Latest / Trend Watch / Episode 24: Trump Eyes RFK Jr., Biden Courts the Youth Vote, and Russia Launches Glide Bombs

Transcript

Episode 24: Trump Eyes RFK Jr., Biden Courts the Youth Vote, and Russia Launches Glide Bombs · Trend Watch

• 0:04
  SPEAKER_01: Ready to take a deeper look at where history, politics, and economics all intersect?
• 0:10
  SPEAKER_01: Well, then you've come to the right place.
• 0:13
  SPEAKER_01: Each week, here's where we pull back the headlines and focus on the big trends, the stuff that actually shapes our future.
• 0:21
  SPEAKER_01: Through the noise, we focus on the signal.
• 0:24
  SPEAKER_01: I'm your host, Neil Howe, and this is TrendWatch.
• 0:30
  SPEAKER_01: Today is April 10th, 2024, and this is Trend Watch.
• 0:34
  SPEAKER_01: Welcome back, everybody.
• 0:36
  SPEAKER_01: As usual, I have on my fellow analyst, Christian Ford.
• 0:40
  SPEAKER_01: So, Christian, how was your week?
• 0:41
  SPEAKER_00: My week was great, Neil.
• 0:43
  SPEAKER_00: I was up in northern Maine to see the eclipse, and I was in the band of totality, so I got to see the 100% coverage of the sun.
• 0:52
  SPEAKER_01: Well, I guess not many come back from the band of totality, I have heard, but you did manage to come back.
• 0:59
  SPEAKER_01: How was it?
• 1:00
  SPEAKER_01: What did you see there?
• 1:00
  SPEAKER_00: It was pretty cool.
• 1:01
  SPEAKER_00: You know, right before it's fully covered, the wind kind of starts picking up because the temperature starts to drop and you get weird air pressure.
• 1:09
  SPEAKER_00: You also, I was on this frozen lake and you see these weird, almost light ripples.
• 1:14
  SPEAKER_00: They're called shadow bands, which always happened before an eclipse that scientists don't really know why it happens.
• 1:20
  SPEAKER_00: And then during totality, you can actually take your glasses off and look directly at it without
• 1:26
  SPEAKER_01: uh damage which was a little stressful you know you don't know if that worry that your eyes will be burned out but i can still see today well you don't you don't want your macula to be burned out for the rest of your life i yeah it it uh that is you know the wind picking up you can imagine what impression that must have made on you know prehistoric humans to witness this uh
• 1:49
  SPEAKER_01: Particularly, I guess it got a little bit better once many ancient civilizations, they could actually, well, they couldn't foresee where they would be.
• 1:56
  SPEAKER_01: I guess they eventually got to the point where they could predict when they would be.
• 2:01
  SPEAKER_01: Right.
• 2:02
  SPEAKER_01: Foreseeing where they're going to be, that really requires modern calculations.
• 2:10
  SPEAKER_01: Anyway, but that is really cool.
• 2:13
  SPEAKER_01: I'm glad you got to do it.
• 2:14
  SPEAKER_01: I'm glad you're back from the band of totality.
• 2:17
  SPEAKER_01: And now on to our now under our farewells.
• 2:21
  SPEAKER_01: We got a couple this last week.
• 2:24
  SPEAKER_01: When I do want to mention this is another story of the greatest generation.
• 2:28
  SPEAKER_01: This is Lou Conter, the last known survivor, the last survivor.
• 2:34
  SPEAKER_01: Known survivor of the battleship Arizona, sunk during the Pearl Harbor attack on December 7, 1941, who passed away at age 102.
• 2:42
  SPEAKER_01: Contra was born in 1921 in Wisconsin.
• 2:44
  SPEAKER_01: He joined the Navy in 1939, just after high school.
• 2:54
  SPEAKER_01: And he reported to the battleship Arizona in 1940.
• 2:58
  SPEAKER_01: And as you can imagine, he found himself at Pearl Harbor.
• 3:02
  SPEAKER_01: Actually, their base was in San Diego.
• 3:06
  SPEAKER_01: And I think FTR moved them all out to Pearl Harbor just to be a little bit forwardly based, more forwardly based in San Diego.
