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What the Economy Is (and Isn't) · Why We Do What We Do

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  Speaker 1: You're listening to Why we Do what we do? Welcome
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  Speaker 1: to Why we Do what we Do. I am your
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  Speaker 1: globally Interconnected host Abraham.
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  Speaker 2: And I'm your Stock Exchange host Shane.
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  Speaker 1: Sure Where I Psychology podcast. We talk about all of
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  Speaker 1: the things that people and animals do and why they
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  Speaker 1: do them, and sometimes we talk about large scale systems
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  Speaker 1: that affect pretty much everyone everywhere.
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  Speaker 2: Yes, and so today we are talking about the economy
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  Speaker 2: and taking some time to define what it is and
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  Speaker 2: what it ain't because I think a lot of people
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  Speaker 2: have a gross misunderstanding of what an economy is and
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  Speaker 2: how it works and all the metrics that go along
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  Speaker 2: with it.
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  Speaker 1: Yeah, there are some frustratingly off the mark simplified analyses
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  Speaker 1: of what the economy is. And to that point, we
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  Speaker 1: will be able to unpack it in its entirety here,
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  Speaker 1: because that would take pretty much a lifetime, we're going
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  Speaker 1: to try and keep ourselves to just an hour, and
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  Speaker 1: that's less than the amount of time that I just said,
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  Speaker 1: So the lifetime that is. So we're expecting it's going
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  Speaker 1: to miss some things and oversimplify a few things, but
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  Speaker 1: we're going to do our best to try and communicate
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  Speaker 1: more or less in broad strokes, what's going on with
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  Speaker 1: the economy in terms of what is it, how does
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  Speaker 1: it work, and what is it not that many people
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  Speaker 1: seem to think that it is.
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  Speaker 2: Yes, before we do that, though, we like to celebrate
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  Speaker 2: on the show, we celebrate so many things. We celebrate
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  Speaker 2: our friend laboratory, we celebrate science, we celebrate knowledge and education.
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  Speaker 2: And so today on December eighteenth, right before the holidays,
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  Speaker 2: officially the cresting, if you will, of the holiday season.
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  Speaker 2: That's right, We're going to celebrate a couple holidays. And
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  Speaker 2: one of them is that today is Arabic Language Day. Ooh,
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  Speaker 2: I wish that I spoke some Arabic. I would say
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  Speaker 2: something congratulatory a bit, and I probably could have googled it.
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  Speaker 2: But instead I'm gonna say it is also bake cookies Day.
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  Speaker 2: I love that so much. It's flake Appreciation Day, which
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  Speaker 2: I'm almost positive is snowflake appreciation Day, and hopefully no
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  Speaker 2: other flake.
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  Speaker 1: Gonna was gonna corn flakes or like flaky scalp or
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  Speaker 1: maybe being a flake.
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  Speaker 2: Yeah, I think I think all of those. I think,
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  Speaker 2: you know, if we're gonna go umbrella terms, I think
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  Speaker 2: that's fine.
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  Speaker 1: Okay, great, it is international answer the telephone, like, buddy
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  Speaker 1: the Elf day, what's.
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  Speaker 2: Your favorite color? That's right, it's International Migrants Day.
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  Speaker 1: Yay love that. Yes, it is National Ham Salad Day.
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  Speaker 1: I've never had a ham salad, at least I don't
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  Speaker 1: think I have. Maybe I have, I don't know. It
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  Speaker 1: doesn't sound like something I would want to have.
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  Speaker 2: It feels like one of those like cursed recipes from
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  Speaker 2: the fifties where it's like everything goes in a jello mold. Yeah, no,
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  Speaker 2: that's probably it. Yeah, it's it's ham probably exactly what
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  Speaker 2: it is. Oh God, what a what a time to
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  Speaker 2: be alive. Like, I don't know how anybody wanted to
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  Speaker 2: survive through the fifties and sixties because of the food
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  Speaker 2: that I see is like all like shrimp, cocktail, jello molds.
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  Speaker 1: Oh yeah, the aspects of everything.
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  Speaker 2: We should do an episode on that. Why anybody thought
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  Speaker 2: that was okay?
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  Speaker 1: The history of jella molds. There is actually a.
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  Speaker 2: History of jeld recipes. Yeah. Yeah, it's also National twin Day.
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  Speaker 2: So Arnold Schwarzenegger and Danny de Vito eat your heart's out.
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  Speaker 1: Also get your studies ready.
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  Speaker 2: Uh huh.
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  Speaker 1: It is national where a plunger on your head day.
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  Speaker 1: I'm gonna go ahead and say it. Don't do that
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  Speaker 1: unless it's clean, I guess. But even then you're greatly
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  Speaker 1: diminishing your capacity to walk through open doors. So don't.
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  Speaker 2: Yeah, how are you gonna drive unless you're driving like
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  Speaker 2: a convertible. It is Christmas bird count Week.
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  Speaker 1: Oh cool?
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  Speaker 2: I love that.
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  Speaker 1: That's really fun.
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  Speaker 2: Love that.
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  Speaker 1: Yeah, I've never done it, but it sounds like fun.
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  Speaker 1: In addition to the fact that it's bake cookies Day,
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  Speaker 1: it's also cookie Exchange Week, So bake them and then
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  Speaker 1: trade them as if they were a commodity and you
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  Speaker 1: were using them to pay for goods and services. Ah.
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  Speaker 2: I like the tie in there. It's drive sober or
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  Speaker 2: get pulled over Winter Enforcement week. Apparently like literally it'
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  Speaker 2: said winter enforcement okay when I looked up this holiday.
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  Speaker 1: So that's probably like various seasonal stages of drive sober or.
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  Speaker 2: Get pulled su sure.
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  Speaker 1: Now unrelated to cookies, it is gluten Free Baking Week.
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  Speaker 1: Leave the gluten and the cookies. Leave the cookies alone.
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  Speaker 1: Just kidding.
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  Speaker 2: Makes watch them, yeah, yeah, make them to your liking.
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  Speaker 1: But yeah, gluten free baking for those people who are
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  Speaker 1: into gluten free baking.
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  Speaker 2: Yeah. And also it is Saturnalia or Saturnalia if you will.
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  Speaker 1: Okay, fun. So anyway, those are some fun things that
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  Speaker 1: you can We would like for those of you who
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  Speaker 1: celebrate openly or privately, we are just we are wishing
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  Speaker 1: them out, the good vibes out unto you for for
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  Speaker 1: your holiday orientations, whatever they may be. We are very
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  Speaker 1: rapidly approaching the Western Christian holiday of Christmas or somewhat
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  Speaker 1: Christian pagan actually pagan holiday of Christmas that has sort
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  Speaker 1: of been appropriated by Christians. We actually did a whole
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  Speaker 1: episode on the history of Christmas in the past and
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  Speaker 1: the remarkable superpowers that Santa Claus has which outpaces even
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  Speaker 1: God in some cases, but where today we are talking
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  Speaker 1: about something much more mundane than that, which is the
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  Speaker 1: thing that kind of keeps the world running. Which when
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  Speaker 1: we're talking about how we move and govern human behavior
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  Speaker 1: at a very very very large, sort of macro zoomed
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  Speaker 1: out systems view, you can just sort of talk about
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  Speaker 1: the exchange of resources that are done contingent on essentially
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  Speaker 1: certain behaviors that we do, and that is essentially managing
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  Speaker 1: resources and how we trade for those things. Right, Because
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  Speaker 1: we are biological organisms. We need certain things to survive. Otherwise,
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  Speaker 1: if we don't have those things, we stop surviving, and
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  Speaker 1: that can be very bad, both for us and for
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  Speaker 1: some people around us. In many ways, maybe is sometimes
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  Speaker 1: better for other people, but in general, in general, we
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  Speaker 1: want the humans to survive as much as possible, and
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  Speaker 1: so in managing those resources, we sort of established this
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  Speaker 1: trade system, and we did a whole episode in the
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  Speaker 1: past on money, where that came from and sort of
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  Speaker 1: how it works. And this is an expansion on that,
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  Speaker 1: if you will, because we're talking about the economy.
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  Speaker 2: Yes, so let's go ahead and answer some questions about
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  Speaker 2: what the economy is, what it isn't, and how we
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  Speaker 2: measure the relative strength of the economy. But first we
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  Speaker 2: like to do background things. We like to share some
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  Speaker 2: definitions and all that. So the word economy specifically comes
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  Speaker 2: from the Greek word oikonomia or oikonomia maybe, but or okinomia,
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  Speaker 2: which means household management.
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  Speaker 1: Yeah, I bet you didn't know that. Yeah, So I
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  Speaker 1: think a lot of people hear economy and they might
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  Speaker 1: rightfully think to themselves, what does that really mean? Or
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  Speaker 1: many people might think that they have an understanding of
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  Speaker 1: what that means, and we're going to do our best
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  Speaker 1: to just explain it regardless of whatever your own individual
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  Speaker 1: history is. So, what is the economy. This is a complex,
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  Speaker 1: very complex, interconnected network of the production of goods, consumption
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  Speaker 1: of goods, and other exchange activities and services that determine
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  Speaker 1: the allocation of resources within a system. And an economy
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  Speaker 1: can refer to really any system that contains elements of
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  Speaker 1: those types of exchanges. You can have economies as small
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  Speaker 1: as down to a single household and what their network
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  Speaker 1: of exchanging activities and services and financial resources or other
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  Speaker 1: resources looks like. And in economics, the study of economies,
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  Speaker 1: that is called microeconomics. Then you have economics at the
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  Speaker 1: level of a single industry. You can talk about a region,
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  Speaker 1: so like a geographical place, or a nation so a government,
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  Speaker 1: and those levels are called macro economics at that sort
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  Speaker 1: of zoomed out level. And then you can even talk
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  Speaker 1: about how all of the connected countries on Earth, the
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  Speaker 1: ones that are connected, participate in these economies, and again
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  Speaker 1: at every level, and that's again still that sort of
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  Speaker 1: macro level economics.
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  Speaker 2: Right, economic systems that entail this ongoing exchange of resources
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  Speaker 2: goods and services exist on a spectrum of market based
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  Speaker 2: economies to command based economies. A market based economy or
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  Speaker 2: a free market is a self regulating system that allows
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  Speaker 2: for the allocation of resources to EBB and flow with
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  Speaker 2: supply and demand from consumers and industries. A command based
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  Speaker 2: economy is one in which a governing agency like the
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  Speaker 2: government will regulate what goods are produced and how much
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  Speaker 2: they cost. And there are not real examples of an
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  Speaker 2: economy that's purely one or the other, which I think
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  Speaker 2: is really important to remember. There is not like a
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  Speaker 2: clear example of one that is solely this or solely that.
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  Speaker 2: Usually it's going to be there's different levels that include
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  Speaker 2: market and command based economies and those principles within it
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  Speaker 2: and across the economy that kind of influence different levels,
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  Speaker 2: varying levels of that economic system.
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  Speaker 1: Yeah, most of them are mixed. And where you to
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  Speaker 1: look for a command based economy, you'll probably find that
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  Speaker 1: in a communist country and communist countries, they'll often dictate
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  Speaker 1: what goods are produced and how much those goods will cost,
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  Speaker 1: and they'll sort of try and govern those things. And
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  Speaker 1: again they'll include some free market aspects, particularly because they'll
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  Speaker 1: need to trade with other countries. Almost all of them, well,
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  Speaker 1: almost all of the countries that exist, will need to
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  Speaker 1: trade with other countries. That don't mean every country trades
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  Speaker 1: with every other country, although that is not far off
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  Speaker 1: the mark, right. But anyway, the point is that if
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  Speaker 1: you look for something that's more of that command based economy,
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  Speaker 1: you're more likely to find that in the way that
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  Speaker 1: communism has been implemented out in the real world. But
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  Speaker 1: if it wasn't obvious from the description that we just gave,
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  Speaker 1: the US leans pretty heavily into the market economy side
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  Speaker 1: of things. The market based economy in which producers determine
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  Speaker 1: what to create and how much to charge for their products,
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  Speaker 1: and they do so with relatively little influence from the government.
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  Speaker 1: The government and the people who run it cannot, through
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  Speaker 1: decree or law, tell companies what to produce, how much
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  Speaker 1: to produce, or how much to charge. Okay, And that's
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  Speaker 1: very important to understand when people think about this, because
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  Speaker 1: a lot of people think that the government does directly
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  Speaker 1: control the prices of goods and services, and in some
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  Speaker 1: countries it can for a lot of them, and the
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  Speaker 1: United States is almost all the way market economy, but
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  Speaker 1: it does have several aspects of the economy that are
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  Speaker 1: command based where the government influences them. So they call
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  Speaker 1: it a mixed economy. But that's pretty much all economies
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  Speaker 1: are mixed economies, but the United States is much more
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  Speaker 1: heavily on the market economy side of things.
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  Speaker 2: Right, So understanding that it is important to understand the
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  Speaker 2: role of the government does play and these types of spaces,
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  Speaker 2: so the government can one they can levy taxes against industries.
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  Speaker 2: One of the ways they do this is through tariffs.
