Tariff Turmoil, Trump’s Tesla Ad, and Newsom’s Bannon Interview

23:56So everyone's like, oh, you should talk to him. I don't know if that's enough common ground to really have anything that's thoughtful in any way because you're constantly spending your entire interview fixing the lie and then the conversations about the lie versus actual policy debate. But even that, even that I've been asked or so one of the shows we go on a lot, sometimes the panelists, I think, like, I just can't keep up with the stream of falsehoods. I'm not going to be able to respond without without fact checking real time. But even what you said, I think, is valuable to say, look, so much of what you're saying does not sound right.

24:37And we can't. And there's so much of it that we can't keep up with fact checking. I think even that's a fair statement to say, you're just flooding the zone. It feels like you're flooding the zone with non-truths. But really good interviews are able to say, well, actually, I think of when this fairly famous venture capitalist who moved from San Francisco to Miami and started shitposting California long enough such that he could get a reduction in capital gains when he sold a stock, went on CNBC and started basically lying about the earnings of open door, basically saying it was profitable when it wasn't.

25:12And Deidre Bolsa fact-checked in real time. She's like, no, you can't say this company is profitable. It's not. She was so prepared, or there was a producer in her ear going, that's not true. Push back on that. She essentially real time said, I don't want you to lie to our viewers over and over. We're talking about people's wealth and stock trades. And two or three times, she would stop him and say, that's just not true. With politics, it's harder because some of it is subjective, right? I mean, but if you're going to say, like you said, the election, I mean, that to me is just a softball, like, please show me the evidence that contradicts the 62 court cases where the judges, including Republican appointed judges and Trump appointed judges said there was no evidence of election fraud.

25:56That's all I wanted. That's essentially, when he did the dissent, when he goes on Fox, I don't think he's hostile. I think he's having a great conversation. actually. I don't think he's like, gotcha. I just was like, what happened to that, Gavin? Like, what in the world happened? And when he announced this, I thought, great idea. You do very well in those environments, and the conversations must be had. But this was, I just don't know what he's up to here, because it's not the guy who goes on Fox News. It's not the guy who wades into, you know, people he disagrees with. I do know California does need this funding from the Trump administration.

26:35I see that he has to be a little more solicitous of these people. But at the same time, and he kind of wants to denuter them before he runs. And so he doesn't get all the flack that they will inevitably aim at the next Democratic presidential nominee. Speaking of the apprentice, I asked my master, if I shave my ass, does that mean I'm gay? And he says, he who is cleaning his house is expecting visitors. Oh, that's wrong. That's really, that's awful. I kind of like that. That's perfect. That's my way of saying we need to segue out of this story. We do. I do. But I do wish he had done what he had done with DeSantis and others, and he's not doing that here.

27:12You got the last word. This is called our relationship. You got the last word. He should also have left-wing figures he disagrees with. Anyway, apparently they won't go on. He told me they won't go on. Yes, I know. Get AOC on and Bernie. No, she'd kick his ass. Plus, can you imagine the two of them together? Oh, my God. Don't you just hope they both get naked and go at it? No, I don't. No, I don't in any way. I pay cash money to see Governor Newsom and Representative Ocasio-Cortez. You know how to get me out of a conversation by making a ridiculous remark about the sexiness. Oh, God. And you know what I want?

27:44I would want them to have 40 or 50 kids. They'd become my army and we'd take over Australia and I would be the general consulate of Australia. People would love They would have barbecued you on the Outback by then. You would have been gone on the Outback. Okay, Scott, let's take a quick break. Now you know how to get me out of a conversation. When we come back, Trump's chaotic tariffs.

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29:46Scott, we're back with the ongoing tariff whiplash. The EU and Canada announced billions of dollars in retaliatory tariffs on Wednesday after President Trump's levies on steel and aluminum went into effect. The markets continue their rollercoaster ride, fluctuating with all the tariff pivots, speaking of pivots, which you and I called red light, green light on Anderson Cooper last night, but steadying slightly with positive inflation report, but people are still expecting inflation to rise. I'll note we're recording this Thursday morning, so Trump may change his mind on tariffs several more times before our listeners hear this.

