Kyla Scanlon has made it her personal mission to bring economics education to a larger audience through social media. She publishes daily content across TikTok, YouTube, Substack, LinkedIn and more, explaining what is happening in the economy and why it is happening. Tyler calls her first book In This Economy? How Money & Markets Really Work a “good and bracing shock to those who have trained their memories on some weighted average of the more distant past.”
Tyler and Kyla dive into the modern state of economics education and a whole range of topics like if fantasy world building can help you understand economics, what she learned trading options at 16, why she opted for a state school over the Ivy League, lessons from selling 38 cars over summer break, introversion as an ingredient for social media success, if she believes in any conspiracy theories, Instagram scrolling vs TikTok scrolling, the decline of print culture, why people are seeking out cults, modern nihilism, how perspective can help with optimism, the death of celebrity and the rise of influencers, why econ education has gone backward, improving mainstream media, YIMBYism and real estate, nuclear pragmatism versus utopian geothermalists, investing advice for young people, why she thinks about the Great Depression more than Rome, creating the next Free to Choose, and more.
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Recorded July 8th, 2024
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This transcript was sponsored by an anonymous listener.
TYLER COWEN: Hello, everyone, and welcome back to Conversations with Tyler. Today I’m delighted to be chatting with Kyla Scanlon, who is here with us in the studio. I have described Kyla as a force of nature. From the point of view of this New Jersey boy, she has come out of nowhere from western Kentucky and is all of a sudden one of the best and also most popular discussers of economics and economic reasoning and economic thinking.
This, in my view, is fantastic. She is super active on TikTok. She has a Substack. Very active on YouTube, on Twitter, and she exists in real life also. But now she has a book out, In This Economy? How Money & Markets Really Work. Did I leave anything out about what you do?
KYLA SCANLON: No, [laughs] I think that’s pretty comprehensive.
COWEN: Welcome, Kyla.
SCANLON: Oh, thanks for having me.
COWEN: Let’s start with your origin story. When you’re young, you’re going to libraries a lot, right?
SCANLON: Yes.
COWEN: What is it you’re reading? And why do you read that stuff?
SCANLON: Oh, I read a lot of fiction when I was younger, and it was mostly because I was trying to understand world-building. I was really fascinated by that, so I read the Graceling series and Harry Potter. For me, the library was also a place to go that supported that kind of learning. I didn’t realize that reading books was cool until I went to the library. It had been really formative with how I thought about learning throughout my entire childhood and adolescence.
COWEN: Are you still doing world-building with economics? Is that a better, more fun, more complex world? Or you’ve given up world-building?
SCANLON: Well, I tried in the book. I had something called economic kingdom because, for me, thinking in games is really helpful for econ because there are so many moving pieces and everything is interconnected. The first chapter of the book was my attempt to describe the economic kingdom, monetary policy castle, fiscal policy castle, inflation castle, labor market castle, so I still try to world-build when I can.
COWEN: Any science fiction when you’re young, or not so much? More fantasy?
SCANLON: Yes, more fantasy. Science fiction was always a little too real for me. [laughs]
COWEN: Too real.
SCANLON: Yes.
[laughter]
COWEN: More generally, why do you think young women are more likely to read fantasy than science fiction?
SCANLON: Maybe it’s because it is too real. I think younger women are more empathetic, and so maybe they’re able to pick up on the nuances of science fiction. Or perhaps it’s just not the interest in aliens and in other worlds like that. I think there’s more romanticism that happens for younger women versus men, and you get a lot of that in fantasy. Not romantic in the sense of love, but just beautiful places, and science fiction can tend to be more warfare. [laughs]
COWEN: Now fast-forward to age 16. You’re in high school. All of a sudden, you’ve become an options trader. How did that happen?
SCANLON: My dad was options trading with a group called tastytrade, just self-taught, and I was really interested in it. I was like, “What is this?” I watched him do it, and he was like, “Do you want to try?” I self-taught myself. It was fun because we had something to chat about, and then I did that for an entire summer as a summer job, and I was really bad at it, but I gave it a shot. And I ended up writing a blog called Scanlon on Stocks, where I talked about my options trading experience.
That was my first foray into internet writing, and it was enjoyable. I wouldn’t recommend it, but I learned a lot about how markets function. I didn’t even know until I got to school that you could major in finance. Then I got to school, and I was like, “I’m going to be an engineer.” Then I was like, “Oh, you can do this.” It was cool.
COWEN: How efficient do you think the options market is?
SCANLON: The pricing strategies are interesting. I don’t spend as much time on it, but I know that the volatility metrics are pretty useful, and I think that there are interesting things that you can do, like combinations of calls and puts on. You just have more optionality than buying a stock and hoping it goes up, but in terms of efficiency, [laughs] I think it’s hard to make money in it.
COWEN: How is it you lost so much money trading a Brazilian ETF?
SCANLON: [laughs] Everything I did, I was pretty risk averse. I wanted to be neutral, and so, I put on this trade called an iron condor, which you do have protection against. But I just kept on making these trades where I was almost too . . . I didn’t want to take on any risk, and if you don’t take on risk, you really can’t make a ton of money, but you can lose money. And so that’s what happened to me.
COWEN: High school finishes up. You’re going to college, and you end up going to Western Kentucky University, right? Why not go to an Ivy League school?
SCANLON: It was too expensive.
COWEN: Too expensive, but you could have?
SCANLON: Yes, I had really good grades in high school. I took all the AP classes, but what was really nice about Western is, I had a full ride, and I got paid to go there. Then I ran cross country and track and field for the school. There are just a lot of options there. I look back, and I loved my professors there.
But it’s interesting because when I graduated, I went out to work for Capital Group in Los Angeles, and the only way that I got in was through a blind résumé. The Ivy League does matter for a lot of the big finance jobs. So, it was a really, really good experience, but it’s funny, the credentialism — just navigating that when you don’t have it.
COWEN: Do you think you’re better off for having gone to Western Kentucky?
SCANLON: I think so. I had a lot of opportunity there, so I ended up triple majoring, came in with a ton of credits. I did research and worked as a tutor, and I graduated as valedictorian, which was really cool. Ran there for a few years. The professors were so supportive, really just a great learning environment. At a school like that, there’s more time and space for you to mold your own learning journey, and that’s what I did. I wrote a blog all throughout school, Scanlon on Stocks. [laughs]
COWEN: You had three jobs, you once said, right? What are the three?
SCANLON: I was a research assistant, I was a tutor, and then I helped out in the office at the school, and so it was busy.
COWEN: What is it you did that you learned the most from? Or what was the generative experience at Western Kentucky for you? Taking economics, or something else? Running?
SCANLON: Running had its own life lessons, for sure, on how you balance time in sport, but for me, I just learned that you can design your own path. When I got there, I didn’t know you could really major in finance. I was going to be an engineer. I didn’t really like the math classes, so then I was like, “Okay, I’ll be a doctor.”
[laughter]
SCANLON: I didn’t really like that path either, and then I took an econ class with Dr. Brian Strow, and I was like, “Oh, this is really fascinating.” I didn’t know that you could study human dynamics and money and the philosophy of money. I just started adding on classes, and I began picking up finance classes, began picking up data analytics classes.
I think I’ve carried that optionality into life now, where you can design your own path if you have the right support, if you have the intentionality behind the decisions that you’re making. At a school like that, everyone was so kind and supportive that there was support for every crazy idea I had. I started a club, and I was able to do so many different things because people cared.
