Pod Insights The Prof G Pod with Scott Galloway Prof G Markets: Adidas’ Crisis Management, Google and Meta Earnings, and Market Moving Fed Speeches About this episode This week on Prof G Markets, Scott deciphers where the investment opportunity might be after Adidas severed ties with Kanye West. He also breaks down how Google did so poorly in the third quarter, and why Meta now looks like a distressed asset. And in this week’s unpack, we learn about how investors react to Fed chair speeches, plus what to listen for at Jerome Powell’s next press conference.
Show Notes:
Adidas
Google
Meta
The Crash of ‘79
Music: https://www.davidcuttermusic.com / @dcuttermusic
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Transcript 6,081 words · 15 speakers
Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
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0:48 Speaker 01 Your heart can tell you a lot about your health. Apple Watch Series 12 measures your heart rate every five seconds with the most accurate heart rate sensing in wearable. So your vitals app, now with heart rate variability, can tell you when something is off. And your readiness score can let you know when to rest and when to push. Hear the story in every heartbeat with Apple Watch Series 12. The features described are for wellness purposes only and not for medical use. iPhone 11 or later required. Based on Apple conducted study of heart rate accuracy, August 2026. Visit apple.com/aplewatchseries12.
1:18 Scott Galloway? This week's number four. California is set to overtake Germany as the fourth largest economy in the world. The state's GDP is already ahead of Brazil, France, and the UK. California's nicknames? The Golden State, the Land of Milk and Honey, the Grape State. Supposedly Elon Musk is taking Tesla to Texas. I would never trust a man with six kids who claims he's pulling out. Wait, I have another joke. Supposedly there are so many wildfires in California that the air has become toxic. Probably means there's a decent chance I'm gonna marry California. That's good, too.
2:02 Scott Galloway? Welcome to Prof G Markets. Today, we're discussing Adidas and its competitors, Google and Meta earnings, and then unpack on what to listen for during Fed Chair Jerome Powell's speech later this week. Here with the news is Prof G Media Analyst Ed Elson. Ed, what is going on?
2:18 Ed Elson? Not much, Scott. I have a, I have a compliment for you. Do you want to hear it?
2:22 Scott Galloway? Okay.
2:22 Ed Elson? So I was looking at your YouTube this morning. I'm going to read this comment out loud. Is it just me or does Prof Scott Galloway look quite similar to Ryan Reynolds in Deadpool?
2:33 Scott Galloway? Yeah, I get that actually a lot, but what I usually get is some sort of addendum that like I look like the older Ryan Reynolds or his, his uncle that didn't get the good genes. I get, I get Ryan Reynolds a lot, but it's usually qualified.
2:46 Ed Elson? But yeah, I think that makes more sense.
2:47 Scott Galloway? I'm actually thinking of going, I'm, I'm in LA to go to all these Arrested Adolescents Halloween parties and I'm thinking of going as Deadpool. I'm just a little bit intimidated by the costume because it's very tight, Ed. It's very tight.
3:03 Scott Galloway? Anyways, enough. Start earning a living. What's in the news?
3:07 Ed Elson? Well, let's start with our weekly review of market vitals.
3:17 Ed Elson? The S and P 500 posted gains early in the week before disappointing tech earnings weighed it down. The dollar fell to a three week low. Bitcoin spiked, rising above 20,000 again. And the yield curve inverted, i.e. the yield on 10 year treasuries dipped below the yield on three month treasuries. And that's a classic recessionary signal because it means that investors are placing more faith in short term bonds versus long term bonds. Shifting to the headlines, the Elon Twitter deal has closed. Musk finally acquired the company for $44 billion at 5420 per share. The US economy grew 0.6% in the third quarter after contracting through the first half of the year. Meanwhile, growth in consumer spending slowed, so that's a sign that the Fed's interest
4:02 Ed Elson? rate hikes are cooling demand. Mortgage rates reached above seven percent for the first time in 20 years. And finally, UK companies will likely receive an extra six billion pounds in dividends this year, thanks to the weakness of the pound. The pound hit a record low against the dollar last month and then rebounded after Rishi Sunak became the new prime minister. Scott, I'd like your reactions to all of this, but first, could you explain how a weak pound could mean greater dividends for a UK company? That seems strange.