30:22We'll get into recession concerns, which I'm calling Trump session in a bit, but what do you think will happen? What do you think about these tariffs over the last few days. Are markets overreacting or are they getting it right? The Wall Street Journal reported on a closed-door gathering of CEOs this week at the Business Roundtable, where an impromptu poll was taken about the economy. Oh, this was the Jeffrey Sonnenfeld one. 22 % said stocks would have to fall, 30 % before they would take a stand. Jamie Dimon finally did after saying Trump's get over it on the tariffs, is now saying this is a bad thing.

30:57Start with tariffs. First off, I think Jeffrey Sonnenfeld is a gift and he wrote a fantastic opinion piece about how some of these corporate leaders who claim to be leaders and claim to care about America need to speak up. And there haven't been that many. And congratulations to Jamie for kind of stepping into the void and saying what's on everybody's mind. I think you're going to see more of it. Look, tariffs are the following. They're not universally bad. If China China is charging a tariff on our cars. We get to charge a tariff on their cars until we both decide to lower tariffs. Free trade creates prosperity.

31:31You can also probably need a tariff to support certain strategic industries. We probably should have some level of domestic production of steel in case those supply chains are shut down and we need to build tanks or what have you. But when, for example, these aluminum and steel tariffs, we tried that in the last Trump administration. And what they found is the following, that, okay, let's assume that the additional revenue created by the tariffs, let's assume that the additional revenue captured by Cleveland Cliffs and U.S. Steel are two largest remaining steel manufacturers. Their market, their products become more competitive because foreign steel is more expensive.

32:08So they get more share, more money, more tax revenue, more jobs. All right, theoretically, it all works. Here's the problem. One, consumers, prices get increased. Consumers have to pay up to$6 ,000,$8 ,000,$12 ,000 more for a truck with these tariffs, which takes down the demand, which takes down the gross profits of the domestic supplier because their products are more expensive relative to other people's products because we have to increase our input costs. There is a reciprocal tariff almost always, meaning that our products become more expensive overseas. And what you found with the aluminum and steel tariffs is that the increase in the cost of steel made that so many products across America had to increase their prices because steel and aluminum were big inputs, that the increase in prices reduced demand much more than the incremental income gains from the companies that benefit from their products being more competitive.

33:04In some, in almost every case, tariffs don't work. And if you look at what companies do thousands of times a year across the market, they are perfectly trying to calibrate. Nike is perfectly trying to calibrate volume times gross margin and figure out the exact peanut butter and chocolate combination for shareholders. All right, if we sold, if we lowered our prices and took our margins down from 30 points to 10 points, we'd double our volume, but we'd end up with less profit. So they perfectly attempt or attempt to perfectly calibrate across every market what is the optimal price relative to volume, relative to margin.

33:39And when the government comes with tariffs, what they're saying is, hey, company, you're stupid. We could take prices up and it wouldn't hurt demand. And it never works out that way. It usually suppresses demand and revenues in a much greater volume or amount than the increase in revenues. It makes us less competitive. It makes us less productive and it increases costs. If you're looking for an elegant way to increase consumer costs while reducing productivity and demand across our products in foreign markets, congratulations. This is supersizing Brexit. This is the most elegant, efficient way to reduce American prosperity.

34:15It makes absolutely no sense. Sorry, here's a period. Boom, boom. Professor Galloway gives you his lecture in class. Even worse than this? Even worse than this? Even worse than the tariffs? If he said, all right, I'm putting a 10 % tariff on everything from China. American companies could go, okay, this is stupid, whatever, but he gets to make this decision. But they could plan. They could say, okay, the cost of our shoes and our cars is about to go up 12 or 15%. We estimate that demand will fall by this and we can adjust and plan for this. But here's what's even worse than these ridiculously stupid tariffs is the uncertainty means that foreign and domestic suppliers can't plan their goddamn business.

34:57When we were at South by Southwest, a lot of the digital media companies who were off to a great start of the year, right? The lack of uncertainty because, okay, we know Trump's in office. We think we sort of know what to expect. Let's get back to business and start spending money. 2025 started great for digital media companies dependent upon consumer advertising. And now their quarter has been blown because some of the biggest advertisers in America, including automobile companies have all said the following, we have no fucking idea what's going on so we're doing nothing. They have told their media planners, until there's more clarity, stop spending money.

35:35And the lack of certainty, the lack of consistency as a trading partner means every large organization and company in the world is trying to reconfigure their supply chain to be less dependent upon America, which means less money for America. The tariffs are bad, the uncertainty is even worse. Oh, wow. That was a lecture. I just felt like it was macroeconomics back in college right now. That was a macroeconomics professor. Thank you, Professor Galloway, for that cogent analysis. It sucks is what I would say. Now come by my office hours and I'll help you on the hard parts. No, no, no, don't do that.