COWEN: Yes, I went to a state school as an undergrad — George Mason — and I’m actually very glad I did, but it’s unusual.
Then you finish, and obviously, you didn’t go to graduate school. Is it just you’re fed up, or too many other things intervened? What was your thinking then?
SCANLON: I wanted to do a PhD.
COWEN: In economics or finance? Both?
SCANLON: Either one. I talked it over with my professors, and they were like, “You should get some experience with institutions before you do a PhD. Spend some time working at a big firm, and then you can go back and get a PhD if that’s what you want to do.” So I graduated, and six months later the pandemic happened, and so everything just got derailed.
COWEN: Now you’ve just ruled it out. You don’t want to do it. You’re too productive to go back to school.
[laughter]
SCANLON: It’s something I think about a lot because I have had the opportunity to go and speak in classrooms like Harvard and MIT and Berkeley. And it’s one of my favorite things, just talking to students, because I had professors that invested so much in me. When I got to school, I was this lump of a person. I didn’t really know what I wanted, and I had a professor whose name is Dr. Chhachhi, who just invested a lot of time in me. Dr. Lebedinsky, too.
I think, for me, there’s this deep desire to reinvest in people. And I get to do that a little bit with social media, but they’re abstract beings when you’re making these videos, and when you’re talking about the book. And I just think there’s something really neat about being in a classroom, as you know.
COWEN: Given the unusual position you have in the world, how is it you think about how you build out? Like your small group of people. In a way, you don’t have many peers your age, but the people you chat with on WhatsApp. I don’t mean family, friends, but semi-professionals, some version of your peers. How do you build that, or haven’t you? Or what does that look like for you?
SCANLON: I think I’m bad at that. I have a lot of people that I can ask questions. Derek Thompson has been a big support over at The Atlantic; Conor Sen, also, at Bloomberg Opinion.
COWEN: He’s great.
SCANLON: He’s amazing.
COWEN: They’re both great.
SCANLON: They’re all great. There are a lot of people that I can turn to and ask questions, but yes, in terms of peer group, it’s a little funny. There are some people like Josh Otten, who runs the YouTube channel Ordinary Things. We were talking about cameras today. It’s a weird intersection, where it’s economic theory, but then how do you deliver this to a wide audience? It’s a weird mix, yes.
COWEN: Then, for a while you were selling cars. Do I have that right?
SCANLON: [laughs] Yes.
COWEN: What did you learn selling cars?
SCANLON: What did I earn?
COWEN: No, what did you learn?
SCANLON: Oh, what did I learn? I learned a lot. It was actually a really formative experience. I didn’t realize how formative it was until I was talking about it a few months ago, because when you’re dealing with people buying cars, you’re with them during an incredibly vulnerable financial experience, and they hate you. They’re like, “This person is trying to rip me off.”
I sold Hyundais. I was 19 years old, during one of my college summers. I just learned how important it is to have economics education. A lot of people come in — maybe they don’t understand what a down payment is, or what interest rates are, or what sort of financing they have to look at. Everybody came in way over budget.
COWEN: So, that’s your start as a TikToker, YouTuber, everything else, was selling cars.
SCANLON: I think so, yes, without even realizing it because I was so frustrated because the industry — it’s ridiculous. Everybody wants to make money. It’s a business. For me, I looked at that, and I was like, “Wow, there’s so much opportunity to help people just understand this stuff, understand the world around them.” It definitely forayed into the content.
COWEN: Were you good at selling cars?
SCANLON: I was very good.
[laughter]
Surprisingly, because I’m quite introverted. In my experience, most sales things, especially something like that, people just want you to listen to them. That’s something I immensely enjoy, just listening. I sold, I think, 38 cars my whole summer. I was on the lot. I worked insane hours. I sold a lot of cars and met a lot of really interesting people.
COWEN: You say you’re introverted. Now, how many TikTok videos do you think you have, not including any alts?
SCANLON: I think over 500.
COWEN: Over 500?
SCANLON: Yes.
COWEN: How many YouTubes?
SCANLON: Oh my gosh, probably over 150, 200.
COWEN: Substack, other things — how does that square with you being an introvert? What’s the bigger model here?
SCANLON: I started making videos during the pandemic. I was living alone in Los Angeles. I was just losing my mind in this 350-square-foot apartment. Nobody knew when it was going to end. I said, “The only way that I’m probably going to have connection is if I’m talking to people through a screen.” So, I just started talking about stuff. I’ve always loved educating. That was the point of the blog. With videos, it’s actually quite ideal for an introvert because you’re literally in a room all alone talking to yourself.
[laughter]
That’s what I have. I’m so grateful to do it every day. When people meet me in real life, I think, it can be jarring because I’m quite quiet. I prefer to listen. I think most people expect people that post on social media to be more boisterous.
COWEN: Do you have a method where you produce perfect paragraphs spontaneously? Or you have to rehearse it, or you do different takes? What’s the equilibrium here?
SCANLON: It depends on what style I’m doing. I have a whiteboard that I’ll sometimes write on. More and more, I’ve tried to just riff, have it be more stream of consciousness. I don’t know if that works. What I normally would do is write out a script in my notes app and just read from that, and then pull —
COWEN: You’re not looking at it when you’re talking, right?
SCANLON: No.
COWEN: You’re just saying things. You write it out, and then you put it aside.
SCANLON: Yes, exactly. Actually, the goal is to keep your eyes on the screen at all times, to be looking at the other person who’s watching it.
COWEN: Now you can just riff on anything. You’re with a friend, and the friend says, “I want three minutes of Kyla on compound interest.” And you can just do it.
SCANLON: Yes. If somebody gets me talking about the Federal Reserve . . . Within my friend group, there’s usually some countdown until I mention the Federal Reserve. [laughs] It’s something I really enjoy talking about. I don’t quite understand human obsession. Why people get interested in things is something that’s very interesting to me. I don’t quite know why the economy is so fascinating to me personally, but I think it’s really important that people understand it.
COWEN: As someone who would count as an outsider by most typical standards, compared to other commentators on the Fed, what is it you think that you might see or understand that others undervalue?
SCANLON: I think there’s definitely a young-person audience that I pull from. Every day I get hundreds of comments from people telling me their own personal experience, what they’re going through. My audience is younger, 20 to 35. I think that is very useful. It’s a more boots-on-the-ground approach. I would say that’s the primary thing.
COWEN: Does being on social media so much drive you crazy?
SCANLON: Yes. You know this. You’re on there.
[laughter]
COWEN: I don’t think it drives me crazy, actually.
SCANLON: Really?
COWEN: No, I don’t think so. Maybe it’s not for me to judge.
SCANLON: Do you separate yourself from it?
COWEN: Yes.
SCANLON: You post something, and you’re like, “Okay.”
COWEN: I don’t follow much politics. We’re here in early July. I’ve actually been following politics the last week.
SCANLON: Yes, it’s hard not to.
COWEN: That’s unusual. I’ll just look the other way and read about China or India or something. That’s politics of a different kind, right?
SCANLON: Yes. For you, how do you separate yourself from it?
COWEN: I think I’m a very good person at compartmentalizing. But you think it does drive you crazy.
