Speaker 1: Well.
Speaker 2: Joining us now is David Bnson. He is the manager
Speaker 2: of a eight billion with a B dollar wealth man fund.
Speaker 2: He's also a prolific writer. He is a contributing writer
Speaker 2: for National Review. He serves on the National Review Institute Board.
Speaker 2: He's named on of America's top financial advisors by Barons, Forbes,
Speaker 2: and The Financial Times. He's also regularly on Fox News
Speaker 2: and Fox Business, as well as a contributor to World Magazine.
Speaker 2: And I wanted to talk to David about several issues.
Speaker 2: First of all, his expertise, of course, is in economics,
Speaker 2: but he also is a published Christian author. He has
Speaker 2: some perspectives on the meaning of life and how to
Speaker 2: find life's meaning in your work and other things. It's
Speaker 2: all we want to touch on that as well. He
Speaker 2: had to rebuttal to a piece that was done on
Speaker 2: the Atlantic talking about the isolation that has been has
Speaker 2: become characteristic of our society. So joining us now is
Speaker 2: David Bonson. Thank you for so much for joining us.
Speaker 1: David, Well, thank you so much for having me pleasure
Speaker 1: to be with you.
Speaker 2: Let's thank you. Let's talk a little bit about this
Speaker 2: piece from the Atlantic. I thought it was pretty amazing
Speaker 2: and It began with an anecdote is mostly stories do.
Speaker 2: This is a guy he's in a restaurant, I think
Speaker 2: it was North Carolina, and he says he's sitting there
Speaker 2: and he's seeing one person after the other coming in
Speaker 2: the restaurant, grabbing a paper bag and going out, and
Speaker 2: there's not really any interaction, you know, there's not a
Speaker 2: group of people coming in and having a meal at
Speaker 2: a table. They're not even really interacting with the people
Speaker 2: behind the counter. And he wrings his hand and says,
Speaker 2: this is awful, and this is what is happening to
Speaker 2: American society. And he said he talked to them and
Speaker 2: it was very bustling place before the pandemic, and yet
Speaker 2: he believed that it was some kind of a problem
Speaker 2: of capitalism. Is what did he say? The problem was?
Speaker 2: How do we get to this?
Speaker 1: Yeah? And what the author ends up doing is concluding
Speaker 1: that it wasn't a problem of markets, so it was
Speaker 1: rather markets adjusting to what the problem was with the culture,
Speaker 1: that the that the society moving towards increased alienation, a
Speaker 1: decreased value on community, on being together. And and of
Speaker 1: course that was an opening anecdote to what was a
Speaker 1: really longer piece. I did a whole podcast at my
Speaker 1: National Review Capital Record podcast about the broader subject of
Speaker 1: how do we reverse this trend of greater alienation and
Speaker 1: isolation in society. And one of the points I make
Speaker 1: is that Mark this restaurant is not going to go
Speaker 1: out of business just because people don't want to go
Speaker 1: out to eat together anymore. So they're going to shift
Speaker 1: to door deliveries and door dash and to go order
Speaker 1: and some of the other things. So the business of
Speaker 1: the restaurant might find a market mechanism that maintains some
Speaker 1: cash flow, but the societal issue that undergirds it is
Speaker 1: really the challenge. And I want to make the argument
Speaker 1: that markets are not causing the problem, they're responding to
Speaker 1: the problem. We don't blame markets when thousands of people
Speaker 1: go out together for big, successful concert events. We don't
Speaker 1: give markets the credit for that. But that's an example
Speaker 1: of markets accommodating a societal trend for the togetherness of
Speaker 1: what was the successful Taylor Swift concert tour a couple
Speaker 1: of years ago. The point I think you're bringing up, David,
Speaker 1: is that there was a societal trend taking place before
Speaker 1: COVID of people valuing community and togetherness less and COVID
Speaker 1: exacerbated it, and it's a trend that we ought to
Speaker 1: be very concerned about.
Speaker 2: I absolutely agree, and of course my listeners know that
Speaker 2: I was a pandemic skeptic before, during, and especially after.
Speaker 2: I mean, the people were pushing this on and say, well,
Speaker 2: we did our best, we just did the wrong thing.
Speaker 2: And that was, as you point out, it was a
Speaker 2: trend that had been happening for quite some time, and
Speaker 2: it was actually war gaming and simulations that they had
Speaker 2: done since two months before nine to eleven to lock
Speaker 2: everybody down and to keep everybody locked down until you
Speaker 2: got their special formula. So I was skeptical of that
Speaker 2: all along, and I've seen the ways that this has
Speaker 2: been used and how it has advanced a lot of
Speaker 2: the let's say, the agenda, because when you look at
Speaker 2: that as well as some things like universal basic income
Speaker 2: and compare that to the stimulus checks, seems to me
Speaker 2: like there was a lot that was going on with
Speaker 2: that that was pushing us down this very bad path
Speaker 2: of isolation and dependency on the government. And it doesn't
Speaker 2: surprise me to see the Atlantic take the approach that
Speaker 2: when the government gas lit enforced a lockdown in isolation
Speaker 2: that they would then blame people who responded to that
Speaker 2: as businesses trying to stay alive.