36:07Don't do that. Don't do that. That's wrong. No, that's wrong. That's wrong. That's wrong. Listen, I will give a much shorter thing. I was on the Amtrak train when the people were coming back from the business round table to New York and all of them were insulting Trump. Every one of them, even if they don't speak out, they all said, what a fucking idiot. This uncertainty sucks. And they were all insulting it and saying, what do we do now? Because they talked too loud on an Amtrak train, all these men. They were all men. And one woman. And then secondly, a CEO of a very big public company that is going to be affected by tariffs.

36:42And I'm not going to say what it is. I said, what are you going to do now? What are you going to do now? And he said, pass it on to consumers. And I was like, thought so, right? And so it is going to hurt his business. He was like, I'm going to have to pass it along to consumers. There's no other way. And it's going to affect his business across the globe. Absolutely. And it was like, we don't know what to do. It's going to affect everyone, along with the cuts in government, the sort of non-scalpel-like cuts in government, which would hearten people, the across-the-board cuts where you don't know where it's going to happen with crazy Elon with a chainsaw.

37:17Same thing. And nobody knows because there's, you know, it's interesting because the Department of Education cuts. Everyone's like, oh, it's not useful. They mostly have privatized much of their research and studies and stuff that's actually somewhat useful to know if things work or not, different testing and things like that. That's all been privatized. So that's going to have second and third order effects and mostly across the country, not in Washington. And so although Washington is also going to be affected, so the effects are everywhere. And so that's why there's been a lot of talk of recession lately, which I call a Trump session.

37:51I'm going to keep saying that word until it catches on, like Bidenomics. Though Trump is dancing around that language. Let's listen to what he told Fox Business' Maria Bartiromo earlier this week. By the way, Kara Swisher is not a fan of Maria Bartiromo. When asked about the possibility of a recession. I hate to predict things like that. There is a period of transition because what we're doing is very big. We're bringing wealth back to America. That's a big thing. And there are always periods of, it takes a little time. It takes a little time. But I think it should be great for us. This issue has been a real hair up his ass, the idea that tariffs will work.

38:34He's way back in the smooth Hawley days. But Commerce Secretary Howard Lutnick had a different take on tariffs and recession. An interview with CBS News. Let's listen. These policies are the most important thing America has ever had. So it is worth it. It is worth it. A, I don't think the only reason there could possibly be a recession is because of the Biden nonsense that we had to live with. These policies produce revenues. So you're saying when it looks chaotic and unpredictable from the outside, that there actually is a master plan when it comes to these tariffs? It is not chaotic. And the only one who thinks it's chaotic is someone who's being silly.

39:15Oh, my God, he's such a clown. The most important thing in American history, so our decision to, at huge cost, risk to our young men, risk to our economy, turning washing machine factories into tank factories overnight. We decided for the second time to enter into World War II and push back on fascism. Oh, we decided that this incredible prosperity and rights should be extended to non-civil rights. Oh, I'm sorry, but these fucking tariffs are the most important thing America's ever done. I know. I mean, you just lose so much credibility when you say that. And this is so chaotic. I don't even know the status of the tariffs right now.

39:57And I follow this shit. I know now why this guy is not respected on Wall Street when he opens his mouth. He's such a clown. He's a suck up to Trump because he's finally relevant. He goes around talking about his best friends to Trump in Washington, all over the place. He is the thirstiest public official I've ever seen. and it's because he's not beloved on Wall Street. And secondly, he's spewing nonsense, just nonsense out of his mouth. You know who's the big winner here is China. You know what China, China has literally deployed dozens if not hundreds of their diplomats to the biggest European and Latin American companies.

40:34And they've said the following, you may not love us, but you can count on us. We like trade, we like commerce, and we do what we say. and you know what you're dealing with with us. You've been buying all these produce or products or finished products or whatever it might be from the U.S. You have no idea how to plan and what to expect from these folks. You can count on us. This is the deal. We are open for business. We love commerce. We are a dependable, consistent partner. Or even not China. Canada's gonna do more business with me. This is literally a gift to every major economic power that had to compete against America.