4:34 Scott Galloway? So the FTSE 100 is the 100 largest publicly traded companies headquartered in the United Kingdom, and 75% of their revenue is generated abroad, right? It just makes sense. If you're a Unilever or Rolls Royce, you're going to get the majority of your revenues outside the UK. Two fifths of UK listed companies denominate their dividends in dollars. So if you're Unilever and you sell $100 million worth of Dove products in the United States, you get to repatriate those $100 million at a weaker pound, meaning you're going to get more pounds, which means you're going to report higher earnings or have more capital for a higher dividend. And some, it's great to get money from abroad when your own currency is weak.
5:13 Ed Elson? And how about the Twitter deal?
5:14 Scott Galloway? Well, here he is, right? And overnight, the natural level of Twitter stock price right now is probably around 10 bucks. He's paid 5420. So you're talking about 30 or 35 billion dollars that just went up in smoke. It's going to be very interesting. Memo got leaked a few weeks ago or a week ago saying it was going to last 75% of the employees.
5:35 Ed Elson? Do you think it's a good idea to lay off three quarters of the staff?
5:38 Scott Galloway? I think layoffs are probably warranted. I've never understood why this company needs 7,500 people. What happened when Elon Musk announced potentially, or quote unquote memo leaked, that he was thinking about laying off 75% of employees? A lot of employees at Pinterest and Snap probably lost their jobs. They just don't know it yet.
5:56 Ed Elson? Why would they follow what he's doing?
5:58 Scott Galloway? Well, everyone thinks he's a genius. And I think also there's some merit to the fact that these companies saw themselves as growth companies. As Swatamotaran, my colleague at Stern, says, "The companies refuse to ever believe they're no longer teenagers." These are no longer growth companies. The revenue is flat to down, and yet they keep hiring like crazy. And when you're stuffing calories down an organism's throat, and that is a company that everybody thinks should be fed like a growth company, but it's no longer growing. Pockets of fat buildup. Yeah. But we've said before, this recession, recessions are either called a white collar or a blue collar recession. We think this is going to be the Patagonia vested recession. And that is a lot of the people who've been hired into a growth economy, who live in Brooklyn
6:42 Scott Galloway? and take their dogs for long walks and expect pet bereavement leave are in for a rough ride here for the next 12 to 24 months. I think there's going to be a lot of layoffs. Sounds like me. Yeah, you. No, you're in trouble. By the way, we need to speak. We need to speak.
7:08 Ed Elson? Adidas is ending its partnership with Kanye West after he made a series of antisemitic comments online. The company will stop producing all Yeezy branded products, which will have a significant impact on the business. The Yeezy line made up 8% of Adidas' sales and roughly half of its profits. And as a result, the company expects to see a $250 million hit to earnings next quarter. Adidas stock is down 16% since October 6th, when the Kanye controversy began, and year to date, it's down more than 60%. So Scott, this is clearly a big economic blow to the company. With that in mind, do you think Adidas made the right decision?
7:49 Scott Galloway? 100%. And this really wasn't a decision. They had to do this. And it's difficult to shut down a business like that responsibly. You got to communicate with your retail partners. You got to communicate with your supply chain. There's probably a couple thousand people just working on this business. You got to communicate to them what's going to happen. You got to communicate to your retailers, this is what's going to happen to the inventory. You got to figure out an investor relations strategy around what this means in terms of projections and forward looking statements. So I think they deserve real credit. And something I'm trying to do is rather than constantly threatening to boycott products, I want to reward companies to do the right thing. And I put out a tweet saying I was
8:31 Scott Galloway? going to wear my Adidas superstars, "Hello 8th grade," with the seashell toe cap. Hello! That's how you lose your virginity at 19, Ed. Anyways, crisis management is always difficult. You have to acknowledge the problem. The top garrigal has to take responsibility for the decision and you need to... Overcorrect, but my favorite thing was that supposedly Kanye was escorted from the Skechers headquarters.
8:55 Ed Elson? Yeah, I saw that.
8:55 Scott Galloway? After showing up unannounced. So rock me bottom. When you're kicked out of Skechers HQ. I mean, that's, you know, that's pretty tough.