• 3:17
  SPEAKER_01: In time for war, as it turns out, that might, you know, it turned out that probably wasn't the best location to have them.
• 3:24
  SPEAKER_01: But Conter was quartermaster on board ship that morning when at just after 8 a.m., actually the very beginning of the attack, an armored piercing bomb penetrated five steel decks and blew up the ship's magazine.
• 3:39
  SPEAKER_01: Turned out, I think this armored piercing bomb turned out to be an artillery shell, which was converted into a
• 3:46
  SPEAKER_01: uh, a bomb that could be derived from, uh, dropped from a dive bomber.
• 3:50
  SPEAKER_01: It contained, uh, and that when it blew up, it blew up the ship's magazine containing more than a million pounds of gunpowder and thousands of rounds of ammo.
• 3:59
  SPEAKER_01: Contra was thrown forward by the blast, but miraculously he was uninjured, uh, while the ship was consumed in a giant fireball.
• 4:07
  SPEAKER_01: He tended to the survivors before eventually abandoning ship with 93 other survivors, many of them blind, many of them burned.
• 4:18
  SPEAKER_01: The other 1,111 sailors and Marines on board the Arizona died.
• 4:25
  SPEAKER_01: That was nearly half of the total deaths at Pearl Harbor.
• 4:29
  SPEAKER_01: Arizona was one of seven ships sunk and over a dozen others that were severely damaged.
• 4:38
  SPEAKER_01: All but three of those ships, by the way, all but three battleships were raised and subsequently returned to service during the war.
• 4:47
  SPEAKER_01: The Arizona and the Utah, both battleships, Utah was just a training ship, were permanently sunk and turned into memorials.
• 4:54
  SPEAKER_01: If anyone visits Utah,
• 4:56
  SPEAKER_01: Oahu, you can see that.
• 4:58
  SPEAKER_01: And the Oklahoma was scavenged for parts.
• 5:01
  SPEAKER_01: So that's it.
• 5:02
  SPEAKER_01: After the attack, Contra joined Navy flight school and flew 200 combat missions in the Pacific against the Japanese.
• 5:10
  SPEAKER_01: Oh, you thought you thought it was over at Pearl Harbor?
• 5:12
  SPEAKER_01: No, no.
• 5:14
  SPEAKER_01: You were in for the duration, right?
• 5:15
  SPEAKER_01: There was more to do here in the Distinguished Flying Cross for one of his missions.
• 5:21
  SPEAKER_01: And then he flew again during the Korean War.
• 5:24
  SPEAKER_01: He flew 29 combat missions and trained down airmen during the Korean War.
• 5:29
  SPEAKER_01: How to survive behind enemy lines.
• 5:31
  SPEAKER_01: Truly, when you think about that.
• 5:34
  SPEAKER_01: the greatest generation.
• 5:35
  SPEAKER_01: I think that's what we think about, right?
• 5:37
  SPEAKER_01: He retired in 1967, later became a real estate broker in the Los Angeles area.
• 5:43
  SPEAKER_01: Later in life, he said he thought about those who died that day every morning when he woke up.
• 5:50
  SPEAKER_01: He denied
• 5:51
  SPEAKER_01: As so many of these veterans do.
• 5:53
  SPEAKER_01: He denied that any of the Arizona survivors were heroes.
• 5:57
  SPEAKER_01: The 2,403 men that died that day are the heroes, he said in a 2022 interview.
• 6:00
  SPEAKER_01: I'm not a hero.
• 6:01
  SPEAKER_01: I was just doing my job.
• 6:08
  SPEAKER_01: And the other person I want to mention is Peter Higgs, the Nobel Prize winning British theoretical physicist who predicted the subatomic particle that now bears his name, the Higgs boson.
• 6:23
  SPEAKER_01: He passed away at age 94.
• 6:25
  SPEAKER_01: Higgs was a child of the Blitz and World War II in England.
• 6:28
  SPEAKER_01: I mean, just note that birth date, right?
• 6:31
  1929.