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  Speaker 2: Tariffs are taxes that citizens and I want to be
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  Speaker 2: really clear about this because this is a huge talking
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  Speaker 2: point right now in the US. Huge tariffs are taxes
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  Speaker 2: that citizens and businesses of that country pay to import goods.
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  Speaker 2: So the citizens of the country, not the country where
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  Speaker 2: the goods are coming from, but the country of the
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  Speaker 2: citizen where the tariff is being administered. Like if the
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  Speaker 2: US is going to put tariffs on Canada, then the
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  Speaker 2: US is paying the tariffs. Here's what we mean by that.
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  Speaker 2: This essentially means that if that organization, that group, that
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  Speaker 2: business depends on imported materials or goods for their business,
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  Speaker 2: the cost of those goods increases, which met usually means
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  Speaker 2: that the company must then charge more for their goods
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  Speaker 2: or for their products. So if a company is importing
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  Speaker 2: goods from let's say Canada, we'll just use that as
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  Speaker 2: an example right now, sure, because that is something that's
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  Speaker 2: come up more recently. So if that business is importing
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  Speaker 2: goods from Canada, then that business will have to pay
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  Speaker 2: higher taxes on what they import. Not Canada. Canada does
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  Speaker 2: not pay those fines those taxes. The business that imports
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  Speaker 2: them does. And then, as a result, because their cost increase,
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  Speaker 2: their goods increase. That's how a tariff works.
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  Speaker 1: The cost of the goods increase.
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  Speaker 2: The cost of the goods increases.
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  Speaker 1: Yes, thank you, yeah, exactly right. And the reason that
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  Speaker 1: this can work is because people will be forced to
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  Speaker 1: more or less continue to import those goods, which means
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  Speaker 1: that they pay more taxes to the government. So it
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  Speaker 1: can raise some revenue for the government by doing this. Again,
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  Speaker 1: it's by taxing its own citizens at a higher rate
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  Speaker 1: on things than they were used to. So that is
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  Speaker 1: a thing that happens when tariffs are levy. The reason
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  Speaker 1: that other countries don't like this is because it means
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  Speaker 1: that the countries that are buying from them are less
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  Speaker 1: likely to buy as many of their goods because their
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  Speaker 1: goods are more expensive, so they buy them in smaller
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  Speaker 1: quantities or less frequently, or they start buying them from
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  Speaker 1: other places. And what can happen as a result of
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  Speaker 1: this is this might make it then more lucrative to
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  Speaker 1: produce those things domestically. Now, again, essentially what that means
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  Speaker 1: is the things that are produced domestically cost a lot
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  Speaker 1: more than the imported goods. And again it's because essentially
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  Speaker 1: what they're doing is they're saying the imported goods were inexpensive,
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  Speaker 1: so we're to make them really expensive. So the things
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  Speaker 1: that are here that are really expensive already seem less
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  Speaker 1: expensive by comparison, right, And so it can indirectly influence
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  Speaker 1: a move to more domestically produced versions of that good,
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  Speaker 1: not universally, and it's not a guarantee. It like doesn't
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  Speaker 1: force it to happen. It just might happen if the
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  Speaker 1: pressures are there, right, So that's an important thing to
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  Speaker 1: understand about that aspect of how the tariffs work.
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  Speaker 2: Right, The government also taxes the financial dealing and income
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  Speaker 2: of companies and might tax them more heavily if they
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  Speaker 2: do business with other countries, or if they produce goods
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  Speaker 2: that are particularly dangerous like tobacco, or even tax them
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  Speaker 2: less depending on the type of product they're producing. So
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  Speaker 2: the government does have the ability to tax dealings and
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  Speaker 2: income depending on what the business is, what goods they are,
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  Speaker 2: what the kind of ebb and flow of the government
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  Speaker 2: is at any given time.
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  Speaker 1: So this is one of the ways that the government
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  Speaker 1: can sort of put its thumb on the scale of
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  Speaker 1: how it influences and affects the economy. Is by affecting
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  Speaker 1: taxes that then influence how much people are having to pay,
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  Speaker 1: which means that affects where they're allocating their resources. So
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  Speaker 1: it's indirect and it can be subtle, but it is
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  Speaker 1: a way that the government can more or less affect
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  Speaker 1: the economy even though they can't directly influence those prices.
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  Speaker 1: A company could choose to just eat those taxes, take
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  Speaker 1: the hit, and charge the same thing they could and
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  Speaker 1: like not raise the prices. They could choose to do that.
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  Speaker 1: They almost never do, but they could choose to do
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  Speaker 1: that if they wanted to, And we unfortunately have to
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  Speaker 1: choose to play ads. All Right, So we've been talking
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  Speaker 1: about the government's role and how it affects the economy,
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  Speaker 1: and one of the ways it can do this is
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  Speaker 1: that it can levy taxes. Another way that it can
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  Speaker 1: affect the economy is the way that it imposes regulatory
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  Speaker 1: standards that can be expensive to implement.
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  Speaker 2: Right, So the government can, for example, ensure that drug
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  Speaker 2: companies must first demonstrate that their medicines are both safe
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  Speaker 2: and effective and that only licensed professionals can produce and
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  Speaker 2: sell those drugs, or they can cut those regulations, and
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  Speaker 2: then we have no idea if medicine works at all
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  Speaker 2: or if it will kill you just by taking it.
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  Speaker 2: That's essentially rf case plan, by the way, is just
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  Speaker 2: kind of reduce those those like kind of like take
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  Speaker 2: some of those things out, remove the regulations here, and
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  Speaker 2: create a space that is very very dangerous for people.
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  Speaker 1: Yeah, doing the research and development to ensure that your
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  Speaker 1: stuff works and is safe is expensive, It takes time,
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  Speaker 1: you have to hire people to do it. You have
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  Speaker 1: to be able to willingly sacrifice decent chunks of the
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  Speaker 1: raw materials use to create those drugs, and that the
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  Speaker 1: time that you're spent doing that is time you're not
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  Speaker 1: spent selling that product. So if you make it so
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  Speaker 1: you don't have to show that it's safe and effective.
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  Speaker 1: You don't have to hire experts to work on these things.
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  Speaker 1: These companies don't have to pay experts even to like
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  Speaker 1: help them peddle their drugs. Well, then they can technically
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  Speaker 1: charge less for those drugs. They'll kill you, but they
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  Speaker 1: won't cost as much. Yeah, cheap funeral, I guess well.
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  Speaker 2: I think the other side too is that they can
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  Speaker 2: remove those regulations that put caps on medication too. So
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  Speaker 2: like what happens is like we you saw the pharma
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  Speaker 2: bro that dude that was going out there, and like
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  Speaker 2: he got a whole bunch of like public flak for
• 16:40
  Speaker 2: increasing the cost of EpiPens and stuff like that. Like
• 16:43
  Speaker 2: the fact that your EpiPen costs so much is because
• 16:46
  Speaker 2: there are loosened regulations around how much an EpiPen can
• 16:49
  Speaker 2: and should cost inside of that, inside of that system,
• 16:52
  Speaker 2: so like the government can put kind of they can
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  Speaker 2: go in and they can put caps on medications necessary
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  Speaker 2: medically necessary medications for people. They were allowed to go
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  Speaker 2: do that as well. And when those regulations are removed,
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  Speaker 2: then you see those prices for drugs that are necessary
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  Speaker 2: for people to live skyrocket, or you see something like
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  Speaker 2: that just happened with Blue Cross, Blue Shield, where they
• 17:11
  Speaker 2: were going to stop providing anesthesia for surgery patients at
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  Speaker 2: a certain level in certain dose because there was no
• 17:19
  Speaker 2: regulation that said they could they had to provide anesthesia
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  Speaker 2: for people who were receiving surgery. They've overturned that decision
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  Speaker 2: since then, maybe partially because of the CEO who's just murdered.
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  Speaker 2: But I do think that there is some conversation to
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  Speaker 2: be had here where the government can put standards in
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  Speaker 2: place and those regulations do protect price gouging from people
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  Speaker 2: from experiencing price gouging in those spaces.
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  Speaker 1: Yeah, and just as you said, essentially there was relatively
• 17:46
  Speaker 1: low levels of regulation in the pharmaceutical industry as like,
• 17:50
  Speaker 1: particularly compared to other industries such as food as things
• 17:54
  Speaker 1: I currently stand, and that's why you were able to
• 17:57
  Speaker 1: get something like Martin Screelly jacking up the That was
• 18:00
  Speaker 1: the guy who tacked up the price of insulin or
• 18:03
  Speaker 1: the EpiPens. And because they essentially had a monopoly on
• 18:06
  Speaker 1: that market and could do whatever they wanted, and it
• 18:08
  Speaker 1: was like, well, let's just get a pay raise. People
• 18:10
  Speaker 1: need this, and if they need it, that means we
• 18:12
  Speaker 1: can charge whatever we want for it, and the government
• 18:14
  Speaker 1: can't say boo, and so the government tried to say boo. Essentially,
• 18:18
  Speaker 1: that is part of how the system works though, where
• 18:20
  Speaker 1: the government can again sort of put its try and
• 18:23
  Speaker 1: influence how the economy goes by putting in certain regulations
• 18:27
  Speaker 1: that will have a lot of effects, but a lot
• 18:29
  Speaker 1: of times what those effects include as things being more expensive.
• 18:32
  Speaker 1: And another one is like the mining industry, because mining
• 18:36
  Speaker 1: does incredible, incredible environmental damage, I mean really astonishing. I'm
• 18:43
  Speaker 1: like cancer to the human body is like medicine to
• 18:48
  Speaker 1: the human body relative to the amount of damage that
• 18:51
  Speaker 1: mining does to the earth. What I'm saying is that
• 18:54
  Speaker 1: like mining is so much worse for the earth than
• 18:57
  Speaker 1: like comparing it to cancer that I feel like answer
• 19:00
  Speaker 1: is more like medicine than anyway. Point being, it's so so, so,
• 19:04
  Speaker 1: so so bad, and there's a bunch of regulations to
• 19:07
  Speaker 1: try and curb how bad it could possibly be by
• 19:10
  Speaker 1: limiting like where they can dump waste and how much
• 19:13
  Speaker 1: waste they can produce and how much damage they can
• 19:16
  Speaker 1: do in the pursuit of their efforts. They're not being
• 19:18
  Speaker 1: completely unlike not completely restricted. They can obviously still do
• 19:22
  Speaker 1: their jobs and make money, but they're essentially being curtailed
• 19:25
  Speaker 1: from doing the worst of what they'll do because although
• 19:27
  Speaker 1: they'll make a bunch of money in the short term
• 19:30
  Speaker 1: by not having to be careful with those systems, the
• 19:34
  Speaker 1: outcome of that is polluted water where people die, and
• 19:38
  Speaker 1: destroyed ecosystems where people hunt and live, and things that
• 19:42
  Speaker 1: we never recover from if they're bad enough. And like
• 19:45
  Speaker 1: that has happened in other places where money was unregulated,
• 19:48
  Speaker 1: So like that's just those are examples of how regulation
• 19:51
  Speaker 1: does make things more expensive in the short term, but
• 19:56
  Speaker 1: it actually saves money and the costs that come down
• 19:59
  Speaker 1: later from like health and environmental disaster where, believe it
• 20:03
  Speaker 1: or not, we live on this planet, all of us,
• 20:07
  Speaker 1: and it's the only one that we have, and we
• 20:09
  Speaker 1: don't have a backup, and if it is gone, then
• 20:12
  Speaker 1: we are gone. So we really should be good stewards
• 20:15
  Speaker 1: of this planet to the best of our ability. And
• 20:18
  Speaker 1: I do think to the people who are critics of regulations,
• 20:21
  Speaker 1: there are times when regulations are not very well thought
• 20:24
  Speaker 1: through and they are sometimes overly restrictive in a way
• 20:27
  Speaker 1: that is like unnecessarily bureaucratic. But that being said, like
• 20:33
  Speaker 1: I'd rather have regulations that protect us and maybe overreach
• 20:37
  Speaker 1: than ones that don't protect us because of like it
• 20:40
  Speaker 1: would make a little bit more money. So for my money,
• 20:44
  Speaker 1: relevant is that may or may not be in this
• 20:45
  Speaker 1: particular conversation. For me, the point is that I think
• 20:50
  Speaker 1: that regulations could be done better, and I think they're
• 20:52
  Speaker 1: entirely necessary. As a matter of fact, I've been thinking
• 20:54
  Speaker 1: we should do a whole discussion just unpacking a couple
• 20:57
  Speaker 1: of regulations, because just unpacking, like take one regulation in
• 21:01
  Speaker 1: the history of it, I think would take a whole
• 21:03
  Speaker 1: discussion to get through. We can maybe pack in like
• 21:06
  Speaker 1: a couple if we do sort of truncated versions of that.
• 21:09
  Speaker 1: But I think there's a lot to say about regulations.
• 21:11
  Speaker 1: But that is a way in summary, how the government
• 21:14
  Speaker 1: sort of affects economies and how they relate to businesses.