9:03 Ed Elson? How much of this do you think was also a financial decision by Adidas? Because there's obviously there's the moral side, which is we don't want to partner with an anti Semite, someone who just puts a lot of hate out there. But also they might have been thinking, you know, if we keep partnering with this guy, people aren't going to buy our products. They're going to boycott us. So what do you think of that? Was that a financial decision as well, do you think?
9:26 Scott Galloway? Yeah, this was a capitalist decision. And that doesn't necessarily mean that they shouldn't get credit for it, but they were just going to get a torrential downpour of shit for the next several months if they refused. It would have never stopped. They had no choice here. Unfortunately, it comes at an especially inopportune time for Adidas, who is like a lot of consumer companies, showing weakness. And even relative to their peer group, they've been struggling. Their stock is way down, as you referenced. And the stock actually even looks cheap. And I think that's kind of a learning here is that there's, when you have bad news and you have dislocation, you have tumult, no obvious answers,
10:10 Scott Galloway? a lot of unknowns, that usually spells opportunity. And that is, there's just a, just a perfect storm of bad things right now at Adidas. There's loss of this hugely lucrative partnership. Their core business is weak. So as a result, Adidas market cap sits around 19 billion. For an iconic century old brand that has real aspirational value and is probably, it's a maybe a distant number two, but it's a solid number two to Nike. Adidas is 24 billion. Its revenues to market cap is about 0.8, whereas Nike does 47 billion and has 145 billion dollar market cap. So it's.
10:51 Scott Galloway? Market cap to revenues is about three. So you have Nike on a relative basis is trading at about three X the valuation of Adidas. So I would argue that the opportunity here from an investment standpoint is actually with Adidas.
11:06 Ed Elson? At the end of the day, this is a retail brand. So if customers are buying the shoes, then investors will buy the stock. So Prof G Media's Mia Silverio took to the streets to find out how consumers are really feeling about Adidas versus its competitors.
11:20 Speaker 03 Would you answer an anonymous question for a podcast?
11:22 Speaker 04 Uh, sure.
11:23 Speaker 03 Nike or Adidas?
11:24 Speaker 04 Um, Nike.
11:26 Speaker 03 Nike or Adidas?
11:28 Speaker 05 Uh, Adidas.
11:29 Speaker 03 How come?
11:30 Speaker 05 Because they're European, because they don't suck. Nike? Nike.
11:34 Speaker 04 Adidas.
11:35 Speaker 03 What's she say?
11:35 Speaker 05 Says to get potato salad, I think.
11:37 Speaker 03 Potato salad?
11:38 Speaker 05 Is that what she said? Ask this shopper.
11:40 Speaker 06 Does the Kanye controversy change how you feel about Adidas?
11:46 Speaker 05 Um.
11:50 Speaker 05 Not really.
11:51 Speaker 04 No, because they did right by it, right? Like, they cut them off, so. So I guess like that makes me like them more.
11:58 Speaker 03 Thank you so much.
11:59 Speaker 04 You're welcome.
12:06 Ed Elson? Google and Meta posted earnings last week, and both were a disappointment. Google reported slowing revenue growth for the fifth straight quarter, and YouTube revenue dropped for the first time on record. Meanwhile, Meta posted its second consecutive actual revenue decline. Quarterly revenue came in at $28 billion, which is down 4% from a year ago. Shares in both companies declined significantly. Google shares fell more than 6% on the news. That stock is down around 35% year to date. And Meta shares fell, get this, 20%. Meta stock is now cheaper than it was five years ago.
12:45 Scott Galloway? This is just the mother of all kind of dog bites, man. I can't get over this. Do you realize that ByteDance, the company that owns TikTok, is now worth more than Meta? I mean, that's just incredible. And Meta has lost six years, five or six years of stock market gains. It's just, it's incredible. And then when you look at everybody, when you look at Snap throwing up on themselves, when you look at Meta's weak numbers, flat to down, when you look at Google slowing down, YouTube was the growth engine, that slowed down. It's reminiscent for me of what's happened the last 20 years in retail. And that is, I don't care what retailer you were talking about, whether it was Macy's, whether it was Walmart, whether it was Urban Outfitters, a company I served on the
13:30 Scott Galloway? board of, we'd have some signs of hope, every once in a while, a good quarter, and then we'd have an okay quarter, and then we'd have an awful quarter. And it just felt like everything was hard. Everything was getting a little bit harder. And the reason why was because it was getting harder specifically. Every day, Amazon took more and more money out of the ecosystem. And what do you have happening here? TikTok, I think, went from 4 billion to 12 billion in revenue last year. It'll easily go from 12 billion to 24 billion. So you have $12 billion in incremental revenue going to TikTok. Now, in addition, you have everyone from Hulu to Apple TV to Netflix announcing that they're going to have commercials.
