16Speaker 00

  And yeah, I think that the tough thing about the economy is when you talk to people about it. Like, I run into this all the time. Like, I tell people that I work on economics education. They're like, "I hate the economy." And it's like, "Well, you're a part of it." Like, sorry. Like, the coffee that you buy, you know, the microphone that I'm talking into, the computer that I'm staring into, like, all of that are components of the economy. And I think it's very similar to how we all know that the mitochondria is the powerhouse of the cell. Like, I feel like we should know something about the economy in a similar sense. Like, we should know what the Federal Reserve does and why they do what they do, because it has such a big influence on our lives. And so that's why with the book is like to be this toolbox. And I think like centering it on the concept of vibes is important, because then people don't feel left behind by conversation,

• 12:01Speaker 00

  which sometimes economists can drift into where it's like money matters the most. It's like, "Well, no, people probably do." And that's, that was the goal of the book.

• 12:10Ryan Sean Adams?

  Yeah, we will return to the vibe economy and explain that in some more detail. But let's get the overall picture of the book. And I want to ask the question, I think Morgan Housel actually is a bankless guest. He wrote the intro to this. And, you know, it's a fantastic intro. But I want to ask the basic question. From your perspective, Kyla, how come no one understands money, finance, the economy? And not only do they not understand these things, when they hear these terms, they like run as fast as possible in the other direction. Why is that?

• 12:45Speaker 00

  I mean, I think the reason that people run when they hear these terms, like money, finance, economy, is because it's so personal. Like, all of us have a really personal interaction. Like, we all have a personal inflation rate. We all have a personal interaction with the economy, based on our job, on our income, on our retirement plan, on our healthcare. And so I think that's kind of part of it, is like, people want to keep some elements of that a secret. And then I think money is like really big and confusing. Like, the way that it works is weird. Like, what even is a bank? Like bankless, right? And I think like, that's a, that's a big part of it is like, there in the, one of the chapters is this economic kingdom, which was my attempt to draw interconnectivity between all of the various topics,

• 13:28Speaker 00

  like fiscal policy, monetary policy, inflation, GDP, labor market, private market, VCs, all of those things, because I think it feels so disparate and big and confusing. And you kind of have to like solar system it and see all the connectivity. And I, I think for people is it's my, I do this all the time. I'm so avoidant. Like, if I don't understand something, I avoid it. And I, I think that's kind of just what people do is like, they're not given the tools. And it's not their fault, but if you're not given the tools and you don't know how to access the tools, of course you're gonna avoid it, right?

• 14:02Ryan Sean Adams?

  Yeah, here's the crazy thing. I did my entire undergrad in business and I like realized at the end of that, I still didn't understand the economy. Like, I, I understood snippets, right? And I read all the textbooks, like I was actually like a fine student, like I did the, the Simon's side. But I didn't really understand until all of this works, until I kind of like took it in my own hands. And actually like crypto was part of my, my whole financial education. I had to learn all of the other bits and pieces. I, I want to ask you another question is some people might still like think if, if they look at your book or, you know, the, the stuff that you're publishing. Okay, so you can help me understand these things and you're using terms that like I understand. But like, what's the payoff? Why, why is it even, why does it even matter if I understand these things? Like, what's, what's the carrot?

• 14:47Ryan Sean Adams?

  Like, at some level, who cares how the economy works? Can I actually change the outcome? Is there, is there a payoff to actually understanding some of the things that, that you understand?

• 14:56Speaker 00

  Yeah, I don't think people need to understand everything as in-depth as I do. I don't think that's necessary. I don't think you need to know like the calculation for owner's equivalent rent that goes into CPI. Just like any industry, right? Like, you don't need to know how the launch codes work for the nukes. Like, you just gotta know that they're there. And I, I think that's a big part of it. But I, I think like in order to be an informed citizen and like make good decisions as a voter, to like engage with the labor market, to understand inflation, right? Like, understand what, why your grocery bill is going up and like why it might stabilize, to understand the housing market, you do need to understand the economy. I, I think that like, The way that I always talk about it is that if people understand the economy a little bit better,

• 15:41Speaker 00

  hopefully they'll make better decisions. And like a lot of better decisions compounding on one another, hopefully would create a better society. And so that's kind of the way that I think about it is if people have sort of, they minimize the cognitive dissonance that comes with interacting with the system that you don't understand how it works. And you're able to make better decisions around that system, the benefits will increase from there. And so I think that's the big thing is like, is important to understand because you are, you are the economy, as silly as that sounds.

• 16:12Ryan Sean Adams?

  Yeah, I would add to that. I do think that understanding like finance, understanding the economy, at least at a base level, is just basically a superpower. And if you like, don't understand these things, you're almost playing behind. It's almost like playing some board game and you just like, don't know how the rules work. And you're just kind of like moving your pieces in a haphazard way. I think some level of base understanding is actually like, really important, not only for society, but for individuals. Like just to like, plan their life and to like, get ahead. And at some level, if you don't understand the dials of the system and how it might be like pushed or even rigged in some cases in one direction or another, you are at a complete disadvantage in the board game of life that you're playing. It's something I've realized, even just like concepts like compound interest.

• 16:57Ryan Sean Adams?

  Like if you don't understand that, my God, it is, it is difficult to get through as an adult. Let's start here, Kyla, with the actual book. And so you've got this broken into a few different sections. You've got the deciders, where you talk about the people and the institutions, like those that tweak the economic dials. And then you're also talking about the economy, so that the metrics, the marker, the markets, that kind of thing. And then like, what we can do about it. I want to start with that, that concept that you started with. And I'll show this like, for YouTube watchers as well. This is the economic kingdom that Kyla was talking about earlier. Like, first of all, did you, by the way, you do all of your own illustrations, is that right?

• 17:39Speaker 00

  Oh, yeah.

• 17:40Ryan Sean Adams?

  Okay.

• 17:40Speaker 00

  Yeah, that's my art, my beautiful art.

• 17:44Ryan Sean Adams?

  This is great. I love this. So like, can you describe what we are looking at here? This is the Economic Kingdom illustration. We have, I'll start with my description, some various castles here. We've got the castle of monetary policy. It's a big looking castle. I guess that's where Powell and friends live. We've got fiscal policy. We've got the dollar. They're all connect, like, certain things like labor market and inflation are sort of connected to monetary policy. We've got roads. We've got bridges, this sort of thing. Can you start with this mental model? Why do you see things as an economic kingdom? And like, who are some of the main players here?

• 18:18Speaker 00

  Yeah, so this is kind of like, do you remember those rugs that you'd play with when you were a kid of like, you would draw your finger along the road and there'd be like houses on the road? You know what I'm talking about?

• 18:28Ryan Sean Adams?

  Totally.

• 18:29David Hoffman?

  In your preschool, in your preschool.

• 18:31Speaker 00

  Right, like when you were a child. That's kind of like how I think about the economy is like that rug model. Whereas like, they are all interconnected. And so I tried to do that sort of model here with the Economic Kingdom. So monetary policy and fiscal policy are like on their own little castle land because they're the policy land. The US dollar interacts with monetary policy. Monetary policy interacts with developed and emerging markets. Monetary policy is shooting a cannon into the labor market and inflation, which are the two levers that monetary policy ends up impacting, the jobs market as well as price stability. And they're using a cannon because they're raising rates, which I explain later on in the book.

• 19:13Speaker 00

  Inflation impacts the housing market. And so it's just showing like, they're in the newest version of the book. There's an updated version of the map as well with a little bit more castles. But it's just meant to show the interconnectivity of all these things. There's a crypto castle going into the stock market.

• 19:29Ryan Sean Adams?

  Thank you for that, by the way.

• 19:31Speaker 00

  Do you like the bright shiny lights going off on it?

• 19:34Ryan Sean Adams?

  Yeah, what are these? Okay, so on the crypto castle, it looks like we have some signs saying money.

• 19:40David Hoffman?

  It looks like a stadium.

• 19:40Ryan Sean Adams?

  And blockchain. Yeah, we got the stadium. We got the advertising. The SPF arena, the FTX arena, maybe.

• 19:46Speaker 00

  Yeah, crypto, crypto colo arena.

• 19:50Speaker 00

  But yeah, yeah. So this is the idea of the economic kingdom. And it's an intro to the book because I wanted to set a precedent for the connectivity of the economy because this is like where I got stuck when I was learning about the economy. I was like, how the heck do all these things interact? Like, is the stock market the economy? Like, what's happening? And so putting it on this map, I did it. I wrote this piece, oh my God, back in like 2021, The Economic Kingdom, I think. And I've always used that as a reference since then. And I thought it would be a good opener to the book, just sort of like setting the stage for connectivity. And the thing is, with like the kingdom itself, you could literally draw like the biggest map in the world and it still wouldn't be big enough for all the moving pieces of the economy. But I tried

• 20:34Speaker 00

  to be reductive and get it in there. Yeah.

• 20:37Ryan Sean Adams?

  Can we, can we start maybe by talking about monetary policy then, that entire kingdom? So give us the 101. What does the Fed actually do?

• 20:46Speaker 00

  My favorite question.

• 20:49Ryan Sean Adams?