SCANLON: I think so because a lot of the comments are personal. They see you as a nonobjective commentator, even if you’re talking about data. For me, it’s been difficult the past few months because you’re talking about various data sources, what’s going on with inflation, what’s going on with the labor market. But because we’re in a post-truth society, everybody is like, “You’re lying.” “You’re a liar.” “You’re horrible for that.” I’ve worked on that because you’re just a figment of the audience’s imagination.
COWEN: Yes, in a way, they’re making a deal with you. They promise to listen and give you numbers, and you promise to let them abuse you. That’s the exchange. That’s what they want.
SCANLON: Yes, exactly.
COWEN: It’s the right to selectively abuse.
SCANLON: Something to project on. It’s never about you. My ego gets horribly in the way. Ideally, I’d remove all ego and realize it’s not about me, but I am working on that still.
COWEN: Do you think by now you have a thick skin?
SCANLON: Oh, yes.
COWEN: So, you’ve worked on it, and you’ve succeeded.
SCANLON: I think success is an end state here where I don’t know if I’ll ever reach it. For me, it’s more of a process than I’d like. I still take a lot of stuff very personally because I just take it personally when it feels like the data isn’t resonating, or if I’m not explaining something properly, or if I haven’t done a good job at conveying the idea of the video. I think that’s the hardest part. It’s like, how could I have done that better? Luckily, I get another chance to try tomorrow, but I would say it’s disheartening sometimes.
COWEN: Putting aside your own work, what kind of economics do you think young people are learning from TikTok?
SCANLON: [laughs] Concerning.
COWEN: Is it conspiratorial? Is it leaning in some particular direction?
SCANLON: I would say it’s definitely conspiratorial. There’s a lot of desire to pin inflation onto companies, which I don’t know if that’s the best thing to do. There’s a lot of desire to have a scapegoat. I think a lot of people are frustrated with their economic situation, and so they look at TikTok videos, and somebody is telling them that, yes, Blackrock is conspiring against them, and that’s very soothing. I think that’s where we have ended up with TikTok and econ.
COWEN: If you’re on social media so much, and they’ve driven you crazy, why is your own analysis so free from conspiratorial thinking? What’s the antidote you have taken?
SCANLON: [laughs] I don’t know. I try to read as many possible sources as I can. If I’m not talking on a podcast or doing a speaking event or in a meeting, I’m usually reading. I just try to read as much as I can. I have the opportunity to have one-on-one interviews with the deputy secretary of the Treasury. I just interviewed Austan Goolsbee of the Chicago Fed. I feel like having that one-on-one talk helps me realize, “There’s real stuff going on here.”
COWEN: Are there any conspiracy theories you believe in? Because I’ve asked myself this question. There’s very few, but there are a few.
SCANLON: What do you believe in?
COWEN: I think JFK probably was killed by more than one gunman, but not for sure. I think there was some concerted effort to adjust the timing of the arrival of the vaccinations before the election. I think more sports events are fixed than we realize. Those would be the three I’m inclined to believe in. It’s hard for me to think of others.
SCANLON: Do you think they’re fixed because of gambling?
COWEN: Yes, just gambling. It’s often the referees more than the players — or team coaches or someone who knows about an injury. There’s now betting on how many rebounds did you pull down? Some of it’s even the players. There is this one guy in Toronto — he’s been banned from the NBA. I suspect that’s tip of the iceberg. But those are my only conspiracy theories. I feel impoverished.
SCANLON: No, those are more than I have. I don’t know if I’m even wise enough to know what conspiracy theories I believe in because I tend to take everything and be like, “Okay, that makes most sense to me.” I think that the thing with conspiracy theories is there are oftentimes more incentives in place than we know, which goes to the point of JFK and what that could have meant. But yes, I don’t have any direct ones that I’m like, “Yes, that probably happened.”
COWEN: How is TikTok changing, putting aside possible ban, but just the thing itself?
SCANLON: There are a couple of things that are happening. People aren’t on there as much. I think Instagram Reels has surpassed it in popularity. Mark Zuckerberg just continues his domination path. I think, also, the algorithm is maybe not as good as it used to be. Perhaps it’s because not as many people are scrolling, but there’s more and more focus on TikTok Shop.
TikTok really wants to make a lot of money, and they’re like, “If we sell commerce, if we sell goods to people, that’ll be the way that we make money.” Now, every other video for people is a face mask or a purse or clothes. You have users that are constantly being advertised to. I think more people view TikTok as an exhausting experience than one of connection, as it was in 2020.
COWEN: In general terms, how do you think Reels is different? Is it more wholesome, or . . . ?
SCANLON: Well, I only scroll once a week, and that’s usually just to get a sense of what’s happening.
COWEN: This is on Reels? Or you mean on TikTok?
SCANLON: Oh, on both. Yes. I try not to actually use social media other than Twitter. I’m a Twitter power user or Twitter power scroller, I suppose. Yes, Reels is a little bit different because they have curated it to be more wholesome. You’re not constantly being advertised to, at least not as directly and as gimmicky as TikTok. I think that there’s more focus on the authentic creator.
What’s nice about Instagram as a platform is that you have stories and that you have posts and you have reels, versus TikTok does have stories, but when you scroll on TikTok, you don’t really scroll for a single person. Instagram — you’re able to curate more of a personality because there’s a profile page. It’s not as algorithmic. There’s more intentionality, I think, with the platform design, versus TikTok just wants to keep you scrolling and scrolling and scrolling. I think Instagram — it seems to be okay if you stray from the path awhile.
COWEN: Say five or ten years from now, what do you think Reels will look like? Or what will it do, or how will it differ?
SCANLON: I think it’ll be much more engaging. I think there’ll be AR VR. I know Mark Zuckerberg is quite interested, or used to be, in the Metaverse. I’m sure AI will have some sort of involvement with that, whether it’s AI creators or something else. I think that the scroll model will have to shift. I’m not sure what it’ll shift to, but I think that sort of motion is going to not be so enticing soon. But yes, I think it’ll definitely be much more interactive, and the user will be able to direct it much more than in the algorithm, if that makes sense.
COWEN: Yes. As someone who’s been and still is an avid reader, if you think about teens or people in their early twenties, what’s the future of print culture and reading? Does that worry you, or you think it’s fine? Or TikTok is just selling books, and it’s wonderful? Or it’s falling to pieces? What’s your take?
SCANLON: What do you think?
COWEN: From the data I see, print culture is declining, unless you count the internet, which is not what I would mean by print culture. If you can be on a flight, say, sit in business class, the most elite group of people you could imagine — like pick an elite route — and everyone’s looking at a screen, and I’m the only person reading, and that worries me.
SCANLON: Do you think they’re reading on their screens, or do you —
COWEN: No, they’re watching movies or videos. Now, book sales are fine. I think romance right now is the most sharply growing category.
SCANLON: Colleen Hoover. Yes. Do you —
COWEN: That may be good culturally, but I’m not sure it’s good for print culture as we understand it.
SCANLON: No, it’s a big deal if you sell at your advance. I think 99 percent of authors don’t. It’s an alarming statistic. The whole business model of print is a little bit funky in terms of the publishers. I just published a book, so I’m hoping that people go and buy it.
COWEN: Again, In This Economy? How Money & Markets Really Work. Very good book.