• 21:18
  Speaker 2: Right, So, at this point in time, we've got that
• 21:20
  Speaker 2: the government can levy taxes, they can put in tariffs,
• 21:23
  Speaker 2: they can impose regulatory standards or remove them. But they
• 21:27
  Speaker 2: can also determine how much companies must pay their employees
• 21:30
  Speaker 2: at a minimum or minimum wage. Minimum wage is based
• 21:32
  Speaker 2: on a lot of different factors, and they do have
• 21:34
  Speaker 2: those conversations. But also part of the conversation around minimum
• 21:37
  Speaker 2: wage is understanding that the government can establish what counts
• 21:40
  Speaker 2: for poverty and when they do have standards for what
• 21:43
  Speaker 2: poverty is and poverty caps, what that does is that
• 21:46
  Speaker 2: triggers some regulations, some laws, some guidelines, different funding, different grants,
• 21:51
  Speaker 2: different social services to have money allocated for those groups
• 21:56
  Speaker 2: that fit into poverty level living Yeah, so it's important
• 22:00
  Speaker 2: I know that, like minimum wage, part of the effective
• 22:02
  Speaker 2: minimum wage is making sure that people can have a
• 22:04
  Speaker 2: living wage they can actually go and live and contribute
• 22:07
  Speaker 2: to the economy in some level. But also that when
• 22:10
  Speaker 2: people reach poverty levels or below poverty levels, that that
• 22:13
  Speaker 2: does allocate different resources within the economy that will affect
• 22:17
  Speaker 2: the economy in the way that like the way that
• 22:20
  Speaker 2: the social services do affect the economy, they do poll
• 22:23
  Speaker 2: resources from other places, not in a bad way. I
• 22:25
  Speaker 2: think that we should have more social services in general
• 22:27
  Speaker 2: and less military budget. That's a conversation for a different day,
• 22:30
  Speaker 2: but it is important to know that that's something that
• 22:32
  Speaker 2: the government can do as well.
• 22:34
  Speaker 1: Yeah, exactly right. Is that the reason that it's a
• 22:37
  Speaker 1: big deal when a state declares a state of emergency
• 22:40
  Speaker 1: is because when they officially do that, there are government
• 22:44
  Speaker 1: funds that are set aside that are specifically being held
• 22:47
  Speaker 1: in reserve for when those are needed, and so people
• 22:50
  Speaker 1: can't they shouldn't at least be able to just sort
• 22:53
  Speaker 1: of discretionarily say, ah, we have a state of emergency,
• 22:56
  Speaker 1: give me some money, please, Like it's in the face
• 22:59
  Speaker 1: of legitimate disease masters and problems. And the same thing
• 23:01
  Speaker 1: is true for poverty. Like that word is really important
• 23:04
  Speaker 1: because as soon as that category is applied to something,
• 23:08
  Speaker 1: all of a sudden, different benefits are available to people
• 23:11
  Speaker 1: who fall into that category. And that could be something
• 23:14
  Speaker 1: that's taken away by people who believe that people get
• 23:17
  Speaker 1: what they deserve and they shouldn't have any support whatsoever.
• 23:21
  Speaker 1: But right now, that is a way that the government
• 23:23
  Speaker 1: can influence how money is allocated in certain systems such
• 23:27
  Speaker 1: as wages and what counts as poverty, et cetera. Another
• 23:31
  Speaker 1: place that the government can sort of influence the economy
• 23:34
  Speaker 1: is by directly subsidizing some commodities and products. And for example,
• 23:39
  Speaker 1: in the United States, our government subsidizes meat and dairy
• 23:43
  Speaker 1: products by like thirty eight billion dollars, Like it's a
• 23:46
  Speaker 1: pretty good chunk of the cost of the industry, and
• 23:49
  Speaker 1: so what that all means is that those industries receive
• 23:53
  Speaker 1: some kind of financial support from the government to continue
• 23:57
  Speaker 1: to produce their goods. And the idea behind it that
• 24:00
  Speaker 1: is that it enables those goods to essentially be available
• 24:03
  Speaker 1: widely and relatively inexpensively, and the government could subsidize them
• 24:09
  Speaker 1: more or less, and whatever it subsidizes, If it subsidizes
• 24:13
  Speaker 1: it more, it could make those things cheaper. But then
• 24:17
  Speaker 1: that essentially means the government's paying more money, which you
• 24:19
  Speaker 1: have to then ask where's that money coming from. Or
• 24:21
  Speaker 1: it could subsidize them less, which makes those goods more expensive,
• 24:24
  Speaker 1: which then people are paying more for. So probably what
• 24:27
  Speaker 1: happens is people are either paying more in taxes and
• 24:29
  Speaker 1: then paying less for groceries, or they're paying more for
• 24:32
  Speaker 1: groceries and less in taxes. I think people like the
• 24:35
  Speaker 1: latter a little bit more, mostly because then they kind
• 24:38
  Speaker 1: of get to choose how that money is spent. But
• 24:41
  Speaker 1: I also think they don't necessarily it's hard to wrap
• 24:47
  Speaker 1: one's head around how big of a deal subsidizing an
• 24:51
  Speaker 1: industry like that can also drive and shape consumer choices
• 24:54
  Speaker 1: and preferences. There's a lot of downstream effects that happen
• 24:57
  Speaker 1: when a government subsidizes an industry. Subsidize a lot of them,
• 25:01
  Speaker 1: but the food industry, particularly meet and dairy, is one
• 25:04
  Speaker 1: that is very heavily subsidized by the government.
• 25:07
  Speaker 2: Absolutely. Some other things that the government can do. They
• 25:10
  Speaker 2: can negotiate reimbursement prices and rates for goods and services. So,
• 25:14
  Speaker 2: as an example, when the government implements a program like
• 25:17
  Speaker 2: we have like Medicare, Medicaid or something in that falls
• 25:20
  Speaker 2: in line with the Affordable Care Act, they can tell
• 25:23
  Speaker 2: drug companies how much they'll pay them for their goods,
• 25:25
  Speaker 2: force those companies to sell at lower prices, put caps
• 25:28
  Speaker 2: on medication we kind of mentioned that earlier or else
• 25:30
  Speaker 2: be out competed by other companies. They do the same
• 25:33
  Speaker 2: thing for mental health professionals. When we work on contracts
• 25:36
  Speaker 2: for private insurance or commercial insurance, or for Medicaid, Medicare
• 25:39
  Speaker 2: and all that, when we work as private providers on
• 25:41
  Speaker 2: those contracts, the government can negotiate those prices. They can
• 25:45
  Speaker 2: negotiate those rates that people get paid per hour, per service,
• 25:48
  Speaker 2: per assessment, per things like that, and that happens across
• 25:51
  Speaker 2: a lot of healthcare professionals, not just mental health, but
• 25:55
  Speaker 2: just as a general rule, healthcare professionals, especially with Medicaid Medicare.
• 25:59
  Speaker 1: Yeah, care professionals do not have to accept any form
• 26:03
  Speaker 1: of insurance they don't want to, and so that's why
• 26:05
  Speaker 1: there are a lot of places you'll go where they
• 26:07
  Speaker 1: specifically won't provide services if your insurance comes from Medicare
• 26:11
  Speaker 1: or Medicaid. But that does leave the door open for
• 26:14
  Speaker 1: other people to use that as their revenue, so that
• 26:17
  Speaker 1: there are lots of people who do so. The government
• 26:19
  Speaker 1: cannot force them to do that, but they can negotiate
• 26:23
  Speaker 1: it in a way. What that usually does is that
• 26:25
  Speaker 1: means that those prices are lower when they negotiate those
• 26:28
  Speaker 1: This is very, very commonly. A big Democratic talking point
• 26:32
  Speaker 1: is they frequently go after drug prices to negotiate lower
• 26:36
  Speaker 1: prices as one of their big platform and issues and
• 26:40
  Speaker 1: something that the vast majority of people are generally in
• 26:42
  Speaker 1: supportive as well.
• 26:44
  Speaker 2: Yeah.
• 26:44
  Speaker 1: Probably not the drug companies so much. The insurance companies,
• 26:47
  Speaker 1: I don't think care very much. I think they're happy
• 26:49
  Speaker 1: to make money either way.
• 26:50
  Speaker 2: Yeah, yeah, exactly.
• 26:51
  Speaker 1: Actually that's not true because the insurance companies might end
• 26:54
  Speaker 1: up having to pay more if the government sort of
• 26:56
  Speaker 1: negotiates that rate with them anyway. Point being that is
• 26:59
  Speaker 1: another way they can influence that another one that could happen.
• 27:03
  Speaker 1: It doesn't happen very much, at least in the United States.
• 27:05
  Speaker 1: It does in other countries. But the government could instead
• 27:08
  Speaker 1: provide the goods and services that people need, and those
• 27:12
  Speaker 1: goods and services they provide might directly compete with private
• 27:16
  Speaker 1: third party businesses. And a very clear example of this
• 27:20
  Speaker 1: is in the United States Postal Service. Now, I think
• 27:23
  Speaker 1: I'm pretty sure if my history is correct, that this
• 27:25
  Speaker 1: came before private delivery was a thing, but it does
• 27:29
  Speaker 1: directly compete with independent private delivery services such as UPS
• 27:33
  Speaker 1: and FedEx and others. Those are just some of the
• 27:36
  Speaker 1: big ones, but there are plenty of other delivery services
• 27:39
  Speaker 1: out there, and so if the government has their own
• 27:43
  Speaker 1: competing version of whatever that business is, they can essentially
• 27:47
  Speaker 1: price their services at whatever price they want, and that
• 27:51
  Speaker 1: becomes competition for the private industry. And so if the
• 27:55
  Speaker 1: government's shipping services through the United States Postal Service are
• 28:00
  Speaker 1: cheaper and easier to use, then people are more likely
• 28:02
  Speaker 1: to use that than one of the private competitors, and
• 28:05
  Speaker 1: so those companies are then kind of forced to compete
• 28:07
  Speaker 1: with the prices and services of the government, and they
• 28:10
  Speaker 1: do pretty effectively, you know, But the government could theoretically
• 28:14
  Speaker 1: do that in a lot of industries where they provide
• 28:17
  Speaker 1: an option and I think Medicare and medicaid actually kind
• 28:19
  Speaker 1: of are similar to this, But the government could provide
• 28:22
  Speaker 1: an option where they provide a good or service and
• 28:25
  Speaker 1: then people could choose to buy it from the government
• 28:27
  Speaker 1: instead of those private industries. And that means that those
• 28:29
  Speaker 1: industries are directly competing with the government in terms of
• 28:32
  Speaker 1: the cost, and the government can very much afford to
• 28:35
  Speaker 1: eat the cost on some of those things and charge
• 28:37
  Speaker 1: less for some of those goods in a lot of circumstances.
• 28:40
  Speaker 1: So just that is a way that they can do this.
• 28:43
  Speaker 1: They don't very much in the United States, but they
• 28:46
  Speaker 1: theoretically could.
• 28:47
  Speaker 2: Right Going back real quick to the reimbursement and the
• 28:50
  Speaker 2: subsidizing goods. You mentioned that earlier. Do you remember growing
• 28:53
  Speaker 2: up in the nineties and everybody had that there's the
• 28:55
  Speaker 2: got milk, yeah, ads, yeah, yeah, Well this ad is
• 28:58
  Speaker 2: not going to be a miss gad, But just think
• 29:00
  Speaker 2: about that for a little bit. So we're talking about
• 29:10
  Speaker 2: different ways that the government can influence and impact the economy.
• 29:14
  Speaker 2: What you're finding, I would imagine as you're listening to this,
• 29:16
  Speaker 2: there are so many different ways that the government has
• 29:19
  Speaker 2: ways to alter or change or not necessarily maybe control
• 29:24
  Speaker 2: the economy, but definitely ways to influence it in a
• 29:27
  Speaker 2: lot of different ways.
• 29:27
  Speaker 1: Yeah. Yeah, they're a pushing around a little bit.
• 29:31
  Speaker 2: Yeah, yeah, yeah, absolutely, like bumpers if you will.
• 29:33
  Speaker 1: Yeah.
• 29:34
  Speaker 2: One of the things that they can also do is
• 29:35
  Speaker 2: they can impose interest rates on loans. And there are
• 29:38
  Speaker 2: a lot of different types of loans, and we can
• 29:40
  Speaker 2: unpack the different types of loans that exist between student
• 29:43
  Speaker 2: loans and homeowners loans and just private loans and business
• 29:46
  Speaker 2: loans and all that. But money loaned inside of an
• 29:48
  Speaker 2: economy is almost always paid back with interest. That's how
• 29:53
  Speaker 2: agencies that offer loans make money is that they put
• 29:58
  Speaker 2: an interest rate on that loan so they can make
• 30:01
  Speaker 2: a little bit back from letting you borrow their money. Basically,
• 30:03
  Speaker 2: an any sort of interest is money paid in addition
• 30:06
  Speaker 2: to the amount of the paid back for the loan.
• 30:08
  Speaker 2: So if you borrow a thousand dollars at five percent interest,
• 30:11
  Speaker 2: you would pay back one fifty dollars back to the
• 30:14
  Speaker 2: lender in theory, depending on how long it took, depending
• 30:18
  Speaker 2: on whether those interest rates change, stuff like that. But
• 30:21
  Speaker 2: the government can actually change or impose interest rates on loans.
• 30:26
  Speaker 2: They can alter that in some ways.