  Well, you are a known Fed simp. I read this in your book as well.

• 20:54Speaker 00

  I think that line got taken out.

• 20:56Ryan Sean Adams?

  Oh, really? There's a line where people don't, will never read this. I have an early edition of the book that says-

• 21:01Speaker 00

  Yeah, you have like a secret one.

• 21:02Ryan Sean Adams?

  Yeah, that says, hey, Kyla says something like, I'm a well-known Fed simp in air quotes. I wasn't exactly sure what that meant.

• 21:10David Hoffman?

  I'm gonna go ahead and guess it's an internet viewer kind of being a troll on YouTube. It kind of fits that bill.

• 21:16Speaker 00

  Oh, yeah. Yeah, because like the way that I, so this is like one of my problems is I get excited about like monetary policy. I love like, I really like the economy as a concept, almost as like a video game for me, like not that people's lives are a video game, but like just that how money moves is so fascinating. And so I can get like a little bit too animated, I think. I'm like, yeah, the Fed. And I pretend to be Jerome Powell in some of my videos. And so people are like, you're simping, dude, I guess.

• 21:44Ryan Sean Adams?

  All right. So there's no simping here in your explanation. What does the Fed do? No simping.

• 21:49Speaker 00

  Yeah, yeah, it's the Fed, huh? The Federal Reserve is the monetary policy unit of the United States. So it's pseudo-governmental, so it's not necessarily part of the government, but they do report to Congress and they set monetary policy. And so they are in charge, one of the illustrations shows it. They're in charge of like walking this tightrope of the economy, balancing both price stability, so making sure inflation doesn't like destroy everybody, as well as the labor market, so making sure that anybody wants it, who wants a job can have a job, which is called maximum employment. And so they make sure that inflation is around 2% inflation rate. And then maximum employment doesn't really have a target, but like unemployment below 4% is usually like what the Fed wants to accomplish.

• 22:32Speaker 00

  And the way that they do this is they have a toolkit. So they manage price stability and labor market through a toolkit, which includes their rates, it includes their balance sheet, and includes forward guidance, as well as a couple other things. But like they've raised and lowered rates depending on if they want the economy to slow down or speed up, so they would raise rates, which they have been doing for the past several years to slow the economy down, because if you make money more expensive, people are going to spend less of it. Less money going around means the economy slows, means inflation slows. If they wanted to speed things up, which they kind of were doing before the pandemic, they would cut rates. And now that's the conversation that we're having is like, is the Fed going to cut rates? Because if they cut rates, that'll speed things up. Money's easier to get, they get going. Balance sheet is a little bit more complicated,

• 23:16Speaker 00

  but basically another tool that they can use. And then they have forward guidance, where they'll have these meetings, where they come out and talk and sort of let people know what they think might happen. And so that's kind of like monetary policy in a very small nutshell, is it is a balance of price stability and labor market. Yeah, that the Federal Reserve, who is a governing body, headed by Chairman Jerome Powell, as well as 12 of the bank presidents, ends up deciding on. The FOMC is a subset of that, but yeah, 12 bank presidents.

• 23:47David Hoffman?

  So as a representative of the crypto castle, and which is connected through the stock market to the Federal Reserve and monetary policy. I'm wondering if you can kind of like, give your take about kind of the group think that comes out of the crypto castle when it really, as it relates to the Fed. So you have the Bitcoiners who think like, the Fed is a corrupt institution. It's 12 white dudes, 12 white people behind closed doors that just like, you know, control the earth. Everyone wants the Fed to cut rates so that they can pump our bags. And overall, like, it's a failure of an institution. It's like maybe a grandiose, like snapshot of a classic crypto take about what the Fed is.

• 24:29David Hoffman?

  Maybe you can kind of like audit that take and for just like the meme of like the crypto takes perception of the Fed, like, how do you feel about that? And how would you actually like, rate or grade the institution of the Fed?

• 24:42Speaker 00

  I mean, I was having a conversation with somebody earlier today and we were talking about nuance. And like, nobody cares about nuance. Everybody wants the hottest take in the world. And I think that crypto and their views on the Fed can end up in that camp a lot of the times. I think that it's important to have, like, it's okay. The history of the Fed is like, it came around like around 1913. And the reason it came around is because we had bank panics. Like, we had banks that were issuing their own currencies, like we had Wildcat Banks.

• 25:12David Hoffman?

  A lot of regional independent banks.

• 25:14Speaker 00

  Yeah, and there was bank runs, like, nobody's like Silicon Valley Bank, but like way worse. And so there's no insurance. Like, so JP Morgan of JP Morgan Chase, I was like, whoa. And so he got the Federal Reserve together and like, that's kind of why we have a monetary policy unit is because, you know, markets are good, but like, they run away a lot of the times. And so I think it is good to have some guardrails on that in the form of a policy unit. I think my big issue with the Fed is the toolkit. Like, right now, they're raising rates in order to battle inflation, but we have a housing crisis and shelter is like 70% of CPI, the Consumer Price Index, this main measure of inflation. And if you're trying to battle a housing crisis by raising rates, making it harder

• 25:59Speaker 00

  to build housing, that's not really going to work. Like, it's going to only be more inflationary. And so I think that's my big issue with the Fed. And what they're doing is like, the tools don't work. It needs to be like targeted. More, but they have such a broad hammer that it's tough. And I think too, they have become responsive to the market in some instance, like the stock market will respond to the color of the tie that Jerome Powell is wearing. And that's, that's tough too. So I think that the crypto people, crypto people have a point that maybe like, what does it actually look like to have an institution with tools that can actually address the policies that we're facing, which are usually like supply side solutions, not demand side solutions,

• 26:44Speaker 00

  like raising or lowering interest rates. But I do think it's important to have an institution in place, which I know is unpopular with the crypto populace. I just think human nature makes it hard for things to be dependent on human nature. Yeah.

• 26:59Ryan Sean Adams?

  So in broad, in broad strokes, right? The Fed handles, the Federal Reserve handles monetary policy. And like, how has monetary policy evolved? Cause it feels like it's a lot different now than it was like maybe 20 years ago or like 40 years ago. So like, what's the current evolution and like, why does it need to evolve?

• 27:18Speaker 00

  Yeah. So, I mean, even when they were figuring out their toolkit, they discovered interest rates essentially on accident. They realized that by lowering and raising interest rates, that would impact how people spent money. This was like right when the Fed was started. And so that became kind of like part of their toolkit was, was the cost of money. But I think like now with Jerome Powell's Federal Reserve, you see a Federal Reserve that talks a lot. You see a Federal Reserve, Federal Reserve that is constantly giving meetings. Like, I don't even know how many Fed speakers were out this week, but they constantly talk because the markets move so fast now that you have to stay in front of the information circuit. And so for them, like they can raise and lower interest rates as much as they want, but that really hasn't worked its way through the economy.

• 28:03Speaker 00

  The balance sheet really hasn't worked its way through the economy. But what the Fed does and says, what the Fed says specifically, not what they do, really matters. And so I think that's kind of been the evolution of the toolkit is that we have seen. A Fed, like Alan Greenspan, you would kind of get a sense of what his Federal Reserve is going to do based on the size of his briefcase. Like if it was a really thick briefcase, you knew that rates might be moving. But if it was a thin briefcase, you wouldn't. And so I think that's like the big change is we see a very, very communicative Fed.

• 28:35Ryan Sean Adams?

  Okay, so that's the Fed castle in our monetary kingdom here. Let's talk about, let's bring a second castle into play here, and that is the castle of fiscal policy. The neighboring castle. Yeah, the neighboring castle. These two are kind of like connected, but they're distinct, right? They have their own like kind of like moats. They have their own castle walls. They're just like also separate castles. So what is fiscal policy? Like what is in the tool belt of fiscal policy?

• 29:00Speaker 00

  Oh, yeah. Fiscal policy is fascinating. It's much more broad than the Fed. Like the Fed kind of has a limited toolkit. They only really can do what they're mandated to do through Congress, which is manage inflation and manage the labor market, and then also like ensure that long-term interest rates are around 2% or normalized. And so for fiscal policy specifically, they have all sorts of tools. Like they have taxes, they have their government debt, which is issued in bonds. They have different acts that they can do. Yeah, thank you. The government's doing taxation and borrowing.

• 29:39Ryan Sean Adams?

  This is Kyla's illustration here, just like a friendly looking person with a tool belt here.

• 29:43Speaker 00

  Their toolkit. Yeah, yeah. So they can borrow money, which is like their government debt, then spending that money would be government spending, taxation. So the government makes money through taxes and they make money through borrowing money, and then they, you know, end up spending that money on whatever. And so you saw fiscal policy become really, really big through the pandemic, where the government was like, oh, gosh, like, we got to get our people through this. So you saw the stimulus checks, you saw student loan forgiveness, until it was not forgiven anymore. And then you saw rent forbearance, other things like that. The big loans that like businesses were able to partake in. And then you saw it now, like the CHIPS Act, the IRA, the IIJA. And so the government is really interesting. Because they can do more targeted policy.

