Receipts Live: Trump Has Absolutely No Idea How Trade with Canada Works

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1:03I'm with Catherine Rampell. We got receipts live. And look, usually Catherine would drive this when she's with JVL, but she's with me today, and I know nothing. And so I'm going to have to pepper her quite with the questions. Before we begin, we're going to be talking about a couple things. Canada, the day after, the lake Ontario, not calling it Lake America. Press conference. We're going to be talking about the straight-up promos. There is like a big thing underway. I'm sure people have seen it to assure folks that the street is totally clear and fine, and we should just go through it. It seems a little bit too on the nose. And then we'll have a couple of topics. Kevin Warsh had to speech this morning at Jackson Hole. That was where it was, right? Yeah, okay, yeah. Where I, in classic Kevin Warsh fashion, I'm not sure he said anything, but he may have. And I just can't tell. Catherine's going to break that all down for us. But before we do that, Tim always does this. So I'm going to do two. You guys got to subscribe to our feed. We're doing like robust economics, as well as silly magas stuff.

2:05It's the whole popery of contents. So boost the feed. Subscribe. Hit like. Do all that stuff. We got to catch up with the mag, a grifter is in all them who have figured out the YouTube algorithm. All right, Catherine, let's start with Canada. How are you feeling a day after we changed the name of Lake Ontario? You know, pretty much the same. Oh, no. Pretty much the same. Yeah, I mean, it'll always be like Ontario to me. Although maps are going to get a lot more confusing, I feel like if Donald Trump really starts cracking down. Like, didn't he crack down on who he got mad at the AP? He got mad at the AP for Gulf of America because they're like, I'm going to do it. But then Google maps, I think, did change Gulf of Mexico to Gulf of America. So it is, there's like a bit of a who's going to do it. And I'll tell you someone who hasn't done it yet, who hasn't changed the name of the map. Who's that? The government itself has not yet changed the name up. I've been checking out this page on the government, which is where they denote and map out the

3:11Lake Ontario. And there it is. The government website, it's from the FWS, which is why am I blanking out? Fish and Wildlife. Fish and Wildlife, yeah. Yeah. So they have, I was looking through all the federal government databases and looking and searching for Lake Ontario. And as of this morning, there it is. Still like Ontario on our own federal government's website. I'm sorry for putting a spotlight on the poor people at the FFF. Absolutely. You're going to be fired. You're going to be fired. You're going to be fired. You're going to be fired. You're going to be fired. You're going to be fired. You're going to be fired. You're going to be fired. Yeah. Beautiful Lake. I feel for it. Yeah. Look, my feeling about all of this is it's incredibly stupid. Obviously, it's also something of a distraction from the much worse stuff that he is doing to destroy our relationship with Canadians to make affordability worse, to destroy lots of economic opportunities on both sides of the border. So it's like, yeah, it's fine. Okay. Yeah. That's fair enough.

4:12And I copped to sort of ignorance here. Why are we fighting with Canada? Like what was, what was, but I'm not I'm not saying that rhetorically like I know what I'm not saying that rhetorically like I know what I'm going to do. Yeah. I know. I think that's a valid question. Like that's not a dumb question. I don't think that I'm not going to have to go. What happened over the past week that like made us do this? Um, really unclear. Donald Trump had been okay to back up a little bit. We have a trade deal with Canada. He had a trouble going to make it. Exactly. And that was the best deal that America ever got. The USMCA, although in Canada, they call it the CUSMA or something like that. Whatever. He said that it was a great deal. It was not appreciably that different from NAFTA, which it replaced. It had some other language cribbed from the Trans-Pacific Partnership, which was another trade deal that Donald Trump tore up that he said was terrible. Like really, he just smushed together these two prior trade deals and lapped his name

5:13on it and said it was fantastic. Now for whatever reason he has decided he wants to go back to the drawing board. He slapped a bunch of different tariffs on Canada in the past year, allegedly for sending fentanyl over the border. He's also accused them of facilitating forced labor, import's made of forced labor or whatever, like a bunch of bullshit stuff, basically. And so the United States and Canada have been negotiating basically with a gun hell to Canada's head how to get rid of some of these tariffs and come up with a new trade deal, which again was sort of apropos of nothing. It's not like there was something that happened that made us need to get this done. These negotiations have been going on for a little while. And so, basically, both sides, I think, had said that they were very close to a deal, a new deal. And then according to Mark Carney, the United States came in at the last moment and basically

6:20through a bunch of poison pills in there, including demanding that some of the French cultural requirements get stripped. Even though those are in the Constitution, the Canadian Constitution. So there were things like that. The United States wanted to have basically have kind of veto power over Canada's trade negotiations with other countries, essentially turning Canada into a vassal state of the United States. Well, it's not confirmed because that seemed totally ridiculous to me that the United States would get veto power over like Canada's trade. I mean, there are more nuances to it than that, but basically they had to follow whatever our trade policies were at least. Why would they ever forfeit their sovereignty in that sense? Donald Trump thinks that they, I mean, he's been saying for what the past year plus that they should explicitly forfeit their sovereignty and become the 51st state. Yeah, that's a good point. So it's intellectually consistent, I guess. I don't know that that's really the motivation here. I think they were just trying to bully the Canadians. And then there's been a bunch of reporting in the times, and I think the journal and some

