AI is Taking Jobs — Here’s How to Stay Indispensable

25:56And I also try to find companies that have avoided, haven't had a big layoff yet. So these are the companies that Mia came up with that seem vulnerable right now. And our prediction is that they'll probably announce some pretty significant layoffs in the next three or six months. Etsy, Pinterest, Airbnb, PayPal, and HubSpot. But those are the companies that Mia came up with. What are your thoughts, Ed? It's tough because this whole argument about whether AI is going to take your job has been front and center. And in many cases, the arguments that we heard from those tech leaders are actually correct.

26:36It's going to create a lot of value. it's going to probably create new jobs in interesting places that didn't exist before. And that's always been true of any big new technology. What seems to be lacking from the conversation is a recognition of the short term. We all, I think, agree. I agree. I think you agree that over the medium and long term, you're going to see value creation and therefore job creation. We seem to all be unwilling to acknowledge the elephant in the room, which is the short-term job destruction, which is what we are now seeing this week and what we have been seeing for several weeks.

27:19The fact that Amazon is cutting 30 ,000 corporate jobs, 10 % of the white-collar workforce. The fact that Intel is cutting 24 ,000 jobs, Microsoft cutting 7 ,000 jobs, and all of them, when you get down to it, are doing it because of AI. And it's not just white collar, it's also blue collar, because as we just learned from the New York Times, this report, looking at Amazon's internal documents, they're planning to automate 75 % of their operations, which is going to wipe out more than half a million jobs. They're the second largest employer in America. And if Amazon does it, look at Walmart as an example, they employ 2 million people.

27:58do we really think Walmart's not going to follow suit? So I think what is missing from the conversation is a recognition that actually some people should be very worried about their jobs, and some people are going to get laid off. And we can look through history and see this happen time and time again. When you had the computing revolution of the 80s and the 90s, there were entire swaths of occupations that were just deleted. Typists, file clerks, bookkeepers, etc. Those aren't interesting or important to us now, but back then, it was quite painful. And there are studies that show that some people were able to retool, but the older people actually weren't.

28:41Many of them actually just had to retire early, so we saw significantly higher retirement rates, and then also dramatically lower earnings among those people. And so we can look at this stuff long term and we can say, yes, we're going to see lots of jobs 30 or 40 years from now. And on a societal level, great. But on a personal level, that's a really long time. So I think what is important and what we will get into in this conversation is, okay, a recognition. Actually, some of you, some of us should be worried. And we can talk in sort of broad generalizations about the future and how society is going to prosper.

29:25But yes, there will be individuals who get burned because of the AI revolution. And it is worth addressing those concerns and thinking about who's going to get burned exactly and also what they can do about it. I don't think it's a bad idea to always be a little bit worried that you're going to lose your job. You don't want it to create anxiety. You don't want it to be debilitating. But it's never a bad idea to just think, okay, how can I be indispensable? How do I increase my currency in the workplace? and also just to do an assessment, if you've figured out a way to kind of have a great remote gig where you don't maybe work four or six hours a day, not the full eight, you add enough value, but you're not really driving value, just know you may fool your corporation for a year, two years, three years.

30:15Eventually they figure it out. And AI is creating all sorts of tools now where they can absorb all sorts of data from the frequency of your emails, the content of your emails, your logins, your time on the computer, the type of activity on your computer, which they all track. It's scary, but yeah, we are living in sort of an information age Stasi's Germany. And then AI will say, you know, these 300 people don't appear to really be working very much. And so I don't think it's a bad idea to assume there's total transparency into what you're doing. And okay, so what does that mean? Quite frankly, if you're not adding that much value, not working that hard, eventually they're going to figure it out.

30:53Maybe you don't care, may be willing to lose the job, it's worth the risk. But one, assume they can see everything. And then if you're doing a lot of good work, also at that point, assume maybe they don't see everything and make sure that people around you and your manager and your reviews kind of know the good work you're doing. I just think when people are drawing up these lists, I hate to say it, it's somewhat rigorous, but it's somewhat not. And that is you're going to see a disproportionate, I believe, amount of layoffs in remote workers because they have weaker emotional bonds with the people making these decisions because relationships are a function of proximity.

