Why Chaos Has Become an Economic Strategy — ft. Kyla Scanlon

Ed opens the show by discussing Shein’s potential valuation cut, South Korea’s crackdown on DeepSeek, and the controversy surrounding Javier Milei’s promotion of a memecoin. Then Kyla Scanlon, author of “In This Economy? How Money and Markets Really Work”, returns to the show to unpack the concept of “FAFOnomics” and explore Gen Z’s growing concerns about the U. S. economy. Finally, Kyla offers advice for Gen Z on navigating today’s labor market and emphasizes why adaptability is essential for career success. Meet us at SXSW Subscribe to the Prof G Markets newsletter Order "The Algebra of Wealth," out now Subscribe to No Mercy / No Malice Follow the podcast across socials @profgpod: Instagram Threads X Reddit Follow Scott on Instagram Follow Ed on Instagram and X Learn more about your ad choices. Visit podcastchoices.com/adchoices

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• 1:26Ed Elson?

  Welcome to Prof G Markets. Scott is out this week. I believe he is in Switzerland or Austria or somewhere. He's skiing. He's not with us. He's slacking. That's basically what's happening. So I'm filling in this week. I'm speaking with Kyla Scanlon, the author of In This Economy: How Money and Markets Really Work. And we'll be talking about the economics of our generation, which is Gen Z. But before we get into the show, just a reminder, Scott and I will be recording a live episode of Prof G Markets from the Vox Media Podcast stage at South by Southwest on March 10. We had an incredible time last year. I was just shocked by the feedback and also just how many of you showed up.

• 2:11Ed Elson?

  I was, it was incredible for us. But we need to make this year even bigger. So we hope you will attend. If you want more info on how to go to the recording, go to voxmedia.com/sxsw.

• 2:26Ed Elson?

  That's voxmedia.com/sxsw. And with that, let us get into the headlines.

• 2:34Speaker 05

  Now has been time to cry. I hope you have plenty of the well at all.

• 2:41Ed Elson?

  Shein shareholders are urging the company to slash its valuation to around $30 billion. That's down significantly from its peak of $100 billion in 2022. According to those familiar with the matter, some shareholders believe the valuation cut is necessary to get the IPO over the finish line. South Korea has temporarily blocked new downloads of DeepSeek over privacy concerns. Regulators said the app will be reinstated on Apple and Google app stores once DeepSeek complies with the country's personal data protection laws. And finally, Argentina's president Javier Millay is facing lawsuits and potential impeachment after promoting a meme coin on X.

• 3:22Ed Elson?

  The coin briefly soared to a $4 billion market value, only to crash within hours of its launch. The coin's creators are accused of a rug pull scheme where developers launch and promote a token and then cash out as its value peaks. Okay, so let's start with Shein. Shein is down to $30 billion reportedly valuation. The first thing I can tell you about this, Scott Galloway is not going to be happy. As many of you probably know, Scott is an investor in Shein. I actually don't know how much he invested. I also don't know what the terms were on his investment. I don't know what the valuation was. And we will find out. We'll make sure we ask him when he comes back.

• 4:03Ed Elson?

  What I do know, though, is that the last time Shein was valued, it was worth 66 billion. And the year before that, it was worth 100 billion. So we're now looking at a $30 billion IPO. That is a 70% decline in less than three years. This is not good news for Shein. Now, why is this actually happening? We've heard a lot of people say that it's, you know, market conditions, there's supply chain issues, there's issues with the logistics on the IPO. Maybe that's true, but I think most of this is a distraction from the real issue, which is Donald Trump. And more specifically, Trump's suspension of this tax law that we've talked about, known as the de minimis provision.

• 4:45Speaker 06

  American consumers will soon see the effects of President Trump's new tariffs on Chinese goods, especially if they shop online at discount stores like Temu and Shein.

• 4:55Ed Elson?

  So what is the de minimis provision? This is a rule that we have in the US for any shipments that come into the US. If they're worth less than $800, then you don't have to pay taxes. And this was originally designed so that Americans could go on vacation and go and buy souvenirs and bring them back, and it would be duty free. But instead, what happened is we had all these foreign e-commerce companies who realized, okay, if we can make our products really cheap, if we can make sure that every order is below $800, then we can access the US economy, we can access the American consumer and not have to pay taxes. And so that is why in the past decade, the total value of de minimis shipments in the

• 5:38Ed Elson?