SCANLON: I don’t know. For me — and I feel like it’s probably the same for you — books, I try to read as much as I can, especially print. I just feel there’s something so beautiful about having a paper experience and being able to write on the page and annotate it. The more and more people I talk to say, “Oh, I don’t read,” or “I need to get back into reading.” That’s just my anecdotal experience. You look at the numbers too, and it’s —
COWEN: The numbers don’t show what’s happening. I’m unsure, but what is read? I also have noticed the last 10 or 15 years, I don’t see many big nonfiction books that have had a lot of impact.
SCANLON: Yes. I guess it’s like Ray Dalio.
COWEN: It may be just luck of the draw, and it will come back, but it feels the ’80s, ’90s, maybe early ’00s, you had more of that. Books like Jared Diamond, whether or not you agree with it, but everyone would read it, talk about it. Maybe Piketty was the last one.
SCANLON: Yes, sure.
COWEN: I don’t see that much of it.
SCANLON: Well, do you think it’s escapism? People just don’t want to deal with nonfiction because that’s reality, and it’s easier to escape from it?
COWEN: Or maybe the low-hanging fruit has been plucked. There’s a good popular science book on everything now.
SCANLON: Everything’s been covered. [laughs]
COWEN: Plants are intelligent, and here’s how geology works and okay, I’ve checked all my boxes. I don’t know.
SCANLON: Yes, I guess so. I love nonfiction. I read quite a bit of it. Paved Paradise — I just finished that, which is a book about parking lots and cars and car culture. It’s very, very good. There’s something appealing about fiction, but nonfiction — it’s definitely a tough space. Psychology of Money, Morgan Housel — that did very well. Yes.
COWEN: What shapes what you choose to read? Do you go to BookTok, or friends tell you, or you visit bookstores or anything?
SCANLON: Yes, it’s usually through visiting bookstores, and then I normally have a topic of the week that I’m pretty interested in. It’ll be dominoes, and I’ll read the history of dominoes, or I read a book about cults. It’s just whatever my mind wanders to. There’s always a book about it. Yes, I just follow that. I ride my bike a lot, and so I just listen to audiobooks and podcasts on the bike.
COWEN: The best book in an area you don’t care about is very, very good, and probably you should read it. Even if you don’t care about, like, cults, right?
SCANLON: Yes. Oh, sure.
COWEN: What was the book on cults?
SCANLON: I’m trying to remember. It was actually called Cultish by, is it Amanda Montell? Have you heard of it?
COWEN: I don’t think so.
SCANLON: Okay. I might have said her last name wrong, but it was good. It was talking about cults of the past and then cults of the present — CorePower, CrossFit. Just what happens when people get sucked into a cult. I think that’s quite interesting because, with people trying to figure out religion, I think there’s more tendency to have cult-like tendencies.
COWEN: Yes. We have more cults in my opinion.
SCANLON: You think so?
COWEN: There’s the AI doomer cult, right?
SCANLON: Yes.
COWEN: There’s Accelerationism cult. They’re both cults. You might agree with one or the other, but they function as cults.
SCANLON: Yes. Do you think people are seeking that out, or do they just stumble into it?
COWEN: I think they’re seeking it out. It’s maybe a more volatile age, and people want to latch onto something organized. Religion is weaker, so they look somewhere else, maybe adjacent to religion but not quite formally religious.
SCANLON: Do you think that’s just human behaviors, that we always need something to latch onto? We’re always going to need to seek out the capital-T truth?
COWEN: I think when social trust is lower, which we’ll get to as a topic, people want to do this more because they don’t trust in the authorities as much. They believe in all these conspiracies, right?
SCANLON: Yes. Why do you think people turn towards conspiracies? Is it just because they don’t trust institutions?
COWEN: I think there are two things at work. One is we’ve actually had a number of bad events. Financial crisis and pandemics and 9/11 would be three big, obvious ones. Arguably, there are more, but those three right there is a lot. That sets off a negative mood.
Then, I think there’s a lot of contagion, and it feeds on itself, and you get into the cycle where it’s self-validating. Social trust is lower; things, in fact, work less well, and politics works less well; and then you think, “Oh, well, I’m right not to trust all of this.” It looks like you’re right. In a way, you are right, but you still would be better if you could jump-start a much more positive dynamic.
SCANLON: Do you think there’s a human tendency towards negativity in that sense?
COWEN: Yes, absolutely, especially when you have those few bad events that clearly are just very bad, right?
SCANLON: Yes, but people don’t view them as outliers. They view them as constant —
COWEN: There’s recency bias. If you were born in year whatever, and the three big events of your life were not like the fall of communism, but 9/11, great financial crisis, and the pandemic, you’re like, “Whoa, what kind of world is this?”
SCANLON: Yes. I just turned 27. I was born in ’97, so born into the dot-com bubble.
COWEN: That’s you. Yes.
[laughter]
SCANLON: Yes, and my cohort, which is why I think there’s a trend towards nihilism. Yes.
COWEN: But you’re optimistic? Or not pessimistic, at least.
SCANLON: Oh, I try to be optimistic as much as I can. I try to always see the good in situations. There’s a quote from James Baldwin that I really like, where the essential ideas — you can look to all the books of the past and realize that somebody else has gone through exactly what you are going through before. History is a cycle, and so, I just take heart in that. I believe in humans, and I believe we always figure it out, even if we suck momentarily. That’s how I try to remain optimistic.
COWEN: You still live in western Kentucky, yes?
SCANLON: I bounce around — Colorado, California. I travel quite a bit right now.
COWEN: Does being in western Kentucky make you more or less optimistic when you’re there?
SCANLON: Kentucky is a very beautiful state, but it was hard for me to be there sometimes. There’s a lot that the state could figure out, and it has taken steps towards figuring out, but people struggle with their health. The opioid epidemic hit it pretty hard. There’s just not a lot of money for things that deserve to have money, like healthcare. It’s just a state that has gotten the short end of the stick for a very long time.
COWEN: What’s your ideal place?
SCANLON: To live?
COWEN: Yes.
SCANLON: For me personally?
COWEN: Yes.
SCANLON: Oh gosh.
COWEN: Constraints removed. You can afford the rent, whatever, the freedom to build.
SCANLON: I really love the mountains and the woods. I love riding my bike, so anywhere where there are trails and where I can ride on the road. It’s a simple life. Books nearby, a nice coffee shop. That’s all I really need.
COWEN: Is celebrity dead?
SCANLON: Oh, [laughs] yes.
COWEN: And do you need celebrity? You said it’s all I need, but in fact, you have however many TikTok and YouTube videos.
SCANLON: Yes, I know. There’s always a little bit of hypocrisy sometimes, I suppose. I think celebrity is dead. I put that down because I was curious what are your thoughts on that as well.
I think people look toward influencers as celebrities now. The celebrities themselves are just sort of these figments of movies. An influencer is somebody who’s going to be your “best friend,” somebody that you tune into every aspect of their lives, and they give you access to every aspect of their lives. I think that far supersedes everything that we’ve ever gotten from a celebrity.
COWEN: I think of celebrity as having peaked maybe in the 1980s. You have Eddie Murphy, you have Schwarzenegger, you have Madonna, Michael Jackson, and it was a thing. Then that starts to collapse and break down, and we recreated this very different thing, the influencer. That’s you, right?
SCANLON: I don’t love the word. This is just probably me getting up on a high horse, but I feel like I talk about the economy. I don’t really talk about my life. I guess if I’m influencing people on economic theory, perhaps. I consider an influencer somebody more who is essentially a marketing ploy in disguise, and I don’t consider myself that entirely.