7:23other places about how these reports until like maybe they didn't really expect Canada to accept any of this that maybe this was all intended to blow up the deal because like the steel lobby of the United States was not happy with some of the terms there. I don't have my own original reporting on any of this, so I don't actually know. But there are a bunch of theories about what happened. In any event, Donald Trump has escalated the situation rather than just like not coming to an agreement. He has said we're going to have tariffs on first. It was it was a bunch of stuff related to like iconic Canadian goods, hockey sticks and things like that. But also, also, stuff that Americans buy, you know, furniture and lumber and we're already tariffing their steel and aluminum. So there was that then he raised it up a notch and said we're going to start tariffing Canadian automobiles and auto parts. That stuff, as I recall, has not gone into effect yet. The hockey stick basket of things, those tariffs have officially gone into effect.

8:27Auto stuff, that would be much more damaging, particularly if you look at how integrated the supply chain is over the US Canadian border because of NAFTA and the USMCA. It would just like dramatically raise the cost of doing business and the race and the cost of making a car and buying a car because it crossed those borders so many times. So Trump, yeah. Well Trump's been out there posting or talking about or offering up a bunch of statistics around how lopsided US trade is with Canada to begin with. I would love for you to sort of put some truth serum out there. Yeah. So he's claimed that Canada conducts 95% of its business with the US and that it's utterly dependent on the US market. Is that like, I mean, I don't know, is that remotely true? It doesn't seem possible that 95% again its businesses with the United States. You know, to be honest, I don't know the numbers off the top of my head. That sounds high to me.

9:2895%? Well, I mean, I believe that we are by far the biggest trading partner. That makes sense. That makes sense. Yeah. Particularly because their most important export to the United States is energy. So we have pipelines going between. So have they said, would they're going to cut off energy supplies to us? I know that there's something about the Alberta oil fields and concerns about that. And I know there's a lot of politicians, US politicians in states that border Canada who are deeply concerned about that. But is that yet taken effect? No, I mean, it hasn't happened, but Donald Trump certainly seems to be egging them on. Like he said, I think we have footage of this, but he said yesterday he was complaining about the size of our trade deficit with Canada. He tweeted similar stuff. Matt, can we play that clip? Yeah, let's play that. What would you say to those who are concerned at trade dispute with Canada could affect American affordability ahead of mid-term? Well, ultimately is going to be very good for us because when you talk about affordability,

10:33we're losing 62 billion a year on average with Canada. And if you really look at it, we're losing more than that. It's too much. It's too much. We don't want to lose it anymore. 60% is that right? He says 62 billion is what he said. So you're billion? Okay, I got you. Okay, so what he's saying there is that we lose money to Canada because we have a trade deficit with them. Oh, great. Okay, so this is wrong on so many different levels. It's like the inception of the long run. Does he think we need to have trade surpluses with the entire globe? Yes, yes. He clearly does that. That he does, which is idiotic for lots of different reasons. I mean, the fact that you have a trade deficit with another country does not mean you're losing to them, does not mean that they are ripping you off. As other people have pointed out, like, I have a trade deficit with the supermarket. I have a trade deficit with my dentist. It means that I am buying things from these counterparties and sending them money.

11:34And that's normal. We are not just sending 62 billion dollars, which is not the right number, by the way, to Canada. We are getting stuff in exchange, specifically we are mostly getting oil. So that number that he cited is about the deficit in goods. If you actually include goods, services, all the things that go back and forth that trinks it quite a bit. In fact, I think the numbers that I had looked up suggested that, yeah. So our overall trade deficit is like somewhere 20 something billion dollars. Okay. With Canada. With Canada. Okay. With Canada. Now. I can't believe we are sending them 20 billion dollars for nothing. Unbelievable. Well, our energy deficit, our energy trade deficit with Canada is like three to four times that. And somewhere around 85 billion dollars. So what that means is that outside of energy, the US actually runs a solid net surplus.

12:37We can't. Okay. And across all goods and services, they're mostly buying more stuff from us than we are from them, which we should not care about. But because Donald Trump does, I'm pointing it out. The issue is that the whole story behind the trade imbalance, if you cared about it, is energy. Hey, what's up guys? It's Hayley Bailey. Okay. I need to tell you about something. I just got YouTube Premium. It's got tons of awesome features like offline downloads so I can download my favorite videos before I travel and watch them whenever I don't have Wi-Fi. Because we all know airplane Wi-Fi is the worst. I get to add free, I get back room play and there's like a ton more in there. You should try it. If you like YouTube, you'll love YouTube Premium. Try it now for two months free at youtube.com slash premium. If you like YouTube, you'll love YouTube Premium. Hi, I'm Sean Evans from Hot Ones and I want to tell you about YouTube Premium. It has offline downloads so you can watch without Wi-Fi. Background play. So you can lock your phone and it still plays baby.