31:32But also, if you were able to go into your boss or present on how AI is going to impact your group and show three, four, five dozen actionable steps for more productivity and how you think it can really improve your group's performance, that impression is probably a good impression for them to have or any other technology, a good impression of your brand before they drop that list. Yeah. So play offense, not defense. I think trying to hide during layoffs thinking they're not going to notice you is the worst thing possible. Terrible idea. It's the invisible people that get laid off first just because they don't know you.

32:10They don't care about you. They The other thing is just emotionally, two things. One, recognize a lot of your success and a lot of your failure is not your fault. And you shouldn't take a lot of your success and a lot of your failure personally. And that is these layoffs are pretty indiscriminate and they're going to, sure, the superstars, someone evangelizing for them will try and save their job and probably will, or they'll find something else for them within the company. But a lot of people get laid off. There are very few people, the wealthiest man in New York, Michael Bloomberg, I think he's the wealthiest man.

32:48He got laid off from Salomon Brothers. There's just very, I think I've been fired from every job I ever had. There's just, it just happens. And you should recognize that it's not an indictment on you. It doesn't mean you're not going to be really successful. It's just a natural part of the corporate life cycle. Don't be afraid to ask people for help. Yeah, I just got laid off. I'm looking for a new gig. Also, this is such a cliche, but maybe think of it as an opportunity to really, really reevaluate where your human capital would be best served. So I think it's an interesting time to sit down, clear your head, go speak to a couple people or a few people, say, this is what I'm good at.

33:26This is what I like. These are kind of my financial needs, what's important to me. And brainstorm potentially about an entirely new career, starting a business. Maybe it's sticking in the same industry and just going doing the exact same thing for a competitor. Maybe it's going back to graduate school. And the other one thing I would say is maybe take a couple days to mourn, but immediately get on to the next thing, whatever that is. Immediately start interviewing. Immediately start networking. Be really social. Go out a lot. Meet friends. I think if you want to help your career, the best thing you can do over the long term is to be more social.

34:04but also just to be honest, there is going to be a lot of layoffs here. And you know, my fear is that young people, I remember I've had several young people break down and cry when I've laid them off. And I just wanted to figure out a way to say, you got to trust me on this. This isn't that big a deal. You're going to look back on this and you're going to be more upset at how upset you were than what happened here. And also if it's not working for you here, you don't want to be here. This isn't good for you. If for whatever reason, fairly or unfairly, the people here in the organization doesn't value your work, you don't want to be here.

34:40You want to go somewhere else. I first just want to clarify who should actually be worried. There is no question AI is taking jobs, but it might not be taking your job or it might be taking your job. So I think The question you have to ask is like, okay, who is actually at risk here? Who should be worried? So Microsoft had this AI report where they basically did this giant study and looked at all of the jobs that are most at risk of being replaced or having the tasks done by AI. And I just want to go through a few of these jobs because it's important if you have one of these jobs, the point being, you should probably be worried and you should probably be listening and thinking about ways that you can protect yourself.

35:29So just going to go through the list here. Sales representatives, customer service representatives, ticket agents and travel clerks, telemarketers, public relations specialists, management analysts, here are my favorites, news analysts, and also market research analysts. So in a lot of ways, me. There are many other jobs that they have in this report, but they are kind of smaller jobs, jobs that don't really have high employment. But the jobs that I just outlined there, these are very, very common jobs in our society today. There are more than 1 million sales representative jobs in America today.

36:10There are more than 2 million customer service representative jobs in America today. So these are big, big occupations. They employ a lot of people. And according to Microsoft, and I agree with the report, they are most at risk of being replaced. So those are the people who I think you should, if that describes you, I think you have real reason to be worried. We'll come back to what you do about it. Now I just want to go over the jobs that are actually not at risk and which I think are going to be rewarded in the future. So some of the jobs that are described in the report. water treatment plant and system operators, roofers, industrial truck operators, tractor operators.