• 6:31
  SPEAKER_01: You know, you're right there in the right there in the
• 6:33
  SPEAKER_01: the silent generation, raised mostly by his mom, often at home during the war.
• 6:38
  SPEAKER_01: He studied math and physics at King's College in London just after the war, received his PhD in 1954, and later by 1960 ended up teaching at the University of Edinburgh, where he did most of his life's research.
• 6:52
  SPEAKER_01: As for his theoretical work, I just want to do an ahem here, Christian, because...
• 6:59
  SPEAKER_01: I don't think anyone really understands what he did.
• 7:02
  SPEAKER_01: But let me put it this way.
• 7:04
  SPEAKER_01: Higgs posited the existence of a subatomic particle that was massless at the creation of the universe, but later acquired mass by entering an energy field, which is later called a Higgs field, right?
• 7:19
  SPEAKER_01: And it also confers mass on quarks and leptons and creates the strong force within the atomic nucleus.
• 7:27
  SPEAKER_01: At first, most physicists rejected his theory, but by the year 2000, many were taking it more seriously.
• 7:33
  SPEAKER_01: And then on July 4th, 2012,
• 7:36
  SPEAKER_01: It turned out that the existence of the Higgs boson, as it came to be called, was confirmed experimentally at the mast accelerator at CERN near Geneva.
• 7:47
  SPEAKER_01: There was he was actually there at CERN when this happened.
• 7:51
  SPEAKER_01: And the entire world of physics watched when the results of the experiment were announced, gave a standing ovation.
• 7:59
  SPEAKER_01: And I have actually watched that.
• 8:00
  SPEAKER_01: And Higgs had tears in his eyes.
• 8:03
  SPEAKER_01: So there you have it.
• 8:05
  SPEAKER_01: The Higgs boson, also called the God particle, would become the keystone of a suite of theories known as the Standard Model, which is supposed to encapsulate all human knowledge so far about elementary particles and the forces which shape nature and the universe.
• 8:25
  SPEAKER_01: That's pretty cool to be the discoverer of the God particle.
• 8:29
  SPEAKER_01: And let me note this, Christian.
• 8:31
  SPEAKER_01: This is a further note.
• 8:32
  SPEAKER_01: Pay attention to all you listeners out there who spend too much time multitasking on social media.
• 8:38
  SPEAKER_01: Higgs preferred spending all of his free time outdoors walking alone.
• 8:42
  SPEAKER_01: He did not own a television, nor did he use email or a cell phone.
• 8:47
  SPEAKER_01: I don't know.
• 8:47
  SPEAKER_01: Just a suggestion.
• 8:50
  SPEAKER_01: You know, if you really want to discover a guard particle yourself, I don't know.
• 8:57
  SPEAKER_01: I think there's a little wisdom in that.
• 8:59
  SPEAKER_01: As always, let me remind you, if you like this podcast, please go ahead and share it with your friends and family.
• 9:04
  SPEAKER_01: Repost it on social media.
• 9:06
  SPEAKER_01: From now on, only some episodes will remain free.
• 9:10
  SPEAKER_01: Christian, I think we should take a moment to, as always we do on this podcast, to let listeners know that this podcast isn't all we do on Substack.
• 9:20
  SPEAKER_01: But we also put out lots of written content under the name of Demography Unplugged.
• 9:24
  SPEAKER_01: And that's where we look into demographic, economic and generational trends.
• 9:29
  SPEAKER_00: Daniel, I would just recommend to all of our listeners to check out the latest piece that we posted today that you wrote about passive investing and how we've really changed from active to passive and the very negative effects this could have on capital markets.
• 9:46
  SPEAKER_01: Yeah, this is one of those dark forces, sort of, I wouldn't call it the guard particle, but it is one of those dark forces hanging over the markets.
• 9:59
  SPEAKER_01: People have opined about it.
• 10:00
  SPEAKER_01: People have warned about it.
• 10:03
  SPEAKER_01: But each time that passive investing crosses a new milestone, and basically the hook to the story was that
• 10:12
  SPEAKER_01: Morningstar just calculated that passive funds are more than 50% of all funds available in the United States, not just equity funds, but also international funds and bond funds.