• 30:28
  Speaker 1: Yeah, there are a couple of different organizations that essentially
• 30:32
  Speaker 1: advise interest rates, but the Federal Reserve can hike interest
• 30:36
  Speaker 1: rates up or lower them. And when they hike interest
• 30:40
  Speaker 1: rates up, it essentially makes it more expensive to borrow money,
• 30:43
  Speaker 1: and that makes it so that people and businesses who
• 30:46
  Speaker 1: are trying to borrow money are less likely to borrow money,
• 30:49
  Speaker 1: or at least borrow less than they would have, and
• 30:52
  Speaker 1: that means that they don't spend as much. So essentially
• 30:55
  Speaker 1: what can happen is that when demand outpaces supply, inflation
• 31:00
  Speaker 1: goes up. Pretty much always, that's pretty much how it works.
• 31:04
  Speaker 1: When people are buying more than there is available for
• 31:07
  Speaker 1: them to buy, than the people who are selling charge
• 31:10
  Speaker 1: more for those goods, and so when the Federal Reserve
• 31:14
  Speaker 1: increases interest rates, people spend less money, which means there
• 31:17
  Speaker 1: is less demand, and that means that there is either
• 31:20
  Speaker 1: a matching supply or maybe even a surplus supply. And
• 31:24
  Speaker 1: when companies have too much of a thing that they're selling.
• 31:27
  Speaker 1: Then they will usually try and sell it for cheaper
• 31:28
  Speaker 1: to get rid of it. And so that's how the
• 31:31
  Speaker 1: government can try to influence how the economy works. As well,
• 31:35
  Speaker 1: is by increasing the cost of borrowing money, which a
• 31:39
  Speaker 1: lot of people in businesses do a lot of the time, right,
• 31:42
  Speaker 1: And it does generate some amount of extra money as well.
• 31:44
  Speaker 1: So there's that, and it is fairly indirect like, it's not,
• 31:49
  Speaker 1: for example, a really common way that this shows up
• 31:51
  Speaker 1: as people who are trying to buy a house. The
• 31:54
  Speaker 1: interest rates that people pay are actually not directly influenced
• 31:57
  Speaker 1: by the federal government unless you're taking on loan with
• 32:00
  Speaker 1: the federal government. I guess I don't know how that
• 32:01
  Speaker 1: would even work. I don't think that's the thing. So
• 32:04
  Speaker 1: technically the industries are separate, but they follow sort of
• 32:07
  Speaker 1: the advice and guidelines of the other companies and organizations
• 32:12
  Speaker 1: that set interest rates. And so when the Fed increases
• 32:15
  Speaker 1: interest rates, that that tends to affect interest rates across
• 32:18
  Speaker 1: the board for many industries right absolutely.
• 32:22
  Speaker 2: Now, one thing the government can do that's actually pretty
• 32:24
  Speaker 2: interesting is they can provide access to reserved goods. Now,
• 32:27
  Speaker 2: what does this mean. Well, governments often will stockpile certain
• 32:31
  Speaker 2: goods that might be used for emergency services, and so
• 32:34
  Speaker 2: they can be distributed as needed in the event that
• 32:37
  Speaker 2: there is some catastrophic emergency for whatever reason. And we
• 32:41
  Speaker 2: actually saw this in twenty twenty one.
• 32:43
  Speaker 1: Yeah, so in twenty twenty one, for those of you
• 32:46
  Speaker 1: who have short memories, the United States was really still
• 32:49
  Speaker 1: and mostly locked down from the pandemic. There was some
• 32:53
  Speaker 1: people sort of venturing out into the wild, but a
• 32:55
  Speaker 1: lot of people are still working from home. Yes. Essentially,
• 32:58
  Speaker 1: what it happened, though, is the price of gasoline had
• 33:01
  Speaker 1: gone way, way up, and so Biden ordered the release
• 33:04
  Speaker 1: of President Biden, Joe Biden. He ordered the release of
• 33:07
  Speaker 1: fifty million gallons of oil from our strategic petroleum reserves
• 33:13
  Speaker 1: in the United States and did this specifically to increase
• 33:16
  Speaker 1: the supply of oil and therefore to bring down the
• 33:19
  Speaker 1: price driven up by the increased demand but the lack
• 33:23
  Speaker 1: of supply. And so this is why gas prices came
• 33:26
  Speaker 1: back down early in the pandemic because no one was driving.
• 33:29
  Speaker 1: There was a massive surplus of oil because they'd essentially
• 33:34
  Speaker 1: drilled all that oil before the pandemic, and then people
• 33:36
  Speaker 1: just weren't buying it. So it was sitting on shipping
• 33:38
  Speaker 1: containers going nowhere, and so the companies took a huge
• 33:43
  Speaker 1: loss on all that oil that wasn't being sold. So
• 33:45
  Speaker 1: when people started driving again and oil was being used
• 33:48
  Speaker 1: more again, they shot their prices through the roof, and
• 33:52
  Speaker 1: so to compete with that, the government basically flooded the
• 33:55
  Speaker 1: market with it was functionally at that point free oil
• 33:59
  Speaker 1: that they had stockpile to try and help bring the
• 34:01
  Speaker 1: prices down, and it worked. Yes.
• 34:03
  Speaker 2: An important aspect to think about here is that the
• 34:06
  Speaker 2: government does not regulate gas prices. No, gas prices shot
• 34:10
  Speaker 2: up as a result of, yes, supply and demand types
• 34:13
  Speaker 2: of situations, but ultimately it was private companies that were
• 34:17
  Speaker 2: setting prices for gas and making profits. So for those
• 34:21
  Speaker 2: of you who were out there who are complaining about
• 34:23
  Speaker 2: gas prices and all that, it's really important to look
• 34:25
  Speaker 2: at the data. And some of the data leads back to,
• 34:28
  Speaker 2: I don't know, CEOs of gas companies and oil companies
• 34:31
  Speaker 2: making a whole lot of profit even though we were
• 34:34
  Speaker 2: all paying for the prices of the gas. So it's
• 34:37
  Speaker 2: really important to kind of the reason that we're talking
• 34:40
  Speaker 2: about this stuff is because of that reason. Like one
• 34:43
  Speaker 2: of those reasons is that a lot of times people
• 34:44
  Speaker 2: will blame X entity and it actually has nothing to
• 34:48
  Speaker 2: do with that entity as far as like price increases
• 34:51
  Speaker 2: and stuff like that.
• 34:52
  Speaker 1: Oh and I almost forgot that. Part of what happened
• 34:54
  Speaker 1: here was that when Russia invaded Ukraine, the United States,
• 35:00
  Speaker 1: as I understand it, stopped buying oil from Russia, and
• 35:02
  Speaker 1: that meant that we were then in a deficit. That's
• 35:04
  Speaker 1: where the supply was cut off and the demand was high,
• 35:08
  Speaker 1: and so the prices went up. And so yes, just
• 35:10
  Speaker 1: as you said, the government does not at all control
• 35:13
  Speaker 1: the prices of gasoline, but they can try and influence.
• 35:17
  Speaker 1: And actually this is one of the industries that's kind
• 35:20
  Speaker 1: of the furthest removed from government influence. But what they
• 35:23
  Speaker 1: can do is they can, as happened here, released from
• 35:27
  Speaker 1: the strategic reserves. They could try and choose very strategically
• 35:30
  Speaker 1: where they're buying importing oil from. But again that's really
• 35:33
  Speaker 1: not up to them. Those are the companies that are
• 35:35
  Speaker 1: doing it. So the companies that are moving oil around,
• 35:39
  Speaker 1: they set those prices. They usually price per barrel, and
• 35:42
  Speaker 1: that comes then down to how much is charged per gallon,
• 35:45
  Speaker 1: and so even gas stations, while they'll definitely price gouge
• 35:48
  Speaker 1: as much as they possibly can. The companies that are
• 35:52
  Speaker 1: moving the oil around to the ones who really dictate
• 35:54
  Speaker 1: the prices, and the government can try and influence that
• 35:56
  Speaker 1: to the best of their ability. But they don't have
• 35:59
  Speaker 1: an endless supply of oil and reserves either, right.
• 36:02
  Speaker 2: Exactly, And so doing something like this is not is
• 36:05
  Speaker 2: not an endless solution. It is something that is for emergencies.
• 36:09
  Speaker 2: It is for crises, and reserves of things like this
• 36:12
  Speaker 2: they run out if given away at substantial quantities and pace.
• 36:15
  Speaker 2: So we have to be mindful that, you know, this
• 36:18
  Speaker 2: is kind of a one time, quick, fixed solution and
• 36:22
  Speaker 2: not the end solution that's going to resolve all the problems.
• 36:25
  Speaker 2: To go along with this, there's still going to be
• 36:27
  Speaker 2: that persistent problem of supply and demand for whatever resource
• 36:30
  Speaker 2: there is.
• 36:31
  Speaker 1: Okay, So I essentially told you that the United States
• 36:34
  Speaker 1: was a market based economy and the government does not
• 36:36
  Speaker 1: directly control things, and then we've spent like thirty minutes
• 36:39
  Speaker 1: telling you that the government can levy taxes, impose regulatory standards,
• 36:44
  Speaker 1: determine minimum wage, subsidize goods, negotiate reimbursement prices, provide competing
• 36:50
  Speaker 1: goods and services, impose interest rates and create a stockpile
• 36:54
  Speaker 1: that they can release into the economy as needed. And
• 36:57
  Speaker 1: that's not even most of our economy, right. Those are
• 36:59
  Speaker 1: just the ways that the government influences the economy. And
• 37:02
  Speaker 1: that's kind of a small slice of the variable pie.
• 37:06
  Speaker 1: So let's get into some of the other variables. And
• 37:09
  Speaker 1: I promise this is not going to be a two
• 37:10
  Speaker 1: hour episode. I just wanted to help paint a picture
• 37:13
  Speaker 1: on using a way that's pretty clear of like how
• 37:17
  Speaker 1: complex of a system this is and where the variables
• 37:21
  Speaker 1: exist and don't exist. And so if you haven't gotten
• 37:25
  Speaker 1: this yet, as a quick litmus test, if you hear
• 37:29
  Speaker 1: someone say when they're talking about the economy and why
• 37:33
  Speaker 1: it's good or why it's bad, and how it works
• 37:35
  Speaker 1: and how inflation works, and they say the words it's
• 37:38
  Speaker 1: simple math, then you have been lied to. They have
• 37:41
  Speaker 1: been lied to, and they know the person who is
• 37:44
  Speaker 1: saying it simple math knows less about economics than they
• 37:47
  Speaker 1: did before someone convinced them it was simple math. Fill
• 37:50
  Speaker 1: in their head with a bunch of nonsense. They've moved
• 37:53
  Speaker 1: from ignorant to supremely ignorant. So it is a significant downgrade.
• 37:59
  Speaker 1: If there is one thing that you could say about
• 38:01
  Speaker 1: the economy with absolute certainty, just one with perfect certainty,
• 38:07
  Speaker 1: it is that it is not simple math. That is
• 38:10
  Speaker 1: the most accurate, most sure thing you can say about
• 38:13
  Speaker 1: the economy. It is a staggeringly intricate network of interconnected
• 38:19
  Speaker 1: inputs and outputs that flow through a wide range of
• 38:24
  Speaker 1: variables that exist not only in money, but the availability
• 38:27
  Speaker 1: of goods and people's behavior. And we'll talk more about
• 38:30
  Speaker 1: that right now.
• 38:32
  Speaker 2: Yes, So how do you measure How do you know
• 38:34
  Speaker 2: an economy is good or strong? Well, there's a lot
• 38:37
  Speaker 2: of different variables and factors to unpack there. So an
• 38:41
  Speaker 2: indicator of an economy is quantifying the sum of the
• 38:45
  Speaker 2: value of all the goods and services produced in an
• 38:48
  Speaker 2: economy in a given period of time, usually within a year.
• 38:51
  Speaker 2: The US produces a staggering amount of goods and services
• 38:54
  Speaker 2: to the tune of tens of trillions of dollars per quarter,
• 38:58
  Speaker 2: per quarter, not per year, per quarter, yeah, making it
• 39:02
  Speaker 2: the largest GDP in the world by a substantial margin.
• 39:08
  Speaker 2: The US GDP in twenty twenty four is over twenty
• 39:12
  Speaker 2: five trillion dollars. And it's not even we haven't even
• 39:14
  Speaker 2: finished calculating all of it yet, right, because it's not
• 39:16
  Speaker 2: the end of the year. Yeah, which is almost double
• 39:18
  Speaker 2: the next highest GDP China at just over fourteen trillion.
• 39:22
  Speaker 2: An eleven trillion dollar difference is a huge amount of money,
• 39:25
  Speaker 2: and this is difficult to measure due to untracked transactions
• 39:28
  Speaker 2: that occur in within those economies.