36:56So a lot of jobs that are vocational and that honestly require use of your hands. Things where you have to be getting in there physically and have some technical and physical expertise. And then the other side is there's a lot of human care work that is not at risk of AI. So nursing assistants, housekeepers, phlebotomists, massage therapists, those are the kinds of jobs that are least at risk of AI. So when we think about this, you want to think about who are the AI winners and it's construction, it's physical maintenance, it's healthcare, it's surgery, you know, human care work, vocational, physical, technical work.

37:39and then the AI losers, it's all of the sort of, I mean, just think it through logically. It's the jobs that AI can do. Sales, administrative support, data analytics, computer science, mathematics, those are all the jobs that are most at risk. So I think the question then is, what do you do about it? And if you are an AI loser, I will just go through some of my recommendations that I think are very similar to yours. So the first thing that I would recommend, if you're about to see layoffs, you want to be the person who is close to the guy who decides the layoffs. So what you've got to do is you have to identify the decision maker at the company, and you have to establish a personal relationship.

38:23I mean, Scott, you said it. Don't hide. If you're invisible, then it's very easy to cut you off. Second thing I have on my list here, try to become the AI person. That might mean you adopt some fluency with AI tools, you start using them, it makes your work more productive and more efficient. But also, quite importantly, you want to brand yourself as the AI person. You want to communicate to your peers, I'm the guy who knows about this stuff. And that might mean you start writing blog posts, or you talk about it on LinkedIn, or you send podcasts to people about AI. You want to show to the decision maker, I understand this stuff.

39:07So if you're cutting people, you don't want to cut me because I'm the one who's going to help turbocharge your business with AI. I have two more. Have an opinion. AI is very good at analytics, but it's very bad at having an opinion. So if you can figure out a way to develop a position on issues, if you can weigh both sides of the argument and then ultimately take a side, because AI is bad at doing that. All it says is, here are all the different things that are going on. But if you can be the person that says, yeah, I know all the different paths that we can take as a company, but I believe that this is the one that we should take because this is my opinion on the issue.

39:44That's alpha. That's something that AI can't do. And the final thing here, and it goes back to what you said, and I think it fits with also your career. I think you need to be willing to reinvent yourself. And I don't think you should be ashamed of reinvention. that's what a lot of people are going to have to do here. If you're being laid off at many of these tech companies, you're kind of being faced with this decision of like, do I go out into the market as the same thing that I was that got fired? Or do I rebrand and do I reinvent? And I think there's a lot of shame in reinventing, but I just want to highlight that many of the most successful people in history completely reinvented themselves.

40:29Just some great examples here. Vera Wang, who is the legendary designer. She was a figure skater before she got into design. Martha Stewart was a stockbroker before she became the media mogul. Reed Hastings was a math teacher, and then he founded Netflix. Ray Kroc was a door-to-door equipment salesman before he built McDonald's. My favorite reinventor is Arnold Schwarzenegger, who was a bodybuilder, who then decided he wanted to be an actor, and then he decided he wanted to be the governor of California, and he was able to do all of it. I think that my point being, there are many people who were incredibly successful, who reinvented themselves and who leaned into it, who were not afraid or ashamed to say, I used to be this and now I'm this.

41:17And as I say it, I think you're a good example of that too. I mean, you were an analyst and then you said, okay, I'm going to go to business school and I'm going to try something completely different. You started companies. And then after you started your company, you said, now I'm going to be a professor. And then after you were a professor, you said, now I'm going to be a podcaster. So I think a lot of this is also about reinvention. AI might take your job, and let's just acknowledge that. But as you say, take stock of your talents and your abilities, and don't be afraid to reshape them, to rebrand them, and to reinvent yourself.

41:53I think that's right. I think that the cautionary tale is that my friends, I have a lot of friends in the hedge fund business or the finance business. And in the odds, it was sort of the golden age. I think like 95 to 2010, I think people look back and say, maybe with the exception of this era in technology or AI, never have so few people made so much fucking money with so little talent than hedge fund managers from 95 to 2010. And that's not to say that they weren't talented, but if you were a really talented lawyer, accountant, actor, whatever, journalist, you made X. If you were a reasonably talented hedge fund manager from 95 to 2010, I'm not exaggerating, you made 50X.