14:14 Scott Galloway? So say they find $10 billion in advertising revenue. That's $22 billion in incremental advertising revenue that's coming from a zero-sum pie. What do I mean by that? Advertising as a share of GDP, or the total amount of money the brand spent on advertising, has been flat for five decades. And guess what? It's not going up. As a matter of fact, with these economic headwinds, it's probably going to come down. So the existing players, whether you're Google, whether you're Meta, Time Warner, $24 to $30 billion is going to be taken out of the ecosystem and go to these new players and to TikTok. So just as Amazon was sucking the oxygen out of the room, day by day, for all of retail,
14:56 Scott Galloway? you have TikTok, and then these new streamers sucking the oxygen out of the room for the ad-supported ecosystem, including Meta and Google. It's really extraordinary. These companies are no longer growth companies. But what you have with Meta, you have a company one. That is flat. It was minus 4% year on year. It was 2%, up 2% on a constant currency basis. And what you also have, though, is you have a company that increased its spending. Its costs were up something like 20%. All of that leads to a massive decline in earnings. So right now, if I understand, if I'm looking at the right numbers here on Meta, it's trading at a price earnings multiple of, get this, I think around seven or eight.
15:40 Scott Galloway? You know, this is what old economy manufacturing companies trade at. Because people see, all right, you got a guy who can't be controlled. He controls the company. He's all in on the metaverse. He's gonna... He's already rich. He doesn't care about money. So his attitude is, I'll show you. I'm gonna prove everyone wrong and keep going all in and spending tens of billions of dollars on the metaverse. And shareholders are in the backseat, you know, buckled in and they can't get out and the doors are locked on this, this crazy nauseating ride called the Metaverse.
16:12 Ed Elson? Yeah, it feels like he just used the Metaverse as some sort of shortcut to say, yeah, we're a growth company. We deserve massive multiples. And then Evan just said...
16:20 Scott Galloway? Where's the growth?
16:21 Ed Elson? Don't agree. Don't believe it. Yeah, there's no growth. I wanna bring up a letter that Brad Gersner of Altimeter Capital wrote to Meta and the Meta Board. Altimeter is a long-term shareholder in Meta. He asked for three major changes. He said, one, reduce headcount expense by at least 20%. Two, reduce annual CapEx from $30 billion to $25 billion at least. And three, limit investment in the Metaverse/Reality Labs, that's their Metaverse unit. Limit that investment to no more than $5 billion a year. Do you agree?
17:00 Scott Galloway? Well, let me be clear. There's a big difference between being right and being effective. And Brad is right, and he will be totally ineffective. All you're doing when you buy shares in a dual-class shareholder company and then telling them what to do is pretending that the company or diluting yourself into believing that the company will be rational and that your force of character and logic will win over someone who controls the company.
17:25 Ed Elson? Can you explain dual-class shares briefly?
17:27 Scott Galloway? It's Kremlin politics. It's okay. You get shares, the Class A shares are the voting shares, and Mark Zuckerberg has, let's call it 51% plus of the voting shares, meaning that he effectively, you know, when shit gets real, when there's anything that's important, he gets to make the decision. And dual-class shareholder companies were initially structured by media companies that didn't want to be subject to the short-term whims of shareholders so they could have an independent newsroom, blah, blah, blah. And then everything changed when Google structured their companies dual-class shareholder. And now a lot of companies do it because you have founders who say, well, I'd like to sell most of my shares, but I'd still really like to control the company. And this is where it comes back and haunts you.
18:10 Scott Galloway? And that is, if this was a single-class share company, when Brad wrote that letter, a bunch of shareholders would call Mark and say, Brad's right. And if you don't stop this, we're going to replace the board, and then the board will replace you. But instead, a board of directors in a dual-class shareholder company isn't really a board of directors, it's a board of advisors. Because at the end of the day, Mark can do whatever the fuck he wants, and all they can do is just advise them and show up every three months for a free dinner and cash their $200,000 a year board checks. But you have absolutely no power in a dual-class shareholder company when you're the Class B shares. The Solzberger family now only owns around 2% or 3% of the New York Times company, but they control the company.