COWEN: But a lot of that, people use as a channel for relating to you as a person, right? If I hold a public event, it’s striking to me, not just that it’s predominantly male, but it’s males within a certain age range, something like 20 to 35, who are somehow looking for something. They are smart, and I maybe give them some smart content they want. But it’s also connected to — there are different models of how a person can be or can be curious or can be productive, and they’re very interested in that.
The people who are 60 years old don’t feel they need to come see me because wherever they’ve ended up, it’s where they’re at. Maybe with you there’s a similar dynamic? You’re a model for something for them?
SCANLON: Productivity. I don’t know. Maybe. I haven’t really thought about that. I guess so. I’m not sure what people would find in me.
COWEN: If you hold a public event, who shows up? A book signing.
SCANLON: It’s what you just described. Yes, the same group of people.
COWEN: Same group of people.
SCANLON: Yes, pretty much.
COWEN: They’re looking for something?
SCANLON: Yes.
COWEN: What do they think they’ll find from you, through you, with you?
SCANLON: I get approached after events most of the time, and people often just thank me for simplifying economics. I think that’s the main thing. The most recent conversation I had was this person who felt like his worries weren’t being recognized as a young person. That’s what I try to spend a lot of time doing. I talk a lot about the housing crisis, talk a lot about what it’s like to move up the “ladder.” Perhaps it’s that.
There’s a lot of focus on being 40 and being a part of the economy, but maybe not being 20 and being a part of the economy.
COWEN: How good or bad do you think economics education is today?
SCANLON: I think there are a lot of really great resources. You all do a great job with that.
COWEN: Thank you.
SCANLON: I don’t know if we need to start in high school, require an econ class. I think even the concept of supply and demand sometimes can be confounding to people. I would say that there are plenty of resources, and I don’t know if people just don’t want to have access to it, but there’s maybe not a lot of interest. Have you found that?
COWEN: My intuitive sense — not based on data — is economics education was better in the 1990s, in the sense that often what really changes people’s minds are events, and people were more sensible then and less conspiratorial. There are way more resources now, obviously —
SCANLON: Yes, tons.
COWEN: — but I’m not sure it’s improved the actual educational outcomes. If anything, it seems to have gone backwards.
SCANLON: Do you think that’s across the board? We have way too much information and not enough knowledge?
COWEN: No, I think the events have gone a bad way, and that makes people more negative in ways that are not useful.
SCANLON: Because we haven’t had a moon landing or something exciting?
COWEN: Yes. Now, we may have those in biomedicine, with AI, but even those — they seem to freak people out a bit.
SCANLON: People are really freaked by AI. I would say, on average, more people are freaked out than excited.
COWEN: I think that’s right. I’m not sure it’s going to serve that function, even if you think it should.
SCANLON: Do you think the hesitancy to education, then, is people are like, “It’s just not exciting to me,” and because there’s no event to base exciting things off of?
COWEN: I think it’s too exciting, but in the negative direction.
SCANLON: Sure.
COWEN: Like, oh, someone stole the election, or so many different versions of whatever, some mistaken belief about COVID and very negative. If people have negative feelings, I think their actual thoughts become worse, even though sometimes the negative feelings are justified.
SCANLON: What role do you think the media play in all of that? Do you think it’s perpetuated a bad cycle?
COWEN: There’s some negative bias in media, which is hard to overcome. One of the things I’ve liked best about your work is, you never fall for that, always trying to be objective and analytic. So, there’s some negative bias.
Then, I think the US having lost relative status in the world — people may not be directly aware of it, but at some level, they sense it, and that makes people more negative.
SCANLON: Sure.
COWEN: Not in all other countries, to be clear, but here. Then, I think that adds on to these other negative events, and people become more emotional and just have worse ideas.
SCANLON: The worse ideas —
COWEN: About economics.
SCANLON: Sure.
COWEN: About many other things too, but certainly about economics.
SCANLON: Just what’s the right economic path, and maybe not seeing economic policy as a whole.
COWEN: The 1990s was very Pollyanna-ish. Mistakenly so, I think, in retrospect, but I think it was good for people’s ideas to be more optimistic. The gains from trade were more easily grasped.
The place where I’ve seen the best economic education, I think, is Singapore. Try to go there if you can. It’s not surprising if you have a taxi driver lecture you about comparative advantage, even using the term. It’s happened to me, and it doesn’t seem weird. People there just know a lot.
SCANLON: Do you think that’s because of good public education?
COWEN: A very good education system, but I think they’ve had so much recent success. It’s fraying now, but overall, there’s still enough positive outlook that it steers them in better directions.
SCANLON: Because there’s such a negative outlook here, of course, the direction is going to be negative.
COWEN: I worry the negative outlook is spreading to many other places, including Singapore, actually.
SCANLON: Oh, so the US is exporting negativity?
COWEN: Possibly. We’ll see. If you go to different countries, like you go to Poland — things feel very positive. Well, they’ve had 4 percent growth for, now, over 30 years. Of course, it’ll feel pretty good. India, people seem quite optimistic, but it’s harder to think of places like that than it used to be.
SCANLON: Do you think it’s the worries of, you said, the US is losing status to China?
COWEN: To China, but just a general sense of, we’re not kings of the world anymore. Of course, we never were, but now it just seems more obvious that our face is being rubbed in the mud, and that breeds some amount of resentment.
SCANLON: Yes, towards policymakers.
COWEN: And just everything. It may not be policymakers. It could be elites, or people think somehow Bill Gates or someone is pulling all the strings. Often the policymakers get off easy, and it’s some set of figures who have actually nothing to do with the matter who get blamed.
SCANLON: Do you think there’s a way out of it?
COWEN: Historically, you see societies finding ways out, but if we knew the formula, I think we’d be out of it already, and we’re not out of it. I know that I don’t know the formula. I try to do my small bit, but no, there’s no formula, I think. Some of it’s luck, better dynamics, maybe people who are more analytic making more of an effort, but that might be small relative to just events.
SCANLON: It’s interesting, too, because you see people wanting to escape, I think. The people that normally might have contributed to a shifting towards positivity are instead retreating into subgroups. Everything’s fragmenting.
COWEN: Yes. It might make it harder to dig out of the various ditches, but you also hope, well, there are all these fragments. Some of them will turn positive, and maybe one of the fragments becomes a spark.
SCANLON: I hope so.
COWEN: That’s speculative. It hasn’t happened yet, but that’s my hope.
SCANLON: I hope so too. I think right, now, a lot of people feel pretty bleak, more so than ever.
COWEN: Yes. What would you do to improve mainstream media? You’re in charge, you own a TV station, a major newspaper. What would you do?
SCANLON: We were just talking about negativity in media, and there’s a chart that I like that shows the sentiment in media. Headlines have gotten extraordinarily negative. Everything has a story. It’s a business model. I don’t know if this plan would make a lot of money, but I think there’s a lot of need for foundational resources on media sites, which a lot of them do have access to. I think no paywall, which is money —
COWEN: Hard to manage.
SCANLON: — problem number one.
COWEN: But you have no paywall.
SCANLON: I have no paywall. And I think just really objective stories — I really like what Semafor does, where they tell a story, and then they say where the reporter’s bias might be. I think that’s just useful. I think you have to parcel out media stories as much as you can, be like, “Here are the facts. Here’s where potential bias might be.” Because that’s what people . . . at least right now, this idea is very responsive to the moment.