  US has gone from $40 million to $40 billion. And more than 30% of those shipments come from two companies, and those companies are Temu, which you've probably heard of, and yes, Shein. So in other words, this tax law is the backbone of Shein's business model. So Trump has threatened to end this. He knows how important this tax exemption is to China. He knows how important it is to Chinese companies. And if he does end it, it would likely ruin Shein's business. So this has always been one of my problems with Shein as an investment, is that their key differentiator isn't any form of technological innovation. Their differentiator is their willingness to exploit a loophole in the US tax code.

• 6:23Ed Elson?

  Now, as we know, exploiting tax loopholes is a great business model until it isn't, until something in the tax code changes. And that's exactly what's happened here. This loophole on which this entire business was built is now under threat. And until we have clarity on what will happen to the de minimis provision, I don't think this company can go public because we simply can't know what the business is going to look like. So Scott, if you're listening to this right now, I think it's gonna be a long time until this company actually IPOs. It was supposed to IPO this April, that was the goal. It's now looking like it's gonna be delayed a lot longer. And if I had to put my money on it,

• 7:04Ed Elson?

  my bet would be that an IPO is probably gonna come in 2026. But maybe I'm wrong. And let me know if you think so, and you can always hold me to account.

• 7:15Speaker 07

  DeepSeek의 국내 서비스가 2월 10월 토요일 6시부터 잠정 중간되었으며.

• 7:21Ed Elson?

  Now, let's talk about what's happening with DeepSeek in South Korea. So South Korea has temporarily blocked new downloads of DeepSeek. We don't know if this ban is going to last longer. I think this is the right move from South Korea. And I'm honestly surprised it didn't happen sooner. The reality with DeepSeek is, yes, it's cheap. Yes, it uses fewer chips. Yes, its reasoning capabilities are highly advanced. But it is also unbelievably insecure as a technology. It's one of the most compromised technologies we've ever seen. Its encryption is the weakest in the industry.

• 8:02Ed Elson?

  It is, according to research, four times more vulnerable to hacks than ChatGPT. We've already had multiple data leaks, and Wiz has published some pretty concerning research on this too. And on top of all of that, their data is stored in the servers of the Chinese government, and DeepSeek has openly said this. So if you're a nation like South Korea that has even a slightly frosty relationship with China, there's practically no reason you shouldn't ban this. It really isn't worth the risk. There really isn't any upside in hosting a Chinese ChatGPT that threatens the privacy and security of your citizens. And by the way, OpenAI's ChatGPT is banned in China. So South Korea is one of the first countries to do this.

• 8:46Ed Elson?

  I think in the next couple of months, we're going to start to see a torrent of other countries banning deep sea. And I think the first country we could probably expect this from is America. You know, if Trump wants to go through with this whole reciprocity thing, then DeepSeek is probably the best place to start. And in fact, we are starting to see some state legislation that is banning DeepSeek on government devices. So Greg Abbott in Texas, he issued a ban. Kathy Hochul in New York, she issued a ban, and so did Glenn Youngkin in Virginia. So to me, this is sort of a no brainer. I cannot see any meaningful upside in keeping this app around. But perhaps I'm missing something. And if I am, let me know in the comments and we can have that debate.

• 9:30Ed Elson?

  But as of now, the stance for me is quite simple. DeepSeek is not worth this risk. South Korea has got this right. DeepSeek should be banned.

• 9:41Speaker 08

  I alguien que viene y me propone crear un instrumento para fundar proyectos de Argentina.

• 9:50Ed Elson?

  And finally, let's talk about what happened with President Javier Millay, the president of Argentina. This story is honestly insane to me. Let's just start with the timeline of what actually happened. So on Friday, a website was launched promoting this project called the Viva la Libertad project. And the mission was, quote, "to boost the Argentine economy by funding small projects and local businesses." Now, exactly how this would be accomplished was not clear. It wasn't really mentioned anywhere. And in conjunction with that project, there was a cryptocurrency that launched called Libra or Libra Coin. And just a side note.