Speaker 1: Well, I believe that pandemic response is unforgivable, outrageous. I
Speaker 1: think there were some people who were better intentioned than others.
Speaker 1: That all of it still, you know, I don't judge
Speaker 1: a policy by its intentions. You judge it by its results.
Speaker 1: And it was bad results. But the lockdowns and pandemic
Speaker 1: issue ended a long time ago. And one of the
Speaker 1: things Derek points out in the Atlantic article he wrote
Speaker 1: a year ago is that the worst year at twenty
Speaker 1: twenty one was very bad for this. Then twenty two
Speaker 1: was bad, and then it got worse than twenty three.
Speaker 1: No one was locked down by twenty twenty three. So
Speaker 1: what you see is this sort of craving of people
Speaker 1: dining alone. Robert Putnam's book Bowling Alone was written in
Speaker 1: the year two thousand. Okay, that was twenty five years ago.
Speaker 1: That was well before the pandemic. The death of community
Speaker 1: is a post modern and secular problem, not merely a
Speaker 1: byproduct of the very bad COVID policies. And I believe
Speaker 1: that societies that don't value mediating institutions like and family
Speaker 1: end up being very lonely societies.
Speaker 2: Oh, I agree. Yeah, it was a trend that was
Speaker 2: already in place, and this accelerated it intensified it significantly,
Speaker 2: I think, and we're living with that. I guess that
Speaker 2: was one of the thing I was most surprised about
Speaker 2: was how rapidly this accelerated trends like that that we
Speaker 2: already saw in place and kind of solidified them. You know,
Speaker 2: and my son's generation, almost everybody meets their spouse or
Speaker 2: whatever that they know have met them online. Initially, there
Speaker 2: used to be places where you could actually go and
Speaker 2: have a human to human interaction with somebody rather than
Speaker 2: primarily being online. And it is such a strange thing
Speaker 2: to see that, and it really is that kind of isolation.
Speaker 2: And many have bragged about that being the design. You know,
Speaker 2: they won't to have like a ready player one environment.
Speaker 2: We're all just set there in our virtual world, you know,
Speaker 2: communicating with people on the outside rather than having any
Speaker 2: kind of in person communication.
Speaker 1: That's exactly right. Dining is but one example all sorts
Speaker 1: of various community activities. You know. We can talk about
Speaker 1: the role that COVID played in exacerbating it. But nothing
Speaker 1: is exacerbated quicker than screens than electronics, And I think
Speaker 1: there's a very healthy way in which one can use
Speaker 1: electronics for productive use. There's plenty of benefits that come
Speaker 1: from it. For people staying in touch. It's an easier
Speaker 1: way to send your law lost aunt and uncle on
Speaker 1: the other side of the country family photos. There's no
Speaker 1: reason to be ludite or a tech fobe about things.
Speaker 1: But to the extent that people have replaced human interaction
Speaker 1: with screen time, it is entirely unhealthy.
Speaker 2: Well, it's one of those things where because it makes
Speaker 2: it easier and available to not actually be in person,
Speaker 2: and it takes some of the discomfort of some of
Speaker 2: the aspects that you would have in meeting with somebody
Speaker 2: in person, takes a little bit of that out. It
Speaker 2: is kind of seductive in that regard, and I think
Speaker 2: we were going to see a lot more of that
Speaker 2: as AI intrudes more and more into our lives. But
Speaker 2: let's talk a little bit about the solution. Because you
Speaker 2: wrote a whole book really about a perspective of life,
Speaker 2: full time work and the meaning of life. Give us
Speaker 2: a little bit of an overview of that.
Speaker 1: Well, I try to make the argument from creational theology
Speaker 1: from the very beginning of the world is to what
Speaker 1: God told us as to why he created us, that
Speaker 1: our endeavors here on Earth matter, that work is not
Speaker 1: just something we do for transactional benefit to help feed
Speaker 1: us or sustain us, but that it is a venue
Speaker 1: for creative and productive outlet. That in producing goods and
Speaker 1: services enhance quality of life, we can enable our dreams
Speaker 1: to come true, our passions are we can develop our
Speaker 1: skills in ways that bring tremendous meaning and joy to
Speaker 1: our lives. This is a productive, proactive view of human
Speaker 1: agency versus a reactive and I think very sedentary one
Speaker 1: where people are sitting still waiting for things to happen
Speaker 1: to them. Yes, and and and one allows for humans
Speaker 1: to experience great joy and meaning and dignity. And it
Speaker 1: reflects the created intent and character of our creator. And
Speaker 1: one is depressing, One leads to isolation, One leads to
Speaker 1: this societal malady that we're dealing with now. Work is
Speaker 1: not the source of our problems. It is the.