42:42And there are a lot of people, especially white men, who if they get the right certification for the first 10, 5, 10, 20 years of their career post-college, it's just up into the right. And I'm not exaggerating. When it goes flat or they get laid off or they can't raise their fund or whatever it is, they literally fucking freak out. And I don't mean freak out in an extroverted way. I mean they become paralyzed. and what i would suggest is you have to if you have to take a pay cuts which industries whatever it is your emotional resilience and not feeling sorry for yourself and not you know acknowledging everybody anchors off they look at the year they made the most money and they think that's my fair market value and the next year's fair market value should be 12 more and right now you could argue every person in AI is wildly overpaid.

43:35None of them think they're overpaid. Nobody, I've never had anyone after a job review and a bonus go, thanks very much. Let's be honest, I'm overpaid. I've never heard anyone say that. It's either like, well, okay, I'm fucking amazing. Thank you for paying me this ridiculous amount of money at a ridiculously young age, but I'm the fucking bomb. Is there a subtweet? Or, or, or what? This is an outrage. it's never like wow look the company's doing great the economy's strong we're making a ton of money and i'm probably making more you know my comp's probably but i've never heard anything resembling that people anchor off the top and that's okay fine but emotionally recognize in your career you're going to have ups and downs and the winners are the ones that quite frankly endure the downs.

44:29They use it as motivation. They get out there. They use it as an opportunity to rethink what they want to do next, and they're resilient. And that's what I worry most about your generation, Ed. If you're 35, you've never known anything but a bull economy. The other thing about these people being laid off, these are some of the most remarkably credentialed people in the world. I mean, you got to keep in mind that the 30 ,000 people are about to go to whatever it is, the 14 ,000 or 30 ,000 people from corporate and Amazon, 99.9 % of the world's population would kill to be the person who just got laid off from Amazon.

45:08Why? It means you likely went to an elite university. You're obviously very good or you never wouldn't have got a job at Amazon. You have Amazon on your resume. You're now like pissed off because you're not going to make 300 grand a year. You might have to take a job at 220. money, 99.9 % of the world would kill to be one of those people that just got laid off from Amazon. I mean, I see what you're saying, but I slightly take issue with it because, I mean, 30 ,000 of those jobs that are being cut, I don't think the majority of them are making $300 ,000 a year. Plus, it's not just limited to white collar work and high-end white collar work.

45:44We are seeing it kind of across the board. We're seeing it with entry-level jobs. And we're also seeing it, we're going to see it down the road with blue-collar work too, which is why this report from the New York Times is so important. The fact that 600 ,000 jobs are going to be lost, and these are blue-collar jobs, the fact that they're going to basically replace humans with robots. So I think the question for people, that individual you described, of someone who was just laid off, who was sold this story about how AI isn't going to take their job, and then they wake up one day and actually AI did take my job, and now I'm resentful, I'm angry and I feel that I was lied to, there are going to be not hundreds or thousands of people, but hundreds of thousands of people who are in that position over the next few years.

46:40And I think the question is, what do you want to do about that? Do you want to be the person who does flatline? And many of them will. Do you want to be the person who is grieving about the lie of AI and is never unstuck from that position? The danger is this flatline. And the flatline can come from different places. I've never, what's interesting is what sidelined me, and I never would have thought about it, when I lost my mom, it like sidelined, and I wouldn't have thought that that would do it. I would have thought I was so focused on money, I would have thought, okay, a business or going out of business or the markets going down.

47:21You know, the dot-com implosion hurt, but it didn't take me off track. And the great financial recession scared the shit out of me because I just had a kid. The thing where I should have reached out for help sooner because it almost took me down and I didn't expect it was losing my mom. And the reality is all of us are going to face tragedy. It's the only thing I know for certain is that everyone will have joy in their life and everyone will have tragedy. And how you respond to the tragedy is really probably the biggest indicator of your success. Because some people just never recover. They just never manage to get back on their feet.