People are constantly seeking where they could possibly be lied to. I would try to do everything I can to make it as straightforward as possible, give access to the data sources that I’m talking about, like when I’m talking about CPI, “Here’s where you can go and check CPI.” That’s how I would run a media site. Yes.
COWEN: If people want to use Twitter — now X — better, what’s your advice for them? Because you do it. I do it. We do something some people don’t manage. They quit, they leave. They’re disgusted, whatever.
SCANLON: Do you block?
COWEN: No, I’ve blocked like one or two people.
SCANLON: Yes. Do you mute?
COWEN: Sometimes. The people I mute are not bad. They’re just too prolific.
SCANLON: Just saying too much.
COWEN: Yes.
SCANLON: I love Twitter. I think that I wouldn’t be here if it weren’t for Twitter, and I’m very aware of that just because so many smart people are on there. That’s where I got my start. For me, I know who’s really good to listen to, like Employ America, great think tank. The people at Bloomberg are always tweeting great stuff, and I know what not to be paying attention to. There’s a component of media literacy to it. You have to scroll by the viral video and get to the data source. I think that’s the way to use Twitter.
Then, of course, it’s a cesspool. The harassment is unreal right now, but you just mute your tweet when you tweet it, and then you just don’t check.
COWEN: I like the animal videos, too.
SCANLON: You watch them?
COWEN: There was one today, like two big bears wrestling with each other. I watched the whole 30 seconds.
SCANLON: Oh, what were they doing?
COWEN: Fighting.
SCANLON: Oh.
COWEN: You don’t get to see the end.
SCANLON: Oh.
COWEN: Which I suspect was not decisive.
SCANLON: Oh, no.
COWEN: But they’re pretty rough with each other.
SCANLON: Were they black bears?
COWEN: I think so, yes. Big black bears
SCANLON: Yes. I saw a bear up close, and it was one of the scariest moments of my life.
COWEN: This was in Colorado?
SCANLON: It was in Colorado, yes. We were on a hike and my dog . . . I have a dog named Moo, and she froze up, and I was like, “Okay. What’s going on?” I look over, and there’s a bear three feet away from us. Very scary.
COWEN: Oh. High housing costs. How much of it do you think is NIMBYism, and how much is it [that] it’s just worth more than it used to be to live near the right people?
SCANLON: Oh, are those not the same thing?
COWEN: Well, they’re interrelated, but let’s say there’s no NIMBY. Like Seoul, South Korea — they’ve built an enormous amount. It’s a very vertical city. It has like a third of the country’s GDP, but it’s still very expensive to live there. You can’t say they’re too NIMBY, but it’s worth a lot to be in Seoul. Busan is important, but there’s nothing really close to being in the economic, financial, and cultural center. At least in Korea, it seems it’s about co-location and not about NIMBY. But if it’s Oakland, California, I suspect it’s mostly about NIMBY.
SCANLON: NIMBY Berkeley. Yes, I would say definitely in some areas, it’s about NIMBY. It’s people really trying to protect the value of their home and the value of what they perceive their surroundings to be, and they don’t want any change ever. I think some components of it are definitely people being resistant to any idea of progress. Then I think a lot of it, too, is just we haven’t built enough.
I interviewed the deputy secretary of the Treasury about the housing crisis, and yes, it’s a problem that we’ve had since the Great Recession. Home builders got freaked out when the housing market crashed, so of course, they’re not going to build. Now rates are really high, so it’s even harder to build. We’ve had all these zoning restrictions, and we just make it really hard to build, too. I think it’s this perfect storm of events.
Then also, a house is meant to be both a speculative asset and a place that you live. There’s one of my favorite charts from the Fed. I talk about it all the time because it’s a distribution of financial assets. It shows the bottom 50 percent — all their wealth is tied up in housing. If you say to those people, “We’re going to build around you and potentially reduce the value of your home,” they’re not going to be so happy about that.
There are studies showing that building more doesn’t reduce the value of a home, but I think you’re fighting an uphill battle with housing because we tell people that this is the ticket to the American dream, and then also just don’t have enough of it because of that.
COWEN: If someone with real money came to you and said, “Should I invest more in real estate in very high-quality locations?” what would you tell them? How should they think about that?
SCANLON: I guess so. I think 70 percent of homes in New York were recently bought up with cash. So, people are definitely still investing in those areas. This is a dynamic that I’m quite interested in because you saw, during the pandemic, people moving away from urban centers and moving out to the suburbs or rural areas to have more space. I don’t know if, with transit and cars and stuff, will the outskirts become more desirable? I think you can look at Texas and see that. It just depends on what highly desirable area that they’re talking about.
COWEN: You don’t think the YIMBYs will win and crash the price of real estate?
SCANLON: I think you can look at Austin, Texas, and see that the YIMBYs did win there, and the housing prices are going down. I think they were down 12 percent as of December 2023. So, I think in some places they’ll win, but then in some places, like New York, for example, the resistance is just going to be far too high. It’ll just depend on what city it’s in, but I think you’re seeing a lot of progress in certain places — progress meaning building more.
COWEN: Yes. Allison Schrager had a recent column for Bloomberg. You may have seen it. She argued today’s young investors take on too much risk.
SCANLON: Oh!
COWEN: Do you agree?
SCANLON: Was she referring to crypto?
COWEN: Some of it crypto, but not only. Meme stocks would be another simple example. They can be risky.
SCANLON: Yes. Do you think that they do?
COWEN: I don’t think I have enough data. I suspect they’re in a position where they can afford it, but that they’re also not optimizing. That would be my intuitive response.
SCANLON: Conor Sen has a theory on this, where he thinks that because millennials and Gen Z can’t afford homes, they’re gambling on crypto and meme stocks, and I think I can see that. One of the comments I get most often is people asking me how they can make the most money as quickly as possible.
[laughter]
COWEN: And you have a simple answer, right?
SCANLON: Yes. I’m like, “Oh, man, yes. That’s why I’m making these videos, because I know the answer.” I think that you see a total disconnect in the market right now between any sense of fundamentals. The Magnificent Seven are up 8 percent on the week, 8 percent on the past week, perhaps, on basically no news. The stock market is driven by hype cycles right now, more so than ever, I believe. If you remove the top five companies, the AI companies, Nvidia included, the market is actually down.
To answer this question more concretely: Number one, there is a desire to gamble. Then number two, I think people don’t see the stock market as a reflection of fundamentals. They see it as an opportunity to gamble because it is so removed from elements of reality.
COWEN: Is that a hype cycle, or is it the reality that AI will displace a lot of traditional economic activity and newer companies will gain more?
SCANLON: I know that you’re a big proponent of AI. Did you see the Sequoia memo, where they were talking about how much would have to be produced in order to —
COWEN: Yes, absolutely.
SCANLON: What did you think about that?
COWEN: Oh, I think it’s all going to crash, like with the railroads and the dot-com bubble, but that it will come back and then make a fortune.
SCANLON: Oh, wow. You think right now, it’s too hyped up, it’ll swing back down?
COWEN: It depends. There’s publicly traded stuff and inside stuff, and it may be quite different answers, but all the major technological revolutions I’ve seen in history — they have bubbles, and the bubbles pop, and a lot of people lose a lot of money. I would be surprised if this time it were different, but I would be surprised if it just stayed down low and never came back. Pets.com is gone, but the internet is with us.