Speaker 2: Solution, absolutely, And it's one more aspect here where we
Speaker 2: can see the wisdom of God, the wisdom of the
Speaker 2: Bible in the sense that this is what we were
Speaker 2: designed for, and we know that that is a very
Speaker 2: effectious a matter of fact, just recently we had doctor
Speaker 2: Oz out there saying we need to keep people working
Speaker 2: longer and retiring later. So the cynics came in and said, see,
Speaker 2: he just doesn't want us to have a nice life,
Speaker 2: you know, And yet he was pointing out that study
Speaker 2: after study have shown that if you have a fulfilling job.
Speaker 2: As a matter of fact, people who are doing work
Speaker 2: that is not menial or reproduct typically naturally work for
Speaker 2: a longer period of time until health makes it impossible
Speaker 2: for them to do that. But if it's something like
Speaker 2: some kind of an intellectual pursuit or something like that
Speaker 2: that's a part of their work or some kind of
Speaker 2: creative process, they typically do work longer. And I'm thinking
Speaker 2: of the many conductors that I've seen who continue conducting
Speaker 2: the symphony works are in the eighties and nineties, and
Speaker 2: it keeps them young and alive. It's not just waving
Speaker 2: their arms around, you know, getting that kind of exercise,
Speaker 2: but it's something that engages their spirit and their intellect.
Speaker 2: And so there is a truth to that, because there
Speaker 2: is a truth to what God said. He designed us
Speaker 2: to work. He designed us to tend the garden. Work
Speaker 2: has become more difficult because after the Fall, God cursed
Speaker 2: that work, and it has now been deliberately made more difficult.
Speaker 2: And yet there are ways that we can still find
Speaker 2: our purpose in it, even if it is tainted by
Speaker 2: the curse of sin.
Speaker 1: And I will say what I think is a little
Speaker 1: bit more biblically precise language. In Genesis three, we don't
Speaker 1: generally talk about children as being cursed that there's pains
Speaker 1: of childbirth now, but that verse came before the in
Speaker 1: Genesis chapter three, the curse to the woman was the
Speaker 1: pains of childbirth. It was not the children. And the
Speaker 1: curse the curse to the man was not work. It
Speaker 1: was the sweat of the brow. It was the thorns
Speaker 1: and thistles. You're right that we're with thea in work.
Speaker 2: Now, hang us, I guess David, you're breaking up there
Speaker 2: a little bit. We can we can pull this back here.
Speaker 1: I'm not sure why.
Speaker 2: Yeah, was it breaking up when you heard atlant or
Speaker 2: was it just on my end? It was okay, it's
Speaker 2: okay now, Yeah, it was just it was cutting out.
Speaker 2: So we didn't get the last of that, So let's let's.
Speaker 1: Pick let me pick it up from the sentence before.
Speaker 2: We'll edit that together. Yeah.
Speaker 1: I think that the man that that that we talked
Speaker 1: about thorns and thistles, that it is a curse that
Speaker 1: now is going to be accompanying work, but that the
Speaker 1: underlying work itself remains a blessing, just like children remain
Speaker 1: a blessing. Sin polluted a lot of things, but in
Speaker 1: God's redemptive plan to restore all of us to an
Speaker 1: edenic condition, I believe that we air to believe that
Speaker 1: work itself was cursed. Work and family both predated the fall,
Speaker 1: and that perspective I think is important theologically.
Speaker 2: Yes, exactly right. Yeah, it is work is harder for
Speaker 2: us now, but even hard work like that, difficult work
Speaker 2: has its reward, you know, just like the pain of childbirth.
Speaker 2: And yet there is a reward of the children as well,
Speaker 2: And so both of those things are there. The process
Speaker 2: is painful, but the reward that we were built for
Speaker 2: is still fundamentally there is that. The basis, then, of
Speaker 2: a thesis of your book, Full Time Work and the
Speaker 2: Meaning of Life.
Speaker 1: It is that there is not fifty percent of people
Speaker 1: who are made to work and fifty percent who were
Speaker 1: made to consume that because all of us were made
Speaker 1: in the image of God, and he did this, by
Speaker 1: the way, because he loves us, not because he hates us.
Speaker 1: That we all have a ability to work. Some have
Speaker 1: different skills and interests and abilities and backgrounds and whatnot,
Speaker 1: but that there is no one God made not in
Speaker 1: his image. And if part of being an image bearer
Speaker 1: of God is the creative, productive, innovative capacity that he has,
Speaker 1: then this means that what I'm speaking to doesn't apply
Speaker 1: to just Elon Musk and Jeff Bezos. It applies to
Speaker 1: all of us in some capacity to go and wake
Speaker 1: up every day with the blessing of being able to
Speaker 1: be productive the four letter word we call work.
Speaker 2: I agree with that that's great, and we shall. I
Speaker 2: think we would all be better off if we had
Speaker 2: that perspective. Let's talk about what many of us work for,
Speaker 2: and that is a roof over our heads. And you
Speaker 2: talked about the root of the housing problem, and a
Speaker 2: recent article that you had. Trump's got one idea of
Speaker 2: how he thinks he actually He's got several. He came
Speaker 2: up a fifty year mortgage Life and Venture Mint to
Speaker 2: the mortgage company that was one of them, of course,
Speaker 2: manipulating interest rates. And now he's got the idea of
Speaker 2: prohibition of institutional investors. And you take issue with that.