• 39:30
  Speaker 1: Yeah, so that's that's the best, the best measurement we
• 39:33
  Speaker 1: have given systems that are designed to track those What
• 39:37
  Speaker 1: that doesn't tell you is the relative quality or standard
• 39:39
  Speaker 1: of living of the people that live inside of that
• 39:42
  Speaker 1: economy and the kind of benefits that they enjoy. It
• 39:45
  Speaker 1: could mean that there was one person controlling everything and
• 39:48
  Speaker 1: running all companies that produce everything and incredible quantities, and
• 39:52
  Speaker 1: you wouldn't necessarily know that just from the numbers that
• 39:55
  Speaker 1: are created from the GDP. But we do know just
• 39:58
  Speaker 1: from experience that that's not the current case, even though
• 40:00
  Speaker 1: it feels like that. Sometimes we all do make some
• 40:03
  Speaker 1: money and spend some money here and there, and people
• 40:06
  Speaker 1: donate things and share things and get things for free
• 40:09
  Speaker 1: and give things away for free. And there's like bitcoin
• 40:12
  Speaker 1: and cryptocurrencies, and there are cash exchanges that go unreported
• 40:17
  Speaker 1: and illegal under the counter things that happen to huge
• 40:21
  Speaker 1: sums of money. When you're talking about like labor paid
• 40:24
  Speaker 1: under the table and sort of untracked. There's a pretty
• 40:28
  Speaker 1: large separate economy that is participating in the existing economy,
• 40:32
  Speaker 1: but sort of in the shadows of it.
• 40:34
  Speaker 2: To the tune of like billions of dollars, not just
• 40:36
  Speaker 2: like it's a bull thousand or it's billions of dollars
• 40:39
  Speaker 2: inside of like the sex work illegal, sex work industry
• 40:42
  Speaker 2: illegal being that like it's made illegal by the government. Yeah, drugs, drugs, gambling,
• 40:48
  Speaker 2: like all kinds of stuff. Like, there's lots of stuff
• 40:50
  Speaker 2: happening there. One of the industries though, that is not illegal,
• 40:54
  Speaker 2: where people are making a lot of money.
• 40:55
  Speaker 1: Is ads, And we're back to be clear, we're not
• 41:04
  Speaker 1: the ones making a lot of money, but yeah, the.
• 41:06
  Speaker 2: Marketing the marketing teams are somewhere.
• 41:08
  Speaker 1: Oh. That reminds me though, If when you're listening to this,
• 41:11
  Speaker 1: you choose to listen to this through our distributors platform,
• 41:15
  Speaker 1: which is Spreaker s p R e A K e R,
• 41:18
  Speaker 1: they will give us a ten percent boost on our
• 41:20
  Speaker 1: ad revenue. So if you want to help us out,
• 41:22
  Speaker 1: that's a way you can do it where you don't
• 41:24
  Speaker 1: have to do anything different. Yeah, so there's that. Okay,
• 41:27
  Speaker 1: So that is an indicator. And actually, if you look
• 41:30
  Speaker 1: at most places that people think about these things, the
• 41:34
  Speaker 1: GDP is the one they turn to the most as
• 41:37
  Speaker 1: an indicator of the economy. Our GDP has mostly been
• 41:40
  Speaker 1: growing consistently for a very long time. The last time
• 41:43
  Speaker 1: it actually decreased was I think under Hoover, but it
• 41:47
  Speaker 1: has continued to grow pretty steadily and is at the
• 41:50
  Speaker 1: highest it's ever been, which we'll talk about in a
• 41:52
  Speaker 1: little bit. But another indicator of how well an economy
• 41:56
  Speaker 1: is doing, which is another one that economists like to
• 41:58
  Speaker 1: point to, is unemployment. And this just indicates the relative
• 42:03
  Speaker 1: economic strength and stability of a given economy, in this
• 42:06
  Speaker 1: case the United States, although all countries that I think
• 42:10
  Speaker 1: most countries or all of them track unemployment as well,
• 42:13
  Speaker 1: And essentially this number is just how many people are
• 42:15
  Speaker 1: working versus not working. That's it. It does include how
• 42:18
  Speaker 1: much they're working and their average wages, but that's more
• 42:21
  Speaker 1: or less what they're trying to measure. The worst unemployment
• 42:24
  Speaker 1: is the fewer people can participate effectively in that economy.
• 42:27
  Speaker 1: They do still participate just in like a greatly diminished capacity,
• 42:32
  Speaker 1: and the weaker the economy becomes. So that's essentially why
• 42:36
  Speaker 1: unemployment is really important, is you want to have as
• 42:39
  Speaker 1: low unemployment numbers as possible where you have the most
• 42:43
  Speaker 1: percent of people effectively participating in the economy, and every
• 42:47
  Speaker 1: one percent that that ticks up is a huge impact
• 42:52
  Speaker 1: on the economy. And the other thing with this though,
• 42:54
  Speaker 1: is it is crazy difficult to measure because there are
• 42:58
  Speaker 1: again people are paid under the table or like the
• 43:01
  Speaker 1: whole gigwork economy that has arisen with things like uber
• 43:04
  Speaker 1: and instacart and things like that, Like does that count
• 43:08
  Speaker 1: as employment if they like they get to choose their
• 43:10
  Speaker 1: own hours. So it's just gotten increasingly complex and is
• 43:13
  Speaker 1: really tricky to track. And of course there are those
• 43:16
  Speaker 1: people who don't report it or don't report it correctly,
• 43:18
  Speaker 1: and so the unemployment numbers are always in a gray area.
• 43:22
  Speaker 1: But they do their best to try and estimate how
• 43:25
  Speaker 1: much how many people are unemployed and are employed.
• 43:29
  Speaker 2: Right absolutely now. Another indicator, one that's a major talking
• 43:33
  Speaker 2: point more recently is inflation, and inflation is rising prices,
• 43:37
  Speaker 2: usually related to rising prices of goods and services. As
• 43:40
  Speaker 2: we've already seen. Various factors contribute to how much something
• 43:43
  Speaker 2: might cost, including tariffs and interest rates and all those things.
• 43:47
  Speaker 2: And from subsidies to taxes, to regulations, to demand for
• 43:51
  Speaker 2: those goods to supply of those goods, all of those
• 43:53
  Speaker 2: things have an impact on inflation. If any one of
• 43:56
  Speaker 2: those variables starts to tip in one direction, the whole
• 43:58
  Speaker 2: market might follow up and down for whatever reason. So,
• 44:01
  Speaker 2: as an example, if the price of the production or
• 44:05
  Speaker 2: shipping of important goods and materials increases, then the prices
• 44:09
  Speaker 2: of those goods increase. This might happen if a global
• 44:12
  Speaker 2: pandemic shuts down a supply chain where there's still demand.
• 44:15
  Speaker 2: If a government floods the economy with money, that might
• 44:18
  Speaker 2: increase demand, or government floods the gas industry with more oil,
• 44:23
  Speaker 2: if the government taxes the imported goods, just random examples
• 44:27
  Speaker 2: just to think about. But this is compared against the
• 44:29
  Speaker 2: growth of income, and this is actually really, really really
• 44:33
  Speaker 2: difficult to measure. It's really hard to figure out the
• 44:35
  Speaker 2: singular thing or the multiple things that influence inflation, and
• 44:38
  Speaker 2: it's also really difficult to figure out how to measure
• 44:41
  Speaker 2: how this works.
• 44:43
  Speaker 1: Yeah, like the numbers that they get for inflation are
• 44:46
  Speaker 1: based on small, random samples of goods and services, so
• 44:53
  Speaker 1: like they really can't track the price that any one
• 44:57
  Speaker 1: place sets for every good or service that they sell,
• 45:00
  Speaker 1: and so they basically go around getting these tiny, tiny
• 45:03
  Speaker 1: samples of like this is what it costs now, this
• 45:05
  Speaker 1: is what this thing used to cost, and then they
• 45:07
  Speaker 1: base those numbers to calculate inflation. But they're gonna miss
• 45:12
  Speaker 1: most of what's actually on the market. They figure sort
• 45:15
  Speaker 1: of like when they're doing polls, they're asking people how
• 45:17
  Speaker 1: they're going to vote or what issues are important to
• 45:19
  Speaker 1: them and whatnot. They basically do these little surveys where
• 45:22
  Speaker 1: they look and see, Okay, these things are changing in price.
• 45:25
  Speaker 1: Let's assume that these are good indicators of inflation. Let's
• 45:29
  Speaker 1: report those as numbers. And so they try, but they're like,
• 45:33
  Speaker 1: we got to definitely take it with the grain of
• 45:35
  Speaker 1: salt that those are not clearly reflective. It's like, at best,
• 45:40
  Speaker 1: a very gross average from a very small sample, which
• 45:45
  Speaker 1: is not nothing. It definitely tells us some information, whether
• 45:49
  Speaker 1: it tells us how the whole economy is doing not
• 45:52
  Speaker 1: so much.
• 45:53
  Speaker 2: Yeah, I think what you're gonna start learning in this
• 45:55
  Speaker 2: is that the economy and the way that we measure
• 45:57
  Speaker 2: it is not quite as precise as you.
• 45:59
  Speaker 1: Think is no, no, no, it's really really there is
• 46:04
  Speaker 1: an alarming amount of guesswork that goes into the measurement
• 46:07
  Speaker 1: part of it. Yes, So another thing that people look
• 46:10
  Speaker 1: at as an indicator of the economy is called balance
• 46:13
  Speaker 1: of trade, and this is one that many economists point
• 46:15
  Speaker 1: to and go, I'm not so sure that matters that much.
• 46:18
  Speaker 1: This is how much goods and services cost to produce
• 46:21
  Speaker 1: relative to the amount of money that they make. A
• 46:24
  Speaker 1: profitable balance of trade is when an economy exports more
• 46:28
  Speaker 1: than it imports, so they're selling more things than they
• 46:32
  Speaker 1: are buying. Essentially, and if there's a deficit in the
• 46:35
  Speaker 1: balance of trade, that's when the economy is importing more
• 46:39
  Speaker 1: than it's exporting, so they're buying more than they're selling,
• 46:41
  Speaker 1: if that makes sense. And there's always going to be
• 46:44
  Speaker 1: a deficit or surplus in one direction or the other
• 46:47
  Speaker 1: at various levels and various sectors of the economy. And
• 46:51
  Speaker 1: again this also does not and cannot account for untracked transactions,
• 46:56
  Speaker 1: which can particularly happen in very large quantities and even
• 46:59
  Speaker 1: in industries that are well tracked, like let's just take
• 47:03
  Speaker 1: phishing for example. The misreporting and fraudulent nature of the
• 47:07
  Speaker 1: labeling of those things makes it very difficult again to
• 47:10
  Speaker 1: figure out what's actually happening.
• 47:13
  Speaker 2: Right now, the moment you've all been waiting for the
• 47:16
  Speaker 2: stock market, because this comes up all the time. Well,
• 47:20
  Speaker 2: the stock market is probably the most removed indicator of
• 47:23
  Speaker 2: the economy. A stock market in which the prices increase
• 47:26
  Speaker 2: indicates confidence in the market, and this may inspire investors
• 47:30
  Speaker 2: to spend more to fund growth of an industry that
• 47:32
  Speaker 2: is increasing popular, that has some type of increasing popularity.
• 47:35
  Speaker 2: Most people don't interact directly with the stock market, and
• 47:38
  Speaker 2: the stock market doesn't really dictate or control the economy
• 47:41
  Speaker 2: in any particularly important way, but it indicates the interest
• 47:44
  Speaker 2: and willingness to provide certain goods and services and can
• 47:48
  Speaker 2: help quantify the relative likelihood of success of those goods
• 47:51
  Speaker 2: and services. Also, it's really important that random, unaccountable variables
• 47:57
  Speaker 2: influence what we see in the stock market as well,
• 48:00
  Speaker 2: all the time, all the time, every single day, like
• 48:02
  Speaker 2: lots of different things. Elon Musk says something on Twitter
• 48:06
  Speaker 2: and then now all of a sudden, Tesla's stocks go
• 48:08
  Speaker 2: down for whatever reason. Right, Yeah, a real life example,
• 48:10
  Speaker 2: that just happened. More like, just like last week at
• 48:14
  Speaker 2: the time of this recording, the CEO of United Healthcare
• 48:17
  Speaker 2: was shot and killed in New York, and the stocks
• 48:20
  Speaker 2: for United Healthcare went up right after he was shot.
• 48:24
  Speaker 2: So there's just weird random variables that just apply, like
• 48:29
  Speaker 2: and we don't even know if that's causal. It's correlational, right,
• 48:31
  Speaker 2: And you'll notice that a lot too when it comes
• 48:33
  Speaker 2: to us to art market. This thing happened. We don't
• 48:35
  Speaker 2: know if it actually changed or drove prices up or down.
• 48:38
  Speaker 2: We just know that this thing happened, and now we
• 48:40
  Speaker 2: have correlational data.
• 48:41
  Speaker 1: Yeah, the stock market is like it's better than a
• 48:45
  Speaker 1: horoscope at predicting, like the economy, but it's worse than
• 48:52
  Speaker 1: everything else.
• 48:55
  Speaker 2: Yeah, yeah, that's a fair way to put it.
• 48:57
  Speaker 1: Yeah. Yeah, again, it's sort of just is reflective of
• 49:01
  Speaker 1: I guess, confidence and interest in some goods and services
• 49:04
  Speaker 1: and the likely lucrative the like how lucrative those things
• 49:10
  Speaker 1: will be. That's about it. Like, if you don't own stock,
• 49:13
  Speaker 1: probably not affecting you very.