41:16What they're saying is America is not competitive because you can't believe what they say. And the greatest level of damage here isn't even gonna show up in the short room. Goldman Sachs already took their GDP prediction from 25 down from 2.4 to 1.7. It'll be the long-term impacts of when people reconfigure their supply chain and their relationships, they're gonna be somewhat like remissed to re-engage again. This is gonna be a structural step down and our credibility across our largest trading partners. And trade, no doubt, if you don't think about who gets really hurt, you can end up with a really difficult situation.

41:53And that's where America, America's been really good on trade, where we're bad is helping out and showing empathy for the people who get, quite frankly, who are on the wrong end of that. But on the whole, prosperity just grows. We just continue to see that economically over time. And people, when they stop buying our products, not because they might be the most competitive in a year, but they're like, we don't know what's going to happen in the next year or two years. So do you think a recession's likely at this point? Because again, with this fell in charge, I mean, I'm thinking Gino Raimondo is so smart and this guy is so dumb, like actually dumb.

42:28Like I think he, when macroeconomics was taking place, he was the one sleeping behind me, the dude sleeping on the desk behind me. That's what it feels like. He's not paying attention to almost any obvious thing. And you're right. When we did some of these trade deals, we didn't think of the effects here enough and figured out how to retrain and get people into new jobs and things that were more competitive and figure out what advanced manufacturing we could do here with our population and et cetera, et cetera. This is an opportunity for China. And the second thing is people worried about their 401ks and portfolios during this volatility.

43:03I mean, do you think there's going be a recession, very briefly. And then what would you say to people with the stock market? Warren Buffett looks like a genius. Tariffs suck. I'm in cash. Look who looks like he is the goat. He should be comer. He should be president, but anyway. Economists, and I don't consider myself like an economist, but quote unquote academics have predicted nine of the last three recessions. It's very hard to tell because you could have AI finally get real traction in the economy and massively increase productivity, which results in economic growth that overcompensates for these ridiculous tariffs.

43:36And we have a tendency to sometimes overestimate the power of the president and his policies on this unbelievable engine called the American economy that usually over the medium and long term sort of figures out a way. So I think it's dangerous to predict a recession. What was your second question, Karen? What would you do? You're in the stock market. Just leave it alone. market. The only thing I would consider is the following. And that is, this stat just blew my mind. If you add in corporate debt, so people have heard that the market capitalization of U.S. stocks now represents 50 % of total equity value globally, which is extraordinary.

44:14But if you add in corporate debt, because the enterprise value of a company is its market cap, say 100 million, plus if it has 50 million in debt, the market is saying that this company is worth$150 million because we're giving it$100 million in equity value, despite the fact it also owes$50 million. We're saying it's worth$150 million. If you add in all corporate debt and the world is worth$100, America costs$70 right now, and the rest of the world, sans the U.S., costs$30. So if someone said to you, Kara Swisher, you can either buy America for$70 or the rest of the world for$30, which you'd buy the rest of the world.

44:51And so what I'm doing is the following. First off, I think you're always invested in the markets. Don't try and time them, you are not Warren Buffett. And when people predict a recession, oftentimes the market goes up 20 or 30%. And also you have to take into account whether you're going to trigger a taxable gain on your, a taxable event on your income gains. What I would suggest, and this is not financial advice, but what I am doing, 70 versus 30, I am pulling money out of the U.S. and I'm putting into low cost, diversified index funds in non-U.S. markets. Because while index funds will diversify you, if you're just in an S &P or a NASDAQ index fund, you're actually not that diversified because typically when the markets get this expensive in America, for the next five or 10 years, you have 0 % returns.

45:35European stocks haven't been this cheap in a long time. American stocks haven't been this expensive in a long time. So what I would say is, one, I don't think you should go to cash. I just don't think you can time the markets. But what I would suggest is Thinking about diversifying across geographies, not just asset classes. Yeah. Excellent. Excellent advice. Professor Galloway. This was a very professorial. I'm I used to fall asleep in macro. It's that math I did this morning. This I was like this. I used to do that. It was at 810 in the morning. Anyway, let's go on a quick break. We'll be back and to chat about Trump and Elon Hawking Teslas at the White House.

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49:22Scott, we're back with our second big story. The beautiful bromance of Elon and Trust continues. That's from our producers. The rest of us worry about dismantling of our government. President Trump is focused on a very important task, promoting sales of Teslas. After posting on True Social Tuesday morning, he said he would buy a Tesla to support Musk. I bet he hasn't. Trump welcomed Elon and a fleet of Teslas to the White House. The president had a cheat sheet of notes, and kudos to that photographer who got that picture. in his hands while praising the company. Let's listen to what he thought when he sat in one of the cars.