• 30:27Speaker 00

  Like I interviewed the Deputy Secretary of the Treasury, Wally Adiemo, who is the Deputy Secretary of the Treasury, about the housing policy of the Treasury and like what they're doing to build more homes. And that's like a whole part of fiscal policy as well. But their main tools on the tool belt are what I listed out there. It's just, it can be applied in so many, because government spending can be applied in so many different directions. Versus the Fed is rather limited. And so I think that's like, kind of, oops, kind of the cool thing about fiscal is that it's so broad. But you have to be really careful. And the thing, the reason the two castles are connected is that the Fed has been raising rates in order to battle inflation, right? And because they're raising rates, they're making all debt everywhere more expensive to finance,

• 31:11Speaker 00

  like mortgages, government debt. And so the government is now about to be spending more on interest payments than they are on defense spending. And that's like a sticky situation for the government is like, we don't want to be spending all of our budget, all of our money on interest. And we want to be spending it on policies to help people through things or to help protect the country or to reinvest in American manufacturing. And that's the problem with fiscal policy right now is that it's being capped by money that is expensive.

• 31:47David Hoffman?

  Maybe to kind of illustrate the two different roles between fiscal and monetary policy, the way I would articulate this in crypto terms is like, fiscal policy is a lot more like opinionated and like potentially can be more precise and granular and like exact and directional. Like you're, the government is actually kind of picking winners and losers here. Like here, here's who we're going to tax. Here's who we're going to subsidize. Whereas like monetary policy, the Fed is a little bit more like wholesale, a little bit more blunt, a little bit more neutral, doesn't pick winners and losers. It just like kind of raises or lowers the temperature for the entire economy as a whole. How would you, do you like those like articulations?

• 32:26Speaker 00

  Yeah, yeah, I think I think that's a good way to say it like, yeah, the CHIPS Act was very much focused on semiconductors and like building out US manufacturing in that capacity. The IRA was actually pretty broad, but like, yeah, there was like targeted monies towards various things, same with IAJA versus yeah, the Fed has such a blunt tool, which is rate hikes. And it's kind of like, this is going to impact everybody versus yeah, more targeted policy.

• 32:55Ryan Sean Adams?

  Kylie, we just did an episode with Lynn Alden on a, yeah, something that that she calls, and this is not just Lynn speaking, but we've entered an era of fiscal dominance is what she's talking about. And the basic idea here is that like the fiscal side, the fiscal kingdom has a lot more weight than it has previously. And like monetary is less impactful, it's still obviously impactful, but is is almost less impactful. It's become kind of like, like a sideshow with with respect to what the economy is going to do. And fiscal is now in charge. And she points to kind of like debt to GDP ratios and other indicators

• 33:37Ryan Sean Adams?

  that that show that that we're entering a new era of fiscal dominance. What's your take on that perspective? I know it's not shared among everyone. What like, what would you say to this fiscal dominance era? Are we in a fiscal dominance era? Or like, would you disagree?

• 33:51Speaker 00

  Yeah, I think there's an element of truth to it. I think the tough part for me is like, you know, we all pay taxes to a certain extent. And then like, you do want the government to spend money on things because like, that's what a government is meant to do. It's meant to serve the people. And I think like, so there is an expectation that they spend money. But like, I do think fiscal dominance is becoming part of an issue where they're like crowding out is kind of like what it might be called as well as like, you know, it's crowding out perhaps private investment. It's making it so there isn't as much opportunity in certain spaces. I really think the interest cost is is concerning because part of the issue with the idea of fiscal dominance, too, is like, how do you back out of that? Like, how do you sort of fix something that's so big?

• 34:36Speaker 00

  That's happening so quickly. And I don't think there is a solution other than big government. And I think you like, this is an aside, but I promise it like, kind of ties into it. But we're kind of entering a new era of robber barons as well, where you see like, some of the tech giants taking some of the same moves that like Andrew Carnegie, or Rockefeller, Vanderbilt will. And the government kind of like turning a blind eye. Like you have seen a little bit of crackdown anti trust wise. But this OpenAI case with Scarlett Johansson and, you know, them using her voice is going to set such a precedent for how AI moves. And like, will the government turn to blind eye to that? And will it be like another era of robber barons?

• 35:17Speaker 00

  Like, is the government doing what it's actually meant to be doing, which is ensuring that the populace is like, respected from a corporation and ensuring that like, you know, taxes are taken care of them. Is there a social safety net for them? And I think we have this element of fiscal dominance that maybe isn't ensuring some of the basic things that might, that people would probably want to have met. Yeah. So that would be my take.

• 35:39Ryan Sean Adams?

  If I were to encapsulate maybe your take from that chapter I read, it's just kind of like, you don't think that fiscal spending in and of itself is bad. Like, so like, you know, it takes like, maybe you call these misconceptions like, oh, the government spending is to blame for all inflation. Or like, government trade deficits are always bad. Or just in general, budget deficits are bad. I think you're like, it seemed to me your take is more, it depends what they spend on. If they're spending on interest payments, or if they're spending on kind of like, maybe you put entitlements in this category. It's just like an area of not like, as much future investment. When I say that, I might, I might mean like, if you massively increase social security or something like that, you're spending on older generations at the cost of like, younger generations.

• 36:23Ryan Sean Adams?

  Then maybe you're not investing in sort of the right things with your fiscal dominance. So whether it's good or bad, it really kind of depends on what the, like, the fiscal side is actually investing in.

• 36:33Speaker 00

  Yeah, like, is it productive? Is it something that's going to grow the economy long term? I think that's the concern. Like, you know, you think of the barbell of life. And right now, we have a crisis on either end, where like, there's a lot of old people, and there's somewhat a lot of young people, specifically babies. And both childcare and elder care is extraordinarily expensive. Childcare has gone up 32% since 2019. It's like $10,000 a month to put somebody into elder care. And so I think both of those are going to require government intervention. And like, both of those can be productive in their own ways, but it is the government spending money on stuff. Like, there is going to have to be the government stepping in. And I think that's where this conversation gets kind of hairy.

• 37:17Speaker 00

  It's like, that isn't going to be a free market solution. Like, you know, a private equity firm can't step in and save the childcare industry because that's, I just don't think that would work. Maybe they can, but the margins are razor thin. It's like 1% margins in childcare. And so you have to have the government, you have to have an element of fiscal dominance with both of those things. But they're refusing to step in in a really big way. So, because they're focused maybe on the wrong stuff, I don't know. But I would say that that's like another component of the conversation.

• 37:46Ryan Sean Adams?

  Maybe we'll talk about more the fiscal side of things when we get to a chapter that you wrote about wealth inequality and like, your take there. But let's, let's get to another entire section of, of like, the education that you're providing. So, we talked about the economic kingdom and some of the main deciders, which is like, the big deciders are monetary policy and Castle, you know, Powell, and the fiscal policy, which is like Castle Congress, Castle President, US Government. Let's talk about the economy itself and maybe how it's measured. So, most people listening will be familiar with GDP or gross domestic income, some of these measures that they hear, you know, so often. We could talk about that. But I actually want to start back to the beginning of this conversation where we talked about vibes itself.

• 38:31Ryan Sean Adams?

  Because vibes are actually, in something that you emphasize, they're also a way to measure the economy. And maybe one way of measuring this is

• 38:43Ryan Sean Adams?

  Consumer confidence, so I'm not quite sure that that encapsulate vibes. But you say things in your book, and you said this before, like vibes are the economy. And you've got this illustration, it's called the cake of uncertainty. And another illustration is basically how you feel and how everyone else feels. So let's get back into vibes for a minute. How come vibes are the actual economy? And like, how do you even measure vibes? Can you measure them?

• 39:10Speaker 00

  Oh, yeah, I mean, I think consumer confidence surveys are a good step. And yeah, I would say that's probably like the biggest thing that we have to get a sense. I would also say polls on trust are a good indicator of overall vibes. Like, the Harvard Youth Poll came out at the end of April, and there's a massive decline in trust, which means that the vibes probably aren't going to be so good. And consumer confidence was improving. It had quite a negative print for the month of April, mostly because it moved to the web, but still, like, you know, stuff wasn't looking so good. And I think that vibes are the economy in the extent that like how people feel matters. How people feel ends up driving how they spend. Consumer spending is 70% of GDP.

• 39:54Speaker 00

  And there's other stuff that goes into that, rather than just like people spending money. But how people spend money matters. And like, if they're spending money, really matters. And if they're feeling good, that really matters as well. And so vibes are the economy to that extent. But then I think it's also, it's a little woo, but like the self fulfilling prophecy aspect of it too. If people are feeling really bad, they don't take risk, they don't start companies, they don't do things. That can be like a long term impact of vibes and how it impacts the economy.

• 40:22David Hoffman?

  Yeah, I think this is where things can kind of get weird from people's intuitions and understandings of economies. Like, like the way that generally like economies is like, it's very measured. It's a science, like you measure GDP and that's the economy. And why are people good? Well, GDP is up, and that's why people feel good. But I think people often like miss the fact that it can actually reverberate back and go backwards. Like, it can actually be the tail that's wagging the dog. So maybe we can illustrate like how negative vibes can create negative GDP. And this is kind of where like the world of like sociology and psychology like actually becomes related to economics and fiscal policy. So maybe you can kind of illustrate like some of the ways that vibes reverberate back into the economy and actually like change the fundamentals.

