Many around the world are
struggling with the surging cost
of living.
Right now in the United States,
inflation is beginning to drop.
We're already seeing big tech companies
like Amazon matter and Twitter
making drastic layoffs.
Twitter is going through
corporate chaos of its own
after Elon Musk's takeover.
Now, Scott Galloway watches
all of this very closely.
He's a professor at NYU's
Stern School of Business in New York
and is the host of the podcast
The Prof Pod.
So welcome to the program.
Thanks, Christiane.
I'm sort of smiling because but I hadn't
I hadn't actually heard the name
because I know you do a lot of podcasting
and I'm on Pivot as well.
And I'm going to get get to that.
But
what about these forces that are coming?
You sort of did predict,
I think, that inflation would drop at
about this time in the United States.
Yeah.
So what's your crystal ball
saying for the U.K., for elsewhere?
Well, if you believe a sort of my
you at around
those standard Blanchflower UK
economists is now at Dartmouth
and every modern economy inflation
sort of does its job
and that as prices go up
consumption
goes down and prices decrease.
You have some unique factors
here, though,
because unlike the US,
you're not energy independent.
And so the fear of being having
an energy shortage creates prices.
Consumer confidence goes down.
But it's really
if you were to bucket
the world in the three buckets,
if you looked at emerging economies,
you might see
a greater proportion of their budget
go to rising interest rates
to cover their sovereign debt.
And then if they have to pay
back in dollars
they're really getting hurt.
Europe, which is seeing, as you
said, 41 year
highs of inflation
and then the US, I would argue,
is best positioned in the world
because we're seeing inflation
start to come down.
The dollar is so strong
or an import economy.
So everything from Toyotas to imported
cheese are coming down in price
or food independent
or energy independent.
And where would you rather be?
Would you rather be in China
with a quarter of a billion
people under lockdown?
So this is globally.
It's the economy is slowing,
and we're seeing inflation
which can lead to
very, very bad dynamics
because people's purchasing
power comes down.
But it's really where you are.
Well, you just said the US
in the way you are.
Question is doing better
relatively right now
because of all the other reasons
of being energy independent, etc..
So why are we watching big U.S.
corporations?
Yeah, as I just listed,
especially the tech ones
and their media corporations.
And also it's just
I mean, literally taking the ax,
slashing and burning
thousands and thousands of people,
some being fired
on social media themselves.
Yeah. Why?
Well,
I think it's more spectacle
than significant.
I think the answer is
I just got out over their skis.
Keep in mind
that we've gotten over the skis
in the number of people they've laid off.
Amazon hired 500,000 people last year.
And what makes news is
when they lay off
10,000, Twitter lays off
50% of their workforce.
That's 30 750 people.
But keep on
keep in mind,
under the cover of darkness,
the day of the midterms
metal is off 11,000 people.
And because even that 11,000 people
just takes them back
to employment levels
of November of last year
if their company were to return
to pre-pandemic levels
that means they're going to layoff
another 40,000 people.
So one it's more spectacle
than significant it's fun.
We in
the media are like a Tyrannosaurus rex.
We're drawn towards violence and movement
and these stories are interesting.
But they're really
these companies
are barely checking
back to where they were last year
and travels with people.
I mean, because this is affecting people.
I mean, look, you said something that,
you know, some might take,
some might think it's
sort of hard nosed business cynicism
You've said that maybe three
to five times
more people than those already laid off
may happen.
You just said
if they go to pre-pandemic levels.
But you talk about the
benefits of labor markets flexibility in
the US
and that actually
laying people off now
and giving them severance
is better than waiting for a few months.
But is that comforting
for all those people
who've basically just been fired?
Well, every recession,
usually we call it a blue collar
or white collar recession.
It impacts one cohort
more than the other.
I would call this recession,
at least in the US,
the Patagonia vast recession,
and that is the people
that it's impacting
most are the ones that have been working
in that part of the economy
that kept on giving,
and that was a growth economy.
And I'm a believer
that the faster you can fire
people, the faster you can rehire them.
And when you're talking about people
that matter
being laid off or Amazon,
these are some of the most
employable people in the world.
Christiana And they
they reenter
they go back into an employment market
that is at historically strong levels.
So I think this is a natural part
of the cycle.
And yeah, these are real people.
It hurts.
But look, guaranteed
a commonality of life
is that you are going to face tragedy
and at some point
you are likely going to be laid off
if you are going to be laid off.
A 27 year old coming out of matter
right now,
their prospects are still pretty good.
Okay.
Well I mean that's
that's one way of looking at it.
I hadn't thought of it like that.
But why is it tech?