49:55And by the way, he hates EVs. He said he actually hates EVs. He doesn't drive, et cetera, et cetera. So this was why this was precious. This is a different panel than I've had. Everything's computer. Oh, my God. He hasn't ever been inside a car in like a long time. It's real. I mean, a car that looks like that. But Tesla stock is down 26 % in the last month at the time of the taping. It had a bump from Trump, but most people are just, there were two analyst reports showing that Tesla's in real trouble, that are taking the stock price down quite considerably, although it's hard to bet against Tesla because of, like, stunts like this.

50:35Scott, did you know that there's a computer in a Tesla? Just, what the fuck? What do you think of this stunt? Look, we have a bias, but this, to me, is a computer. me just seemed fucking ridiculous that the president of the United States would decide to do an infomercial for one brand and not all other American brands. It's one thing if he and the Commerce Secretary were to stand in front of a bunch of American-made EVs, including Tesla. I think Biden screwed up not including Tesla in the EV summit. That was punitive the other way. That was playing favorites the other way. But when you basically do one of these bad local, You know, I'm crazy, Bob.

51:13Come down to Bob's Ford and Lincoln Mercury for a crazy deal. No percent down, whatever. Yeah, yeah. Yeah. I was joking that you can lease to own America for$285 million. It's just this is stupid and goes back to the notion that this kind of shit should not be allowed. It reflects poorly on America. It reflects poorly on Trump. And the thing I don't get about Musk, who obviously has such an unbelievable feel for business, is that 75 % of Republicans say they would never buy an EV. If he was just purely, quote unquote, economically driven, which I think he is, I think he would have gone blue pill because the marketplace, I always use the example.

51:57We talked about this. When Nike went political, it was a smart move because they tickled the sensors of the core market. He's pissing off his core market. I just don't, I don't understand his end game here as Gavin Newsom. I think he's uninterested in Tesla. I think he's uninterested in Tesla anymore. I don't know what else because they haven't innovated on the product. I know everybody sort of looks at the polarization that he's created, and he's repulsing his customers, and he's not going to attract the ones who like him now, right? They may like him. They're not going to buy his car. They might.

52:28I mean, they might, I guess, but I doubt it. Sean Hannity supposedly bought one, whatever, and he's like, it goes fast. I was like, these are good cars. That said, you know what? I complained again to Dara Khosrowshahi. I was like, I just ordered an Uber Black and a Tesla showed up and they're still not luxury cars. Now I'm making the argument to him. It's not a luxury car. It's very tinny and a bumpy ride. And if I wanted a luxury car, send me an actual luxury car if I'm paying for it. But that said, I think it was pathetic. But now, interestingly, if support doesn't do what Elon was hoping in the long term, which was at least stabilize Tesla shares, which are drifting down, I suspect they're going to be drifting down again, it's not the only way the president is attempting to help him.

53:15Trump also said he would label attacks against Tesla dealerships domestic terrorism. Nobody likes these attacks. These are stupid, what people are. They're allowed to protest, and the fact that he's trying to sort of link regular protests with domestic terrorism is ridiculous, but attacking, you know, charger facilities, etc., is just violent, is what it is. It's not terrorism. It's just obnoxious and illegal, and those should be arrested. And Elon Musk is paying back the favors. He reportedly plans to give$100 million to President Trump's political operation that Trump can control rather than Musk.

53:49during the election, Musk donated over$250 million to his pro-Trump super PAC that he controlled. He made up that$100 million in the rise in Tesla stock after Trump did this infomercial. But it feels so pay to play. It's like so right in front of you. And I agree, Biden should have included a Tesla in that particular event at the White House. And, you know, someone was arguing that presidents always promote different American products, but not like this. This was like, it was, plus he didn't know how cars worked, which would have made him seem older and more like an old man in my, I think that also was weird.

54:28His discomfort inside of a car felt very, I don't know, it gave me like a Biden feel, like a doddering old man kind of. And he's, I think he is much more vibrant, obviously, than Biden. And any other thoughts about this money that's going back and forth between these two? There's, it really is. I mean, it's so passe, but money in politics and just what feels like a straight pay for play. And all the incentives are, I mean, I've said this for a long time. The thing that's always horrified me about our representatives and our Congress is not that they're whores, not that if you give them money, you get audience with them.