• 41:05Speaker 00

  Yeah, I mean, I think George Soros and reflexivity is a good example of this. Like what people think about prices ends up sort of moving prices because it ends up dictating their actions. Prices move relative to that. And so you kind of have this self fulfilling prophecy. And so it's sort of the same with the economy, too. Like if people are like, I'm freaked out and I'm not gonna buy, you know, that ends up impacting the economy at large. What's sort of funny is you're seeing these companies sort of pull back on inventory, like Target specifically, where they bought up a lot of inventory during COVID because they didn't have enough because people were buying a lot. But now they're like, oh, my God, we have so much inventory. Like, we have to do all these massive sales. And that's largely dictated by consumer behavior. And so I think that's just like one example of vibes and like how people feel as well

• 41:50Speaker 00

  as, you know, macroeconomic circumstances. But I would say like reflexivity is sort of the textbook definition of what you're describing as well as vibes is just a different word.

• 42:00David Hoffman?

  One like, just like, something that I thought that was pretty interesting to watch was all the data about the Taylor Swift era's tour and how it actually showed up on GDP measures. And if you, anyone saw like one single video of like a concert of like all these screaming girls of all ages at Taylor Swift having some incredible vibes. Just and just like that show like transcended, just like it was an international vibes all over the place, everyone having a really good time. And then it actually like shows up in positive GDP numbers. And I think there's like a pretty like direct correlation there. It's like vibes were had, people want, want good vibes, so they pay for a Taylor Swift concert ticket, they go, they have good vibes, they buy the merch, you know, they go out

• 42:45David Hoffman?

  with their friends, they have a good time, and then, and then the GDP numbers go up. Maybe you can like kind of unpack that relationship a little bit well, just like the, the demand for good sentiment that people want and the actual like showing up in GDP numbers.

• 42:56Speaker 00

  Yeah, it's, it's funny that you mentioned her because somebody, a couple of people mentioned that Taylor Swift should be like a Fed economic tool, like we should review her.

• 43:07Speaker 00

  When the economy needs stimulation because she was a little bit inflationary. I think specifically it was like maybe Sweden and her and fiance are coming at the same time or maybe at several times. So like both times, like the Swedish economy or the Swiss economy perhaps was like, oh my God, like this is so inflationary for our hotel prices. And so, yeah, like that's a very good example. And I'm glad that you brought it up of how the vibes can sort of impact. I think for her, like she's an interesting case study of culture, like religion and what people are seeking from the things that they consume. But yeah, people spent like $1,300 on the whole experience. People have built special outfits. Like there was a museum that put together a Taylor Swift exhibit and they

• 43:52Speaker 00

  had their best day in 60 years because of that. And so if people like really are excited about something, they're going to find a way to spend money on it. And then that will show up in the economic numbers because they're spending money and they're feeling good about it. And they're going to invest in this service, which is Taylor Swift and her concerts. And so I think that that was like such a huge economic boon. She's in Europe now and people are flying to Europe to go see her. Another economic boom. And that's like, we saw people shift from spending on goods to spending on services. And Taylor Swift is just one example of that. But it's kind of like the post-COVID YOLO economy is what some are calling it, where people want to consume experiences. And that's very

• 44:36Speaker 00

  good for the economy because when you consume an experience, you consume a restaurant, you consume a hotel, you consume clothes, you consume transportation. So it's an all encompassing thing versus just buying a shirt.

• 44:49David Hoffman?

  You introduced yourself as like somebody who explains markets and economies from like a very humanist standpoint in the introduction of this episode. And the takeaway that I kind of have from this is like, this is a really good case study of like Taylor Swift, for example, or just anyone with talent who like has a show that people buy tickets for and like do consumption as a result of. Like there's some lesson there about like individual agency and. The ability to like increase the GDP of their local environment. And like Taylor Swift is kind of like the archetype of this, like she did it for the entire world. But like, one of the like vibes that I get from your content is like individual ownership and responsibility about like how to change one's like local state of being.

• 45:32David Hoffman?

  And like the lesson I think from there is like in like, one person can improve the economy, like look what Taylor Swift did. Now, not everyone has to be Taylor Swift, but I think it does illustrate the power that one has to influence the economy in like their, their local regional area.

• 45:46Speaker 00

  Yeah, I wrote a piece on this recently. I've been like really into the idea of trust lately. It's been like my post book endeavor is figuring out why we hate each other. And um, it was just fun, but agency is a big part of that, I think, like there's sort of a decline of agency. We've, we've seen it since 2020. Jean Twenge, who wrote iGen documented it. People feel like they don't have the capabilities or the tools to make the decisions that they want to. So they end up stuck, which is kind of the opposite of what you would expect, especially for you all, like in a crypto, you know, internet era.

• 46:23Speaker 00

  But yeah, I mean, I think the big thing that I I've sort of come to as I've been wondering, it's very easy to like go on a podcast and be like, "Look at all the things that are wrong with the economy. Who's gonna fix it?" And then like, but to actually think about the solutions is more challenging. But I do think you're right that, that it is, it does boil down to the individual and what an individual can do. Because we all cannot go and make policy. We can all vote, right? But like, there, there's some really fuzzy parts to actually making changes in the economy. And it oftentimes boils down to reinvesting in your local community, like planting a garden or volunteering at the library, making sure the library exists.

• 47:05Speaker 00

  Like, things like that is kind of what we, we have to do. I went to this art exhibit like a weekend ago and I went to the 1700s exhibit. And the whole time they were talking about in the art, they were talking about reason versus emotion. And I think it's very similar to like the vibes discussion around the economy is like, there are the rational aspects of this, like yes, invest in your community. Yes, do this and that. But then there's the more emotional side where, um, you know, what do you do when things feel impossible? And it's still important to understand those things and to give yourself the tools that you need to try and fix them on the local level.

• 47:44David Hoffman?

  I think one thing I've at least appreciated, I think both me and Ryan have like a love hate relationship with crypto Twitter. But one thing I've appreciated with crypto Twitter is the vibes are like so salient. Like when people feel good.

• 47:56Ryan Sean Adams?

  Vibes are everything on that platform.

• 47:58David Hoffman?

  Yeah, it's like when prices are up, like vibes are good, the memes are good, and just everyone's having a good time. When prices go down and they continue to go down, then like things get really nasty. And it's like a very easy thing to feel once you're on crypto Twitter a lot. You have this idea in your book called vibe markets as vibe reflectors. And like I said, crypto has this like full, like totally naked. It's so easy to understand like people's sentiment in crypto because like it changes on a whim as a result of like the very volatile crypto markets. But maybe you can unpack the whole like markets as vibe reflectors take.

• 48:32Speaker 00

  Yeah, yeah, I mean, I think it's exactly what you're saying is that markets do end up reflecting how people feel about the circumstances. Crypto specifically, like, you know, prone to speculation in some pockets. But I think that's the big thing is, you know, GameStop just went up again at time of recording on May 21st, where, well, now it's back down. But like last week, it was up crazy because Roaring Kitty tweeted a meme, tweeted like 50 memes. And those are vibes. That's not reality. And so I think that's like, kind of the takeaway. I don't enjoy that take, but I think it's true. It's like one of those things where it's like, I wish the fundamentals mattered a bit more. But like, you just look

• 49:15Speaker 00

  at the stock market and you're like, all right, you know, what's happening here? And it's better than it was. But like, still, things like GameStop, you're like, that's not, that's not real.

• 49:25Ryan Sean Adams?

  Have you converged, Kyle, on this idea that vibes are fundamentals? Like, are they like one in the same sort of thing? Because this is like a constant question that we have and are sort of sorting out. Some people are like, no, the vibes are the fundamentals. You know, like the memes are actual, it's all memes, all the way down.

• 49:41Speaker 00

  I guess.

• 49:41David Hoffman?

  There's a sector of meme coins in crypto where like the investment philosophy is you go into the telegrams and you buy the coins that have the funniest memes and you sell when the memes stop making you laugh.

• 49:51Ryan Sean Adams?

  Yeah.

• 49:52Speaker 00

  I know. What was it? George Boden? George Boden?

• 49:55David Hoffman?

  Joe, yeah, Joe Boden.

• 49:57Speaker 00

  Yeah. But, um.

• 50:01Speaker 00

  I hate that. I'm sorry.

• 50:06Speaker 00

  I think I'm just like too much of an idealistic where I'm like, no, the world's good and perfect and everybody is rational and like, obviously not, like, I'm not rational. But I think that like, I think it more so frustrates me as it does for everybody who's kind of like, you know, I'm invested in crypto and like, I pay attention, but it's kind of like, what the heck? But it makes sense, like, it makes sense that memes would take over because like memes are a sense of reality in a world, the post-truth era, right? Like, nobody knows what to believe in, so why not believe in like, a Doge? And so I think you're right to the extent that vibes are fundamentals. But with companies, it's like, okay, this company makes no money and has no products, like, should it be trading like this? Maybe, I don't know. I don't know.

• 50:50Speaker 00

  It's, if I'm saying that vibes are the economy, it probably would make sense to say that vibes are the stock market, too.