13:39Oh, and it is completely add free. Yes, I said it, add free. Try YouTube Premium for two months free at youtube.com slash premium. Trial eligibility varies, terms apply, cancel anytime. This fall in Jeep country and during the drive into fall sales event get a great deal on four by fours that refuse to be contained like Jeep Wrangler. Confidence built into every drive with the most awarded SUV ever, Jeep Grand Cherokee, and freedom that can't be denied with the open air freedom in Jeep Gladiator. After 85 years, it's no surprise that Jeep became America's SUV brand. Get a great deal during the Jeep Drive into fall sales event. Jeep is one more awards over its lifetime than any other SUV brand, even the Jeep Grill or Registered Trademarks of FCA US LLC. When Donald Trump is complaining about we are sending money to Canada and not getting anything forward or whatever, we're clearly getting something forward, but it's because of energy. So what he is basically doing when he complains about that deficit is he's inviting Canada

14:44to stop selling us energy. Right. That's what we depend on. And by the way, it's not just oil. Well look, well, oil. He's oil. Yeah, go on. So we've looked up the stats. Canada's exports to the US are not 90, whatever percentage, about 70 to 75% of all Canadian exports are to the US, which is a lot. It's a lot. If Canada were to say, hey, all right, you don't want to trade deficit, we won't sell you oil. It's not that simple, right? I mean, they need other customers. Yeah. Yeah, I mean, it would be painful for them, absolutely. But Donald Trump seems to have no qualms about inflicting lots of pain on Americans. So that he can be painful for us too, because we lose an increase in the US. Yeah, we would lose out. They would lose out. This is what economists mean when they say there are mutual gains from trade, right? That we are all better off if we continue trading with each other and we have, you know, collectively, there are some, you know, individual winners and losers, but collectively, we are better off if we can continue to buy the energy from Canada.

15:47We continue to sell, to pay money to Canada for the oil, for the hydro power. That was the other thing I was going to mention. New York City, where I live most of the time, is largely powered by hydro power from Quebec. Actually there was a big new transmission line that was built or opened earlier this year about that. So like a million New York City households would lose their power potentially if they cut off that pipeline or that transmission line as well. So we are dependent on them, but we come out ahead. Like we benefit, they benefit mutual gains from trade. Donald Trump has basically said he wants to punish everyone. Well, I mean, he doesn't what he thinks he's saying. He thinks like we're just punishing Canada if we put tariffs on them. No, we are hurt and they are hurt. If they cut us off from this very important product that we import, that they export, we are hurt and they are hurt. The question in all of these trade wars is basically who is willing to endure more

16:47pain? Well, yes and no. Well yes and no, right? Now we're going away from the economics into the sort of geopolitics, which is, I mean, tell me if you think I'm wrong here, but it does seem like world leaders have kind of wise up to this in two ways. One is, they, a lot of them just assume that he'll taco and that when it comes down to it, he'll cut some deal that's basically status quo and say he's a great negotiator. Right. Well, the other thing is I don't think they take the threat and maybe relatedly, I don't think, I think they've prepared their economies better for the possibility that there's going to be some sort of, you know, friction with the United States that, you know, Karney would give a pretty remarkable speech. Not so long ago where he talked about reorienting the Canadian economy away from the United States. And he had a tweet up and I don't know if we can get it. If we can find it, it had to do with the renaming of Lake Ontario. But really there's a part of it about how the United States was changing and that they

17:49had to realize that. And so I think it's just the reaction, the global and political reaction to what's happening now strikes me as fundamentally different than what we saw in, say, April 2025. Yeah. I think that other countries, well, it's some combination of they are trying to figure out, can they weighed him out, right? Like, are they going to make whatever concessions he wants them to make? And it's not even clear what concessions he wants to make. I think here's the Karney tweet. Yeah. So it's the third graph that really stood out to me. We know that America is changing or trading relationships, their foreign policies, their national monuments, their hard genomes, which is a fancy word for bodies of water, names of bodies of water. So yeah, I mean, he's just like, yeah, we know that this is, and it was almost like in a way he was just saying, I'm not bothered by this. Like this is just the reality that we live in and I'm not shocked. And I feel like that's just fundamentally different than where we were a year ago. Yeah.

18:50I think you are seeing other countries, including Canada, where you orient themselves to other trading partners. As I've mentioned several times when I've talked with Andrew Egger about the US Canada trade war. It's been a little disturbing to me that favorability among Canadians for China has gone up so much. So at the same time that Canadians have a less favorable attitude towards Americans, that's been going down. The attitude towards China has been going up and it's not like China has developed a more democratic system or less authoritarian policies or better human rights record or whatever. But they do maybe look like a little bit more reliable of a trading partner at the very least than the United States does, which is a horrible thing to say. And I do wonder like, so just in this example, I mentioned before that Trump is trying to,

19:50or has announced that he's going to tariff automobiles and auto parts from Canada. I wonder, like what does this mean in the long run for the Chinese EV business, which has been like BYD for example. They make these, I've never been to one, but I've heard that these are actually quite good, pretty very cheap EVs. They're just churning them out. There's been this fear that they're going to take over the global market because they're just so much better and so much less expensive than a lot of the competition. And to date, Canada has been, has, you know, had some hesitation about letting BYD or other Chinese automakers come in and sell freely to the Canadian market. Well, now that we are, but that's partly because that that relationship between Ontario and Detroit was so tight, that supply chain was so tight. Now that we look less reliable, now that that supply chain is going to maybe have some more friction in it, maybe that's an opening.