SCANLON: Yes, that’s true. Part of the Sequoia memo was like, “We don’t know how some of this application will be applied. We don’t know where AI will be actually useful.” Do you think that the example of pets.com with the internet bubble — there are useful parts of AI, and the un-useful parts, the pets.com of AI, will get washed out in the cycle?
COWEN: It may be more dramatic than that. One possible model is, the AI services become commoditized, so the people who paid for all the fixed costs of training and the like — they are, so to speak, the suckers. They’ll never get that money back. We’ll have really cheap AI soon for almost everyone, and most of the gains will go to users and consumers.
SCANLON: Oh, wow.
COWEN: I’m not sure that’s the case, but that would be my default model, and the investors just lost a lot of money. But you see the same with vaccines. Most vaccines don’t make money; they may lose money. They’re great for the world overall. Maybe we’re just going to keep on repeating that pattern.
SCANLON: Yes. There was a really big Bloomberg article that got a lot of pushback, talking about the energy usage of AI. Do you think that’ll be . . . Sam Altman was even like, “We have to have nuclear eventually.” What are your thoughts on AI blowing out grids?
COWEN: Well, I would be long energy — the hard part of energy, not the commoditized part, but the parts of the infrastructure that you can’t just build en masse ad infinitum. I think not only because of AI, just data centers, the demand for that will go up a lot. The US will be slow with nuclear, but countries that are non-NIMBY on energy have a very big geopolitical comparative advantage, and we just don’t quite see it yet. I think that’s an underrated feature of today’s world.
SCANLON: Energy.
COWEN: Energy. Like UAE, which has shown a lot of willingness to build a lot more, and they have a lot of sun there. I think they’ll do very well for that reason.
SCANLON: Yes, I think energy is this thing that we don’t really think about because we’re so used to just clicking on the light switch and having it work. We’ve done such a good job at hiding it from people.
COWEN: That’s right.
SCANLON: Yes. So, they just don’t think about it.
COWEN: It was a big thing in the ’70s, and then it more or less went away, and it got pretty cheap, and I just think it’s going to come back. Or it is back already.
SCANLON: I think so, too. I think that might be bigger than . . . When you were talking about AI, I think the hype cycle will die down as well. I think energy will be the point of interest when that is in a downturn.
COWEN: Yes, especially for places that don’t have simple solutions like hydroelectric or solar.
SCANLON: The cost of that has gone down tremendously. Battery power — the cost of that is down quite a bit. Solar has gone down quite a bit.
COWEN: Yes, but you still need some backup for solar. Even if batteries are good, the notion that there could be a big volcanic explosion, and the sun is somewhat blocked for a year and a half, and you just don’t have power — I think there will and should be backups of some kind. Probably those should be nuclear, but again, it will be up for grabs, and there’ll be a lot of demands that are hard to satisfy.
SCANLON: Yes, I think nuclear. Do you think that’s the way that we have to go?
COWEN: I don’t know about have to. I have friends who are utopian geothermalists. I don’t feel I can evaluate that. They feel that a lot of places — not just, say, parts of the American West — can access geothermal power just by making the technology better. I just can’t tell if they’re right or not, but if they’re right, that’s great. If they’re not right, we’re back to nuclear, but voters don’t like nuclear in most countries.
SCANLON: That’s just because of associations?
COWEN: They don’t like having it near their homes — the associations. French voters seem okay with it, Swedish voters. Not everywhere, but NIMBY is strong, and NIMBY versus nuclear — NIMBY has always won.
SCANLON: Do you think that voters oftentimes vote against their own self-interests?
COWEN: Yes. That’s what voting is for.
[laughter]
COWEN: Feel good about yourself but make a bad decision.
SCANLON: Has that always been the case?
COWEN: It’s selective. I think the overall composition of the federal budget — it’s too much to old people and not enough to young people, and that is because old people vote more. You wouldn’t actually say it’s bad for the old people. No, they get more money, and then they’re going to die. It’s okay for the old people, but still, there’s a lot of expressive voting, and people wanting to vote for causes just to send a message. But when it’s done en masse, it screws up the system.
You see this in the French elections that were just concluded. The extreme left, the extreme right — they get a lot of votes because people are upset with the status quo. In my view, it would have been better if they all voted for Macron, and maybe you had 5 percent or 10 percent with protest votes. But you have most of the electorate casting a protest vote.
SCANLON: Why do you think that’s happened? Why has everything become to the tail ends of the extremes?
COWEN: Well, if you mean France, I think people are genuinely upset about what they consider too much immigration, and there’s not been a real policy response. But I also think the French have a historical tradition of being especially expressive politically: action in the streets and strikes and more. Americans have their own version of that. Maybe that would be listening to people on TikTok or something.
[laughter]
COWEN: But France, you get out there and you do something and you really protest, but I think they end up with a less functional politics for that reason. A lot of it is self-destructive.
SCANLON: We don’t have to get into it, but do you think the US is trending toward that?
COWEN: I think we’re trending toward greater passivity, where all kinds of outrageous things happen and no one protests, which to someone my age is quite extreme and unusual. And they just operate on social media, and maybe that absorbs the chaos, but you get less error correction over time.
SCANLON: Because people are passive.
COWEN: People are very passive. They become more passive, but they’re given an outlet where they feel like they’re doing something.
SCANLON: Yes, like sharing a story on social media.
COWEN: Yes. In the aggregate, the stories wash each other out so you don’t have impact, even though your story might have caught some attention. But both sides do it, and then you’re left with not much protest.
SCANLON: Yes, and the passive acceptance of whatever the result is going to be.
COWEN: Without taking sides politically, there have been a variety of candidates selected in different places, where 30, 40 years ago, you would have thought there were going to be big protests, and mostly there weren’t.
SCANLON: Yes. I don’t think there’s been much of any. There were protests during 2020 on BLM, but yes, it doesn’t seem like . . . That’s something I’ve thought about. There would be, why don’t I protest certain stuff, right?
COWEN: Yes, you do in a way, but very indirectly.
SCANLON: Yes, it’s sharing a story. It was really interesting watching the French election because it mirrors, in a sense, what’s happening here, especially with the breaking apart of the left here. People just seem to want to check out.
COWEN: Maybe the depression, the passivity — it’s all part of some common negativistic picture.
SCANLON: Do you think it is because of demographics? They’re like, “Oh, the older people are taking over.” For younger people, for example — they’re like, “I’m just not going to do anything, because it’s just so far out of my control.”
COWEN: I don’t know. There are still democratic incentives in the system. I think people think in generational terms, maybe more than is warranted by the data. I’ve had this discussion with Peter Thiel. He talks about boomers and millennials and Generation X and Z. To me, it’s a continuum, and it’s the events at any point in time that matter a bit more, but I think people disagree on these questions. I don’t think it’s settled.
SCANLON: In terms of?
COWEN: How different different generations are, whether it’s a continuum or you have these fixed start and stop points.
SCANLON: Well, I think it’s in the cult-y thing that we were talking about earlier, where it’s like people want to belong to a certain generation. It’s easy to put yourself in a box that way.
COWEN: Yes, I’m never convinced that’s the right way to look at it.
SCANLON: I don’t think so. I think it creates more problems than answers.
COWEN: Yes. There’s some solution that involves a lot of talking across generations. Some people have this view, “Oh, the boomers, they all die off, and then you get something very different.” It would surprise me if that were the mechanism.