• 50:56Ryan Sean Adams?

  One thing that politicians I feel like have been tapped into for a long time, this might be like more tangible to a broader audience, is like gasoline prices and how people feel on the back of high gasoline prices, because it matters. And also, I feel like it matters maybe more than it fundamentally should, because gas prices are just so visible. And for some reason, everyone talks about it. It's like small talk, it's like, one of the categories of like, you talk about the weather and you also somehow, for whatever reason, talk about like, the price of gas. And I don't know, I'm not in like, the gas price talking subculture, but like, people I know, just like, are always talking like, about the price of gas.

• 51:38Ryan Sean Adams?

  And when gas, you know, gasoline price at the pump went up like above like, I don't know, $8, something like this, in place in California, like, there's memes and just like, all sorts of things about it. Is the price of gas another example of like, the vibe economy and how this works? And have politicians kind of figured this one out?

• 51:57Speaker 00

  So there's a newsletter called The Briefing Book, which is very good. And they wrote this piece called "The Bad News Bias in Gasoline Price Coverage." And the media loves gasoline prices. So I think it's not only that you're seeing like this neon sign on every street corner, because we're such a car dominant culture in the US. That like you're on a road that has a gas station most of the time if you're on a road. But also like it's media loves it. They love talking about gas prices. And gas prices are funny, because it is something that people end up spending a lot of money on, because people drive everywhere in the US. You know, the relationship that people have to their car is very personal. And so I think that's like one part of it. But yeah, it's funny, like politicians are definitely tapped into it.

• 52:42Speaker 00

  They'll be like, "Gas prices are high under this guy. You don't want him. Get me, I'll make it cheaper to frack." And it's like, what? And the funny thing is that, you know, gas prices, the reason that they're high going into the summer is because we switched to a different blend. So we switched to Sweet Summer Crude, which is like a different blend.

• 53:03Ryan Sean Adams?

  Sweet Summer Crude? There are blends? I don't know if my gas flavors- This sounds like my coffee. Yeah, that sounds lovely. I'd love some Sweet Summer Crude.

• 53:11Speaker 00

  You would like to drink gasoline.

• 53:14Speaker 00

  Yeah, but no, we switched to a different blend. And then there's also maintenance on the refineries. So gas prices, and also people travel more. And so the gas stations are like, "Raise those prices." Because demand goes up. And so there are like actual reasons that gas gets more expensive at certain times of the year. But like, you know, explaining, "Oh, we're switching to a different blend." Like, that's not as exciting as being like, "No, the, you know, the politics." Right? And so it's totally a political talking point. And it's a media talking point as well.

• 53:46David Hoffman?

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• 54:31David Hoffman?

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• 55:15David Hoffman?

  sending crypto to phone numbers across wallets using social connect. But Cello is a community-governed protocol. This means that Cello needs you to weigh in and make your voice heard. Join the conversation in the Cello forums. Follow Cello on Twitter and visit cello.org to shape the future of Ethereum. Arbitrum is the leading Ethereum scaling solution that is home to hundreds of decentralized applications. Arbitrum's technology allows you to interact with Ethereum at scale with low fees and faster transactions. Arbitrum has the leading DeFi ecosystem, strong infrastructure options, flourishing NFTs, and is quickly becoming the Web3 gaming hub. Explore the ecosystem at portal.arbitrum.io. Are you looking to permissionlessly launch your own Arbitrum Orbit chain? Arbitrum Orbit allows anyone to utilize Arbitrum's secure scaling technology to build your own Orbit chain,

• 56:00David Hoffman?

  giving you access to interoperable, customizable permissions with dedicated throughput. Whether you're a developer, an enterprise, or a user, Arbitrum Orbit lets you take your project to new heights. All of these technologies leverage the security and decentralization of Ethereum. Experience Web3 development the way it was always meant to be: secure, fast, cheap, and friction-free. Visit arbitrum.io and get your journey started in one of the largest Ethereum communities.

• 56:23Ryan Sean Adams?

  But this also gets into how the deciders, back to fiscal and monetary deciders, actually, they're not dumb. They know that vibes drive the economy, right? And they have some influence over the vibes, right? So you talk about price at the pump. Well, there can be fiscal policies that tap into the petroleum reserves, right?

• 56:45Speaker 00

  Oh, sure.

• 56:46Ryan Sean Adams?

  And get more or less sweet summer crude and bring price at the pump down. There's certainly Powell, which is like, I don't know if the central banker of the US, Jerome Powell, he's like the chief vibe officer of the economy, it feels like sometimes. And this is why people pay attention to the Fed chair's briefcase and what they're wearing and the tone that they use in a given FOMC meeting, all of these things. Presidents certainly set vibes as well, like how optimistic they are, how visionary they are versus like how maybe pessimistic they are. So I guess maybe the general question is, what's the role of the deciders in setting the vibe? Is it really bottom up?

• 57:29Ryan Sean Adams?

  Is it really decentralized where the people get to decide? Or do the deciders themselves sort of influence the vibes? And are they aware of how much influence they might have?

• 57:38Speaker 00

  Yeah, no, the deciders definitely influence the vibes. People respond to what they hear. And I think there's like two components, right? Like what Jerome Powell says, the color of his tie, whatever, what the president says, what the communications office of the president says, how the media translates all that. If you have a negative word in a media headline, the click-through rate increases by 2.3%. If you have a positive word, it decreases by 1.9%. And so there's an incentive in the business model to spread negativity. And I think that's a big component of the vibes as well, is that people consume headlines.

• 58:18Speaker 00

  There is a statistic that the average American spends five minutes a month on news websites. So they're just consuming headlines, like for a couple of seconds every day, just consuming some headlines, which is fine, sort of. But I think that's where the vibes are set, is through the translation of policy. And right now, just because of the business model of media, the translation is largely negative. And not to be like media bad, but I do think that's true. Yeah.

• 58:48David Hoffman?

  Your vibe session term that, like I said, got just merged into everyone's brains pretty well just because it felt like it filled like a niche of understanding in people about why they feel bad. I'm wondering what your perspective is on like what the actual role of the decision makers are in making vibes good. So it's like there's an affordability crisis, as you've said, like food is more expensive, houses are more expensive, like these are things that are on Maslow's hierarchy of needs. Yet they're not all of the economy. And so policymakers, decision makers, they have to look at all the economy. But then also, a lot of people are feeling really bad because of food and housing. And so I'm wondering, like, what

• 59:29David Hoffman?

  role do you think bad vibes ought to play a role in the inputs into decision makers?

• 59:35Speaker 00

  I mean, I think that it's been, Jerome Powell's been asked about consumer sentiment before. He's like, people are like, what's up, dude? Like, why are people feeling bad? And he's like, I don't know. And then he points to like structural affordability. And so I think like there's, you can't, I'm trying to figure out how to say this best, but like, you can't lie to people. We do have a structural affordability crisis. And I think what people crave now more than ever, and what crypto does a relatively good job with, actually, is like transparency. Like, people really want people to lay it straight. Like, I think everyone's really sick of being advertised to, of being lied to. And so I think that's the responsibility of policymakers, is to translate these really complex things as

• 1:00:19Speaker 00

  simply as possible and tell people like what actually is going on, rather than speaking around it. And that might like impact the vibes short term negatively. But I think right now, in order to establish like long term, good vibes, we have to rebuild trust in a major way. And that'll come through transparency. And so I do think Like, I don't think that policymakers should get up there and be like, things are great, everybody, because people aren't stupid. Like, everybody kind of has a sense of what's happening. And I think it's a disservice to the public to not speak to that.

• 1:00:55Ryan Sean Adams?

  I want to ask you what your perspective on the housing market is right now, because, you know, because it's not, you know, we can't tokenize houses yet. Actually, David tried that in a previous company. It's a little bit of that, but not very much. So, we don't often talk about the housing market on Bankless, right? But it's a very important market and something you give a lot of focus to, I think, in your content, certainly in the book. So, do we have a housing crisis right now? If yes, like, how would you describe it? Like, what does the average person, what do Bankless listeners need to know about the housing market? Like, how it works and what the problems are?

• 1:01:29Speaker 00

  Yes, we do have a housing crisis, because people cannot find a place where they want to live cheaply. And like, home prices have skyrocketed. In 2020 to 2021, they far outpaced wages. Like, home prices went up by $55,000, I think, which is like, higher than the median wage. And so, like, it's like, whoa, what's happening? And there's so many different components. Like, it's number one is the history of housing. Like, homes were never meant to be the speculative investment. The return on housing from like, 1870 to 1970 or so was 0.06%. But now, we expect this like, massive return on our home. And part of the problem is that, if you look at the chart of the distribution of financial assets from the Federal Reserve, the bottom

• 1:02:13Speaker 00

  50%, all of their wealth is tied into their house. And so, the American dream is this idea that you'll get a house, and that house will be your nest egg. And that's what you're gonna like, make all your money on. You're gonna sell it when you're old, and then, you know, you're gonna die or whatever. But that, like, that's not working out, how people thought it would. Because, number one, people can't get into homes. But, and so, going back to that chart, though, if you look at the top 10%, all of their wealth is in equity ownership and stocks. And so, like, number one, there's a lesson there, that maybe homes shouldn't be a speculative investment. If people want to make a lot of money, it should be exposure to markets, as well as things like that. Like ESOPs, employee stock option programs, or owning a small business. And then in terms of the housing market at large, we are now, Derek Thompson wrote a really good piece on this.