• 10:28
  SPEAKER_01: are now passive, I think, for equity alone, U.S.
• 10:31
  SPEAKER_01: equities alone.
• 10:31
  SPEAKER_01: It's more than 60% now.
• 10:33
  SPEAKER_01: But as I explain in the piece, and I urge everyone to read it, how we define passive is itself a question.
• 10:40
  SPEAKER_01: I would argue actually a lot more of the market is passive because even active investors have to simulate or mirror the market, which is increasingly acting in a passive manner so that there is a
• 10:53
  SPEAKER_01: there is a kind of a multiplier effect of all these factor-driven algorithms on the market.
• 11:02
  SPEAKER_01: And I go through basically their impact, not just on markets, but also their impacts on the economy.
• 11:08
  SPEAKER_01: And anyway, please go ahead and read.
• 11:13
  SPEAKER_01: Let's get into today's podcast.
• 11:14
  SPEAKER_01: As always, we have much to talk about.
• 11:17
  SPEAKER_01: Speaker Mike Johnson is going to propose a bill to aid Ukraine.
• 11:20
  SPEAKER_01: I understand.
• 11:22
  SPEAKER_01: Biden just announced a student loan relief plan that is going to be available to nearly 30 million borrowers.
• 11:32
  SPEAKER_01: How much is it going to cost?
• 11:34
  SPEAKER_01: I don't know, maybe half a trillion dollars over the next five or six years.
• 11:39
  SPEAKER_01: But who's counting, Kristen?
• 11:40
  SPEAKER_01: Is anyone counting anymore?
• 11:42
  SPEAKER_00: I don't know.
• 11:43
  SPEAKER_01: I don't know.
• 11:44
  SPEAKER_01: But we're going to talk about that.
• 11:46
  SPEAKER_01: The Trump RFK ticket.
• 11:48
  SPEAKER_01: Is that possible?
• 11:50
  SPEAKER_01: What should we call that?
• 11:51
  SPEAKER_01: The QAnon ticket?
• 11:52
  SPEAKER_01: I mean, I'm just joking here, but I mean, there is kind of something, I don't know, am I in the zone of totality when I think about that ticket?
• 12:00
  SPEAKER_01: Maybe I am.
• 12:02
  SPEAKER_01: Trump announces his opposition to federal anti-abortion legislation.
• 12:07
  SPEAKER_01: I think that is a very interesting thing.
• 12:10
  SPEAKER_01: We're going to talk about the US, UK, and Australia are inviting Japan to join a
• 12:16
  SPEAKER_01: AUKUS, that is the sort of the military sharing capability of Australia, UK, and the US as a, I guess, what do we call it?
• 12:26
  SPEAKER_01: A pillar two partner.
• 12:29
  SPEAKER_01: Germany sends troops to Lithuania.
• 12:31
  SPEAKER_01: This could be a lot of troops.
• 12:33
  SPEAKER_01: Eventually, what?
• 12:34
  SPEAKER_01: A regiment, right?
• 12:37
  SPEAKER_01: 5,000 German troops in Lithuania.
• 12:39
  SPEAKER_01: Interesting.
• 12:40
  SPEAKER_01: Glide bombs in the Ukraine.
• 12:42
  SPEAKER_01: What is a glide bomb?
• 12:43
  SPEAKER_01: And how might glide bombing be actually truly changing the war in the Ukraine and not in Ukraine's favor, by the way?
• 12:53
  SPEAKER_01: Israel update.
• 12:54
  SPEAKER_01: We will do that.
• 12:56
  SPEAKER_01: I don't know.
• 12:56
  SPEAKER_01: You explain Israel to me.
• 12:57
  SPEAKER_01: I just don't understand what's going on there.
• 12:59
  SPEAKER_01: Netanyahu is we're one step away from victory, but he's taking all of his troops out of southern Gaza.
• 13:06
  SPEAKER_01: I don't get it.
• 13:07
  SPEAKER_01: You can explain it to me.
• 13:09
  SPEAKER_01: And Ecuador police raided Mexico's embassy in Ecuador, right?