• 10:35Ed Elson?

  It was launched on this platform called FixFloat, which notably does not ask for any personal identification. Everyone is anonymous and it is most commonly used for scamming and rug pulling. So it's a very shady start to begin with. None of this really mattered, though, until half an hour later. The president of Argentina, Javier Malé, tweeted out the news of Libra and Libra Coin, and he directed his 4 million followers on where they could go online and buy the token. And within 45 minutes, the market cap of Libra went from virtually nothing to $4.5 billion. Now, to put that in context, that would make Libra, this cryptocurrency, the ninth most valuable company in Argentina.

• 11:20Ed Elson?

  Within an hour, $1.5 billion worth of Libra coin was transacted between buyers and sellers. Then, all of a sudden, the early investors started to sell and the value of Libra plummeted. And after one hour, Libra had lost 70% of its value, until eventually President Malé deleted his tweets and he apologized for what happened. He said, quote, "I was not informed of the fine details of the project, and after learning, I decided not to continue spreading it." But by that time, the damage had already been done. 75% of the investors lost money. And according to the on-chain data, many lost up to $10,000, some lost up to $100,000.

• 12:04Ed Elson?

  So the financial damage here is, once again, just enormous. And the winners, of course, there are always winners with these crypto tokens. The winners were the developers of Libra, who sold at exactly the right time. Many of them made millions, and one of them netted almost $9 million in profit. So I think what we have here is the same dynamic we had with TrumpCoin, where the power of a presidency, in this case, Argentina's presidency, was abused to essentially trick people into wiring their money to a handful of anonymous individuals with no financial protection, no recourse, and it's unlikely.

• 12:44Ed Elson?

  Likely that these people will ever see their money back. I doubt it will ever happen. And this is exactly why I personally don't like crypto. I I think it's one of the most useless and the most destructive technologies of our time. And when you put it in the hands of the wrong people, they can levy extreme damage on a lot of people who don't really know what's happening. And I think that's what happened here, probably. I don't think this was a malicious operation by President Malay. I don't think he was behind the scenes orchestrating this. I mean, he deleted the tweet. He eventually expressed regret. I think the most likely scenario is that he got tricked. And that's a shame because so far Malay has actually done quite a good job.

• 13:27Ed Elson?

  He's brought inflation way down. He's brought wages way up. He's expanded the Argentine economy. I was with Argentinians this weekend and they were huge fans of President Malay. He's doing everything he really should be doing. But now that this has happened, this is a huge hit to his credibility, because it basically means one of two things. Either he's a scammer himself, which I don't believe, but it's possible, or he's easily duped by scammers. And neither of those things reflect very well on him or on Argentina. It's a massive sign of weakness. And so what happened, as soon as the markets opened, the Argentinian stock index

• 14:08Ed Elson?

  fell 6%. And this is exactly the kind of thing that rattles investors. So it's now being investigated in the courts. We'll soon find out what actually happened and what he actually knew about this Libra coin. But what is clear is that this is going to be a very long road to recovery. And this is certainly the lowest point so far in the Javier Malay presidency.

• 14:33Ed Elson?

  We'll be right back after the break for our conversation with Kyla Scanlon. If you're enjoying the show so far, be sure to give Prof G Markets a follow wherever you get your podcasts.

• 14:51Speaker 00

  Flowing ad budget on metrics that look great till the CFO sees them. That's bull spend and marketers are calling it out in. Dashboard confessions.

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  I remember telling my boss it'll be good for the brand when leads were slow. Yeah, it it wasn't.

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• 16:12Ed Elson?

  Welcome back. Here's our conversation with Kyla Scanlon, financial writer, video creator, podcaster and author of In This Economy: How Money and Markets Really Work. Kyla, thank you very much for joining us once again on Profite Market. Thanks for having me.

• 16:29Ed Elson?

  So we're exactly one month into the Trump presidency. A lot has happened. We've had tariffs, Doge, we've had drama with Greenland. I mean, the list kind of goes on. I guess what has stood out to you so far and what have been kind of your main takeaways from this presidency so far?

• 16:48Kyla Scanlon?