20:53For China, for BYD, like there are so many longer term implications about how our partners, including Canada, maybe reorienting the choices that they make, the economic choices that they make, and the diplomatic choices that they make, because we have just thrown a grenade in what had been a very stable, mutually beneficial relationship. And the auto sector is just one example of all of this. Like who knows what other kinds of opportunities Americans are going to miss out on and maybe China or other adversaries of the United States will benefit from? For folks who are interested in that and the EV portion of this conversation, I John think I'm sort of in a lot about this, even prior to this, how we are shooting ourselves in the foot with EV competition in China, this will hurt it more. I am curious, two questions. One is, where's your cat? Like why is the kind of? Two is upstairs. If you had to put your crystal ball, take it out, like, how does this get resolved?

21:59I mean, I think the logical resolution is some sort of taco type. We got to deal and it's just really the status quo. But what do you anticipate? I think that's the best possible scenario. We're a lot of ways in which this can go haywire, right? Particularly because we are antagonizing China so much about energy. Like I don't know, maybe Canada will do something dumb or maybe it's strategically smart. I don't know, but something painful, the very least, like, Korean. Cut off New York. I hope not. I live in New York, you know, that would be bad. First of all, when you said New York runs on, I thought you were going to say bagels and then you went with Quebec energy. Yeah, that would be bad. That would be a definite middle finger. There are a lot of ways that this could go pretty badly. And one thing that I think I've talked about before as well is the fact that the feedback

23:01loop that has tempered Trump that has caused him to taco in the past has been the market, right? Does something catastrophically stupid, like liberation day or whatever, markets freak out and then he pulls back. He moderates somehow. How are the markets handling this? Fine. Because it's not because it's now this is the status quo. Right. And I think it's because there is this anticipation that he will taco, but because there is an anticipation that he will taco that may reduce the likelihood that he touches. It's like a self negating prophecy or whatever. That's what I'm worried about. That it's like Trump is not getting the signals that he needs to demonstrate to him that this is really dumb. And he's obviously not getting that advice from his advisors because it's a bunch of yes men who just tell him everything he does. Well, you do you do pick up some stuff here and there like I saw James and Grew are the

24:03US trade representative on Fox and they're you know, they're talking and think they're asking about the toilet paper crisis, which is actually not really a crisis. We looked into it. But what was interesting about Grew is he was just being like, you know, this isn't a big deal. Like we're not even really doing it on that many goods. Like he was trying. If you read the subtext, I know it is a big deal. But if you read the subtext, he was really trying hard to be like, we're going to get this resolved. Don't worry. Like we got to figure this out. And you get the sense that some people there understand the severity of it. It doesn't mean that Trump does. Yeah, my recollection is that Grew made those comments on CNBC or wherever some some cable news channel. And then almost immediately afterward Trump tweeted something to escalate. Like said that they should be the 51st or whatever. The next day Trump renamed Lake Ontario. So there's that speaking of and we're going to move on from the segment. We did because we again folks, we're doing all the hard work and journalism here. We are not leaving any stone unturned. We went to all the online maps of the lake to see if they have changed the name yet.

25:05So let's put them up one by one. Let's start with Google Maps. What do you got? Lake, they haven't changed it yet. They haven't changed it yet. Somebody in trouble say, um, this is, I'm, this is a private company. I'm not trying to get them in trouble. They can make their own decisions. Uh, nobody. But last time Trump yelled at all of these companies. OK. Well, when I will get them in trouble because now we have Apple Maps. Let's go. It's a little bit hard to read, but that definitely says Lake Ontario. First of all, what's your preferred online at? Well, hold on. Last one, Map Quest for the traditionalists. Wow. Lake Ontario, they haven't changed it yet. OK, what's your preferred online map? You know, I'm a map quest guy. I got to be honest. Really? No, I'm a Google map guy. OK, I was going to say, I was going to say I've lost some respect for you, Sam. Um, just the bridge too far. How could I? Well, yes, literally, April, too far. Um, yeah, I'm a Google map. You Apple Maps? OK. Oh, I want to like drive into the pond or whatever.

26:05It's not you're not actually going to drive into the pond. You'll be, it might say you're in the pond, but you're not going to. All right. Speaking of bodies of water, look at this transition. Um, let's talk about the trade of framus. OK. Wait, didn't he, didn't he name this one? Didn't he call it the straight of America or straight of Trump or something? I forget. I mean, he might, he might have floated. He floated the idea of renaming the Atlantic Ocean yesterday. Nobody saw that. Well, I know you're talking about it. They, they've talked about like, oh, we're going to name it the straight of America. Yeah, I think they definitely talked about it. Um, I don't think, well, he can do whatever, Amy could try to do it every once. Probably put some executive order out there. Anyways, the straight. Is it open? Is it not? So yesterday, Seth Com puts out some video that was very celebratory and very happy. Uh, where they declared that they have demined the straight. There are some interesting wordage in there that I think you can pick up. But let's watch the video. Uh, and then we're going to talk about whether or not this is just, um, spin. If you like YouTube, you'll love YouTube premium.