• 49:14
  Speaker 2: Much, right, exactly, exactly, All.
• 49:17
  Speaker 1: Right, Well, let's also try and relate the economy to
• 49:21
  Speaker 1: human behavior, because like I said, there's a million variables here,
• 49:24
  Speaker 1: but I think understanding this and the context of behaviors
• 49:27
  Speaker 1: specifically in the variables that drive those, does help, I think,
• 49:30
  Speaker 1: start to paint the picture of the kind of complexity
• 49:33
  Speaker 1: of the variables that contribute to the decisions that are
• 49:35
  Speaker 1: made that, if effectively, are the variables that participate in
• 49:39
  Speaker 1: the economy.
• 49:40
  Speaker 2: Right, and also too, this is a podcast about psychology
• 49:43
  Speaker 2: and human behaviors, so we probably should talk about that
• 49:45
  Speaker 2: at some point in time, I would imagine we should.
• 49:47
  Speaker 1: Yeah, So presumably, yeah, So.
• 49:50
  Speaker 2: The economy is essentially a large network of human behavior
• 49:53
  Speaker 2: as it relates to our financial infrastructures around the world,
• 49:56
  Speaker 2: so we all engage, and we could argue that there's
• 49:59
  Speaker 2: things inside of the that you know, when we talk
• 50:01
  Speaker 2: about the economy, I guess people argue that it's more
• 50:03
  Speaker 2: about infrastructure to manage our resources, but it's still all
• 50:06
  Speaker 2: of the human behavior around that system that makes it work.
• 50:09
  Speaker 2: Our choices, our engagement, our refusal to engage, talking and
• 50:13
  Speaker 2: walking with our money, voting with our feet, if you will, Like,
• 50:16
  Speaker 2: all those things are different influences on the economy that
• 50:19
  Speaker 2: we as humans get to engage with and act with.
• 50:22
  Speaker 2: In our own life to benefit us, to work along
• 50:24
  Speaker 2: our values as well.
• 50:26
  Speaker 1: Yeah. What that means though, ultimately is a lot of
• 50:29
  Speaker 1: people think that economics and the economy is just money.
• 50:33
  Speaker 1: It's just how money moves. But I think by the
• 50:35
  Speaker 1: way you just described it, it's actually very clear that
• 50:38
  Speaker 1: it's not. It's more than that that that's just like
• 50:41
  Speaker 1: an aspect of it. The economy and economics touches and
• 50:45
  Speaker 1: is touched by many other professions and scholarly research involved
• 50:50
  Speaker 1: in these that are involved in sort of the economy
• 50:52
  Speaker 1: and understanding the various choices that individuals, companies, governments, and
• 50:58
  Speaker 1: politicians make. There's all a lot of elements of this
• 51:01
  Speaker 1: outside of just the dollars and the goods themselves, that
• 51:05
  Speaker 1: influence how these things move around, increase, decrease, change, could
• 51:10
  Speaker 1: disappear altogether.
• 51:12
  Speaker 2: With all that being said, the economy is influenced and
• 51:15
  Speaker 2: affected by the availability of food and the cost of growing, manufacturing,
• 51:18
  Speaker 2: and distributing food, and where and how it is accessed.
• 51:21
  Speaker 2: It is influenced by conflicts near and abroad that may
• 51:24
  Speaker 2: affect supply chains like oil, grain, or other imported goods.
• 51:27
  Speaker 2: It is influenced by laws that are created and how
• 51:29
  Speaker 2: they are enforced, and not just nationally but internationally. Yeah,
• 51:33
  Speaker 2: it is influenced by crime, both in crimes against individuals, businesses,
• 51:37
  Speaker 2: and governments. It is influenced by fears and hopes that
• 51:40
  Speaker 2: people have. It's influenced by religion, by culture, by the
• 51:43
  Speaker 2: size of families people have, by healthcare, by ideological movements,
• 51:46
  Speaker 2: by legislation passed by governments. It's even influenced by how
• 51:50
  Speaker 2: we talk about those things and how ideas are about
• 51:52
  Speaker 2: them are disseminated, like social media. It's influenced by pandemics
• 51:55
  Speaker 2: and illnesses. It's influenced by national tragedies. It's influenced by presidencies.
• 52:00
  Speaker 2: It's influenced by all kinds of things. There's so many
• 52:03
  Speaker 2: unique variables that act upon the economy that there is
• 52:08
  Speaker 2: no possible way that you can a research this in
• 52:12
  Speaker 2: any sort of like sterile lab setting to get some
• 52:15
  Speaker 2: ideas on causal relationships and b There's no way you
• 52:18
  Speaker 2: can pin down every variable that may exist that influences
• 52:21
  Speaker 2: the economy on any given level.
• 52:23
  Speaker 1: It's even influenced by the weather. And again, because you're
• 52:27
  Speaker 1: exactly right about all of that, anyone who thinks this
• 52:30
  Speaker 1: is simple math is egregiously mistaken. It would be as
• 52:35
  Speaker 1: accurate to say that war is simply disagreements. It's wrong
• 52:39
  Speaker 1: and it doesn't tell you anything, and it may have
• 52:42
  Speaker 1: you believing and acting in a way that is so
• 52:45
  Speaker 1: useless as to be counterproductive, much like ADS. Now, I
• 52:58
  Speaker 1: don't want to minimize my statement of out believing in
• 53:00
  Speaker 1: simple math as being counterproductive by likening it to ads.
• 53:04
  Speaker 1: I was using that as a segue for the ADS,
• 53:06
  Speaker 1: But I very much meant what I said before that.
• 53:08
  Speaker 2: Yes, absolutely so. At the time of this recording, just
• 53:12
  Speaker 2: to be clear, we are recording in December of twenty
• 53:14
  Speaker 2: twenty four, So just to give you some ideas on
• 53:16
  Speaker 2: that the US economy has right now at the end
• 53:19
  Speaker 2: of Joe Biden's presidency, he is currently still the sitting president,
• 53:22
  Speaker 2: the highest GDP it has ever had. Interestingly, a poll
• 53:27
  Speaker 2: in September of twenty twenty four found that people believe
• 53:30
  Speaker 2: the economy is doing very or somewhat poorly, while sixty
• 53:32
  Speaker 2: percent of people surveyed also said that their personal finances
• 53:35
  Speaker 2: were good. So we'll go back to human behavior studies
• 53:39
  Speaker 2: and just kind of pinned down that, like people are
• 53:41
  Speaker 2: just not generally good reporters of their own behavior. We
• 53:44
  Speaker 2: know that about the human behavior. We're not very good
• 53:46
  Speaker 2: at reporting our own stuff.
• 53:48
  Speaker 1: Very true. Yeah, so it was, and I think I
• 53:51
  Speaker 1: forgot to include the statistics here. It was sixty six
• 53:53
  Speaker 1: percent of people said the economy was doing poor and
• 53:55
  Speaker 1: then sixty percent said that they were doing good. So again,
• 53:59
  Speaker 1: the math isn't matter thing here, right.
• 54:00
  Speaker 2: Like, clearly people back bro.
• 54:04
  Speaker 1: Clearly there is a disconnect between what they're sort of
• 54:08
  Speaker 1: experiencing themselves and what they're feeling about the economy apparently
• 54:12
  Speaker 1: outside of themselves. Although to be fair, some economists have
• 54:16
  Speaker 1: pointed out that what people see is that prices feel
• 54:20
  Speaker 1: like they are higher than the people think that they
• 54:22
  Speaker 1: should be on several of the sort of day to
• 54:25
  Speaker 1: day goods that they consume. So thinking about inflation, because
• 54:29
  Speaker 1: that's largely what's a factor here, even though it's a
• 54:33
  Speaker 1: indicator of the economy and not even the one that
• 54:35
  Speaker 1: most people economists actually use. Inflation rose substantially at the
• 54:40
  Speaker 1: end of twenty twenty and into twenty twenty one, and
• 54:42
  Speaker 1: finally it peaked in June of twenty twenty two at
• 54:45
  Speaker 1: nine point one percent. That's very high for inflation. At
• 54:49
  Speaker 1: that point. The strategies to curb inflation began to finally
• 54:52
  Speaker 1: have an impact, and inflation rapidly decreased over the next
• 54:56
  Speaker 1: year and a half, down to just two point six
• 54:58
  Speaker 1: percent as of October twenty twenty four. Those are the
• 55:01
  Speaker 1: most updated numbers that I could find, at least looking
• 55:03
  Speaker 1: around for this right.
• 55:05
  Speaker 2: And now, inflation we mentioned before is only part of
• 55:07
  Speaker 2: the larger kind of conversation here, and inflation is probably
• 55:10
  Speaker 2: a discussion all on its own, or at least of many.
• 55:12
  Speaker 2: But inflation means the rate at which prices are rising.
• 55:14
  Speaker 2: So basically we're just saying how rapidly you know these
• 55:17
  Speaker 2: prices are rising, So inflation at two point six percent
• 55:19
  Speaker 2: means that prices are still increasing, just not as fast
• 55:22
  Speaker 2: as they were. Also, inflation is essentially a given. It's
• 55:25
  Speaker 2: it's ongoing. There is pretty much never a time where
• 55:29
  Speaker 2: there isn't inflation, and Trump's first term inflation averaged one
• 55:32
  Speaker 2: point nine percent, which also includes a period at the
• 55:34
  Speaker 2: beginning of the pandemic when the global economy was in
• 55:37
  Speaker 2: panic and inflation fell to less than one percent. Unrelated
• 55:41
  Speaker 2: to any one administration on the planet, it was something
• 55:43
  Speaker 2: that we saw across the globe, but even Trump's average
• 55:46
  Speaker 2: with the thumb on the scale by the pandemic was
• 55:48
  Speaker 2: higher than Obama's average of one point four, meaning.
• 55:51
  Speaker 1: That under Obama's presidency, inflation on average was lower than
• 55:55
  Speaker 1: under Trump's presidency. Right, And all that's to say, I'm
• 55:58
  Speaker 1: actually not trying to point to anyone administration as being
• 56:00
  Speaker 1: responsible for this, because again, it's just data. Yeah, it's
• 56:03
  Speaker 1: just data. Therese are multifaceted and multifactured things, and one
• 56:08
  Speaker 1: of them was greatly influenced by the pandemic, for example,
• 56:11
  Speaker 1: and specifically supply chain issues. But that is an indicator
• 56:15
  Speaker 1: that a lot of people think about right now. Wage
• 56:19
  Speaker 1: growth has outpaced inflation over the last year, and what
• 56:21
  Speaker 1: that means is that people's money should be and is,
• 56:24
  Speaker 1: by their own reports, stretching further than it was when
• 56:27
  Speaker 1: inflation was outpacing wage growth. And so this does kind
• 56:30
  Speaker 1: of explain in part why people perceive things is worse
• 56:33
  Speaker 1: than they are even when they're doing well, because prices
• 56:36
  Speaker 1: shot up really passed the point at which they could
• 56:39
  Speaker 1: afford them. And now people's wages are finally outpacing that
• 56:43
  Speaker 1: the cost growth again, but they kind of have to
• 56:45
  Speaker 1: close that gap, if you will, And so while their
• 56:48
  Speaker 1: finances are doing better, prices still feel high relative to
• 56:52
  Speaker 1: what they wish they were paying for things. And it's
• 56:54
  Speaker 1: because those prices shot up really quickly in a short
• 56:56
  Speaker 1: period of time, whereas they had kind of always been rising.
• 57:00
  Speaker 1: And oh is a rising, that's really not a point,
• 57:02
  Speaker 1: as you said, when there's not inflation right now.
• 57:05
  Speaker 2: People tend to make choices along the dimensions of how
• 57:07
  Speaker 2: much it costs, how efficient it is, how important it is,
• 57:10
  Speaker 2: how much they enjoy it, how much they make the
• 57:12
  Speaker 2: risk of losing the to crime, the risk of losing
• 57:15
  Speaker 2: it to crime, their preferences toward brand, social perceptions of
• 57:18
  Speaker 2: that spending, how they have been advised by others, the
• 57:20
  Speaker 2: types of purchases people around them are making, and a
• 57:22
  Speaker 2: billion other factors. So again, this is such an imprecise
• 57:26
  Speaker 2: thing to measure because people make so many choices based
• 57:29
  Speaker 2: on unique contextual factors that and what one hundred thousand million,
• 57:34
  Speaker 2: a billion, if you will, factors that are going to
• 57:36
  Speaker 2: influence that single individual decision.
• 57:38
  Speaker 1: That's kind of a way of thinking about to how
• 57:41
  Speaker 1: and when goods and services succeed or fail. How the
• 57:45
  Speaker 1: prices go up is if something is not worth it
• 57:48
  Speaker 1: to someone and they don't need it and it doesn't
• 57:50
  Speaker 1: increase their convenience, then, like, it's very difficult to justify
• 57:54
  Speaker 1: the price tag no matter what it is. If it
• 57:56
  Speaker 1: makes their life a little bit more convenient and is
• 57:59
  Speaker 1: not particularly expensive, then people will often buy that thing.