  I think the main thing that I've taken away is there's kind of this element of faffinomics is sort of what I'm calling it, where people are like really effing around and and really finding out in a very big way. Like, that's what you see with Doge, with some of these maybe hasty firings and then the subsequent rehiring that have to happen, like with nuclear safety workers. So I think what we're seeing is just an administration that's moving pretty fast and moving without maybe any acknowledgement of potential guardrails and just kind of a gutting happening at the federal level at a piece that we really have never seen before. And I think a lot of people are a bit worried about what that could mean.

• 17:33Kyla Scanlon?

  A lot of people are excited because they want to see, you know, debt levels go down. But I think the underlying worry then is, well, you know, if you got the government from the inside out and have to rebuild it, it could be quite expensive. So I think right now, everybody has more questions than answers. There's tremendous amounts of uncertainty and you can really just feel that percolating.

• 17:53Ed Elson?

  Yeah, you mentioned that term faffinomics, which I've read about and which I love. Could you just spell out exactly what that means for us?

• 17:59Kyla Scanlon?

  Well, it means eff around and find out. So the idea is chaos as just a strategy, right? And so you're just gonna sort of go full steam ahead and see what you can unplug and then see what stops working once you unplug it and then maybe figure out a way to plug it back in. And so that's the general strategy is just effing around. And that's a very crude and reductive way to say it, but it maybe is a decent summary.

• 18:28Ed Elson?

  Yeah, chaos as a strategy sounds about right to me. Why do you think we have reached that point? Why do you think people are attracted to this chaos as a strategy system that we seem to be reverting to right now?

• 18:44Kyla Scanlon?

  I think that there's a lot of distrust in institutions. And so you see things like the Spring 2024 Harvard Youth Public Opinion Poll, where they asked young people, you know, what institutions do you trust in? And trust in all institutions except for the United Nations was down by double-digit percents. You know, trust in the media, trust in the White House, trust in Congress. And so I think you have this base of people who just don't trust in The possibility of things getting done. And so that drives, you know, actions like Doge is able to take, like people support that because it's like, well, nothing else seems like it's working. And so you have that lack of trust. And then you have the echo chambers that can be created by social media where people

• 19:29Kyla Scanlon?

  are hearing that, you know, this sort of strategy is the best way to approach it. There's a lot of misinformation flying around right now, like with social security payments and an understanding of what nuclear safety workers do. So I think it's that, like, there's this, this lack of belief. And that's all compounded by the systems that we engage in every single day. You know, the algorithms perhaps perpetuating that even more.

• 19:57Ed Elson?

  One of the big themes you talk a lot about is this idea of, of the vibe session. A lot of people love that term. And basically what that means is this disconnect between the reality of the economy versus the way people feel about the economy. And it was very relevant last year when you had low consumer sentiment. But at the same time, the economic data was actually quite strong. I'd just be interested to hear what you think about where we are today. Do you think we are still in a vibe session? Is there still a disconnect between how people feel about the economy versus how the economy actually is going right now? Or do you think we've kind of come to our senses?

• 20:42Kyla Scanlon?

  I mean, I think the big thing with the vibe session is we did see, and I wrote about this in my newsletter, like we did see aspects of the vibe session show up in the electoral data. Like, part of the reason that people voted for Trump is because they were like, I'm sick of this economy. I'm really tired. Like, I just wish somebody would make it easier to afford a house. And that's like, so valid. Like, part of the vibe session is the data might not be telling the whole story, like aspects of structural affordability, like housing and childcare and elder care are very important and they impact people's lives and they're extraordinarily expensive. And so with the vibe session itself, at least right now, those things are still extraordinarily expensive.

• 21:24Kyla Scanlon?

  And we also saw, of course, a partisan flip in sentiment, like Republicans are now feeling quite good about the economy, Democrats are feeling quite bad, this happens. Pretty much every election cycle. And we haven't seen things really take impact on the economy yet. Like now that so many workers have been fired and we could have inflationary pressure due to tariffs, that could create a bad economic environment where it's totally, you know, valid to have maybe negative consumer sentiment. But the whole goal with the VAB session story is to really talk about what data are we using to measure the economy? Like, is it the right data? And so in that capacity, like, who knows if we're still in one or not. But I think that the sentiment has always been a bit strange to measure.