27:06It's destroying athlete, creator and YouTube, max. YouTube premium enhances how I use YouTube with awesome features like offline downloads. So I could download my favorite training videos before I hit the gym. So no Wi-Fi doesn't turn leg day into loading day. Plus I get ad free videos, background play and so much more. YouTube premium is like YouTube got some extra gains. Try YouTube premium for two months free at youtube.com slash premium. Hey, what's up guys? It's Hayley Bailey. Okay. I need to tell you about something. I just got YouTube premium. It's got tons of awesome features like offline downloads. So I can download my favorite videos before I travel and watch them whenever I don't have Wi-Fi because we all know airplane Wi-Fi is the worst. I get ad free. I get back room play and there's like a ton more in there. You should try it. If you like YouTube, you'll love YouTube premium. So try YouTube premium for two months free at youtube.com slash premium. Try eligibility varies terms apply cancel anytime. That's a mouthful. It's fall in Jeep country and during the driving to fall sales event,

28:06get a great deal on four by fours that refuse to be contained like Jeep Wrangler, confidence built into every drive with the most awarded SUV ever, Jeep Grand Cherokee, and freedom that can't be denied with the open air freedom and cheap gladiator. After 85 years, it's no surprise that Jeep became America's SUV brand. Get a great deal during the Jeep driving to fall sales event. Jeep is one more awards over its lifetime than any other SUV brand. Jeep and the Jeep Grill or Registered Trademarks of FCA US LLC. US military has achieved a major milestone in the Strait of Hormuz. We have successfully cleared sea mines in the straits international shipping lanes that were laid months ago by Iran's Islamic Revolutionary Guard Corps. International recognized transit routes in the Strait are free of Iranian sea mines thanks to the incredible work of the US military. Okay, so I'm not like a total expert on this. But the people I've read about this have said they don't have no reason to doubt it.

29:07In fact, they think it's probably true, but it's not the full straight one. And two is it doesn't accommodate for the possibility that they didn't know where every mine was or that there are mines still floating there, where they call ghost mines, or that Iran could in fact go back in and continue to mine the Strait or that there's other ways to go after. Yeah, sure. So they're trying to navigate. Yeah. So it is, it is an achievement, but this fits into a larger context of the administration trying its best to encourage energy companies to use the Strait and without fear. And we've seen it in a couple of occasions Donald Trump has talked openly about it. We have Axios doing reports. Axios has gone from reporting about how close a piece deal is to how open the Strait is. They seem to be on the cutting edge of calming the markets. There's the headline that sucker is open. US gains the upper hand in the battle for Hamuz.

30:08And yet the actual data shows that it's not open or at least it's not as open as it once was. So I'll show up as I get the data oriented, but what are your thoughts on this? Yeah. Well, a few different things. Fewer ships are going through less oil is going through. Even if all of that is true that the mines were gone, it doesn't seem to have actually convinced private companies where they're insurers that it is worth transiting the Strait. And before the war, something like 20 million barrels of oil were transiting the Strait every day, the journal had a piece, I think, saying that people who are actually paid to track how much oil is going through are finding, well, was it like two to six million barrels a day? Yeah. So the journal has, I don't know, do we have it up? Well, I can read it. Yeah, read it. Yeah, they say that the count from commercial ship trackers tells a different story with estimates ranging from roughly two

31:14million to six million barrels a day. Industry figures on the amount of crude oil and oil products being loaded onto ships and the Persian Gulf and delivered to buyers don't corroborate US claims. So what matters is not that Donald Trump and those answering to him say that it's safe and that oil is getting through. What matters is what private companies and the people that they employ and the companies that ensure them think is safe and possible and worth whatever cost benefit analysis that they are doing to actually send ships through and these tankers through this street and that does not seem to be happening. And forgive me if people might be a little bit skeptical of the information coming out of this administration, the official statements coming out of this administration. Right. You know, there's a rule of thumb that I think of quite frequently during this administration that I may have talked

32:16about before, but it's, I call it the Goolsbee rule. It's named for Austin Boston. Yeah, you know, Austin. So he's now the president of the Chicago Fed. He said this beforehand, but he said basically some version of when you lose your credibility, the things you say start to mean the opposite of what you intend them to mean. And so when you have an administration that has consistently lied about things big and small, crowd sizes, measles, counts, you know, voter fraud, everything in between. When they lie repeatedly about things, it means that when you really need the world to trust what they are saying, people won't. And so I think it is quite reasonable that this assurance alone from sent-com, from the White House may not be sufficient to convince private companies that it is worth their while,

33:17that they will not get blown up by minds or by drones or otherwise antagonized to go through. And so they'll just say screw it. We're not going to. I think the private companies are one audience that they're trying to convince, but I don't think it's the full audience. I think they're trying to convince the markets. I think they're trying to like present this non-reality that everything is copacetic, back to normal, and you shouldn't worry about the war. We can live with whatever the status quo is right now with Iran, because we've done the hard work and we've gotten the minds out there and shipping is happening all over again. So you look at Scott Besson, the treasure sector. He puts this tweet up. The blockade and operation economic outcast will crush the failing Iranian economy. The US has guided 130 million barrels out over the past 14 days while Iran has done zero. And it's like, okay, I look at that. That seems cool and I'm happy. And maybe things are going to go. And then you actually do the math and it doesn't take much. You're like, okay, but if we're doing 20 million barrels a day,

34:17that would about to about 280. Another Krung over 130. And then you add on to that all the efforts that have gone into and still go into ensuring that ships can get into and out of the street. And upholding that blockade and monitoring the Iranians so they don't mind the straight again. And you're talking real investments here. And on top of that, the strategic petroleum reserve is at incredible lows. And they're just leaving all that stuff out for obvious reasons. And I think they're just doing it because they want to condense the markets not to crash. Yeah, but that's not going to work. It's worked so far. I mean oil prices are high. Yes, but the markets are not like, I mean, we all thought the market. That is the market. What market are you talking about? But the stock market. Oh, the stock market. Like the larger markets. Sorry. Because I can say, I don't know what oil prices are right now. We can look it up. But one second, I'm doing a lot of prices.