• 1:02:57Speaker 00

  We're facing this question of like, is a home an investment? Or is it a place to live? Like, is it a speculative tool? Or is it something that you like raise a family in? And for a lot of people, it's both. And that's a really sticky situation when there aren't enough homes. And that's the problem that we're having is we just don't have enough homes in the places that people want to live. And part of the reason is zoning laws, like we have crazy zoning laws. Seventy percent of LA is zoned for single family homes. Meaning that you can't build multifamily, you can't build duplexes, triplexes, townhomes. You can only build single family homes, which is great. But like, you have to have a little bit of a mix of it.

• 1:03:37Speaker 00

  And then it's NIMBYism, so not in my backyard. So going back to the point of homes being a speculative investment. There's a lot of people who are like, I've lived here for 30 years. I want to sell this home for a million dollars more than I bought it. And I don't want anything else built around me because it could destroy the value of my home. Even though there's plenty of studies showing that that's not the case. So that's one component of it. And then the other thing is just the cost of building homes has been really expensive. Especially into the pandemic, like lumber had a whole crisis. There was a lot of labor market costs around constructions. And so housing has just been this perfect storm. Even post 2008, like builders were like, we're never going to build another home again. After what just happened here, like this is nuts.

• 1:04:22Speaker 00

  And it's really quite hard because you have this like psychological impact where people are like, I have to have a home. To build wealth, I don't know how else to do it. And then also it's like, well, I have to have a place to live and I'm going to be renting for the rest of my life. And legislation really favors homeowners, like you get a tax break on a mortgage, you don't as a renter. And that's like one component of it too. All the tax incentives are also in place. For older people, people to stay in their homes for a very long time and not sell. Like boomers own most of the four bedroom homes. At this point, that should be passed on largely to the millennials who have kids. And so it's all this stuff, like the US housing market is. There's so much going on. That's why I have a whole chapter.

• 1:05:07Speaker 00

  I could talk for like an hour straight.

• 1:05:09Ryan Sean Adams?

  I'm just curious, like, so for people who are listening, right? Obviously, homeownership is skewed older, right? So baby boomers are like, kind of like, looking around. Some of them are like, what problem? That doesn't make a problem. Even like elder millennials, many of them have houses, many of them have property. But this is particularly hitting, you know, Gen Z and some of the younger millennials. Do you have any like advice for them in general? Like, they're faced with this problem, they just don't know. They can't afford to buy a home. They don't even know whether they should. And it feels very much like a speculation casino. Like, is it going to resolve at some point? Is like the advice just like, hold on and wait? Or like, what's the practical advice for someone who's just like stuck in this dilemma of like,

• 1:05:51Ryan Sean Adams?

  renting forever, not being able to afford a home, like really wants one, really wants some participation here? What would you say to someone listening like that?

• 1:05:58Speaker 00

  Yeah, I mean, I think like, I would like to own a home one day too. And it's like, I don't know if that's gonna happen. And so I think like, what's kind of interesting about the housing situation, and Conorsen from Bloomberg Opinion has pointed this out, is that like, when you don't own a home and you push off having kids, you have a little bit of extra spending money. And so you do see people, you know, spending on various activities, whether it be like sports gambling, or investing, or crypto. And so like, that's like, one way to do it is to find another outlet for the money, to invest it, rather than purchasing a home, you know, the down payment, the mortgage, the property taxes. I'd say like, not all hope is lost.

• 1:06:43Speaker 00

  But I would say it's just, it's more frustrating than anything. And I recognize the frustration, but there are alternatives to homeownership that include, you know, building a pretty good investment portfolio, if they choose to do so.

• 1:06:58Ryan Sean Adams?

  Another market we don't talk about very much on Bankless, or relatively uninformed on, is like, the labor market. And there's a whole section in your book about the labor market. It's incredibly important, but like, what, high level, what is the labor market? Where does it fit in? Who's responsible for the labor market? And what do we mean by that?

• 1:07:14Speaker 00

  The labor market is everything. It's like, everywhere. And the way that it fits in is that it's like where employers and employees interact. And so if you're looking for a job, you know, you're part of the labor market. I'm technically part of the labor market as a contractor. And so like, that's just one example, right? And there's all sorts of services that encompass the labor market. But the labor market is important because it gives us a good sense of how the economy is moving. So there's different surveys that give us this idea, like the JOLTS, the jobs opening and labor turnover survey, which is what the Fed and other entities use to gauge the strength.

• 1:07:56Speaker 00

  The labor market is the job openings numbers that these companies are posting. However, this metric has been a little bit fuzzy because sometimes people will post a job opening and that opening won't be real. It'll just be positive press, like, oh, look, we're hiring, even though they're not planning to hire anybody. And so that can get a little bit weird. Another metric that's good in terms of the strength of the labor market is the quits rate. So the quits rate is actually a sign of strength. If people feel like they can quit their job, that is actually a very strong labor market. It's a very tight labor market. And so for the Fed, the way that they would want the labor market to be in an economy that they're trying to slow down would be a looser labor market, like a higher unemployment metric

• 1:08:39Speaker 00

  versus an economy that they want to speed up. They would want to see a tighter labor market over time. But yeah, it's really just like how people interact to get a job. It's income, it's taxes, it's how people, most people get help here in the US specifically. And so, yeah, it's an incredibly important market to pay attention to. But because of the metrics, it can be a little bit fuzzy to figure out what's happening. Because JOLTS isn't very good, quits can be weird. And yeah, it's a very interesting market, but there's a lot of nuance to the numbers.

• 1:09:14David Hoffman?

  I would imagine the labor market is very tightly coupled to vibes. I think you defined the labor market as for everyone who wants a job, they can get a job. But I think maybe what's missing from that definition is the type of job that people want. And so like, you know, I have worked jobs in my past that I do not want to return to. Maybe it's a rite of passage of people's like first job or first job out of college or something like that.

• 1:09:40Speaker 00

  What were your worst jobs?

• 1:09:43David Hoffman?

  Well, okay, I was proud of the fact that I worked at this mental health agency with kids between the 13 and 18 for two years, but I would never ever want to return there. My gosh. So it's social work. And, you know, glad I did it, but just like the my vibes were going to be bad if I stayed there for too long. And so like, there's a relationship between like, can you get a job is the first thing, but then can you get the job that you want? And do you feel fulfilled in that? And all of these things, all of these like variables, I think, relate to vibes, probably very strongly. And so like, how does that the vibes element play into the idea of like, the labor force and a strong labor market?

• 1:10:21Speaker 00

  Yeah, I mean, I think that's like, the thing that we're kind of seeing now is that there's rolling recessions in tech and finance. And so like, for tech and finance, people specifically on Twitter, if you say the labor market is good, people will be like, no, it's not, because for them, it's not. But for healthcare and hospitality, it's great. It's a really good labor market. And so like, that's kind of the problem with sort of painting a broad brush stroke over things, is that like, some components of it are doing very well. Tech and finance over hired during the pandemic, like, a lot of tech companies had jobs that unfortunately, maybe didn't make sense for the long term, but they hired for. And that's tough to back out of. And so that's kind of like what

• 1:11:05Speaker 00

  we're seeing in some aspects of the labor market now is a normalization, but that doesn't feel very good at all. And so that's why the vibes can be off is like, people are like, I got this cool job, and now it's gone, and this really sucks. And it does, because we don't have a great social safety net. So if you lose your job, it's like, it's really quite scary. Speaking from experience, you know, it's scary. And yeah, so I would say that's like, part of the vibe, part of the labor market.

• 1:11:35Ryan Sean Adams?

  What about some of the intergenerational tensions here? Like, what, how would you describe the the generations are interacting with one another? Is it like, sort of worse for one generation, or, you know, one segment of the age demographic versus another? Or is it just like, is it, yeah, who's, who's feeling the bad vibes right now? And like, who's feeling the good vibes based on age?

• 1:12:00Speaker 00

  I think all of the demographics have similar issues. Like, there's been a lot of good pieces talking about ageism. Like, certain people pass a certain age struggling to get hired, or being, like, given the, what's it called? The golden let go or something, like, the soft goodbye. And so I think that's the hard part for older groups. And then I wrote this piece for Fast Company around this time last year, around how Gen Z was thinking about the labor market. Because it is like a completely different environment. You can't really rely on your employer how you used to be able to. It used to be that you would work somebody, somewhere for 40 years, and that would be your job.

• 1:12:44Speaker 00

  But now, you know, there's no pension. There's not really that same job security. And so I think younger people are thinking about the labor market much more differently than how older people would. And a lot of corporations are like, well, why wouldn't you sell your soul to me? Like, I give you money. And people are like, oh, my god. I also think there's the rise of entrepreneurship. Like, you all are a really good example of that, like, striking out on your own. Crypto enabling a lot of that. You know, me, too, doing something sort of similar. People now have the internet, which enables anybody to sort of do their own thing. And I think a lot of young people have taken advantage of that. The gig economy has sort of died. It's still around, but I think people are very much like,

• 1:13:27Speaker 00

  wow, this is a crazy way to treat other humans. So I think, like, there's a lot of lessons in the labor market, yeah.