• 58:04
  Speaker 1: And I actually think the Apple Watch is kind of
• 58:05
  Speaker 1: a good example of this. Like, no one was wearing watches,
• 58:08
  Speaker 1: not no one, but very few people were wearing watches,
• 58:10
  Speaker 1: and watches were not the cultural dominant thing they once were,
• 58:14
  Speaker 1: and then all of a sudden, everyone is now wearing
• 58:17
  Speaker 1: watches again, and it's largely because they provided a product
• 58:20
  Speaker 1: that increased convenience and was pretty inexpensive relative to all
• 58:24
  Speaker 1: of that, and it did like a lot more stuff
• 58:26
  Speaker 1: than like watches had ever done before. And there are
• 58:29
  Speaker 1: lots of watches on the market now that are smart
• 58:31
  Speaker 1: watches that have that thing. I feel like, and I
• 58:33
  Speaker 1: could be wrong, but I feel like the production of
• 58:35
  Speaker 1: smart watches got kicked into gear when Apple sort of
• 58:38
  Speaker 1: did that, and they did a really good job essentially
• 58:40
  Speaker 1: balancing cost and functionality and convenience, and they introduced a
• 58:44
  Speaker 1: market that nobody was asking for, but it worked because
• 58:48
  Speaker 1: they balanced those factors so well. But that sort of
• 58:51
  Speaker 1: when you see people choose when they're commuting somewhere, do
• 58:54
  Speaker 1: they take public transport, do they drive their own car,
• 58:57
  Speaker 1: do they take a plane, do they take a bus.
• 59:00
  Speaker 1: Part of that's going to be influenced by things like cost,
• 59:02
  Speaker 1: convenience and time and like efficiency, But as you said,
• 59:07
  Speaker 1: there's also these other factors. The perception of how it
• 59:09
  Speaker 1: makes them look to fly in a plane in maybe
• 59:11
  Speaker 1: first class versus coach, or to take a train, or
• 59:13
  Speaker 1: to ride a bus, or to take ride sharing or
• 59:15
  Speaker 1: take a taxi or drive their own car, and like
• 59:18
  Speaker 1: the status of that and how that shows up. And
• 59:21
  Speaker 1: they also get to then choose their own pace and
• 59:23
  Speaker 1: how often and when they stop, and they get to
• 59:25
  Speaker 1: listen to their own music so like. But then they
• 59:27
  Speaker 1: could also just have headphones if they were commuting. There's
• 59:30
  Speaker 1: there's so many things that the choices that people weigh
• 59:32
  Speaker 1: to make those decisions, and they can be really little things,
• 59:36
  Speaker 1: but they are all very important and they all add
• 59:39
  Speaker 1: up to how that person then chooses to participate in
• 59:42
  Speaker 1: any one industry or not right.
• 59:44
  Speaker 2: And so all this means is that any change to
• 59:46
  Speaker 2: any of the factors that we just mentioned can start
• 59:48
  Speaker 2: to shift their decision making, which can in turn shift
• 59:51
  Speaker 2: the decision making of people around them, which can in
• 59:53
  Speaker 2: turn impact local economies, regional economies, national economies, depending on
• 59:58
  Speaker 2: any number of factors. Right, So, like these ripple effects
• 1:00:01
  Speaker 2: can happen starting with a single person, all the way
• 1:00:03
  Speaker 2: up through larger organizations. There's lots of ways as kind
• 1:00:06
  Speaker 2: of manifests.
• 1:00:07
  Speaker 1: Yeah, any one person is not going to drastically shape
• 1:00:10
  Speaker 1: and mold an economy. But the thing is, I can
• 1:00:13
  Speaker 1: almost guarantee you you are not the only person making
• 1:00:16
  Speaker 1: the choices that you're making. There are thousands or tens
• 1:00:20
  Speaker 1: of thousands, or hundreds of thousands or millions of people
• 1:00:23
  Speaker 1: who are making similar purchase decisions as you. And so
• 1:00:26
  Speaker 1: while yours is not the one that is the deciding factor,
• 1:00:29
  Speaker 1: it is still relevant in the grand scheme of things.
• 1:00:32
  Speaker 1: And that's how you can sort of help move and
• 1:00:34
  Speaker 1: shift things by choosing where and how you allocate your time, money,
• 1:00:38
  Speaker 1: and resources.
• 1:00:39
  Speaker 2: Right.
• 1:00:39
  Speaker 1: Absolutely, Well, we are getting close to the end of
• 1:00:42
  Speaker 1: this discussion, but we do have a few myths that
• 1:00:44
  Speaker 1: we found. Unfortunately, in doing the research for this, there
• 1:00:48
  Speaker 1: were a lot of places that called things myths about
• 1:00:52
  Speaker 1: the economy but they felt more like opinions. Sure, And
• 1:00:55
  Speaker 1: so I tried to do my best to use sort
• 1:00:58
  Speaker 1: of fact based things that represented myths that people believe
• 1:01:02
  Speaker 1: or misconceptions that people have about the economy. And so
• 1:01:07
  Speaker 1: there were three sort of main ones that I found
• 1:01:09
  Speaker 1: that seemed relatively verifiable.
• 1:01:11
  Speaker 2: Right, there's a myth that most Americans live paycheck to paycheck. Now,
• 1:01:14
  Speaker 2: some do a lot, do a lot more, a lot
• 1:01:17
  Speaker 2: more do than should have to. Yes, I think it's
• 1:01:20
  Speaker 2: an important piece there, But actually most people have a
• 1:01:23
  Speaker 2: savings enough to last three months if they needed to,
• 1:01:26
  Speaker 2: so they do have a little bit of a back
• 1:01:28
  Speaker 2: a cushion there.
• 1:01:30
  Speaker 1: Yeah, And the median checking account volume is eight thousand dollars,
• 1:01:34
  Speaker 1: and there are people who obviously have their money wrapped
• 1:01:37
  Speaker 1: up or hidden in other ways, but that's kind of
• 1:01:39
  Speaker 1: the median. And what that suggests is that most people
• 1:01:43
  Speaker 1: could miss a paychecker too if they absolutely needed to.
• 1:01:47
  Speaker 1: They would hate it and it would make their lives
• 1:01:49
  Speaker 1: more difficult, but they wouldn't be destitute. Now that's not everyone.
• 1:01:53
  Speaker 1: A lot of people hear most, and instead what they
• 1:01:56
  Speaker 1: when I say most, they hear all, And I'm not
• 1:01:58
  Speaker 1: saying all. There are people whom if they missed a
• 1:02:00
  Speaker 1: single paycheck they would be unable to continue on. But
• 1:02:04
  Speaker 1: most people, but not all at least, are not having
• 1:02:09
  Speaker 1: like they're not destitute the final days before their paycheck.
• 1:02:12
  Speaker 1: They will make it to the next paycheck, even if
• 1:02:15
  Speaker 1: they're spending most of that money, they still make it
• 1:02:18
  Speaker 1: through one to the next and they're okay.
• 1:02:21
  Speaker 2: And that also doesn't include factors like maybe they are
• 1:02:24
  Speaker 2: not leaving paycheck to paycheck, but maybe their life circumstance
• 1:02:26
  Speaker 2: is different because they have to maybe live with roommates
• 1:02:28
  Speaker 2: or stuff like that. There's other factors here.
• 1:02:30
  Speaker 1: True.
• 1:02:31
  Speaker 2: That's really important to remember that we're not just saying like, oh, well,
• 1:02:34
  Speaker 2: everybody can live on their own paycheck to paycheck and
• 1:02:36
  Speaker 2: it's fine. That's not what we're saying. And we're just
• 1:02:38
  Speaker 2: saying that, like, yes, somebody has a ranger circumstances so
• 1:02:41
  Speaker 2: that they are not having to live quite as paycheck
• 1:02:44
  Speaker 2: to paycheck where they are not going to be destituted. Now,
• 1:02:45
  Speaker 2: they might not be in ideal situations, but they are
• 1:02:48
  Speaker 2: able to thrive.
• 1:02:50
  Speaker 1: There are people who are very very who are really
• 1:02:52
  Speaker 1: struggling and who really need help, and I think they
• 1:02:55
  Speaker 1: should really get that help, But I think the perception
• 1:02:58
  Speaker 1: that most people are living paycheck to paycheck is just
• 1:03:00
  Speaker 1: not an accurate reflection of where most people are.
• 1:03:02
  Speaker 2: At right now. Another myth is about the trade deficit.
• 1:03:06
  Speaker 2: So the government deficit contributes to, but it's not fully
• 1:03:10
  Speaker 2: responsible for the trade deficit.
• 1:03:13
  Speaker 1: And as you're remember, this refers to essentially how much
• 1:03:16
  Speaker 1: is being imported and exported, and so the idea that
• 1:03:20
  Speaker 1: we're importing more than we're exporting is essentially where this
• 1:03:23
  Speaker 1: comes from. And so the government has a deficit where
• 1:03:26
  Speaker 1: they borrow money to pay for the things that the
• 1:03:28
  Speaker 1: government has to do, largely salaries and a lot of
• 1:03:31
  Speaker 1: other things that it funds and spends money toward, but
• 1:03:35
  Speaker 1: it has to frequently borrow that money. And the money
• 1:03:39
  Speaker 1: that it borrows is our national debt. It's how much
• 1:03:42
  Speaker 1: the government owes to other countries that it from which
• 1:03:45
  Speaker 1: it has borrowed money, and that can contribute to that
• 1:03:48
  Speaker 1: trade deficit, but it's really not a super primarily important variable.
• 1:03:53
  Speaker 1: And the other thing that economists point out is debt
• 1:03:55
  Speaker 1: is not necessarily problematic. When that debt is you borrow
• 1:04:00
  Speaker 1: money to pay for something as an investment, and that
• 1:04:03
  Speaker 1: investment will then pay off more than the cost of
• 1:04:06
  Speaker 1: the money borrowed. This happened the government borrowed money, and
• 1:04:10
  Speaker 1: I think this was I mean, this has happened many, many,
• 1:04:12
  Speaker 1: many times, but there was like a classic example, and
• 1:04:15
  Speaker 1: I want to say the sixties or seventies. The government
• 1:04:17
  Speaker 1: borrowed a whole bunch of money, invested all of that money,
• 1:04:21
  Speaker 1: and made so much back on that money that it
• 1:04:23
  Speaker 1: was then able to pay it back. But then it
• 1:04:25
  Speaker 1: borrowed more again to keep doing that, to keep making
• 1:04:27
  Speaker 1: those investments. So the debt itself wasn't actually a problem
• 1:04:31
  Speaker 1: because the investments meant that things were more lucrative and
• 1:04:35
  Speaker 1: making more money than when they were just trying to
• 1:04:38
  Speaker 1: sort of rest on their own laurels, if you will.
• 1:04:40
  Speaker 1: They were only using the money that they was immediately
• 1:04:42
  Speaker 1: available to them. Instead, it was borrowing money to invest
• 1:04:45
  Speaker 1: in things that were lucrative.
• 1:04:48
  Speaker 2: Right now, obviously, debt can be a risky move, but
• 1:04:51
  Speaker 2: smart investments can reduce that risk. And the amount that
• 1:04:53
  Speaker 2: the US borrows could be compared against his GDP. Right now,
• 1:04:57
  Speaker 2: the debt to GDP ratio is lower than it has
• 1:04:59
  Speaker 2: been in the past, although it is increasing, so it
• 1:05:02
  Speaker 2: is one of those things where we want to keep
• 1:05:04
  Speaker 2: an eye on it.
• 1:05:05
  Speaker 1: Yeah, we have. In the past, we have borrowed less money,
• 1:05:09
  Speaker 1: but it was so much money against our GDP that
• 1:05:13
  Speaker 1: it was actually a fairly high percentage of our GDP
• 1:05:15
  Speaker 1: the amount that we were borrowing. Right now, we're borrowing
• 1:05:18
  Speaker 1: more money, but our GDP has grown so much that
• 1:05:22
  Speaker 1: the amount we're borrowing is a relatively smaller proportion than
• 1:05:25
  Speaker 1: it was in the past when we were borrowing less money,
• 1:05:28
  Speaker 1: if that makes sense. And so essentially it's considering how
• 1:05:30
  Speaker 1: much money are we making relative to how much we're borrowing,
• 1:05:34
  Speaker 1: and we are borrowing a lot less than we're making,
• 1:05:37
  Speaker 1: but it is increasing. So right now our current deficit
• 1:05:40
  Speaker 1: is trending upward, where for a very long time it
• 1:05:43
  Speaker 1: had been trending downward because we were borrowing more and more,
• 1:05:46
  Speaker 1: but our GDP was growing so much that the percent
• 1:05:50
  Speaker 1: of our GDP we were borrowing against was actually shrinking.
• 1:05:53
  Speaker 1: Right The last myth to tackle here is has to
• 1:05:56
  Speaker 1: do with taxing, and it's a kind of nuanced once
• 1:06:00
  Speaker 1: just bear with us for a second. There is this
• 1:06:02
  Speaker 1: idea that if we tax the highest earning people, that
• 1:06:06
  Speaker 1: that will raise the federal budget and decrease the deficit.