• 22:08Ed Elson?

  What would you say are the most important pieces of data that we should be looking at? I mean, I feel like, you know, when we say, oh, the economy is doing well, oftentimes we're saying, you know, GDP is expanding or inflation has come down. But then you look at the price of houses and the fact that none of our generation is even close to being able to afford a home. And perhaps that's what we should be looking at. Like, what do you think is most important when it comes to measuring or taking our temperature as a nation and checking in? How well are we doing?

• 22:41Kyla Scanlon?

  This is a good question, too. The American Academy of Arts and Sciences has a new paper that they released last year called The Core Score. And I worked a little bit to like, develop some videos around it. But the whole idea is like, how do we measure economic well-being? And it's looking at things like housing. It's looking at things like healthcare. And I think that sort of stuff is important because it gets beyond just GDP, which is like, consumer spending and things like that just outlays. And I think if we can sort of get a little bit more granular in how people are actually experiencing the economy, which is what The Core Score, a nonpartisan effort, tries to do, that's a better way to actually figure out what's happening and how people are feeling.

• 23:25Kyla Scanlon?

  And then we can address the problems a little bit more head on. Like, clearly, housing is a massive, massive problem. You don't need The Core Score to tell you that. But then the question becomes, well, how do we build more housing? And I think that's also. A measure of economic success, like not just how the economy is performing, but what are we doing in the future to like make it perform even better? Things like building more housing, having more access to healthcare and education, et cetera.

• 23:50Ed Elson?

  People are very interested in Gen Z all of a sudden, it feels. I mean, they really want to know how we think, probably because we're now entering the workforce and suddenly we're all a bit more relevant. I'd like to get your view. How do you think Gen Z feels about the economy right now? What do you think is most top of mind for our generation?

• 24:11Kyla Scanlon?

  So I have been on the road traveling for the past eight months, talking about my book. And I have had the opportunity to talk to a lot of young people across 25 different states about how they're feeling about the economy. And I think the main thing that I'm hearing is people are really concerned about the labor market. Like when you talk to kids and, or students, not kids, in college, a lot of the times it's, you know, it's like, well, I'm getting all of these skills, but when I graduate, like this could be a totally useless degree. Like, look what happened with software engineering, which was supposed to be this really safe way to go. And so you see a lot of young people going into the trades, like Wall Street Journal had this article called "Gen Z is a Toolbell Generation."

• 24:55Kyla Scanlon?

  And where I'm from in Kentucky, like you're seeing this massive move towards the trades. And so I think that is how young people are feeling about the economy, is they're not sure what their place is in it anymore. They're not sure where they fit, partially because, you know, the growth of AI, partially because we are seeing some dismantling of the government and there's uncertainty about what jobs are going to be left there as well. And then you also have, and I know you all talk about this a lot on the podcast, but like you have these get rich quick schemes that work, like meme coins. And so when you look at these two things, like you have Maybe the ROI on a college education isn't, it doesn't seem as powerful as it once was.

• 25:39Kyla Scanlon?

  And then you have the ability to make a ton of money on what is, you know, essentially could be called a scam. It's super confusing. And so I think that's what young people are really dealing with is the world is rapidly changing. And the world is always changing, but like, it feels like it's changing really fast right now.

• 25:57Ed Elson?

  Yeah, just some stats we could point to here. I mean, the cost of college is just gotten out of control. And just this stat, for my grandparents, the annual cost of college was 13% of their income. For our generation, it's 43%. And if you look at housing, the average cost of a home for my grandparents' generation was three times their annual income. For us, it's seven times. So it does just feel as if Gen Z is a lot poorer than our parents. And certainly their parents. What do you think our generation can do about this? I mean, how are we supposed to navigate a world where we've been told, you know, these are the rules of the game?

• 26:38Ed Elson?

  And then suddenly we go out into the world and the rules appear to be completely different and completely irrelevant. And certainly not applicable to the lives that our parents led. What do we do about that?

• 26:49Kyla Scanlon?