• 1:13:35David Hoffman?

  Growing up, my financial and Marxist literacy was basically at zero. And I was very much in the same, in kind of an anti-capitalist camp, which I, like, fall, fell victim to, like, the thinking of just, like, wealth inequality is like the bane of, bane of the existence, like, you know, down with the bourgeoisie, this kind of thing. And but like also at the same time, like the wealth inequality is like a huge drag on vibes. Like, it doesn't really matter that we're living in some of the best times in human history ever, where like in people in poverty in America still can watch some of the best entertainment on Netflix that we've ever had. But that doesn't really matter.

• 1:14:16Speaker 00

  Right.

• 1:14:16David Hoffman?

  When like you can kind of look over the fence at your like neighbor with a Ferrari or like, you know, billionaires tweeting on Twitter about their shenanigans. Because like the gap between the rich and the poor will always still make people feel bad. How would you say the variable of wealth inequality is impacting the whole the whole structure of the economic kingdom that you've illustrated?

• 1:14:36Speaker 00

  Oh, it's huge. Have you heard of the Las Vegas tunnels?

• 1:14:40David Hoffman?

  No, I haven't.

• 1:14:40Speaker 00

  Okay, so there's a group of homeless people that'll live underneath Caesar's Palace. There's a very good documentary on it. But like, it's kind of interesting because you have these people like living in a tunnel because the water is cleaner. You know, you can plug into Caesar's pretty easy. And above them is like billionaires just walking around and gambling and like all this opulence. And I think that's like, it's not even a metaphor. It's like the economy. Right, it's like these, you know, you have people living in tunnels and above them is, you know, billionaires' footprint. And I would say like wealth inequality is a huge part of it. There is a statistic that talks about like the top 400 people in the US. They used to be 2% of US GDP and now they're like 17%.

• 1:15:25Speaker 00

  So we have seen a lot of wealth concentration at the top. And like, there's all sorts of tax policies in place too. Like, the inheritance tax that we have basically does not exist. So if you inherit money from your rich boomer parent, like, you're solid. And this is creating a really, John Bern Murdoch wrote about it in the Financial Times, like this really crazy bifurcation. This is not even on the level of wealth inequality. It's just like between generations. Like, there's going to be a cohort of millennials who are inheriting a home from their boomers, from their boomer parents, and then a cohort of millennials who aren't. And so that's going to sort of create even more stratification between these two groups and create even more wealth inequality.

• 1:16:06Speaker 00

  And like, there's really, like, what are you gonna say about that beyond just like tax people more? But I think that wealth inequality is a massive problem. And it's so sad, like, I love the United States and I love living here, but it's such a bummer because we have so much wealth, but like, not a lot of prosperity. You know, upward mobility, Stephanie Stancheva, researcher at Harvard, has documented upward mobility has declined. It's harder to get to where you would want to go just because of the concentration of wealth amongst the top. And, you know, there's all sorts of political incentives to take away benefits for the bottom, even though it's kind of like, we probably should help these people, like,

• 1:16:51Speaker 00

  they need help. It's tough, yeah.

• 1:16:54Ryan Sean Adams?

  Is this kind of like a drag, would you say, on the economy in general? Or is just this sort of like a distribution type of like problems that, or is like, I guess, you know, some folks that we've talked to feel very strongly like wealth inequality like turns into social, political problems. This is kind of like a Ray Dalio type of concept. It's just basically, it just spills over into turmoil, like revolution, this type, this type of thing, which called, like, creates kind of a negative sum type of gain, game. And this is how it affects society overall. But like, what do you see as the effect of wealth inequality to the economic kingdom?

• 1:17:38Speaker 00

  Oh, yeah. I mean, I think it is a huge drag, both economically and, you know, socio culturally. It's a, there's an Einstein quote that talks about, I can't do it justice because I can't remember the whole thing, but essentially it's this idea of like, how many kids are stuck in cornfields not having access to the education that he had? Like, how many geniuses do we have stuck in the middle of nowhere because they couldn't get out? And I think that's really true. And like, the internet helps with all that, but like, wealth inequality traps so much intelligence and it traps so much brilliance because people are just stuck. And I think that's so. So sad, and it's obviously a drag on the economy because like if we had a better ladder

• 1:18:21Speaker 00

  out of poverty for people, who knows that we could accomplish, right? And I think it's always been hard to get out of poverty, obviously, but I think now it's difficult. It's just like, things are so expensive, student loans are very high unless you get a certain amount of scholarships. And I think that people, maybe they're not willing to take on as much risk as they used to be able to. There's sort of like the decline of the internal locus of control and a focus on the external locus of control, like pushing blame to everything outside rather than knowing on the inside that you can take certain actions.

• 1:19:03Speaker 00

  And I think that's kind of the tough part is, yeah, like we have so many people that need help, and how do you help them?

• 1:19:11Ryan Sean Adams?

  One maybe last area, I would love your insight on is energy and commodities in general. I know you've talked a lot about energy, and I'm wondering your take on how energy sort of factors into the economic mix and understanding it. I think that we want to do more episodes on just like the energy lens on things in general, even on just-

• 1:19:37Speaker 00

  That'd be good for you.

• 1:19:38Ryan Sean Adams?

  Yeah, I think it would. On like monetary economics and that sort of thing. Some folks have talked about energy, basically with respect to even central bankers and fiscal policy, there's kind of like an energy blindness, like almost the idea that that nature is kind of like the ultimate central banker, right? Like the price of oil, barrels of oil, actually like matters a lot. And sometimes we are so abstracted from that and disconnected from that, we don't realize how much it matters and how much energy price impacts in a positive way, the good times that we all enjoy. Well, what's your lens on things? Like if you were to, you know, provide some education for people listening on energy, what do they need to know?

• 1:20:22Speaker 00

  Yeah, I mean, I think that what's happening with energy right now is kind of sad. We've made a lot of progress towards clean energy, like we're moving towards solar. We're moving towards other alternatives, but you've seen more of a move toward fossil fuels again, towards coal, just because people are like, it's kind of expensive to be green. And we like short-term profits. And so I would say that's like a big thing that's happening. But there is so much progress in the clean energy space, and I think there's a lot of exciting things happening. But I think you're totally right that like commodities are the undercurrent of the economy. Sam Altman, who's the CEO of OpenAI, was giving an interview

• 1:21:05Speaker 00

  about energy usage of AI, because AI uses a ton of energy because of how big the data centers are. And he was like, yeah, we're probably gonna need nuclear power soon. Like, we're gonna need to figure this out. But like, that is not feasible. And I think it's really, it is feasible, but like, it's a long path toward it, right? And it's something we should have done a long time ago. But I think that's kind of the thing is like, we're, you know, we're talking into our computer screens, we're looking at the AI voice bots that sound exactly like Scarlett Johansson, and turns out is Scarlett Johansson's voice. And we're saying like, okay, this is cool, this is awesome. And I don't think we give thought to the fact that like, one conversation with ChatGPT is equivalent

• 1:21:48Speaker 00

  to pouring out an entire water bottle. Like, it uses an entire water bottle's worth of energy. And so I think that's just gonna be the capacity constraint. You see it with Nvidia, too, is making these GPUs. Like, there's real-world capacity constraints to everything that we interact with. And that's something I wrote this piece called AI Can't Plant Corn Yet, because we often give a lot of virtue to the, you know, the very cool technology that's coming out of AI. But we oftentimes forget that, hello, we need corn, and we need like, the stuff on the ground. The Wall Street Journal published this piece

• 1:22:30Speaker 00

  called Gen Z is the Toolbelt Generation, talking about how Gen Z is returning to trades. And I think this is sort of a tangent. I do this all the time. Like, I'm like, it's sort of related to what we're talking about. But it's like a tangent to the energy conversation. But I do think, like, Gen Z being the tool belt generation, a focus on energy, a focus on clean energy specifically, is going to be

• 1:22:51Speaker 00

  So important for the next decade and it'll be the key to economic growth because we can't grow the way that we are right now. I mean, we can, but like we won't be here in 15 years.

• 1:23:01Ryan Sean Adams?

  Kyla, this has been so, so good. And I think we've only got a taste of the excellent resource, this, this book that, that you've written. Maybe to kind of close things out, let's start talking about application. It's sort of like, let's say those listening and people in general become more financially, economically literate. Now's the question of like, what do we do with this knowledge and, and how do we prepare? So you've got a chapter that talks about, you know, some of the, the metrics to pay attention to. And I think maybe this is one lens of your book is once you understand how all of these die, like just the basics of how these dials work and how the economic kingdom, the various,

• 1:23:44Ryan Sean Adams?

  you know, castles interact with one another, then you can like interpret things that are happening in the news or in your life and like take some action, make, make a better decision on the back of that. And all of these like better decisions, financial and life decisions that you make over time, those will compound into like a better life for you, right? Whether it's like your career, you know, what you do there, or how you budget, or what you invest in, or some of the major purchases you make. So maybe let's talk about some of the, the metrics to watch and like what people can do with them. Once they have this base level of, of financial literacy. So something like interest rates. Okay. What do you do when they're high? What do you do when they're low? Like, um, you know, how

• 1:24:28Ryan Sean Adams?

  do you pay attention to interest rates?