47:57They lose their sense of it. Winston Churchill summarized it perfectly. Success is the ability to move through failure without losing your sense of enthusiasm. This was a guy that made the military decision to sacrifice thousands of young Australian men with a total fucking military disaster called Gallipoli. He was responsible for terrible decisions that killed a ton of teenage and early 20s young men. and yet he managed to, I mean, that must have been devastating. Maybe it's even a little bit sociopathic, not psychopathic, but he managed to believe I can add value. And I think there's a practice around meditation, maybe seeking therapy if you feel like you're stuck, and also just repeating over to yourself.

48:44I remember thinking to myself, I know I'm a great entrepreneur. This company went out of business, but I'm hardworking. I'm willing to take risks. I know I got hurt very much a couple of times when I was younger because I had women break up with me that I was madly at least in love with. And of course, as an insecure young man, the moment they broke up with me, I decided that that was the one that I would never recover. And being able to look in the mirror and go, I know I can add value to someone's life. I know I'll be a wonderful boyfriend. And also to say, you know you can add value to a company.

49:17You know, I think it's really important to just tell yourself that over and over and start manifesting it until you start believing it. And also every day to just one foot in front of the other. Also, this is sounding very, you know, like a bad version of Mel Robbins with a Gen Z and an old man who drinks too much. But use it as an excuse to get really fucking fit. Try and take an hour or two hours a day. Try and limit your alcohol and your THC consumption and use it as a means to get really fit. Because I find just being strong is really good for you emotionally. Try and catch up on some stuff, maybe spend some time.

49:56I just, I think try and look at it as, all right, I'm not going to wait around. I'm going to get right on it. But also you will have at least a couple hours free a day. Try and channel that into important activities as opposed to just sleeping in or feeling sorry for yourself or becoming, you know, really getting really into that new porn site. I can imagine and just sort of hear the retorts from people, say, from someone who just got laid off, who would say, oh, so the solution is chin up, be resilient. Work out and look in the mirror and tell me I like me. To which I say, actually, yes, that is the solution.

50:31Like these soft things that people often kind of poo-poo is like, oh, you're just offering some wishy-washy advice as to how, when it's like, this is a structural problem. It's like, well, give me an alternative. If you really want to improve your life, what are you going to do about it? And I agree. I think my generation, I don't know, maybe we, I think we, perhaps we underestimate this generation. So I think we'll see, we'll see what happens and how we react when AI inevitably wipes out a ton of entry-level jobs as we are seeing today. my hope is that we will be very creative and resilient and i think i'm actually somewhat optimistic that we will be um but that is the question for young people ai is going to take your job potentially depending on what job you have how are you going to respond to that

51:30we'll be right back and for even more markets content be sure to sign up for our newsletter at profgmarkets.com slash subscribe.

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53:56We're back with Prof. G Markets. Last week, President Trump and Xi Jinping met face-to-face in South Korea. It was their first in-person meeting since Trump's second term began. The result was a trade truce. China agreed to pause its export controls on rare earth elements for a year. And in return, Trump cut tariffs on China-related fentanyl products. to 10%, bringing the overall tariff rate on Chinese goods down to about 47%. But there's still a lot that we don't know, like whether this truce will affect Nvidia's chip exports or TikTok's future in the US. So, Scott, Trump and Xi, they met. The overall takeaways, the fentanyl tariff has been reduced from 20 % to 10%, so the overall tariff on China is now down from 57 to 47 percent uh america is also going to suspend these port fees that we saw china is going to end its boycott of the soybeans which trump and the farmers were very upset about uh china is also suspending these new export controls on rare earth minerals they said they're going to step up their control on on the chemicals that are used to make fentanyl we'll see uh but those are that's the long and short of it, your reactions to this meeting.

55:16My reaction is this is a lesson in really poor strategic thinking. And that is the key to one of the keys to strategy when you're negotiating is to really have an accurate assessment of your leverage and their leverage. And I feel this is one of Trump's many Achilles heels. And that is he plays, he thinks he's playing with a stronger hand than he is. He thinks he's the biggest customer of China and just can just muscle around. We're actually the third largest trade trading partner with China. The biggest is ASEAN, the Association of Southeast Asian Nations. Number two is the EU. The EU is more important to China than the US.