• 13:18
  SPEAKER_01: What city is that?
• 13:19
  SPEAKER_01: Is that Quito?
• 13:20
  SPEAKER_01: Yep.
• 13:21
  SPEAKER_01: Yeah.
• 13:21
  SPEAKER_01: OK.
• 13:22
  SPEAKER_01: And they arrested the former vice president of Ecuador, who apparently had fleed for safety in Mexico's embassy.
• 13:33
  SPEAKER_01: They they grabbed them.
• 13:34
  SPEAKER_01: They just battered down the doors.
• 13:36
  SPEAKER_01: And of course, that shocked everyone.
• 13:38
  SPEAKER_01: You know, diplomatic immunity.
• 13:39
  SPEAKER_01: What's going on here?
• 13:40
  SPEAKER_01: We got to talk a little bit about that.
• 13:42
  SPEAKER_01: That's it.
• 13:43
  SPEAKER_01: So as usual, Christian, you're going to go and talk a little bit about markets, right?
• 13:48
  SPEAKER_01: I believe this actually was an interesting day on Wall Street.
• 13:52
  SPEAKER_00: And then we'll get going.
• 13:54
  SPEAKER_00: All right, Neil, the S&P 500 closed down today, 0.95 percent.
• 13:59
  SPEAKER_00: And over the last five market days is down 0.98 percent.
• 14:03
  SPEAKER_00: It's a very similar story for the global Dow.
• 14:05
  SPEAKER_00: That closed today down 0.96%.
• 14:08
  SPEAKER_00: And over the last five market days is down 0.97%.
• 14:11
  SPEAKER_00: As for the VIX, that closed today at 15.83%.
• 14:12
  SPEAKER_00: And as for the 10-year Treasury, that is at 4.55%.
• 14:22
  SPEAKER_00: up 19.5 basis points over the last five days.
• 14:26
  SPEAKER_01: Well, that rising yield on the 10-year says it all.
• 14:30
  SPEAKER_01: And I think clearly the trigger was this morning's CPI inflation report, right?
• 14:37
  SPEAKER_01: We all looked at that.
• 14:40
  SPEAKER_01: If anyone who had been watching all about the indicators was not surprised at the trend, which is that
• 14:49
  SPEAKER_01: Core CPI inflation measured on a month over month annualized basis continues to grow.
• 14:56
  SPEAKER_01: It's been growing for the last seven months straight.
• 15:00
  SPEAKER_01: Who says that inflation is over?
• 15:02
  SPEAKER_01: The bond market is beginning to respond to it.
• 15:06
  SPEAKER_01: The economy, which a lot of people think is beginning to heat up again, is so you got basically two things going on for the bond market, right?
• 15:13
  SPEAKER_01: You've got real interest rates, which are rising because the economy looks like it's heating up.
• 15:18
  SPEAKER_01: Then you've got the inflation premium going up.
• 15:21
  SPEAKER_01: So that is causing those kind of yields to rise.
• 15:26
  SPEAKER_01: And guess what?
• 15:27
  SPEAKER_01: How many Fed cuts are we going to see in 2024?
• 15:32
  SPEAKER_01: I think at the beginning of the year it was six.
• 15:35
  SPEAKER_01: Can you do with me the blast off?
• 15:38
  SPEAKER_01: Six, five, four, three, two.
• 15:41
  SPEAKER_01: We're down to, I think we're down to two now, right?
• 15:45
  SPEAKER_01: And there's a significant share.
• 15:47
  SPEAKER_01: I mean, if you go in the, you know, the usual, you know,
• 15:52
  SPEAKER_01: futures trading information on short-term interest rates, you will see that there's a significant share of traders who think by the time we get to the December Fed meeting, we're only going to have one cut.
• 16:06
  SPEAKER_01: And wouldn't it be interesting if we don't cut at all?
• 16:10
  SPEAKER_01: And wouldn't it be interesting if 2025 we start rising?
• 16:14
  SPEAKER_01: Then again, what's going to happen to the election and what's going to happen with the economy?
• 16:19
  SPEAKER_01: So many things, right?
• 16:21
  SPEAKER_01: We don't know.