18:54 Scott Galloway? The Ford family controls a single-digit percentage of Ford, but they control it. And in general, it is bad to separate economic risk from accountability and control.
19:05 Ed Elson? We were talking about dislocation earlier. This doesn't really fit in because its actual fundamentals are down. But do you feel like because Meta is down so much, it's where it was in 2016, 2017? Do you feel like this is maybe a buying opportunity?
19:21 Scott Galloway? So I want to be clear. I think Meta is a net negative. I think big tech is a net positive, which isn't to say we shouldn't potentially break them up, which isn't to say that they shouldn't be subject to the same scrutiny as other companies. But if you had a button and you could press it and all of big tech would go away, you wouldn't want to press the button. We're net gainers from big tech. I think we're net losers from Meta. I think Meta has done so much damage to our elections, our discourse and to teens, that if you had that button, you might consider pressing it. Having said that, when you have a company that has a core business that is a cash volcano and it's trading at a price earnings multiple of seven, I'm not going to buy it because I don't want to support the company.
20:05 Scott Galloway? I don't want to help finance it. But you do not, in my view, you want to be very careful about shorting this stock because the stock could double from here and have a multiple that wouldn't look like an expensive multiple. By all traditional metrics, this company looks cheap. What they're paying or what's happening here is there's a, what I'll call a Mark Zuckerberg crazy fucking metaverse discount here. But this company now feels almost like a distressed asset.
20:35 Ed Elson? Okay, we'll be right back after a quick break with an unpack on the peculiar history of Fed chair comments moving the market and how to interpret Jerome Powell's speech this week.
20:53 Scott Galloway? Support for the show comes from Superhuman. The pace of modern work can be relentless. You're getting a constant influx of messages from a ton of different apps. You haven't closed all your browser tabs in a year. Everything seems urgent, and staying on top of it all feels like an impossible task. Superhuman Go is an AI chat that's always there when you need it, already aware of what you're doing and doesn't ask you to start from zero. Superhuman Go, from the makers of Grammarly, help you be the best version of yourself at work. It handles the repetitive stuff so you can focus on the work that only you can do. Whether you need to summarize an endless email thread or prep for a meeting that's happening in five minutes, Superhuman Go works inside the tools and sites you already use: your browser, inbox, docs, and your project tools. And its AI chat is available on the side of your browser, and it's always ready.
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23:14 Ed Elson? We're back with Prof G Markets. Markets news is often about the numbers. It's the domain of stock prices, statistics and ratios. But sometimes a few words can be more powerful than any number, especially when those words are uttered by the chairman of the Federal Reserve. For decades, traders have been hanging on the sometimes cryptic statements of the Fed Chair. This Wednesday, current Fed Chair Jerome Powell is scheduled to hold his bimonthly press conference, and the financial world will once again be reading the tea leaves of his comments. For more on this tradition, here's Prof G Media's editor in chief, Jason Stabbers, with this week's edition of the unpack.
23:52 Speaker 07 Ed, being chairman of the Fed must be a little like being Aladdin with your lamp. Your words are subtly imbued with great power, but you find out pretty quickly that you have to be very careful what you say. The genie of the market can be tricky. So the modern history of Fed Chair statements moving markets begins on October 6, 1979.
24:16 Speaker 08 Prices in the United States during the first three months of 1979 went up at an annual rate of 13%.
24:23 Speaker 09 The question is, how long will this go on? Inflation running out of control? The answer, probably for years.
24:29 Speaker 07 Paul Volcker had been Fed Chair for just two months, and on a Saturday afternoon, he summoned the press to the Fed's DC headquarters, ostensibly to announce a technical change in how the Fed would be implementing monetary policy. But everyone present understood that behind the technical change he announced that day, a revolution had taken place within the Fed. A new intellectual regime was in place, one that would aggressively raise interest rates, choking off the supply of easy capital for corporate America. Over the next week, the Dow Jones Industrial Index had some of its worst days of the decade, and it lost nearly 7%. Bonds were also crushed. By January, the economy was in recession.