Speaker 2: Tell us why you think that is the wrong approach
Speaker 2: to it, and what the real root of the housing
Speaker 2: problem is.
Speaker 1: Well, I take issue with almost all of them, although
Speaker 1: that one might be among the worst. We have a
Speaker 1: tremendous problem of inadequate supply. Housing is too expensive because
Speaker 1: we need more of it. And this is basic economics.
Speaker 1: When supply stays level but the demand curve moves up,
Speaker 1: then you get higher prices, and so you need an
Speaker 1: equilibrium between supply and demand in order to avoid prices
Speaker 1: going higher, let alone higher than the rate of inflation itself.
Speaker 1: House prices have outpaced wage growth and job growth and
Speaker 1: economic growth for some time, and that is unsustainable and
Speaker 1: it creates an affordability price problem. Vice President Kamala Harris,
Speaker 1: when she was running for president, said we'll all address
Speaker 1: the affordability issue by giving every American twenty five thousand dollars.
Speaker 1: President Trump has said, or every American wants to buy
Speaker 1: a first time home. President Trump said, I'm going to
Speaker 1: address it by having Fanny and Freddy buy a ton
Speaker 1: of mortgage bonds, so it creates more supply of mortgage
Speaker 1: financing and pushes interest rates down. Both things feed demand
Speaker 1: but do nothing about supply. And when he talks about supply,
Speaker 1: he says, the institutional people that have come in and
Speaker 1: built new homes and bought homes have now made it
Speaker 1: more unaffordable. The reality is, first of all, the largest
Speaker 1: institutional holder owns about sixty thousand homes, thirty thousand that
Speaker 1: they own to sell, thirty thousand they owned a rent.
Speaker 1: This is in a nation with ninety million homes. Some
Speaker 1: of the cities with the worst home price appreciation meaning
Speaker 1: the lowest, have the highest level of institutional ownership. Some
Speaker 1: of the cities that have the highest home price appreciation
Speaker 1: and the biggest unaffordability problem have no institutional ownership. So
Speaker 1: there's no real empirical evidence that this is a factor
Speaker 1: at all. But what it does do is tell Americans
Speaker 1: who they're allowed to buy and sell their home to
Speaker 1: and from. Yeah, exactly, it's just outrageous, and so it's
Speaker 1: not only not addressing the problem, but it is a
Speaker 1: solution that is outside of market principles that most of
Speaker 1: us on the right have believed in for a long time.
Speaker 2: That's right, And you point out your article American Enterprise
Speaker 2: Institute going through and looking at the data behind it,
Speaker 2: that eighty percent of all institutionally owned homes exist in
Speaker 2: just five percent of US counties. So again, that's not
Speaker 2: the systemic issue for prices because they're seeing this everywhere.
Speaker 2: And he also point out that not a single country
Speaker 2: in America has even has ten percent institutional ownership share,
Speaker 2: so clearly, yeah, that's not the issue, clearly when you
Speaker 2: look at the numbers. But again, what he's talking about
Speaker 2: doing is, as you point out, is going to feed demand.
Speaker 2: I look at this in a sense like the car issue,
Speaker 2: you know, look at how unaffordable cars they've gotten. I
Speaker 2: talked about this week the electric vehicles and how they
Speaker 2: were bragging that this new type of electric vehicle would
Speaker 2: be priced at under sixty thousand dollars. I thought, how
Speaker 2: is that a selling feature that's so incredibly expensive. I
Speaker 2: went back and I looked at the average car price
Speaker 2: and adjusted it for inflation, and that's going from nineteen
Speaker 2: seventy four, so the last fifty years or so, that
Speaker 2: is double what it would be if you just adjusted
Speaker 2: for the inflation for the devaluation of the dollar, and
Speaker 2: so there's something else going on here. We know that
Speaker 2: the price of cars, it's not like it has a
Speaker 2: supply issue. It's really a pricing issue, because the car
Speaker 2: manufacturers would be more than happy to ramp this up.
Speaker 2: But it's all the regulations that are put onto the
Speaker 2: cars are making it very expensive. What about the regulations
Speaker 2: that make houses more expensive, because they've got a lot
Speaker 2: of mandated stuff with regulations. From that standpoint as well,
Speaker 2: how does that affect the supply side in your view, Well, it's.
Speaker 1: A huge issue. And it doesn't just affect the supply
Speaker 1: side in getting priced in. It affects the supply side
Speaker 1: in not getting new supply because some of these regulations
Speaker 1: are so expensive that they simply cannot build, and or
Speaker 1: they it takes so long to build that you end
Speaker 1: up not keeping up with growing demand. There's a few
Speaker 1: things that all played into this, and I'll do this
Speaker 1: very quickly for your listeners. But you had the financial crisis.