55:07I've known that for a long time. it's what incredibly cheap whores they are. And that is, if you give 10 to 25 grand to every senator, I bet more than half would meet with you when you swung by Washington. And influence is a function of proximity and intimacy. You have audience with people who get to levy or are the arbiters of the largest person in history. So the incentives are, Jeff Bezos or Mark Zuckerberg look at these investments and go, this is the best investment in history. A million bucks for his inauguration campaign and he stops threatening to put me in jail or he's going to not try and break me up or he's going to tell the FTC or the DOJ to hands off Amazon or whoever.

55:52This is the best money spent unless you have systemic laws and regulation that says, no, we pass laws that affect all companies. We're not allowed to play favorites, it's just a race to the bottom where everyone's like, all right, let's give him a giant medal and award and build a gold statue of him and give$10 million to his electoral campaign. And the problem is that favors the incumbents because they're the ones that have all the power. And anybody who says, no, I'm standing up for American values. I'm not going to take this money. They're at a huge disadvantage. And we end up with a majority of our elected officials are willing to engage in this grift, in this trade.

56:32So as far as you can see, you know, it's interesting because there is a point to be made that, you know, other politicians are getting paid under the table and this is explicit, but it's gross no matter how it happens. And it doesn't look like it's about the products, right? It never, it's not about what's best. It's what, who can pay me the most. And that, you know, that's the, we're not focused on making things that are good. We're focused on who owes the money. And we all know that about American politics, but it's not implicit or explicit. It's grotesque is what it is. You know who is? Just one example.

57:07You know who's doing this, right? The University of California. I owe California taxpayers a lot. I've given some money to UCLA and to Berkeley. And both the chancellors of UCLA and Berkeley called me and said, one, thank you. And two, I just need you to know this. your kid is less likely to get in now that you have given money. They are not only so worried about conflicts of interest and abusing the public purse, that if you give over a certain amount of money to the University of California, the chancellor will call you and say, just FYI, your kid is now less likely to get in because we have to be so careful about conflicts and not abusing the public trust.

57:45And quite frankly, I respect it. Yeah. You could call your kid Swisher. You want to change the kitchen to Swisher. Trust me, I'll call you. That's right. You went to a private school where you can still just pay, you can do pay for play. Yeah, that's true. But this, that is how government, that is how you are supposed to respect the power of money you're given. This is, when he favors industries, he's spending your money. He's abusing your tax dollars. Totally. I don't even know how much that costs. That probably costs, like, it's the amount of money this guy just throws away of taxpayer money, like on golfing or his dumb military flights of immigrants that are overpriced, and then does this.

58:27You know, it's just ridiculous. And, you know, and the only person that benefited was Elon Musk with the stock going up. And then somewhere, somehow, there's money in Trump's pocket every time. I think this was bad for the brand. I really do. I think it just, I think it looked desperate. Yeah. Yeah, I agree. You know, now that you really don't want to own a Tesla. All right. Scott, one more quick break. We'll be back for predictions.

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1:00:12Okay, Scott, let's hear your prediction and just say you thought that they're going to break up. Do you still think that? You said Doe should be over and Elon would be gone. But let's hear your prediction first. Well, that is my prediction. And that is there's not going to be a breakup. I think that essentially people keep asking us, as Anderson did last night, when does the relationship end? I don't think the relationship ends with a bang. I think he just sorts, I think Musk just fades to black. One, if the president is really serious about the cabinet secretaries now get to make the final decision and Musk is just an advisor to them, that means nothing is going to happen because these cabinet secretaries have a very difficult job.

1:00:53They need all of their staff. The savings are minimal in comparison to, for example, the increase in the deficits from the planned tax cuts. If Elon Musk comes back, He's not going to come back with a thoughtful. You could probably cut a thousand of the 4 ,500 people from the Department of Education who have overseen national mandatory testing, which most people think has not worked. Right intentions has not worked. If he came back with thoughtful recommendations, the Department of Education might say, okay, that might make sense. But he's not there to look at fraud and waste, which by the way, we've got a clean bill of health on so far because they can't find as much as everyone had anticipated.