  Yeah, I'm trying, I'm working on this piece right now, like trying to iron out those details. And I think the thing is like, you can have a middle path. Like there's sort of this barbell effect where you have people like going into the trades and being like, I just hope this works. And like, there's so much value in that. And then you have people who are going after, you know, the meme coins, cryptocurrency, trading, et cetera. And I think there's a middle path where you can use AI to like enhance your job, use it to enhance your career, figure out where things are. Like things aren't going to change that quickly, but I think what will be required over the next couple of months. And this is what I've said at the universities that I've been able to speak to is you have to be adaptable.

• 27:31Kyla Scanlon?

  Like you have to learn new tools really quickly. You have to be on top of all the new technology that's coming out. So you can figure out how to integrate it into the work that you're doing now, or be prepared for when that job might change or shift. Vice President J D Vance said that he hopes that their plan is that AI will be a complement, not a replacement. So at least at the federal level, that seems to be the goal is like not to have AI replace people. But, you know, I think people just have to be prepared for all possible. Outcomes and being adaptable, being ready, being a learner and not a learned person is key. Yeah, it's very like soapboxy, but that's where I've landed.

• 28:13Kyla Scanlon?

  Yeah. Do you have thoughts on that? Like as a person who's also navigating the economy?

• 28:18Ed Elson?

  Yeah, I think where you're also headed is you have to completely adjust your expectations. And I think one of the big problems for our generation is that from being online all the time, our expectations have been completely nuked about what we can actually expect professionally and in our lives. This survey that I just saw, which I just found crazy, they asked all these different generations, what they thought a successful income is. And I just want to read you these stats here. So for baby boomers, the baby boomers believe that a successful income is on average a hundred thousand dollars. For Gen X, it is two hundred

• 29:00Ed Elson?

  and twelve thousand dollars. For millennials, it is a hundred and eighty thousand dollars. And for Gen Z, it's five hundred and eighty eight thousand dollars. That's what we believe success is. And this just tells me that, I mean, it tells me that something is broken in our brains, certainly about how we think about money. I'd love to get your take on, you know, what do you think is broken? And, you know, maybe to what extent is this a function of the fact that we have lived the majority of our lives, pretty much our entire lives online?

• 29:36Kyla Scanlon?

  So I saw that survey too. And I think the main thing for me was like the cost of a house. Like if you ever want to own a home, like it really is, it's so expensive, especially in city centers where I think a lot of young people either have to live or want to live for work. And so I think that's part of what we're seeing there. But then there's also And this is more speculative, but there is a lack of kind of a social safety net in the US now more so than ever. Like, there is worries that social security will be, there won't be enough. So people are paying into a system that they may not benefit from. And so I think the idea is like, there has to be that extra income now, because if you

• 30:18Kyla Scanlon?

  fall, you're falling so far and falling so flat. And I think people can really feel that, especially young people. We saw the government step up, like during the pandemic, when people weren't able to work and there was unemployment. But then all those things were rolled back as well. And I think that's the other thing is like, we have seen the government provide, and this was during Biden's era, and then stop all of that. And so I think young people just really feel that quite viscerally. And also, the path to prosperity, it's not as straightforward as it once was. Not that the boomers' path was like incredibly clear, but there was an idea that like you would have a pretty predictable return on education. You'd have a predictable path to buying a house, like a predictable time

• 31:02Kyla Scanlon?

  in the labor market. Of course, they dealt with stagflation and mega-high interest rates, but there was more predictable wealth progression, where I think for young people, it's like, well, if I don't get in on the, you know, Argentinian meme coin, who knows what could happen?

• 31:18Ed Elson?

  We'll be right back. And if you're enjoying the show so far, hit follow and leave us a review on Prof G Markets.

• 31:34Speaker 00

  Flowing ad budget on metrics that look great till the CFO sees them? That's bull spend. And marketers are calling it out, in. Dashboard, confessions.

• 31:43Speaker 01

  I remember telling my boss, "It'll be good for the brand," when leads were slow. Yeah, it wasn't.

• 31:51Speaker 00

  Cut the bull spend. LinkedIn lets you target by company, job title, and more. Advertise on LinkedIn. Spend $250 on your first campaign and get a $250 credit. Go to LinkedIn.com/campaign. Terms and conditions apply.

• 32:04Speaker 11

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• 32:54Ed Elson?