Speaker 1: There was a big glut of supply relative to demand,
Speaker 1: and when the bubble burst, it was very difficult to
Speaker 1: get capital investment into housing, and then they came into
Speaker 1: a lot of new regulations about the banks what they
Speaker 1: were and weren't allowed to do, and so there was
Speaker 1: so much excess inventory that had to be worked through
Speaker 1: as millions of Americans had bought homes they couldn't afford,
Speaker 1: so that was going to set everything back a few years.
Speaker 1: Made a lot of sense why there wouldn't be a
Speaker 1: lot of people lining up to build new homes in
Speaker 1: the immediate aftermath of the financial crisis. But then combined
Speaker 1: with that, demographically at the time, we had millennials becoming
Speaker 1: adult age and normally would be buying a home starting
Speaker 1: a family. But they were getting married five years, ten
Speaker 1: years later than their parents did. They were having kids five, ten,
Speaker 1: twelve years later. So it put a big increase of
Speaker 1: demand on multifamily homes and a big decrease in demand
Speaker 1: on single family But then a few more years go by,
Speaker 1: it turns out they do want to get married, they
Speaker 1: do want of kids, even though they're now into their
Speaker 1: thirties instead of their twenties, and so that is what
Speaker 1: it is. But lo and behold. Now the housing crisis
Speaker 1: purge is long gone. A lot of millennials have gotten older.
Speaker 1: There's a huge demand for single family housing, but we
Speaker 1: haven't built any new homes in ten years. Then the
Speaker 1: COVID moment happens. Interest rates go to zero. There's tons
Speaker 1: of demand, low price financing. Everybody wants to move to
Speaker 1: a bigger home, and we don't have the supply. It
Speaker 1: pushes prices up. Now you have a ton of people
Speaker 1: own homes at very low interest rates and they don't
Speaker 1: want to sell. They think they've made a bunch of
Speaker 1: money on their home. But now all of the young
Speaker 1: people entering the workforce can't afford to buy a home.
Speaker 1: There's three or four things involved there. Some are more
Speaker 1: dominant than others, but I put all of them together
Speaker 1: to say it isn't a simplistic thing. People that want
Speaker 1: to blame Blackstone for the housing crisis, or blame Fanny
Speaker 1: Free for the unaffordability thing, or just blame the FED
Speaker 1: or whatever. There's a lot of different things going on here.
Speaker 1: But the fundamental solution is that you don't have enough supply.
Speaker 1: And where you do have states that didn't give in
Speaker 1: to SEKA and the environmental regulations and burden some permitting
Speaker 1: and zoning requirements. They were able to keep in front
Speaker 1: of it by building a lot of new supply. Now
Speaker 1: house price has got more expensive in Phoenix and Dallas
Speaker 1: and Charlotte and Miami and Nashville too, even though they
Speaker 1: were much better behaved states about building new supply. But
Speaker 1: that's because their demand was huge. And so thank god
Speaker 1: they built a lot of new supply because they had
Speaker 1: a lot of new demand because a lot of people
Speaker 1: left blue states to move to red states that were
Speaker 1: behaving themselves.
Speaker 2: Yeah. Yeah, we look at building code, you know, you
Speaker 2: look at building code and the massive expansion of regulations.
Speaker 2: There are much of that being driven by Washington, you know,
Speaker 2: pushing out regulations for people, you know, do this, do that.
Speaker 2: It's going to be greener if you do this. And
Speaker 2: so there's a lot of those types of things that
Speaker 2: are there. And when you talk about you brought up
Speaker 2: the concern about Blackstone, and people get Blackstone and Blackrock
Speaker 2: mixed up and you point that out. But I think
Speaker 2: that kind of plays into people's suspicion because Blackrock made
Speaker 2: so much money out of the derivatives market that created
Speaker 2: the real estate crash, that was at the heart of
Speaker 2: the real estate crash. Stuff they made so much money
Speaker 2: with that, everybody's think, Oh, they're going to do something
Speaker 2: about that. Again. I think that's a big part of
Speaker 2: this policy that I would characterize Trump's policy as a
Speaker 2: mixture of demagogery and democrat economics.
Speaker 1: What do you think, Well, there's a lot of demagoguery.
Speaker 1: I'm not sure what Blackrock had to do with the
Speaker 1: derivatives market in the financial crisis, right, they were just
Speaker 1: a passive asset manager that had very little fingerprints around
Speaker 1: all that. There's a lot people could criticize Blackrock for.
Speaker 1: There's certain things they could complement Blackrock for. I have
Speaker 1: a pretty thoughtful take on the good, bad, and ugly
Speaker 1: of Blackrock, almost nothing to do with housing, but the
Speaker 1: Blackstone is a larger I don't blame people for getting
Speaker 1: black Rock and Blackstone mixed up. That's easy enough mistake
Speaker 1: to make. I do, however, blame people for still holding
Speaker 1: on to the class warfare narrative when it has been corrected,
Speaker 1: when it has been pointed out, Hey, we're not talking
Speaker 1: about Blackrock, guys, we're talking about Blackstone. But the demagogery
Speaker 1: is too important to them to let go of. I
Speaker 1: want to hold onto truthful narratives when we critique public policy,
Speaker 1: and I don't like seeing my friends on the right
Speaker 1: hold on to untruthful narratives just because it fits a
Speaker 1: demagogay that has become baked in the cake. Yeah.