35:20This is the beautiful. Yeah, I mean, there's still not that high. It's 88. Yeah, this is nothing like it was at the peak during the Iran. Yeah, it's not as bad as the peak. Yeah, I think it's still above where it was pre-war if I recall correctly. Sure. In any event, yeah, there is this real question about why stock markets have held up. And is it because of faith, in Trump, and the economy, is it despite deteriorating faith in Trump and the economy? And I think it's mostly the latter. I think that the AI boom slash bubble is doing a lot of the hard work in pushing up prices. But I agree. It's like I have not really understood candidly why equity markets have been so copacetic throughout all of this. Again, not just the war, but the trade wars and all of the other erratic behavior and threats to rule of law and

36:22tainting of statistical data that traders rely on. Like there are so many reasons why I feel like all of these problems should be reflected with bigger pain in the stock market. And you haven't seen it. And I don't entirely know why. I will say that the bond market is a different story. All right, it's been in that. So the bond market is freaking out more than the stock market. And I think that's some combination of like we have a lot of debt. And so we have a lot of debt. We have a lot of inflation still. That the Fed has not been able to ring out of the economy. And I think that there is actually a kind of a credibility crisis that treasury and potentially the Fed are going through right now. And the bond market, maybe there's like less dumb money floating around. I don't know. Then in the stock market, maybe there are fewer like whatever retired dentists and other like casual retail traders.

37:25I don't know. And maybe there are just more professional types in the bond market. But there you do see yields higher. Certainly then there were a few months ago when Scott Bessent tried to intervene in the bond market and bring those long-term rates, those bond yields down. It backfired. So you do see more jitters if not outright panic. In the bond market, then you do in the stock market. And maybe that's something like, I don't want to say it's comforting, but maybe it feels a little more rational than what's happening in the stock market. But like again, I don't know how much of this is AI and how much of this is just like people are still playing music until, you know, while the, I don't know what the metaphor is. But it's like they're dancing while the party is still going on. I think it's playing music on the deck of the Titanic. Or something like that. Well, it is, I guess it is kind of crazy to me how much we basically,

38:30it's not that we've backburned it. Although I guess it is because the war obviously is still going on, but no one really, nothing's happening. You know, we're just in this moment. Strategic petroleum reserve. Lowest since November 1982, we can put up the graph there for folks watching. You can see it's, and that downward turn right at the very end, that's all the war. Yeah, I mean, I'm old enough to remember when Donald Trump was yelling at Donald Trump and other MAGA people were yelling at Biden for drawing down the strategic petroleum reserve, which they did in part because there was a different war that's still ongoing, the Russia Ukraine war. And that was screwing up global oil markets. And so like they did draw on the strategic petroleum reserve at the time in part to like, equilibrate, you know, to like counteract the fact that they're all these supply disruptions. And people were Republicans were like, oh, that's too political. Like we need to save that for a real emergency.

39:30And now obviously Donald Trump is going absolutely beyond it. Yeah, just taking a big straw and sucking it all up. As for the cost of crude pre-war with $72, it's there you go. 88. So it is up, but it was over 100 and definitely not there now. All right, last topic before I let you go. There's like a slew of corruption stories and it's kind of, you know, these are like a dime a dozen. But I do think it's coming upon us. What a sad commentary on the world, yeah. I know. I do think it's coming upon us to actually talk about them. There was three that we spotlighted. There's, I have my favorite. I don't know if you have yours from the doc that we're working out of. There's two really that I really want to talk about. One is the crypto bank, which is basically this Abu Dhabi royal has invested in insane amounts of money in world liberty financial, which is the company that the Trump family more or less runs and operates. The other one that I thought was really crazy was the prediction market story.

40:31So basically Don Jr., who has a stake in, was a Calche. Yeah, I think he must take a Calche and in polymarket. He goes in front of the attorney generals, the state attorney generals and he starts berating them to like not, you know, not crack down on these prediction markets and over-regulate them. And it's just, you can read it there. Mr. Trump in this case is not the president in Donald Trump Jr., so it says, and I'll read it to the people who are listening. And I'm watching sitting on stage for question answer session with Montana's attorney general, Mr. Trump the Donald Trump Jr. suggested that state leaders were being led astray by vested interest, gambling firms that wanted to protect their monopolies by attacking prediction markets for people familiar with their mark said. In reality, he said the markets already had robust oversight describing them as a sophisticated financial tool overseen by federal officials, not state attorneys general. Mr. Trump's tone was friendly, the people said, but his comments, which have not been previously reported dovetailed, where the message as follows administration as sent the state leaders back off.