• 16:22
  SPEAKER_01: So it gets very interesting.
• 16:24
  SPEAKER_01: But I do think that this has been a very surprising trend.
• 16:28
  SPEAKER_01: Markets, remember markets were just, they're just in there waiting.
• 16:31
  SPEAKER_01: We give us our cuts, you know, we're waiting for all the cheap money that's going to flow in.
• 16:35
  SPEAKER_01: Well, they're not going to get it, at least not as soon as they thought.
• 16:38
  SPEAKER_00: All right, Neil, should we do the couple of indicators I have?
• 16:41
  SPEAKER_00: Yep.
• 16:42
  SPEAKER_00: All right.
• 16:42
  SPEAKER_00: I only have two from the U.S.
• 16:43
  SPEAKER_00: It's been a slow week for indicators internationally and in the U.S.
• 16:47
  SPEAKER_00: But as we were just talking about, annual inflation rate rose 3.5% in March.
• 16:52
  SPEAKER_00: That's the highest rate we have seen since September.
• 16:56
  SPEAKER_00: And we got non-farm payrolls, which hit 303,000 in March.
• 16:59
  SPEAKER_00: And that crushed expectations of 200,000 and is a 10-month high.
• 17:06
  SPEAKER_01: Yeah, again, on our indicator show, we're going to talk about that.
• 17:11
  SPEAKER_01: And by the way, the household survey was also up big.
• 17:16
  SPEAKER_01: So it was definitely a big month for employment growth.
• 17:19
  SPEAKER_01: However, I'll say another thing that's odd about these employment numbers.
• 17:24
  SPEAKER_01: We continue to puzzle over them because they don't make sense.
• 17:27
  SPEAKER_01: The part time continued to rise.
• 17:31
  SPEAKER_01: Right.
• 17:31
  SPEAKER_01: Full time jobs actually continued to shrink.
• 17:34
  SPEAKER_01: Isn't that interesting?
• 17:35
  SPEAKER_01: Right.
• 17:37
  SPEAKER_01: And so what does that say?
• 17:40
  SPEAKER_01: Because typically part time increases a lot more than full time when you're near the end of an expansion, when things, you know, labor market conditions are actually getting worse.
• 17:51
  SPEAKER_01: easier, or at least people don't expect to expand anymore.
• 17:58
  SPEAKER_01: We always look at marginal employment.
• 18:00
  SPEAKER_01: That's why we look so much at things like attempts and Help Wanted and everything from disabled to young people.
• 18:07
  SPEAKER_01: I mean, everywhere in the labor market, we're looking at anything that could be considered marginal employment.
• 18:13
  SPEAKER_01: That's how we actually test for the strength of the labor market.
• 18:18
  SPEAKER_01: So and that continues to show a great deal of weakness on many of these indicators.
• 18:23
  SPEAKER_01: So I would just say an interesting, even somewhat paradoxical set of indicators.
• 18:28
  SPEAKER_01: We're going to be making more sense of them on our next show.
• 18:31
  SPEAKER_00: All right, Neil, let's move on to our first story.
• 18:33
  SPEAKER_00: Speaker Johnson has pledged to hold a House vote on Ukraine and Israel aid in the coming days.
• 18:39
  SPEAKER_00: We know that the bill will be different from the Senate bill, but details are unclear.
• 18:44
  SPEAKER_00: Johnson has suggested that Ukraine and Israel aid may be split into two separate bills.
• 18:50
  SPEAKER_00: He has also suggested a few other policy changes.
• 18:53
  SPEAKER_00: These include some of the aid may be converted to a loan.
• 18:57
  SPEAKER_00: They might use seized Russian assets to fund Ukrainian reconstruction.
• 19:01
  SPEAKER_00: And they may lift Biden's moratorium on new liquefied natural gas export projects.
• 19:09
  SPEAKER_00: Of course, members of the far right are displeased with the plan.
• 19:12
  SPEAKER_00: Marjorie Taylor Greene has already filed a motion to oust Johnson, but has not yet called for a vote.
• 19:19
  SPEAKER_00: She says this is a warning to the speaker.