25:09 Ed Elson? Careful what you wish for.
25:10 Speaker 07 To an extent, yeah. Volcker surely knew that his words would suppress valuations, but no central bank chair wants to watch the country's debt and equity markets just sink day after day. And Volcker himself repeatedly said that market volatility was a problem he wanted to avoid.
25:27 Ed Elson? And how did that turn out?
25:29 Speaker 07 Well, whether it was Volcker's interest rate increases or just the natural turn of the business cycle, inflation was eventually taped. But Volcker wasn't the last Fed chair to spook the markets. The most famous example belongs to Alan Greenspan, who ran the Fed for nearly 20 years, from 1987 to 2006. Greenspan was famously cautious in his public pronouncements. He relied on vague language and he hedged everything he said.
25:53 Speaker 10 Indeed, there is an especially pernicious, albeit remote, scenario in which inflation turns negative against a backdrop of weak aggregate demand, engendering a corrosive deflationary spiral.
26:07 Speaker 07 He gave no radio or television interviews during his tenure and even had his PhD dissertation removed from the NYU archives when he became Fed Chair. But if he was hoping that this would reduce the impact his words had on markets, he had to have been disappointed because the opposite happened. Deciphering Greenspan's every word became an obsession. Academics even wrote papers analyzing how he used language. In 1996, he gave a speech at the American Enterprise Institute. Stock markets at the time were in a prolonged bull market, driven in part by highly valued tech stocks. So Greenspan, in this speech, posed a rhetorical question. He said, quote, "But how do we know when irrational exuberance has a duly escalated asset values?"
26:52 Speaker 07 That phrase, irrational exuberance, probably became the two most expensive words ever uttered. The Japanese stock market was the first to open. After Greenspan's speech, promptly lost 3% of its value. The Dow fell 2% in the first hour of trading. And the New York Times headline the next day read, "Stocks Worldwide Dive As Greenspan Questions Euphoria."
27:15 Ed Elson? So this doesn't seem like a great system, right? I mean, The idea that one person's comments can cost investors billions of dollars. In fact, it seems like a terrible system. Is that right?
27:27 Speaker 07 It doesn't seem that great, does it? So Greenspan's successor, Ben Bernanke, was pretty concerned about this. And so he tried sort of the opposite approach from Greenspan. Rather than speak rarely and as obscurely as possible, he implemented regular press conferences. He hoped that he could sort of smooth out the impact of his statements, basically by making more of them.
27:47 Ed Elson? Did it work?
27:48 Speaker 07 Well, to a degree. Bernanke himself kind of sabotaged the system on occasion. So, for example, in 2006, he was at the White House Correspondents' Dinner, sitting next to a CNBC anchor. And he made an offhand comment about the Fed's plans with regard to interest rates. She reported that comment on her show the next afternoon at 3:15 in the afternoon, and by 4, the stock market had gone red. Overall, though, more communication from the Fed Chair has somewhat formalized the process in that we know when the Fed Chair is going to speak. And a kind of informal code has developed between the Chair and the market.
28:22 Ed Elson? OK, so Jerome Powell is holding his press conference this week. What do you think we should be expecting?
28:28 Speaker 07 Well, this history of Fed Chair statements is interesting, in part because we haven't really tested the system in a while. Until this year, it had been a decade since the market was hypersensitive to the Fed's moves. We've been in a consistently low interest rate environment with no real expectation that would change. And that's not true anymore, as the Fed has been raising rates to fight inflation. And so Fed Watchers are dusting off their Fed Chair translators and, once again, hanging on the Chair's every word.
28:55 Speaker 11 We are taking forceful and rapid steps to moderate demand so that it comes into better alignment with supply and to keep inflation expectations anchored. We will keep at it until we're confident the job is done.
29:08 Speaker 07 So in anticipation of Powell's speech this week, we spoke with Bob Iacchino. He's a trader, chief strategist at Path Trading Partners. Bob explained what traders will be listening for when Powell takes the mic on Wednesday.
29:21 Speaker 12 Essentially, you first look at the statement. Okay, and the statement will have key phrases in it. Those are the places where you would look for it to change up. So for example, inflation remains elevated. They might change that to inflation has moderated. Um, two or three meetings ago in the statement, they said, we're looking for substantial progress on the rate of inflation. They might say, we're seeing marginal progress. It's those little key words that directly affect the actions they might take in the future, not what they just took, but what they might take in the future that you're looking for changes in.