41:32It does strike me as like the sun is basically giving them a warning. My dance is going to come down on you. Hey, what's up guys? It's Hayley Bailey. Okay, I need to tell you about something. I just got YouTube Premium. It's got tons of awesome features like offline downloads so I can download my favorite videos before I travel and watch them whenever I don't have Wi-Fi. Because we all know airplane Wi-Fi is the worst. I get to add free, I get back room play, and there's like a ton more in there. You should try it. If you like YouTube, you'll love YouTube Premium. Try it now for two months free at youtube.com slash premium. If you like YouTube, you'll love YouTube Premium. Hi, I'm Sean Evans from Hot Ones and I want to tell you about YouTube Premium. It has offline downloads so you can watch without Wi-Fi, background play, so you can lock your phone and it still plays baby. Oh, and it is completely add free. Yes, I said it add free. Try YouTube Premium for two months free at youtube.com slash premium.

42:33Trial eligibility varies, terms apply, cancel anytime. It's fall in America. Make it count at the Ram Drive into Fall sales event. Make it powerful with our strongest Ram 1500 ever. Make it move with the Ram Heavy Duty with an available Cummins diesel and make it go the distance with a 10 year or 100,000 mile powertrain limited warranty. Hurry in now for great deals during the Ram Drive into Fall sales event. Excludes fully electric vehicles applied to 2026 model year vehicles non transferable visit Moapart.com for complete details and a copy of the powertrain limited warranty. Cummins is a registered trademark of Cummins Inc. Ram and Hemi are registered trademarks of FCA US LLC. Yeah, and in this case, it's probably pretty intimidating. There is a real conflict. There are legitimate issues here about whether states or the feds should be regulating these markets. And the prediction market companies like Kalshi and Polly Market and others have argued like, well, we shouldn't have this patchwork regulatory regimes that

43:35shouldn't be different in Texas versus Idaho versus Vermont or whatever. Yeah. The problem and I understand that. The problem with that argument is that that is how gambling is regulated right now. Like if you're if you talk about sports betting, for example, that's done at the state level those regulations generally. The the federal government has a relatively light hand and there's some conflicts between how states have regulated again this form of gambling like sports betting or slot machines or whatever and what is allowable on these sites. And now the sites will say that like they're a sophisticated commodity market. It's not the same thing as gambling whatever, but like I don't know if you're making a bet on the outcome of an athletic match. I don't know that it's really that different from a consumer's point of view at the very least. And so there are a lot of states. I think it's something I looked it up before. There are

44:36I don't know in all but a few states no one younger than 21 for example can play sports bets. But on Calche the app is available to anyone over the age of 18. So like how do you reconcile those things if you're in a state that says you can't play sports bet but you can do it on Calche. It just seems like there's some at the very least regulatory arbitrage that's going on. Yeah. That needs to be resolved. And I'm not a lawyer. I don't I don't have very strong informed opinions about the right way to resolve it. I will tell you that I would not go to Donald Trump Jr. for advice on the right way to resolve it because he clearly has a vested interest. You know, in that quote that you read where he's talking about like all of these vested interests are trying to to influence the outcome of you buddy. It's like yeah. Most of them don't have daddy in the White House. I know it's a remarkable thing. It's very stingy. Yeah. Think about it like if in a more traditional setting like let's say Donald Trump Jr. was not you know was on the board of a

45:39you know defense company and he went to all the lawmakers and not the attorney generals on the you know defense appropriations committee and he told them you will you shouldn't buy any of the other companies because they're bad but just don't buy them like we'd be like that's insane behavior like you're basically using your ties to your father to benefit yourself and that's what's happening here. Yeah. Just to be clear just to be clear the Trump administration has already started cracking down on this stuff like they didn't need DJ to weigh in and suggest it openly. So the Trump administration has said that the CFTC which regulates commodities should be the only game in town for regulating prediction markets and the CFTC was set up in 1974. This is something else I think I pulled from I forgot if it was a journal article what I think it was a journal article. In the half century since it was set up the CFTC had never sued a state over regulatory issues.

46:41This year it has sued nine states all led by democratic governors and twice the agency has instructed prediction markets to sidestep court orders invoking emergency powers that had not used for decades. And so they're coming down the side of less regulation I presume. Yeah. Yeah they're basically saying only the feds can regulate by which we mean not regulate at all these markets the states cannot and when the states try Donald Trump senior the guy in the White House will sue via the CFTC. And so Don Jr. is like basically saying my dad's going to come after you which is credible because his dad is already coming after them. Yeah. I've never heard you use DJ TJ before. I like it. Oh. DJ TJ. I should use that. I'm aware of the acronym but it's nice. I like it anecdotally. I don't know if you've experienced this but I weigh more friends who are like just casually betting