Speaker 2: I've said many times the Republicans are the Democrats of
Speaker 2: my youth, and the Democrats are the Marxists of my youth.
Speaker 2: We have drifted in that direction on both sides, and
Speaker 2: so it is kind of interesting the as I said,
Speaker 2: kind of the demogogery as well as the Democrat policies.
Speaker 2: And you point out and you're op ed piece about
Speaker 2: how this sounds like Bernie Sanders and Elizabeth Warre even Trump.
Speaker 1: By the way, by the way, if I'm being fair here,
Speaker 1: some of it is not sound like them. It's literally them.
Speaker 1: It was, you know, banning institutional ownership of homes, limiting
Speaker 1: credit card fees. That was actual legislation that these two
Speaker 1: socialist senators wrote.
Speaker 2: Yeah, well, you know, I think that there is something
Speaker 2: to say about usury laws. I think that was something
Speaker 2: that served us well as a society in the past.
Speaker 2: I think there's been a huge imbalance in terms of
Speaker 2: what they actually have to pay to get their money
Speaker 2: from the Fed or whatever. And what they charge people.
Speaker 2: I think we've gotten into loan shark territory there. So
Speaker 2: I'm kind of sympathetic to putting something on about usury.
Speaker 2: But of course what Trump is talking about is a
Speaker 2: one year moratorium on it, and to me, that is
Speaker 2: no different than a kind of a come on rate
Speaker 2: to get you to switch your credit card company that
Speaker 2: we've seen over and over. In one year moratorium on
Speaker 2: lowering the rate really doesn't do much to help. You
Speaker 2: can actually get a better deal than that with changing
Speaker 2: credit card companies.
Speaker 1: Yeah, I don't believe that the credit card companies have
Speaker 1: anything to do with usury laws biblically defined. I mean
Speaker 1: the concept of not having exorbitive interest, but in terms
Speaker 1: of usury being a personal law with one's neighbor who
Speaker 1: is destitute and hard up and not taking advantage of
Speaker 1: them for commercial purposes. Credit cards the interest cost is
Speaker 1: zero when you pay your bill every month. This is
Speaker 1: revolving and non purpose credit. That one lender in America
Speaker 1: has seven billion dollars of bad debt write downs per
Speaker 1: year because this is totally unsecured lending. And so the
Speaker 1: cost of credit cards to low income and new borrowers
Speaker 1: or maybe people with troubled credit past. The cost of
Speaker 1: it has to factor in, just for one bank, seven
Speaker 1: billion dollars a people that don't pay their credit card
Speaker 1: bill back party. Hey, my problem is, if I'm afraid
Speaker 1: of usury, which it sounds like you and I both are,
Speaker 1: I believe this creates a lot more usury because when
Speaker 1: the bank stop generating credit cards because they're going to
Speaker 1: lose money, their net profit on the credit card business
Speaker 1: is somewhere between seven and nine percent. When they when
Speaker 1: they then say okay, well now we can't charge more
Speaker 1: than ten percent, and we're going to lose seven billion
Speaker 1: dollars on bad borrowers. So we're just not going to
Speaker 1: extend credit cards to a whole segment of the population
Speaker 1: that needs them for building credit, for expenditures, for medical emergencies,
Speaker 1: what have you. Where are those people going to go.
Speaker 1: They're going to go to real loan sharks, to a
Speaker 1: day lenders, to other higher cost, higher usury expenditures. So
Speaker 1: that's why I opposed it when Bernie Sanders wrote this
Speaker 1: bill last year. And while I want to see cost
Speaker 1: of credit be proportionate, there's one thing that really does
Speaker 1: hold the credit card companies inline, and that is the competition.
Speaker 1: But what President Trump's trying to do is eliminate competition
Speaker 1: and make everybody charge the same amount. That's not going
Speaker 1: to help.
Speaker 2: No, Yes, I would argue, though I would say one
Speaker 2: more thing. I'd say, if they've got that big a
Speaker 2: bad debt issue, as you point out, maybe they're not
Speaker 2: doing due diligence when it makes ten credit, So maybe that.
Speaker 1: Should be a prodigence on first time home. On credit
Speaker 1: card borers, they have no assets and often no income
Speaker 1: and no credit, so the due diligence means not giving
Speaker 1: them credit, and society hates that even more. It's a
Speaker 1: risky form of credit. And what they do to pay
Speaker 1: for it pay for the lack of due diligence because
Speaker 1: this is not like a home underwriting when you're looking
Speaker 1: at income verification and you have an underlying asset you
Speaker 1: can repossess. What they do is they charge twenty percent
Speaker 1: because they're going to recover the bad debt from good
Speaker 1: payers with a higher interest rate. That's the business model.