• 1:24:30Speaker 00

  Yeah, yeah. I mean, I think interest rates are a really good metrics to pay attention to because they ultimately determine borrowing costs for most things. And so if they're low, it's, it's probably a good time. So if you're looking to buy a house, to pay attention to A mortgage and home prices and see if that's a place that you want to go into. High interest rates are maybe a good time to pay attention to bonds. Various stocks as well that would do well in a high rate environment. So like, there's all sorts of investment opportunities that come along with interest rates, as well as life decisions, like purchasing a home or taking out a big loan for maybe starting a new business. I would say that's like the application that can be taken away from paying attention to interest rates.

• 1:25:13Ryan Sean Adams?

  How about inflation rates? That's another number that's kind of top of mind. And, you know, CPI has been burning hot lately. Maybe it's down a little bit, but what do you do when it's high? What do you do when it's low? Is there anything you can do?

• 1:25:23Speaker 00

  Yeah, CPI is frustrating. Inflation is frustrating. I mean, here, it's like, one thing I talk about in the book is sort of your personal inflation rate, so having a sense of what you're spending money on. Maybe it's something that you're spending money on, like beef went up crazy amounts, eggs went up crazy amounts. Like, maybe you don't eat beef and eggs. You eat turkey or chicken for a couple of weeks, just because those are rather expensive. So it's kind of like paying attention to those things. That's a little bit in the weeds, but a lot of, there's even investment tools that can help hedge against inflation, like TIPS, Treasury Inflation Protected Securities, which is the government. You can purchase some of those. They're protected against inflation, so it's a rather smart move in a high inflation

• 1:26:07Speaker 00

  environment to have exposure to things that are relatively insulated from inflation. And when inflation is raging, that's a good thing to do. When inflation is low, it's like, it's fun. You know, it's a good time to have exposure to fun companies.

• 1:26:22Ryan Sean Adams?

  How about employment data? Is there anything we can do with kind of the unemployment numbers that we hear economists report out?

• 1:26:29Speaker 00

  Unemployment, like, the labor market is funny because there was a survey that came out that said that six in 10 Americans think that unemployment is a massive problem, even though unemployment's basically at an all-time low. And so I think it's just really understanding, like, what's actually happening with the labor market, but then also having knowledge that there are rolling recessions. So if you're like, maybe going to enter a certain industry, like, okay, maybe it doesn't make sense to go into computer programming right now with AI. It's still like, we're going to need programmers, but there's been a lot of pullbacks in hiring in that industry. So just paying attention to like, who's hiring what and where and why, and maybe building out skill sets relative to that.

• 1:27:11Ryan Sean Adams?

  So overall, Kyla, what do you hope people get out of this book? What do you hope they take away? And how do you hope it benefits their lives?

• 1:27:20Speaker 00

  I mean, the reason that I wrote this book is because I felt like it was important for people to have a toolbox to understand the economy. There's so many good economics books out there, like Basic Economics, Economics in One Lesson. Jeremy Rudd just published a really good book on economics. There's so, so many. And so what I tried to do is just consolidate that information and make it really fun and accessible. So it's more consolidation rather than a creation. And I hope that people feel like they are able to have the information they need to make decisions about their lives. I think it's really tough to exist in a system that you don't understand. And I think that's how a lot of people feel about the economy is like, what are interest rates? What is the Fed? And I'm hoping that this can help just one person make a better decision about their life.

• 1:28:04Ryan Sean Adams?

  So what's next for you, Kyla? I'm actually incredibly impressed that you have the discipline to put together an entire book. This is a thick book as well. It's like a lot of pages. And I know from my experience, David and myself is just, I think we probably, David, we've not had an explicit conversation for a while, but probably we thought about doing a book. But it's always like, rather than spend the time and discipline ourselves to come up with a book, we just record another podcast. We do podcasts instead. It's way easier.

• 1:28:36Speaker 00

  Podcasts are long.

• 1:28:37Ryan Sean Adams?

  And sometimes if we're feeling really disciplined, we will write an article. David does more of that than I. But you've put together an entire book and you're also still producing a massive amount of podcast content, video content, TikTok shorts, all of these things. Short skits? Yeah. We haven't even done that. So I guess my question is, what are your plans next? First, congrats on the book. And then what are the plans next? Is this a book tour? Are you doing a media tour? Will you never write a book again? Will you become a notable author with dozens of books in the future? What are your plans?

• 1:29:14Speaker 00

  I don't know.

• 1:29:17Speaker 00

  I'm actually having like an identity crisis. This happens, I think, after you write a book. Because like the book is all of you for a whole, like for me, it was about a year. And so like, all I would talk about is my book and like all this stuff and, or the book and all my book. And yeah, and so like for me, I'm really interested in just how can we help people understand the economy? And like not be so concerned, like nervous about it? How do we help people get the information that they need? And so I explored that in a book format. I'm kind of interested in a TV show format next, if that ends up working out. I would love to write another book. I write my newsletter about every two months right now, but it'll tick back up soon. And then I have all sorts of short skits as well on the various platforms.

• 1:30:02Speaker 00

  But I really think it's kind of like connecting people to the foundations of understanding the world around them. Like, one thing I also tried to do in the book is connect it back to philosophy. So there's a lot of poems, there's a lot of quotes from various writers. Because I think that like, and this is me getting on my high horse, but I think that the economy is holistic. And we have to understand it through a human lens, and that requires multidisciplinary efforts. And so that's kind of also what I'm interested in is how do we tie together? I love tying stuff together. I'm sure that Economic Kingdom made that clear. But I, how do you, how do you tie together all of these things? And econ has been so underserved in terms of art. So how do you make more art about the economy?

• 1:30:44David Hoffman?

  Very cool. I love that perspective. And like Ryan said at the beginning, just a master explainer of very hard things that few people have attempted to explain before and now. Kyla, your, your brand to me has always been like radically independent. I know you have a publisher of a book because you kind of need that to write a book. But overall, like I think you're pretty much a pretty independent content producer.

• 1:31:09David Hoffman?

  Talk about that, that like choice or just that, that resonance with remaining independent? And how you like, what that means for the future of your, your story arc?

• 1:31:18Speaker 00

  Yeah, I mean, I contract. So like you all were literally the first people ever to take a chance on me, which thank you. Huge, huge. I should have thanked you very first thing in the podcast. But yeah, it's like contract with various people, make videos for them. It's scary. As I know you all kind of know, it's like, you know, it's you don't have healthcare, like stuff like that. And so you're kind of jumping around trying to figure out what's next. But like, yeah, I think like, I have so many ideas that it would be hard for me to work for somebody because it wouldn't be fair for them. Because I'd be off like working on something else when they'd be like, can you please get back in Excel? That was my issue with the first job I had. And so, yeah, I would really love to stay independent. Yeah, I think it's really fun.

• 1:32:01David Hoffman?

  Do you have any advice for young aspiring entrepreneurs, content creators, educators, just, you know, startup founders about your experiences that you've had?

• 1:32:12Speaker 00

  Yeah, I mean, I was so scared when I first started out. Like, I was terrified. And then, like, I think the biggest thing is like, asking for help and letting people take chances on you and sort of being brave. Like, I had no net. Like, if things didn't work out, like, bye. And so I think the biggest thing is just believing in yourself, as cliché as that sounds, but also knowing when to stop. Like, I've started and stopped so many projects because I was like, this is not the right thing to be focusing on. Like, my energy is better served elsewhere. And so it is like, taking multiple risks within, like, that's why I'm on literally every single platform is because you have to be everywhere all of the time in the work that I do. And I think it's like, that's a similar lesson

• 1:32:57Speaker 00

  for an aspiring entrepreneur is be everywhere that you need to be within the industry that you're in.

• 1:33:03David Hoffman?

  Well, Kyle, it's been fantastic having you on Bankless. The fact that Bankless had any small role at all in the very beginning of your arc is, I think, pretty cool. And I'm very humbled by that. And it's been cool watching you leapfrog us into the world of like mainstream media and reaching far more people than I think we have. So, congrats on your arc.

• 1:33:20Speaker 00

  Thank you. Yeah, thank you guys so much.

• 1:33:22Ryan Sean Adams?

  By the way, Kyle, I really, David, I like that mental model for us. Maybe we should just produce art about crypto. Maybe that should be our model.

• 1:33:30Ryan Sean Adams?

  Something underserved. Kyle, yeah, thanks again for joining us. And Bankless Nation, we will include in the show notes a way for you to either preorder, depending on when this is released, or order Kyle's book. It's going to be released May 28. It's called "In This Economy: How Money and Markets Really Work." We talked about some of it here today, but it's only just scratched the surface. And we have to end with this, of course. Our usual risks and disclaimers. Crypto is risky. You could lose what you put in, but we're headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bankless journey. Thanks a lot.