47:44on things these days. Do you? I mean it's mostly sports honestly. I don't know to be honest. I think I friends who are like in the middle of games will like re-rebet on the games and the outcomes and wait and they're like you know they are admittedly like yeah I'm kind of addicted to it and it's weird. It's like it's an addictive thing obviously but it's obviously the stuff is proliferating in ways that I don't think we appreciate and I'm seeing it in my own life. I stay away from that shit. I'm too I'm too anxious to do that. Yeah I'm not a gambler so and also I don't really I'm not invested in anything athletic so maybe that shields me from some of this stuff. You can bet on a bunch of shit. I know I know you could bet on the 20 award winners and shit like that. Yeah. They have markets on all of that stuff but I am not partaking. Okay. Before before we go to clean up stuff and in the tour dates because we have a tour coming up on one of the details. Kevin

48:46Worsh did speak this morning and I'm sorry that you have to cover this man. I really genuinely feel bad for you because people have to understand in journalism it's great to cover the crazy figures and I guess that's partially why Trump is you know he gets pressed but it's like people genuinely like covering Trump even though he's horrible. Kevin Worsh is the antithesis. He says nothing it's like reading like a scroll in a different language that you're not a familiar. So what do you say? That's the job of every fed official there are jobs. Was it always making? I don't know. That's their job if they are. He's very good at it. He's scoring out. Well, it's good at not making news. I don't actually think that's true. I think he is trying to not make news but if you look at his last press conference he made quite a bit of news unintentionally by suggesting for example that the fed was maybe going to change the artistic it uses for measuring inflation that would be like a very big deal. He kind of said it in an off-hand

49:47comment. Maybe going to maybe. Yeah well that like freaked out markets because they're like well as this a backdoor way to like not be as tough on inflation. I mean there are a bunch of things that I think he didn't mean to say. The best fed officials are the ones who have very control. I mean from the perspective of not from a journalist perspective from the perspective of like what's good for markets and the economy. The best fed officials are the ones that like stay on message that like project calm seem like they know what they're doing and I don't know that Warsh did that at least at his last press conference. Today he kind of said nothing and and I guess that I mean the thing that I was hoping. He said inflation was still worrisome. Oh okay great and he made one little cutesy joke about like you can call what I'm about to tell you a you know I'm going to tell you what my speech is about you can call it an outline you can call it a framework but don't call it forward guidance which is a joke for e-con nerds because they they've not been

50:49giving forward guidance something else. I mean. Did you chuckle? I did not but it's it made it into every right up of the speech so I guess he did his job that he distracted people from like the actual potential credibility crisis that are financial policy. I know well the thing that I wanted him to address and then I think a lot of other people were hoping that he would address is how the fed is viewing these bests and bond buybacks because it really seems like the treasury you know Scott Besson is treasury secretary it seems like treasury is kind of like homing in on the fed's turf because the fed is supposed to be the one that's like setting interest rates mostly the short-term interest rates but they also do things to affect long-term interest rates like buying and selling long-term bonds and now Bessent is getting in on that and so like there's this question about who's in charge and he didn't get into any of that so a lot of unresolved questions well we don't need to belabor it and try to figure out or divine what he was trying to say

51:54it's just the world we live in um but for folks who do want to get a better understanding of the economy they should subscribe to your newsletter you see you had a great one but the fuck around find out economy of course because you're too polite you didn't like saying the word fuck in the text so I'm I'm gonna say I'm not gonna say it F-A-F-O Catherine doesn't like to swear and every time I try to put a swear in her text no it's true but to be honest every time I try to put a swear in your copy like take that out so I'm not gonna do it anymore it's true are you denying it? I definitely said bullshit a bunch of times isn't swear Catherine you know it's interesting so I used to work at the Washington Post right and I was a columnist there for many years and I was kind of used to this world where like I could say outrageous things in my initial draft and knowing that editors would pull me back and then it's the opposite here it's a lot more careful because it's like sometimes I'll put in something like bullshit

53:01in my draft figuring that I'll change it you know like I'll come up with some better less craft way to say the thing that I'm trying to say and um and then it just it lives there and that's okay it lives there and I'm like actually can we go a little harder um yeah all right I'll stop doing that all right quick quick no before I let you go uh this is for folks who are the real sickos out there who like seeing us in live as opposed to on YouTube actually I will say having done a couple of these the live shows are awesome like they are totally different experience so much energy in the room uh it's fun you get like to be around others uh we do different segments have different games um it's a genuinely fun experience and we're always hanging around and you got a chance to talk to us on occasion so uh if you're in these three cities Columbia South Carolina Charlotte North Carolina and Atlanta Georgia those are the three stops on what we are calling the good fight tour it's this October coutan's gonna be in one of those which one

54:01you're gonna be in do you remember uh Charlotte yeah you're in Charlotte so we got Columbia South Carolina on October 16th Charlotte North Carolina on October 18th and Atlanta Georgia on the 20th you can get tickets right now you can see it on the website the bullock.com slash events I would highly recommend if you can make it to come and do one of these events it's a great way to ramp up for the midterms meet the gang have a good evening ticket to sale the bullock.com slash events all right Katherine thanks so much really appreciate it take care we'll see you soon it's fall in jeep country and during the driving to fall sales event get a great deal on four by fours that refuse to be contained like jeep rankler confidence built into every drive with the most awarded SUV ever jeep grand Cherokee and freedom that can't be denied with the open air freedom and jeep gladiator after 85 years it's no surprise that jeep became america's SUV brand yet a great deal during the jeep driving to fall sales event jeep is one more awards over its

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