  We're back with Prof G Markets. You've also said that Gen Z can be broken up into three groups, which I found interesting. You said each one having, quote, "a differing relationship to digital reality." What are these three groups in Gen Z, in your view? And how do they behave differently?

• 33:12Kyla Scanlon?

  Yeah, so there, this woman named Rachel Janfaza posted a graphic on Twitter talking about Gen Z 1.0 and Gen Z 2.0. And then Derek Thompson of The Atlantic just published an article talking about Generation C, this like subsegment of Generation Z, which is conservative. And so, Gen Z 1.0 and Gen Z 2.0 is kind of like the pre and post-COVID. So Rachel has it broken up. You graduated high school pre-COVID. And Gen Z 2.0, you graduated high school post-COVID. And when I read this graphic, I was like, well, I think there's actually three, where there's the Gen Z 1.0, which I'm a part of. Like, I'm an old Gen Z. And so I remember a world that was analog. Like, my first phone was a flip phone. And then there's the Gen Z 1.5, which is the COVID cohort.

• 33:57Kyla Scanlon?

  You know, their really formative years were shaped by COVID. For me, as a bridge generation, I graduated from college into the pandemic. So a little bit of a different experience than being in high school or college during the pandemic. And then there's the Gen Z 2.0s, which are the digital natives. They have never known a world without smartphones. And Um. The digital infrastructure is basically reality, right? Like, it's not a second layer, it's the the full reality. And so that's kind of the way that I'm thinking about it. And they have all had massively different experiences with digital realities and massively different um development experiences too. And that's just shaped how they think about the world, how they think about their economic opportunity

• 34:42Kyla Scanlon?

  and how they think about society at large.

• 34:45Ed Elson?

  Yeah, it's almost there varying degrees of how online each generation is. And we are becoming increasingly extremely online, which is the the technical term for it. Um. And there's also in that term an implication that if you're in it, if you're extremely online, you have a tendency to overemphasize the importance of the digital world. Or you see everything through the digital world and it sort of distorts your your perspective. But, you know, I'm curious, from your perspective, as someone who has kind of built a career online and achieved a lot of success from posting on TikTok, from posting on social media, which has led to all these, all of these other opportunities.

• 35:29Ed Elson?

  How important do you think is it that we take digital seriously? Is this something that everyone our age needs to be thinking about? Do we all need to be getting out there on social media and living our lives online? Or do you think it's breaking us and causing us too much of a distraction?

• 35:48Kyla Scanlon?

  I think it's both. Like, I always say that I'm a hypocrite because whenever I talk about social media, I try to talk about it from both angles. Like, I think of it as a tool. Like, the fact that I'm able to talk about economics to, you know, hundreds of thousands of people every day, like, that's using social media as a tool. And it's reaching people that maybe wouldn't have had access to economics, education. Wherever they're living. And so I think social media is a tool, number one, but then I definitely think it can shape us for the worse. What the problem with algorithms is they really like rage and they really like anger. And that's just what does well because a lot of people respond and then everyone's yelling and it's kind of counterproductive. And so I think that's what I worry about with social media is it just, it does fuel

• 36:33Kyla Scanlon?

  the rage and it fuels the anger. And a lot of people way smarter than I have written about this and have documented this, like we are angry and we are lost and we are confused, partially because it is so easy to go get lost inside of an algorithm. And so I am a hypocrite, but I think there's a lot of power to social media. Like I've learned a lot just from connecting with people. I have all of this opportunity because it exists. And I think I hopefully am doing good work to try and help people understand what's going on economically. But there's absolutely a bad side to it. And that bad side, if the incentives are misaligned, which you could argue that they are right now, can be very, very bad indeed.

• 37:16Ed Elson?

  I mean, you get a lot of feedback from being online in a way that I think other financial media personalities probably don't. What are some of the main concerns that people have, either maybe on your YouTube channel or on your social media? What do you think are the main things that young people are thinking about right now? And how are they responding to your content?

• 37:41Kyla Scanlon?