55:49And he acts as if he's their only customer. He's the only member of a club, if you will. So he's never really appreciated that he's playing with cards that he doesn't have. And two, I don't think anyone really game-theoried out what is their bazooka. And unfortunately, they've learned what it is or they figured it out and they're willing to use it. And that is rare earth materials. I mean, these things, you know, a single submarine can require 8 ,000 pounds of rare earths. The F-35 jet requires 900 pounds. It's literally a security issue for us. And they threaten to not only reduce exports to us, but to put controls on any product that has rare earths such that it can't get to a Western nation which it didn't take people very long to say, this could end the war in Ukraine in a way we don't want to end it.

56:40If all of a sudden the U.S. has an inability to produce many weapons as they thought, because we did not stockpile these rare earth materials, on the marginal side, we would cut armed shipments to Ukraine. So they pulled out this weapon. And if you'll notice what they've agreed to, again, I hate this word framework, meaning we want to pretend this was a productive meeting, but we don't actually know what's going to happen. And the thing that really struck out to me is that it's a one-year, they've suspended rare export curves for one year. That's nothing. That means that, okay, China got some stuff back.

57:16They lowered the tariffs. They seem to have come to some sort of like, it feels like they're just kicking the can down the road. Meanwhile, Their bazooka, I mean, it's not, they put the safety switch back on, but they're still pointing that gun at us. In six or nine months, it's going to be, okay, what if we do if we don't find, what if they decide to cut this off? They basically said, when you say I'm only suspending this critical technology or this critical mineral used in your weapons, your cars, and if you don't do it, you know, if we can't figure out a way to get along, we're going to use it.

57:56this is nothing but, this feels like a very tenuous ceasefire to me. My sense is there hasn't been, and quite frankly, until Trump's out of office, I don't think we're going to have a sustainable, enduring relationship with China. And I'd like to say, well, what about Xi? She's probably there for the next 10 or 20 years. He's consolidated power. So I don't know if this feels like we've avoided an all-out economic war at a time where we didn't want it right now. But I don't feel we came away from a lot of this here. Their bazooka is still aimed at us. We put it off. They've agreed not to fire it for 12 months, which just means in six months, we got to start freaking out about it again.

58:41Or we'll start freaking out about it in a month because they'll just abandon it, as we have seen over and over again. I mean, I think that's the problem with these framework agreements and these handshake deals and this press release economy or press release politics is what we have found is that it's very easy to just break these agreements. We keep on seeing this because they don't really put it in writing. Signatures are not put to, pens are not put down to paper. We don't see signatures. We don't see contracts signed and people going over the language and understanding what the language actually means.

59:18All we see are press releases, which means that the cost of abandoning or doing a 180 on your quote-unquote agreement is not that high which is why we keep seeing it over and over again the tariffs go up the tariffs come down they're on they're off we have a truce we don't have a truce they say oh we're going to have these that we're going to loosen the export restrictions but then they're going to tighten them again now they say they're going to loosen them again i think the point being saying the words, we're going to suspend these export restrictions for a year, is not a powerful or binding statement.

59:54And so I think what we could probably expect is that it will not last. And so this is definitely still a problem, the rare earth issue. And I think all that this has done is highlighted China's leverage on the US. I mean, none of us really knew what rare earth minerals were like a year or two ago. I certainly didn't, or at least I knew conceptually what they were, but I didn't know their significance. And I certainly didn't know that China was a major player in that industry. And now we all know China has big time leverage over us. I mean, we didn't even realize how important these things were, but we need these minerals for missiles and for cars and to create chips.

1:00:43I mean, because of those export restrictions, we saw a ton of stoppages, a ton of closures, because there was this shortage in rare earth magnets. I mean, Ford had to close down an entire factory in Chicago because they didn't have enough magnets to build the cars because China shut them down. And we all learned now, China controls 60 % of the rare earth mining, 80 % of the rare earth processing in the world. None of us knew that before. And now we do because they flex their muscles and it has shown, okay, China does have a one-up on America. So I like what Josh Brown says. And that is you have to always ask what could go right.