That is
part of what you call this spectacle
and particularly
is this a separate issue?
Elon Musk at Twitter.
Okay.
There's a numbers of layoffs,
but then there's
I mean, what you yourself
have said in the podcast
and others are saying
the same thing
Musk is unraveling before our eyes.
You think
and you feel that
there's a cult growing
around the personality of Elon Musk.
You kind of made some parallels
with Donald Trump,
but so, you know, develop that.
How is he unraveling
and what does that mean for
for the bigger picture?
Yeah, I don't think
I think we're
seeing the on the unwinding,
not of a company,
but the unwinding of a person.
And I believe it's
a larger trend
as societies
become wealthier and more educated.
The reliance
on a super bang
and church
attendance goes down,
but they still look for idols into
that void
has step technology leaders
because technology is the closest thing
we have to magic.
And you know, our new Jesus
Christ was Steve Jobs.
And now Elon
Musk has taken on that mantle.
And every ridiculously mean,
nonsensical, irrational move he makes
is somehow seen as chess, not checkers.
We're just not privy to his genius yet.
I think this is an individual
who has demonstrated
a total lack of grace
as no guardrails around him.
And is going to see his wealth
probably cut in half.
This is already
the second worst acquisition in history.
Just a week or two weeks after the close,
it is
that because he's bitten off
more than he can chew,
because most people believe
his other enterprises
are hugely successful, his
masa, his Tesla cause StarLink,
which is right now
paying off in the battlefield in Ukraine.
So importantly, well,
the warriors have returned in Rome
after a huge victory,
and they would have a ticker
tape parade for them
and they would hire a slave to follow
and shout to the person
and whisper in the conqueror's ear
You are only a man.
I have never met a man or a woman.
That is infallible, Christiane.
They they all eventually screw up
a universal pillar of truth
is that the universe doesn't
want a consolidation of power
among any country,
any society or any individual.
This is someone who, in my opinion,
shows a bit of a God complex
vastly overpaid in a fit of mania
or seeing something we don't see.
This is a company
probably worth 10 billion
that he paid 45 billion
and thinks he can lay off half the staff
and treat them
poorly and disparage them
and not have any ramifications.
I think quite frankly,
I think he's a terrible role model
for young business people
you can't
deny is incredible accomplishment
but now he's running
three different companies.
So this notion
that there is a super being,
I have found that that
notion never proves out
one of
these people who
believe there are super being
is Donald Trump.
I mean, he
he believes it and he thinks it.
And you've called
and others have said
that there has been a cult developed
around it.
Well, last night
he did actually say
that he was going to run again.
This is what the Democratic Senator
Chris Murphy,
said about his reaction to it.
Know, as you can imagine, not thrilled
I'm not excited
about Donald Trump's
decision to run for office.
I think it'd be better for the country
if Donald Trump vanished
from the political landscape.
This is the most dangerous
political figure America has encountered,
at least in the last half a century.
And his attacks on democracy his support
for political violence
threatens to undo the very fabric of
the country.
Do you think
somebody who's
failed in all the elections
he's tried
since since winning the first presidency
and given,
you know, the Republicans sort of second
guessing him right now,
do you think that he has a chance
because he has said
he wants to play the victim,
the underdog?
You know, he talked about America
being absolutely terrible
and people will only figure
that out in two years,
given what,
you know, about the bigger picture.
What do you think?
So I need to caveat that I come at this
with a bias.
I think Donald Trump is
a stain on America
that will take decades to wash out
and I predicted
eight of the last zero times
that he's quote unquote, been done.
This does feel different, though.
This doesn't feel like a red wave.
It feels like a goodbye wave.
And you referenced it.
Everyone is supported.
Didn't win.
He's already
being outraised by Ron DeSantis.
So this feels like
this does generally
feel like the beginning of the end.
The silver lining here is that
this was a wonderful week for the West.
Our institutions are holding
peaceful transfer of power in Brazil,
which you covered eloquently.
The fact that we've decided
our elections matter,
our electoral boards, our institutions.
We're finding out with Sam Bang
Friedman that the SEC and our
are government
entities around regulation,
that they matter is cryptocurrency 100%.
So I think our institutions
had a wonderful week.
And I think the cult of the individual,
whether it's Donald Trump or whether it's
Kanye, or Bolsonaro or,
you know, name in name
you're cult like leader has seen serious
check back.
I think it's been a wonderful week
for the West and institutions
all over the world.
Well,
I think that's a very good place to end
because it's an optimist again,
since you're here in London now
on your book tour. Right.
That's written
the book Adrift we will have you back on
because your fingers on the pulse.
Thanks for that, Galloway.
Thank you so much indeed.