  A lot of the DMs I get are young people trying to position themselves. So like, well, should I try and buy a house now and then, you know, be okay in the future? Like, how should I think about my job? How should I think about my education? How should I think about inflation? And so I think a lot of people are trying to contextualize what's happening to the economy, to their real life. So I get a lot of questions about things like that and try to talk people through that as much as I can. And so that's what I've noticed is like, there really is this. Beautiful, like genuine curiosity from people to understand the system that we live in better. I think it's kind of a, I think it's a total tragedy. I don't think it's kind of a tragedy that we don't teach economics, considering that

• 38:26Kyla Scanlon?

  it's all something that we have to live in every single day. And so I think most people are just trying to sift through the noise to figure out where the signal is.

• 38:34Ed Elson?

  What would your advice be for someone in that situation? I mean, you're, you're 27 years old, you've written a book, you've been featured in Bloomberg and the New York Times and all of these other publications. You've kind of done it all at a very young age. What would be your advice, your career advice to any young people listening to this podcast right now?

• 38:55Kyla Scanlon?

  Yeah, I mean, I think the career advice is what I was talking about earlier, like being adaptable and then trying to do something that you love. Like people say, don't let your passions be your job.

• 39:05Ed Elson?

  Scott's guilty, yeah.

• 39:07Kyla Scanlon?

  I know. Yeah. No offense to Scott, but I do, I actually think we talked about that when I was on the podcast last. But I, I, I don't know, I just like, I think that if there's something that you really care about and you would, like, it's sort of a regret minimization framework. Like if there's something that you really want to do and there's something you really want to try, like make sure it's stable for you to try it. Like I, when I first started out, I made a total mistake where I had zero safety net. And I just was like, I'm going to try doing social media, which was not smart. And like luckily I was able to sort it out, but like there's smarter ways and more risk minimization ways to approach it. But that's what I would say is like, you know, try to implement regret minimization. Would you regret not trying this thing?

• 39:52Kyla Scanlon?

  Is there a way to try this thing safely? What do you actually care about seeing in the world at the end of the day? There's also totally a world where a job is a job and maybe that job helps you pursue your passions on the side and the passions aren't the main focus. And so I think it's just figuring out where your own personal risk tolerance is, what you want to focus on, on the day to day. And there's no, you know, wrong answer. It's just, do you have the, the framework in place to pursue what you want to pursue?

• 40:20Ed Elson?

  What do you think is the greatest misconception that older generations have about Gen Z, about our generation? What is it? What are we like that people don't seem to recognize?

• 40:32Kyla Scanlon?

  I get asked this a lot too, because that's the goal is like, everybody just kind of wants to understand what everyone else is thinking about most of the time. And so I think for the older generation, they're like, I just don't really know how to communicate to younger people. Like, I feel like I'm not getting through to them. I feel like they're not listening. I get a lot of people telling me that the younger generation doesn't work hard enough, that they're always distracted, that they're pretty lazy. And I think what's tough about that is it really is a carrot and stick kind of problem. Like, I think there has to be incentives in place for younger people to work hard. Like, it isn't as simple as maybe it was when other people, boomers maybe, were starting out, where it's like, I'm gonna stay at this company for 40 years, I have a sick pension, it's gonna

• 41:14Kyla Scanlon?

  be amazing. Like, the incentive model is different. And so you have to create those incentives internally for people to have that same passion at work. So, much easier said than done. But I think that's the main thing that people tend to miss out. It's like, young people are just living in a vastly different economic system. And so they're gonna respond very differently to workplace incentives because it doesn't feel the same.

• 41:37Ed Elson?

  Kyla Scanlon is the founder of a financial education company, Bread, and a creator. She writes a weekly newsletter, makes YouTube videos, hosts the Let's Appreciate podcast, and posts almost daily short-form videos about the economy and markets. Her first book, In This Economy: How Money and Markets Really Work, is available now. Thank you very much, Kyla. This was really fun.

• 41:57Kyla Scanlon?

  Thanks for having me.

• 41:59Ed Elson?

  This episode was produced by Claire Miller and engineered by Benjamin Spencer. Our associate producer is Alison Weiss, Mia Silverio is our research lead, Isabella Kinsel is our research associate, Drew Burrows is our technical director, and Catherine Dillon is our executive producer. Thank you for listening to Prof G Markets from the Vox Media Podcast Network. If you liked what you heard, give us a follow and join us for a fresh take on markets on Monday.

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