29:59 Speaker 07 And that's the key to all this Fed watching. The markets have already digested what the Fed has done. They want to know what it's going to do. And the best way to figure that out is to listen to the Fed chair. Jerome Powell speaks on Wednesday, November 2nd at 2:30 Eastern time.
30:15 Ed Elson? Thanks, Jason. Scott, do you listen to the Fed chair? Do you pay attention to what he says? And if so, how do you interpret his words?
30:23 Scott Galloway? I don't, but I'd hate to be a speechwriter. I'd hate to be the person responsible for trying to assemble these words, recognizing that anything could be taken out of context and create a cartoon and then it's irrational exuberance, or it's a very strange situation around how markets absorb a language and then, and then act on it. It's almost become a game.
30:46 Ed Elson? Do you think it's a bad system? I mean, I don't know what the alternatives are, but it just seems so rudimentary that our entire economy is based around whatever this guy says.
30:57 Scott Galloway? Yeah, I think it was either you or Jason brought up an excellent point in our editorial meeting that in China, they just stopped giving guidance. And that people don't trust the numbers that come out of their system. And key to economic growth is trust. And so I think the chairman communicating or over communicating is really a powerful positive or a positive sign for our economy and our democracy. And you try to be as transparent as possible. The learning here for young people. Is in relationships and in your personal life and your professional life. When things aren't going well, or it's a tense time in a relationship or a business, you want to over communicate.
31:38 Scott Galloway? And that is the market and your spouse and your parents and your friends, they don't like bad news, but they can tolerate it. What ruins relationships is surprises. Wait, you knew this was going on and you didn't tell me? And now it's worse? So the fact that we consistently publish minutes of the Fed meeting, the fact that he will come on during very tense times and tell people the hard truth, the fact that our inflation and GDP numbers have more veracity than the numbers that the CCP releases is really a positive forward-looking indicator in our economy. And it's the reason why the dollar is the reserve currency. It's the reason why people want to own American stocks.
32:21 Ed Elson? Only you could turn Jerome Powell's speech into relationship advice.
32:25 Scott Galloway? There you go. Comedy, esterperal of the economy.
32:29 Ed Elson? That's good, actually.
32:29 Scott Galloway? Hello, hello.
32:31 Ed Elson? Okay, well, let's take a look at the week ahead now.
32:32 Scott Galloway? You can recover from an affair, Ed. Now think of your life moving forward.
32:37 Ed Elson? Yeah, okay. The week ahead, we'll be watching for that next interest rate hike decision from the Fed on Wednesday. And we've also got earnings from Airbnb, from Uber and from CBS. Do you have any predictions on this or on anything else?
32:51 Scott Galloway? My prediction is in the next six months, 10,000 people are going to be laid off from ad-supported big tech, Twitter, Snap, Meta and Google. It's going to be big. It's going to be big, Ed. All right, that's all for this episode. Our producers are Claire Miller and Jason Stavert. Special thanks to Catherine Dillon, Ed Elson and the Prop G Media team. If you like what you heard, please follow, download and subscribe. Thank you for listening to Prop G Markets from the Vox Media Podcast Network. We will catch you next week.
33:39 Scott Galloway? Hello, gun shows in town. Where's that naked guy? Where's that naked guy? He was wearing Under Armour underwear. Who the fuck stays at the Beverly Hotel and buys Under Armour underwear? Literally.
33:50 Ed Elson? Is he at the Beverly Hills?
33:52 Scott Galloway? Yeah, that's where I am, at the hotel. Seriously, that's the... I won't show him to you. And I'd probably get sued for that. Oh, he subjected us to nude men. Anyways.
34:03 Ed Elson? Yeah, I'm gonna report you for that.
34:05 Scott Galloway? We're gonna meet him for drinks later. He looks like a Ron. I think his name is Ron. I get the sense his name is Ron.
34:12 Ed Elson? Hmm.
34:13 Scott Galloway? Dun dun dun.
34:14 Ed Elson? I believe it.
34:16 Scott Galloway? I'm sorry, anyway.
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