SCANLON: Well, I think you’ll just step into the boomers’ shoes.
COWEN: Yes, exactly.
[laughter]
COWEN: Meet the new boss and meet the old boss.
SCANLON: You see that with Gen X, I think, to a certain extent, just accepting elements of that status quo.
COWEN: Yes. Rilke. I brought my copy of Rilke. Why is Rilke important to you?
SCANLON: Oh, I’ve been working through my own copy. I think that there are a lot of life lessons in what is being discussed in the poems. I’m not a scholar in any sense of the word. I’m just somebody trying to understand things, but there is a passage that I sent you about, “Poems are not emotions or experiences.” I think that that is just what he is able to convey. Everything is an experience in the way that he writes, and it’s really quite beautiful.
COWEN: What else do you like in poetry?
SCANLON: Like what do I look for?
COWEN: What other poets, or however you figure it out?
SCANLON: Oh, I have a poem page in my —
COWEN: Oh, I know. Yes. What else? What’s the meta algorithm?
SCANLON: I try to find answers, yes.
[laughter]
SCANLON: I don’t know if it works or not. I think oftentimes, I probably absorb more of the world than I should. I don’t have great boundaries up against emotions, so I turn to poetry, especially with the economy — it’s so personal for people. I feel oftentimes you can explain economic theory through the lens of poetry, and so I look for the world-encompassing poems that can help me think about the economy, [laughs] if that makes sense.
COWEN: How do you think that gives you a different perspective on economics?
SCANLON: What I like to say is that it gives me a more human-centric lens. I try to think of people first as much as I can, even though it’s sometimes difficult. The way that the economy is composed in my head is of people, and I try to see poetry in all of it. It sounds very woo, but —
COWEN: Yes. If you’re giving advice to young people who will be investing — and they have long time horizons; they’re going to live a lot more years — is there any advice other than just buy, hold, and diversify?
SCANLON: It’s the thing that’s worked historically — buy, hold, and diversify. What I do with my own portfolio is buy the S&P as much as I can, have the cues, which is the tech companies. Then, if I purchase certain things, if I buy a certain pair of shoes from Nike or go to a restaurant or fly United, I’ll own some of those stocks, too, so I try to build a portfolio that reflects me as a consumer. I don’t know if that’s true or not.
COWEN: You feel in touch with the companies and how they’re doing.
SCANLON: Yes, and then I think if my money’s going toward them, I should probably put some money toward them as a stock. I try to not look at my portfolio as much as I can. I bought up some Treasuries when rates were super high. It’s just about paying attention, diversifying. There’s the saying, time in the market beats timing the market, which I think is what you’re saying with the younger people having a long time horizon. I think it’s really just about starting.
Going back to that chart that I referenced earlier, the bottom 50 percent — all their wealth is in real estate. The top 10 percent — all their wealth is in equity ownership and businesses. There’s the example right there — the top 10 percent own stocks. I think the more that we can encourage people to have some sort of stock portfolio, perhaps outside of their 401(k), the better. Sixty-two percent of Americans do own stocks, but it would be nice if that was higher.
COWEN: Do you use AI for your work at all?
SCANLON: Yes, I ask it questions. I use Claude quite a bit for research. I’m a one-person team, so it’s nice to have something to talk to. I use Claude quite a bit, and then I use ChatGPT, mostly for fact-checking, grammar, and how to pronounce words. I have a lot of trouble saying certain words. Youglish is very good for that, but I’ve also found that ChatGPT can be helpful with saying it in context of a sentence.
COWEN: How often do you think about the Roman Empire?
SCANLON: [laughs] That meme.
COWEN: That meme.
SCANLON: Honestly, more so over the last couple weeks — because of what’s going on in the US — than usual. I think that they’re quite fascinating, but I think I think more about the Great Depression than I do the Roman Empire.
COWEN: Why the Great Depression?
SCANLON: I’ve ended up reading a lot of books about it recently. Trust is a book that just won the Pulitzer a few years ago, and that was the fictionalization of somebody who greatly profited from the Great Depression. I’ve just read a lot of books about that era. I think the robber barons, who are around that era as well, are very fascinating: Andrew Carnegie, Vanderbilt. I just think that that’s an interesting time in human existence. I like to think about it because it was a little bit closer than the Roman Empire.
COWEN: Some of it’s a period where this negative sentiment spirals out of control, of course.
SCANLON: Yes, absolutely. I think people were totally distraught after the Great Depression. There was no hope on the horizon, but we made it through. I think another reason why I’ve been thinking about it quite a bit recently is, there was a statistic that was released, maybe a few months ago or a few weeks ago, that said that a certain amount of people think that now is worse than the Great Depression. I’m just trying to process —
COWEN: And unemployment’s what? 4.1 percent?
SCANLON: Yes. Can you believe it?
[laughter]
SCANLON: I don’t know. I just think you can learn a lot from recent history, as you know, and so I spend a lot of time just reading fictionalizations of it.
COWEN: When you think about the next steps for you, building out the Kyla Scanlon empire of one, what does that look like? Or what are you going to do, or what are you trying to learn next? What should we expect?
SCANLON: I’d love if there’s more than one. Hiring is tough. For me, I just wrote the book, and that was a big endeavor. It’s very hard to write a book. There were a lot of lessons learned from it, and I would like to write another one about something. That would be very nice.
Then also, I am very interested in different mediums. Radio is something I’m very fascinated by, TV shows, very fascinated by. For me, I would like to produce economic education across a variety of content. The reason that I produce across TikTok and Substack and have a podcast and have a YouTube channel is because I try to reach people where they are in terms of how they consume media. I think of having a TV show, like Free to Choose.
COWEN: Sure. I watched it as a kid.
SCANLON: Yes, exactly.
COWEN: It was on PBS.
SCANLON: Yes, exactly. I think something like that would be really great, where there’s this foundational place that you can go to get access to this stuff. That’s something that I wanted to experiment with as much as possible, just the different mediums of education.
COWEN: Lying between you and the Kyla Scanlon TV show, what is scarce?
SCANLON: In terms of getting there?
COWEN: Right. Is it money or talent or someone to work with? What’s the most scarce thing?
SCANLON: When you’re in this sort of job, you’re a contractor. I make money from the platforms, and I make money from the partnerships that I have, which I’m very grateful to have. This self-sustaining aspect of it can be interesting to navigate. There are aspects of that. Then there are aspects of, how do you do a TV show? Who do you talk to? How do you get the right connections? It’s mostly just navigating a field. You’re in a corn maze, and you know that there’s a way out, but you just have to figure out what the right path is.
COWEN: To close, I’ll repeat the book again, In This Economy? How Money & Markets Really Work. But please just repeat how people can find you across all your different platforms.
SCANLON: I’m kylascan on Twitter, on Instagram, on TikTok. I have a LinkedIn where I also post videos. Kyla.substack.com is my newsletter. My YouTube channel is Kyla Scanlon, and I have a podcast called Let’s Appreciate. Then, the book is called In This Economy? I narrate the audiobook version. There’s also an e-book version. If you want to support a local bookstore, you can buy a signed copy from Boulder Bookstore in Boulder, Colorado.
COWEN: Kyla Scanlon, thank you very much.
SCANLON: Oh, thanks for having me.
Photo Credit: Rachel Woolf