1:01:24And just as China figured out workarounds for when we embargoed our highest quality AI chips, and they came up with their own LLMs and chips that required less energy. I think there's actually, what could go right here is that we figure out different supply sources for rare earths. A good friend of mine who has been in private equity his whole career just took a job with the defense department. And his job is to find and invest in companies who reduce our reliance on Chinese rare earth and other critical components that weaken our defense posture. So to the administration's credit, they've been thinking about this.

1:02:04Retroactively, after they realized, oh, fuck, we're screwed. You could argue they probably should have figured this out sooner that we were so dependent upon these things for critical. Right. Before you launch a trade war, maybe make sure that you have the leverage. You're sounding more and more like me. So, but, you know, under the auspices of, again, asking yourself what could go right, potentially, potentially we find different different supply chain here, different sources here. I don't know enough about them, but the investment opportunity, which it was right to come down to, I would love to go further downstream and say, okay, what company, if you're some shitty little company that's in Latin America, I don't know, wherever that's been, that does have the ability to produce these things and these, I guess, these magnets, you got to think that company's getting a lot of attention right now.

1:02:50And it's going to have a lot, a lot of suppliers would love to do business with them because they'll think of them as being a more not being tainted by geopolitical concerns. But this is like, I've said that I thought that at the end of the day, by the time Trump leaves office, we're going to end up with largely trade agreements that largely reflect where they were before he came into office with some higher tariffs. But we will have erect alliances, created unnecessary tension, unnecessary risk. And this is all just a massive, it feels like a massive distraction that kind of gets us I don't want to say it gets us nowhere.

1:03:26I think it gets us backwards and just don't get the strategy here, what they're hoping to get out of this. I do think his instincts around China were right. I do think we had an asymmetric trade relationship there where they were taking advantage of our open markets and theirs weren't open.

1:03:43I had never heard the term rare earth material until about a year ago. And all of a sudden, you find out that we can't produce fighter jets or submarines without them. and our biggest, arguably our biggest adversary or our most powerful adversary controls all of the market. Right. And I, by the way, the big question is, did Trump even know what that was before he launched this attack on China? Was he aware of rare earth minerals and critical minerals? And was he aware that we need them for our defense industry and to manufacture missiles and tanks? Did he know any of that? Or is he only just realizing this now?

1:04:18The team of the best players wins. And there's a couple of things we're not focused on, and so is the boring shit underneath the surface that really fucks you. Two-thirds of researchers are now saying they're open to moving abroad. So we're about to lose our intellectual capital, which people don't appreciate. And these guys don't appreciate because the effects pop up. You don't even miss the fact that you didn't come up with a new way of pricing derivatives that makes a U.S. bank much more competitive internationally. You don't miss, okay, we're no longer producing the best CT scanners in the world, right?

1:04:51Just someone else does it. It's now coming out of Siemens because the world's top researchers and mammography or whatever it is end up at the University of Cologne because they're like, I'm sick of this shit. So when you look at them, generally speaking, if you look at how incompetent some of the higher profile hires have been in the Trump administration, you got to think it infects at every level. And I just wouldn't be surprised if no one even brought up rare earths until they showed up and said, oh, we're embarking on your rare earths. Certainly what it looks like. Well, if you want to see how good a baseball team is or how good an organization is, you look at how clean the dressing room is.

1:05:32You look at the quality of, you know, you look at how well run the cafeteria is because it's a general approach and a culture to hiring outstanding people and making sure they feel appreciated and putting in place the right compensation, the right incentives. And if his senior level hires, ranging from a guy who's a vaccine denier to a former TV Fox host, fat shaming people as any indication, or a former head of a wrestling federation is now in charge of the Department of Education and didn't know what AI was. Did you believe that? When she was grilled about AI, she called it A1. She didn't know what AI was.