Speaker 1: And if you take away that, then you can say, hey,
Speaker 1: we are going to have to do harder underwriting, and
Speaker 1: that means we're not going to give about two million
Speaker 1: of you credit cards. There's trade offs.
Speaker 2: Right now when you look at some of the other
Speaker 2: policies of Donald Trump in terms of economics. She wrote
Speaker 2: an op ed piece for the National Review, and it
Speaker 2: was titled the Saddest part of this recent economic lunacy?
Speaker 2: What is the economic lunacy in your view? And what
Speaker 2: is the statust part of it?
Speaker 1: Well, in that particular article, it was all in about
Speaker 1: a four day period, I believe, where the President announced
Speaker 1: and I'm going to say some really great economic things
Speaker 1: that the President has done and hopefully will do. But
Speaker 1: what I was referring to there was the ban on
Speaker 1: institutional ownership. We've already talked my opinions on credit card
Speaker 1: interest caps that we've already talked about, I'm going to
Speaker 1: make Fanny and freddie Go buy two hundred billion dollars
Speaker 1: of mortgage bonds to try to manipulate interest rates, and
Speaker 1: then saying I'm going to tell our defense companies that
Speaker 1: they can't return capital to shareholders. So our private companies
Speaker 1: like Lockheed Martin and Raytheon and Boeing that we're not
Speaker 1: going to allow them to reward investors with dividends and
Speaker 1: stock buybacks. Whereas if somehow we're going to maintain our
Speaker 1: superiority and as a defense industry if we can't attract capital,
Speaker 1: and what causes you to not attract capital is treating
Speaker 1: capital poorly. So he had all four of those ideas
Speaker 1: in about a five day period. I wrote an article
Speaker 1: at National Review criticizing all of it. And yet right
Speaker 1: now I hear that the White House is very seriously
Speaker 1: considering indexing capital gains on primary residents to inflation. That's
Speaker 1: a brilliant idea. That supply side that will enable people
Speaker 1: that want to sell a home but are holding it
Speaker 1: because the tax burden, and a tremendous tax relief that
Speaker 1: incentivizes a natural flow of activity that creates new available
Speaker 1: inventory in the housing market. He in his first term
Speaker 1: reduced the corporate income tax from thirty five percent to
Speaker 1: twenty one percent in the Big Beautiful Bill Act last year,
Speaker 1: which had plenty of things in it I didn't like,
Speaker 1: and plenty of things they didn't do enough. They didn't
Speaker 1: cut spending enough, in my opinion, But it has supply
Speaker 1: side tax deductions to incentivize more business investment, full expensing,
Speaker 1: bonus appreciation, deduction for research and development, so there. I'm
Speaker 1: not a constant critic of the president's economic agenda, but
Speaker 1: I do want to call it out when some of
Speaker 1: the good things in his economic agenda are going to
Speaker 1: be impeded by the bad things in the economic agenda.
Speaker 1: And where it comes from is impatience. It's the same
Speaker 1: thing that caused Kamala Harris or Elizabeth Warren to come
Speaker 1: up with these ideas, the belief that government needs to
Speaker 1: do something now. Most of the time when government does
Speaker 1: something now, they make it worse, not better.
Speaker 2: Oh yeah, and you talk about that, you talk about
Speaker 2: human action, human freedom, you talk about some of the
Speaker 2: Austrian econ economists like Mesas and Hyak and so forth.
Speaker 2: The knowledge problem and I've always said that about centralized
Speaker 2: control and centralized planning. Even the smartest person doesn't have
Speaker 2: sufficient information to make these decisions like the marketplace does.
Speaker 2: Is kind of the invisible hand that is there. And
Speaker 2: yet do you think that they will use the idea
Speaker 2: of artificial intelligence to attack that knowledge problem? In other words,
Speaker 2: saying well, we can sort through massive amounts of information
Speaker 2: as they can with AI. They can go through and
Speaker 2: do audits of individuals, and a lot of things like
Speaker 2: that to organize and find the needle in the haystack.
Speaker 2: Are they going to then try to make that argument
Speaker 2: that we ought to let government do it with their
Speaker 2: artificial intelligence? How do you do you see that breaking out?
Speaker 1: If people don't fight back against this, they have no
Speaker 1: idea what kind of tyranny and statism is coming. I agree, yeah,
Speaker 1: because the notion that all we're talking about the knowledge
Speaker 1: problem means they don't know what questions to ask, They
Speaker 1: don't know time and place circumstances, They don't know the
Speaker 1: immediate context the way a person who runs a trucking
Speaker 1: company in Nebraska knows or a bakery in Des Moines, Iowa,
Speaker 1: that they have local access and thought process and history
Speaker 1: and whatnot at a very imminent, proximate level. That those
Speaker 1: are the decision make factors that matter most and what
Speaker 1: we do that Washington, c can never have the idea
Speaker 1: that AI is going to give the government the ability
Speaker 1: to do it in a better way than that humans
Speaker 1: using their own language learning models. And then the application
Speaker 1: from that knowledge that you could say, well, AI gave
Speaker 1: us more information, so we may as we I'll let
Speaker 1: the information go to bureaucrats in Washington, D c because
Speaker 1: they're really smart. Even if they get the information because
Speaker 1: of AI, it doesn't solve high X knowledge problems to
Speaker 1: what they do with that information context You guys to
Speaker 1: one's own individual, family, business, community, etc. Buying into that
Speaker 1: argument is an invitation for statust tyranny.