1:01:30But also these are not, this isn't about an audit. This isn't about efficiency. These are political actions. When you cut off all USAID, it's a political action and political actions are supposed to be left to our elected representatives representing the people. So if it was in fact about efficiency, fine. But what he said is if he in fact is honest about now he's just an advisor, he's going to have no power, nothing's going to happen. And in addition, he is now probably doing the math and going, I miscalculated. There are not only his Tesla sales being hammered, but what he's really scared of has happened.

1:02:09And that is the virus here has jumped the lab to Starlink. And that is a lot of big customers are now rethinking their Starlink relationship. So what initially was very accretive to his personal wealth has returned. He's lost all that money and the momentum is downward.

1:02:28So just slowly fade away out of, and I think Doge is going to die a quiet death because he has, it looks as if his power has been emasculated. And two, he's just losing so much money right now because of the negative brand halo. Well, guess, and guess what country has alternatives? China and Jeff Bezos is working on things. There's so, to Starlink, Starlink is dominant at this point, but, and he keeps saying there's no other alternative. He said that about Tesla. There's other alternatives. There's going to be other alternatives. And then he is up the creek without that proverbial paddle. You're right.

1:03:04I agree with you. Interesting prediction. We'll see. There is a staying power. There's a weird relationship happening between these two, though, that he stays there, that he's at the White House, the kids around. There's something much different here, but I would agree. He almost teared up when he was talking about the money he was losing. Even the world's richest man doesn't like to lose tens of billions of dollars on any one day. So, Kara, you know what stock is up? The Starlink competitor in Europe, Utelstat, has quadrupled in the last 30 days as these small, inferior product competitors are now viable again because they have an enormous increase in interest from nations and companies that don't want to work with Starlink.

1:03:45That stock is gone from a month ago. It was trading at$1.20. Buy Europe. That's the Scott Galloway message. Today it opened at 682. So you're about to see a massive amount of capital. I mean, this is so bad for Starlink. You're about to see a massive amount of capital going to other satellite and communications providers that, quite frankly, weren't as competitive. They weren't as good as Starlink. Starlink's a superior product. And by the way, Tesla was a superior product, but he never, he hasn't improved it. And again, as I say over and over again, a lot of people are banning Tesla because they're repulsed by Elon Musk, but they have not innovated their product.

1:04:27If you have a great product, and in this case, it's the repulsiveness and the danger if you go with him in this case, and that's why Europe is going to abandon him. And so is Canada, as Canada has. It's not just that. And there's plenty of, there's going to be plenty of competitors in the Starlink business very soon. Anyways, there won't be a press announcement, but watch. In 30 or 60 days, Doja is going to be surprisingly not in the news. Okay. All right. We'll see. I'd be interested. That would be great. And then they can go to Mars, and it'll be great for them to do that. We want to hear from you.

1:04:58Send us your questions about business, tech, or whatever's on your mind. Go to nymag.com slash pivot to submit a question for the show or call 855-51-PIVOT. Scott, that is the show. When are you going back to London soon at some point? I'm going away for the weekend, and then I go back to London on Sunday. How about you? What are you up to? Oh, you know, I'm moving my mom to Washington, as I told you. I'm picking her up tonight. And then I will be in D.C., but then I'm actually going on a little vacation myself. Where are you going? Puerto Rico with three of my four children. We're going, and we're going to have a little L.U.K.

1:05:34time and be in Puerto Rico, which should be a state as far as I'm concerned. I'm excited. Amanda loves it. And so we're going to go there. I've never been to Puerto Rico. I love Puerto Rico. It's beautiful. It's a beautiful place. It's a really nice place, and it's in these United States, and people should go there. People should go to all the places that were sort of hit by our gains, too. I like going to places that are in the United States and also deserving of our attention. Anyway, I'm not a big vacationer, so I'm excited. I'm going. The new Tariff San Champagne, I feel bad. I'm going to spend my time in St.

1:06:08Bart's just to be a good citizen. Yeah, okay. All right. All right, Scott, that's the show. We'll be back on Tuesday with more Pivot. Read us out. Today's show was produced by Lara Neiman, Zoe Marcus, and Taylor Griffin. Ernie and her Todd engineered this episode. Thanks also to Drew Burrows, Miss Laverio, and Dan Shulon. Nishak Kerouas, Vox Media's executive producer of audio. Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to Pivot from New York Magazine and Vox Media. You can subscribe to the magazine at nymag.com slash pod. We'll be back next week for another breakdown of all things tech and business care.

1:06:41Have a great time moving. Lucky.