1:06:08I forgot about that. So what do you think the number two, three and four thousand of the Department of Education have been hired by Trump are like? And they just hired this. I mean, anyways, I'm ranting here, but would it surprise me if no one when they showed up and said, well, we're going to block shipments and exports of rare earth and someone said, what's rare earth? And it shows in the way they have negotiated. They launched the attack. They say we're going to flex our muscles. China flexes their muscles right back, and then suddenly Trump's off in Asia, meeting with Xi Jinping, saying, hey, man, please, please stop.

1:06:43Stop doing what you're doing. You're putting forward a thesis that a lot of people would say, like, oh, you're just being Trump deranged. It's like, just look at the way events unfolded. That is simply what appears to have happened. They didn't realize that China could do what they did. And so then they suddenly started panicking. It just reflects poorly on us and our competence. And I don't think, I think Americans have taken for granted for a long time, just the quality and depth of talent we have working for us in our government. And there's a general like, oh, you know, it'll be fun to see what it's like to not have air traffic controllers or all these people, all these employees.

1:07:23You don't realize there's a lot of talented people trying to figure out a way to get your grandfather's prescriptions mailed to them in a rural area. You forget how hard it is to do physical rehabilitation for our veterans. You forget how important it is to have in tax laws enforced such that we actually have a treasury. You forget how hard it is to actually guide a plane when there's 11 ,000 planes in the sky concurrently. These people are good at what they do. And a lot of people who have a lot of opportunities to grow into other industries decide they want to work for the government and because they find purpose in it.

1:07:59And we've just taken for granted these folks, their competence, their commitment, the fact that most of them, a lot of them are working below market. Some are probably working above market, but many of them are working for below market fees. And I think we're finding out painfully what it means to have a cacostocracy, which means a society run by fucking idiots. And anyways, I'm not, back to China. I think we've just kicked the can down the road here. I think she knows he's playing with a stronger hand, and Trump has made a rookie mistaken strategy, and that is believing he has assets he doesn't have.

1:08:32All right. Let's take a look at the week ahead. We'll see earnings from Palantir, AMD, Uber, Pfizer, Novo Nordisk, Spotify, and Airbnb. We'll also see the results of the New York City mayoral election, and the Supreme Court is set to begin hearing oral arguments on the tariff case on Wednesday. Scott, any predictions? Mondami is going to win. Uh, and my prediction though, is that you're not going to see an exodus from the city. Uh, I think there's actually one of the most unfortunate things about the city. I think right now is it's become so expensive. There's been so much inflation that the scrappers really talented, hardworking people in a variety of industries who want to come here and just kind of make it on raw, raw talent and dancing between the raindrops.

1:09:16I think we've lost those people, which will hurt the economy over the medium and long term. That has nothing to do with Mondame. He's going to win. But all these people threatening to leave and corporations threatening to leave, I just don't think that's going to happen. One, I don't think that the structural – he has actually – I don't think he has the authority to make many of the changes that these corporate leaders are worried about. And I just – I've always found that, quote, unquote, whenever people are threatening to leave, that's not when they leave. You know, everyone was going to leave California.

1:09:46and as someone who's in New York a lot, the reason why there's the highest taxes in the world here is because it's worth it. And if you have the money, which these corporations do, and these rich people do, I'm not, and I don't think these, it's sort of a false argument because I don't think he's going to be able to raise taxes. I don't know if he's going to be able to do it. I think if you look at his actual power, I'm not sure he has the power to do these things. That's one small prediction, But the other prediction just goes back to what we were talking about before. And that is, I think we're going to see significant layoffs.

1:10:22And Mia did this work at a variety of other information age companies. And our picks were Etsy, Pinterest, Airbnb, PayPal, and HubSpot.

1:10:34This episode was produced by Claire Miller and engineered by Benjamin Spencer. Our associate producer is Alison Weiss. Mia Silverio is our research lead. Our research associates are Isabella Kinsel, Dan Chalon and Kristen O'Donohue. Drew Burrows is our technical director and Catherine Dillon is our executive producer. Thank you for listening to Prof G Markets from Prof G Media. Tune in tomorrow for a fresh take on the markets.

1:11:00Lifetimes

1:11:05You have me In kind reunion

1:11:17As the world turns

1:11:22And the dark flies In love

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