Speaker 2: I agree, and I'm very concerned about the AI initiative.
Speaker 2: That's one of the things that concerns me so much,
Speaker 2: the Genesis Act and clearing the clearing the decks for
Speaker 2: AI to go basically unregulated for ten years. Because there's
Speaker 2: a great deal of harm that can be done by
Speaker 2: AI by the government. There needs to be regulation of
Speaker 2: the government's use for AI, I think, and that's one
Speaker 2: of the things that really concerns me a great deal.
Speaker 2: We've talked about a lot of different things, and I
Speaker 2: really do appreciate your perspective on it, David, and very
Speaker 2: interesting and I enjoy reading your articles. I have not
Speaker 2: read your book yet, but I'm looking forward to doing
Speaker 2: that at some point in time. I think we all
Speaker 2: need to get back to human interaction and the importance
Speaker 2: of person to person interactions, the family and the community
Speaker 2: and other things like that. And I think all this
Speaker 2: the new technology is being thrown at us. The rapidly
Speaker 2: increasing change is naturally pushing us away unless we fight
Speaker 2: against that tide. And I think it's important for us
Speaker 2: to understand where we're being, where we're drifting to. I
Speaker 2: used to go to Daytona Beach a lot with my
Speaker 2: family and you could get pulled out with the undertowe
Speaker 2: not really realize how far you are out until the
Speaker 2: lifeguard whistled you in. And so we're trying to act
Speaker 2: like a lifeguard and whistle people in from this drift
Speaker 2: that is taking us out to see. And I think
Speaker 2: you've got your finger on the pulse of this. We
Speaker 2: have to get back to our interaction and our families
Speaker 2: and our relationship with God. That's very true. Thank you
Speaker 2: so much, Amen.
Speaker 1: I appreciate your kind words, and I agree with you completely,
Speaker 1: and I think it's a great analogy. We don't want
Speaker 1: to get pulled away without realizing we're getting pulled away.
Speaker 1: And yet also one of the greatest agents for change
Speaker 1: here is going to be us modeling the right behavior people.
Speaker 1: The society is not going to change if we're not changing,
Speaker 1: if we're not doing the right things.
Speaker 2: Yes, it starts with each and every one of us,
Speaker 2: and then it goes out like a pebble being dropped
Speaker 2: in a pond. You know that you get things right
Speaker 2: with yourself as much as you can, and that's going
Speaker 2: to move out to your family, your community. It's really
Speaker 2: got to come from the bottom up. It's got to
Speaker 2: happen one person at a time. We're in agreement on
Speaker 2: that as well. Thank you so much, David Monson at
Speaker 2: the Bonson Group.
Speaker 1: You have a website, Yeah, so Dividendcafe dot com is
Speaker 1: the easiest one to remember. That way, people don't have
Speaker 1: to spell anything tricky like Bonson Dividendcafe dot com. Plenty
Speaker 1: of my economic writing and investment writing and information there,
Speaker 1: and then for those that are interested, bonson dot com
Speaker 1: is where all of my other material, theology, politics, all
Speaker 1: that fun stuff can be found.
Speaker 2: Great, and I'll spell it for him. B A H
Speaker 2: s E N so.
Speaker 1: H n s e s Oh.
Speaker 2: Okay, there you go. See you just illustrated the point
Speaker 2: for us. That's right, I did it for you.
Speaker 1: God gave me a lass name that is easy to
Speaker 1: find on Google. But the bad news is he gave
Speaker 1: me a last name that it has to be spelled
Speaker 1: on radio that's right.
Speaker 2: Thank you so much, David, appreciate that have a good doc.
Speaker 2: Thank the common man. They created common Core, dumbed down
Speaker 2: our children. They created common past, track and control us
Speaker 2: their comments project to make sure the commoners own nothing
Speaker 2: and the communist future. They see the common man as simple,
Speaker 2: unsophisticated ordinary. But each of us has worth and dignity
Speaker 2: created in the image of God. That is what we
Speaker 2: have in common. That is what they want to take away.
Speaker 2: Their most powerful weapons are isolation, deception, intimidation. They desire
Speaker 2: to know everything about us, while they hide everything from us.
Speaker 2: It's time to turn that around and expose what they
Speaker 2: want to hide. Please share the information and links you'll
Speaker 2: find at the Davidknightshow dot com. Thank you for listening,
Speaker 2: Thank you for sharing. If you can't support us financially,
Speaker 2: please keep us in your prayers. The Davidknightshow dot Com