• 1:06:09
  Speaker 1: So the one percent of earners in the country who
• 1:06:12
  Speaker 1: earn like a crazy amount of money, it's like stupid
• 1:06:15
  Speaker 1: how much they have. If we were to tax them
• 1:06:17
  Speaker 1: at much higher rates, then that would be bringing a
• 1:06:20
  Speaker 1: whole lot of money into the government and decreasing the deficit. Now,
• 1:06:25
  Speaker 1: the myth isn't whether or not this would work. It
• 1:06:28
  Speaker 1: would work, absolutely, it would work. The myth is how
• 1:06:32
  Speaker 1: effectively it would work.
• 1:06:34
  Speaker 2: Right, So this could be very effective, but this may
• 1:06:36
  Speaker 2: not be sufficient to make a huge change or the
• 1:06:39
  Speaker 2: change that people tend to say about it. So it
• 1:06:42
  Speaker 2: would result in real money, but it would only be
• 1:06:44
  Speaker 2: about seventeen percent of the current deficit. It wouldn't be
• 1:06:47
  Speaker 2: as nearly as large as we think it would be.
• 1:06:50
  Speaker 1: Yeah, it's just like it's not the only solution to
• 1:06:54
  Speaker 1: try and manage the sort of debt to income ratio
• 1:06:57
  Speaker 1: that might exist in the country. And like how much
• 1:06:59
  Speaker 1: the gouvern is having to borrow to pay for its spending.
• 1:07:02
  Speaker 1: I mean, seventeen percent of trillions and trillions of dollars
• 1:07:05
  Speaker 1: is a huge amount of money. Yeah, and it's only
• 1:07:09
  Speaker 1: seventeen percent. So it's like I can see both of
• 1:07:12
  Speaker 1: those angles and understand. So I think the pragmatic strategy
• 1:07:16
  Speaker 1: moving forward is if we are concerned about our debt
• 1:07:20
  Speaker 1: to income ratio by how much we're having to borrow,
• 1:07:23
  Speaker 1: which is a lot, then this should be a thing
• 1:07:27
  Speaker 1: that we implement. It just can't be the only solution.
• 1:07:30
  Speaker 1: There's got to be other things.
• 1:07:31
  Speaker 2: Right, Because the economy is multifaceted, our solutions also have
• 1:07:34
  Speaker 2: to be multifaceted.
• 1:07:36
  Speaker 1: Exactly correct. Yes, that exactly nails it so beautifully. But
• 1:07:40
  Speaker 1: I think that is what we have to say about
• 1:07:42
  Speaker 1: the economy right now. But advertisers might have something else
• 1:07:46
  Speaker 1: to say.
• 1:07:47
  Speaker 2: Oh, yes they do.
• 1:07:56
  Speaker 1: All right. If you're joining us for the first time,
• 1:07:58
  Speaker 1: then walk home. We're so happy to have you. I
• 1:08:00
  Speaker 1: hope you enjoyed today's discussion and didn't walk into something
• 1:08:03
  Speaker 1: where you're like, what on earth is going on here?
• 1:08:06
  Speaker 1: This is kind of standard, I think, sort of format
• 1:08:09
  Speaker 1: for what we mostly do, although this is more government
• 1:08:12
  Speaker 1: leaning than it is psychology leaning, which is I don't know,
• 1:08:16
  Speaker 1: we do all kinds of crazy stuff here. So this
• 1:08:17
  Speaker 1: feels part for the course.
• 1:08:19
  Speaker 2: Yeah, yeah, for sure. Yeah, this was we like to
• 1:08:22
  Speaker 2: spice it up a little bit.
• 1:08:23
  Speaker 1: Exactly, but we've covered all kinds of crazy topics and
• 1:08:26
  Speaker 1: in Halloween we do or in October we do Halloween
• 1:08:30
  Speaker 1: or spooky themed sort of topics. Have been doing that
• 1:08:32
  Speaker 1: for several years and now we've been releasing these mini
• 1:08:35
  Speaker 1: episodes that come out on Mondays that are just these
• 1:08:37
  Speaker 1: fifteen minute ish short dives into a particular topic. Anyway,
• 1:08:41
  Speaker 1: as I said, thank you, really happy to have you here.
• 1:08:43
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  Speaker 1: least you gave them the choice by putting them on
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  Speaker 1: the path of us.
• 1:09:45
  Speaker 2: Yeah, and we don't mind discourse. We're fine with discourse.
• 1:09:48
  Speaker 1: Yeah. And I'd also like to thank my team of
• 1:09:50
  Speaker 1: people who make this thing happens. You're writing and fact
• 1:09:53
  Speaker 1: checking from Shane, Katie and myself. Our social media coordinator
• 1:09:56
  Speaker 1: is Emma Wilson, and her audio production Maestro Master Extraordinaire
• 1:10:01
  Speaker 1: is Justin. And we are going to recommend some things
• 1:10:05
  Speaker 1: right now, which is a thing that we do for fun,
• 1:10:07
  Speaker 1: where we just talk about something that we enjoy. It's
• 1:10:09
  Speaker 1: often or usually unrelated to our topic at hand, but
• 1:10:13
  Speaker 1: we just recommend them because they're fun and we're like, hey,
• 1:10:15
  Speaker 1: this is something we like, maybe you'll like it too,
• 1:10:17
  Speaker 1: that's more or less how that goes.
• 1:10:18
  Speaker 2: We hope that you'll like them. If you don't like them,
• 1:10:20
  Speaker 2: that's okay. We like these things and they bring us joy.
• 1:10:22
  Speaker 1: Yes, is there anything that I am forgetting before we
• 1:10:25
  Speaker 1: transition to our recommendations.
• 1:10:27
  Speaker 2: No, not today.
• 1:10:28
  Speaker 1: Oh I will say if you'd like to talk to
• 1:10:30
  Speaker 1: us about the economy, anything that we said in this
• 1:10:32
  Speaker 1: episode that we missed or that you'd like to add,
• 1:10:34
  Speaker 1: or if you'd just like to pay us heaping amounts
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  Speaker 1: of praise, you can email us directly by emailing us
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  Speaker 1: at info at wwdwwdpodcast dot com. And we're also on
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• 1:10:49
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• 1:10:52
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• 1:10:53
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• 1:10:54
  Speaker 2: That's true.
• 1:10:55
  Speaker 1: All right now, we recommend yay.
• 1:11:04
  Speaker 2: Recommendation. So I'm gonna recommend a book I like to read,
• 1:11:09
  Speaker 2: and if you listen to the show, then you know
• 1:11:11
  Speaker 2: that I like to read it. But I have been reading.
• 1:11:14
  Speaker 2: I would call it a classic because I think the
• 1:11:17
  Speaker 2: movie itself is pretty iconic, and that is a book
• 1:11:21
  Speaker 2: called The Shining by a man named Stephen King. So
• 1:11:24
  Speaker 2: I have been on a journey right now to work
• 1:11:26
  Speaker 2: my way through all of Stephen King's books. It's hard
• 1:11:29
  Speaker 2: to keep up because he writes so many books per
• 1:11:31
  Speaker 2: year that I would have to just solely read his
• 1:11:34
  Speaker 2: books to be able to read them all, especially because
• 1:11:36
  Speaker 2: they're like all over a thousand pages. They're crazy. But
• 1:11:39
  Speaker 2: The Shining is I think masterfully done. It is the
• 1:11:42
  Speaker 2: story of a family who the husband and the family
• 1:11:45
  Speaker 2: becomes the caretaker for the Overlook Hotel in Colorado and
• 1:11:49
  Speaker 2: antics and Sue, we'll say that.
• 1:11:53
  Speaker 1: Soting it.
• 1:11:56
  Speaker 2: Yeah, very different than the movie. The movie, I think
• 1:12:00
  Speaker 2: is a little bit more artie than this book is,
• 1:12:02
  Speaker 2: and something that you learn about Stephen King as you
• 1:12:04
  Speaker 2: read more, as he's very like psychological and introspective rather
• 1:12:09
  Speaker 2: than events happening in action. And I think that that
• 1:12:12
  Speaker 2: is a subtle difference between the movie and the book.
• 1:12:14
  Speaker 2: The book is great. I love the descriptions in it.
• 1:12:17
  Speaker 2: It's scary, it's creepy, it's weird, and I've really been
• 1:12:21
  Speaker 2: loving it. So I strongly recommend if you if you
• 1:12:24
  Speaker 2: want to pick up a Stephen King book. This is
• 1:12:25
  Speaker 2: a really great one to start with.
• 1:12:27
  Speaker 1: Yeah, you know, it's it's kind of like, because, as
• 1:12:30
  Speaker 1: you said, the movie in the book, I think, seem
• 1:12:33
  Speaker 1: to sort of exist in different spheres, and it's sort
• 1:12:35
  Speaker 1: of like you can look at both of them as
• 1:12:37
  Speaker 1: entertainment media that do a good job at telling a story. Yeah,
• 1:12:41
  Speaker 1: it's sort of like you can look at the Toby
• 1:12:44
  Speaker 1: maguire Spider Man movies and the Andrew Garfield Spider Man
• 1:12:47
  Speaker 1: movies and the Tom Holland Spider Man movies and you
• 1:12:49
  Speaker 1: can appreciate that they're they're telling different stories, but they're
• 1:12:53
  Speaker 1: they're just they're using a similar vehicle. And I like them.
• 1:12:56
  Speaker 1: I think they're all fun. Yeah, and some of them
• 1:12:58
  Speaker 1: are better than others. But but they're a perfectly good
• 1:13:01
  Speaker 1: time and I think that's true here, as they're just
• 1:13:03
  Speaker 1: they're telling slightly different stories using a similar vehicle. Absolutely
• 1:13:06
  Speaker 1: one hundred percent excellent. Well, speaking of different stories using vehicles,
• 1:13:11
  Speaker 1: I'm recommending a relatively recent movie that came out just
• 1:13:14
  Speaker 1: this year. I believe it is called Alien Romulus. This
• 1:13:18
  Speaker 1: is a new entry in the Alien franchise. This is
• 1:13:22
  Speaker 1: of the monster horror variety. So if monster horror is
• 1:13:26
  Speaker 1: not your thing. This probably won't be your thing. I
• 1:13:29
  Speaker 1: thought it was really fun. I mean, this was a
• 1:13:32
  Speaker 1: strong homage to the very first Alien movie done by
• 1:13:36
  Speaker 1: Ridley Scott. So if you are into if you likes
• 1:13:39
  Speaker 1: Ridley Scott's Alien, and I love that movie, then I
• 1:13:43
  Speaker 1: think you will very much enjoy this one. And you know,
• 1:13:45
  Speaker 1: I think don't take it too seriously. There are definitely
• 1:13:48
  Speaker 1: some things in there that if you are familiar with
• 1:13:50
  Speaker 1: the canon, or even if you're just following the logic
• 1:13:52
  Speaker 1: of the story, you kind of go huh. But beside that,
• 1:13:57
  Speaker 1: I think the movie works very well, and I think
• 1:13:59
  Speaker 1: they do a really good job accounting for I think
• 1:14:02
  Speaker 1: it's a nice self contains little adventure. If you have
• 1:14:06
  Speaker 1: seen the original Alien movie, I think it builds on that.
• 1:14:10
  Speaker 1: If you haven't, I think it stands alone just fine.
• 1:14:13
  Speaker 1: I think you are a little bit better prepared to
• 1:14:17
  Speaker 1: understand one piece of this if you've seen either Prometheus
• 1:14:21
  Speaker 1: or Alien Covenant, but again, I think it works fine
• 1:14:26
  Speaker 1: without that if you haven't. So if you're in the
• 1:14:28
  Speaker 1: market for a monster movie that is continuing to expand
• 1:14:33
  Speaker 1: on the story and lore of this Alien franchise, I
• 1:14:36
  Speaker 1: definitely recommend Alien Romulus.
• 1:14:39
  Speaker 2: I support it. I haven't seen it yet, but I
• 1:14:41
  Speaker 2: heard it's really good.
• 1:14:42
  Speaker 1: Yeah, I enjoyed it. So I think that's what we
• 1:14:44
  Speaker 1: have to say about Alien and the Shining and for
• 1:14:46
  Speaker 1: right now. The economy will probably expand on this in
• 1:14:49
  Speaker 1: one way or another moving forward, but the one thing
• 1:14:51
  Speaker 1: that we can all agree on is that it's not
• 1:14:53
  Speaker 1: simple math. Is there anything that you would like to
• 1:14:56
  Speaker 1: add or anything that I forgot before we wrap this
• 1:14:58
  Speaker 1: up today, Shane, No, I think that's it.
• 1:15:01
  Speaker 2: Well.
• 1:15:01
  Speaker 1: Thank you for recording with me today, and thank you
• 1:15:03
  Speaker 1: everyone for listening. This is Abraham and this is Shane.
• 1:15:06
  Speaker 1: We're out, so Ya. You've been listening to Why We
• 1:15:09
  Speaker 1: Do what We Do.
• 1:15:10
  Speaker 2: You can learn more about this and other episodes by
• 1:15:13
  Speaker 2: going to WWDWWD.
• 1:15:16
  Speaker 1: Podcast dot com.
• 1:15:17
  Speaker 2: Thanks for listening, and we hope you have an awesome
• 1:15:20
  Speaker 2: day