Jim Egan on the Mortgage Gap That's Dividing America
Somehow, the American consumer remains quite strong. Despite higher interest rates, tariffs, general economic uncertainty and so forth, people are continuing to spend. And yet there are some pockets of weakness that you can observe, especially if you look at delinquency data for various types of credit. But even here the patterns aren’t totally obvious, as it doesn’t break down nicely among prime vs. non-prime borrowers. But there is one important divide: Do you have a ZIRP-era mortgage or not? According to Morgan Stanley housing strategist Jim Egan, there is a massive difference in how strained people are for those who locked in their housing costs prior to 2021 vs. those who didn’t. People with ZIRP-era mortgages are benefiting from low stable payments (which have declined on a real basis), as well as broad equity accumulation. Those who didn’t are much more strained in their finances. We discuss how this is playing out, as well as the state of the housing market more broadly, which has seen rising inventories, and the possibility for an overall downturn in prices nationwide. Only Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox — now delivered every weekday — plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.
--------
35:26
The Big Gulf AI Deal That's Divided the White House
Back in May, President Trump announced this big plan whereby American tech giants would participate in major AI projects in both Saudi Arabia and the United Arab Emirates. The announcement has created divisions within the White House, and more generally among people who are thinking about the intersection of artificial intelligence and geopolitics. One argument is that this is great news geopolitically, because it gives American technology a beachhead in this crucial region. Another argument is that by exporting the chips abroad, it creates a possibility that some of the technology will leak to China, or benefit China in some way. On this episode we speak with Bloomberg News reporter Mackenzie Hawkins, who covers tech and geopolitics in Hong Kong, about the deals, the divisions, and what to watch next as the US looks to maintain its edge in these key areas. Only Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox now delivered every weekday plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.
--------
26:50
Trump Economic Advisor, Stephen Miran, on Tariffs and Tax Cuts
The Trump administration seems to have a lot of big ideas about reshaping America, including its economy. We've seen the unveiling (and delaying) of sweeping tariffs aimed at boosting US manufacturing. The 'Big, Beautiful Bill' is currently working its way through Congress and features a lot of supply-side economic ideas, including an extension of tax cuts. So do all of these things work together to boost growth? What happens if that growth doesn't materialize? What is the administration's ultimate vision for the US economy? And what are they seeing right now in terms of things like inflation and employment? We speak with Stephen Miran, Chair of the Council of Economic Advisers at the White House.See omnystudio.com/listener for privacy information.
--------
40:25
Ricardo Hausmann on What it Takes to Win a Trade War
The focus of Trump's trade policies is clearly China. There are tariffs on everyone, of course, but it's the growing Chinese manufacturing might, and the various perceived risks associated with that, which have catalyzed this impulse to rethink how America trades with the rest of the world. But can the US actually move the manufacturing center of gravity? On this episode we welcome back Harvard Professor Ricardo Hausmann. We've had him on before to talk about the importance of economic complexity -- the capacity to build complex things -- in measuring the wealth of nations. On this episode we use that lens to discuss tariffs and the trade war, and the risks that the new administration's policies will play in reducing our capacity to build the most advanced things. Only Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox now delivered every weekday plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.
--------
44:07
Vladislav Zubok on What the Cold War Actually Was
These days, it's common to talk about the emergence of a New Cold War that exists between the US and China. It's debatable whether or not this is a useful framing. But in order to answer the question, it requires that you have some conception of what the original Cold War actually was. Vladislav Zubok, a professor at the London School of Economics, has a new book out on exactly this question. In The World of the Cold War: 1945-1991, Zubok attempts to explain how we should understand this period, which he sees as both an ideological battle, as well as a geo-strategic one — and also a battle that the two main actors (the US and the USSR) saw very differently at the time. In addition to understanding the contours of that tension, we discuss its applicability today, as the new administration attempts to re-arrange our relationship with China and the Middle East, as well as other rivals, allies, and partners.Only Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox — now delivered every weekday — plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.
Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.
México