Economics Matters with Laurence Kotlikoff

Afleveringen

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  Why Putin Can't Win, China Won't Fold, and Trump Is Running Out of Options 06.08.2026 1u 8min

  What if the three most dangerous regimes on earth — Russia, China, and Iran — are all weaker than they appear, and yet America is still losing ground to all three at once?Sir Niall Ferguson has spent a career studying how empires rise, overreach, and fall. He watched the Soviet Union collapse from the inside out while everyone in Washington assumed it would last forever. He's been warning about China's hidden fragility for years while the consensus said otherwise. Currently, he's watching the United States make the most conventional mistake of Donald Trump's entire political career: getting bogged down in the Middle East on the side of Israel, just like George W. Bush before him.Professor Kotlikoff and his old friend have a wide-ranging, rapid-fire conversation covering the real state of the Iran conflict, why a Taiwan semiconductor crisis is the single biggest threat to the world economy in the next two years, why Putin cannot win in Ukraine and knows it, why nuclear weapons won't be used, what Ferguson would actually tell Trump to do right now, and whether American universities brought the current backlash on themselves.What You'll Learn:[00:11:45] Why this is not World War III[00:13:50] The "American Suez" framework[00:17:00] Why there is no great military option left[00:19:15] The desalination plant vulnerability[00:22:00] The missile economics problem[00:25:00] The authoritarian axis[00:31:53] How the regime change in Iran already happened[00:34:15] Ferguson's actual policy prescription[00:45:11] Why Ferguson doesn't think China will overtake the United States[00:45:33] Cold War II and the Cuban Missile Crisis parallel [00:47:01] Why Russia is no longer a great power[00:48:00] Why Putin won't use nuclear weapons[00:53:35] The optimistic scenario[00:56:29] The university debate [01:01:26] The 75% to 35% collapse Sir Niall Ferguson is the Milbank Family Senior Fellow at the Hoover Institution at Stanford University and Senior Faculty Fellow at the Belfer Center at Harvard. He holds a DPhil from Oxford University and has taught at Oxford, Cambridge, Harvard, and Stanford. He is the author of 16 books including The Ascent of Money, Civilization: The West and the Rest, The Great Degeneration, Doom: The Politics of Catastrophe, and the two-volume biography Kissinger (volume two forthcoming). He was knighted in 2023. He writes regularly for The Free Press and Bloomberg.Resources Mentioned:The Ascent of Money: A Financial History of the World — Ferguson's recommended starting point for an economics audience, now in a 10th anniversary edition:https://www.amazon.com/Ascent-Money-Financial-History-World/dp/0143116177The Great Degeneration: How Institutions Decay and Economies Die — the book most directly influenced by Kotlikoff's generational accounting work:https://www.amazon.com/Great-Degeneration-Institutions-Decay-Economies/dp/1594205450Doom: The Politics of Catastrophe:https://www.amazon.com/Doom-Politics-Catastrophe-Niall-Ferguson/dp/0593297377Kissinger: 1923-1968: The Idealist — volume one of the biography Ferguson is still completing:https://www.amazon.com/Kissinger-1923-1968-Idealist-Niall-Ferguson/dp/0143109758Full Niall Ferguson book catalog:https://www.amazon.com/Niall-Ferguson/e/B000APQ8G0"How to Stop Iran from Winning the War" by Ferguson, Haass, and Zelikow — the Strait of Hormuz Authority proposal referenced in the episode, published in The Free Press, April 13, 2026:https://www.thefp.com/p/how-to-stop-iran-from-winning-the-warNiall Ferguson at The Free Press: https://www.thefp.comKarim Sadjadpour at The Atlantic — Ferguson's recommended source on contemporary Iran:https://www.theatlantic.com/author/karim-sadjadpour/Economics Matters Substack (Larry Kotlikoff): https://larrykotlikoff.substack.comDisclaimer: Any opinions expressed on Economics Matters are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.
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  The Illiquid Jenga Tower: Inside the Private Credit Timebomb Nobody's Talking About 02.08.2026 1u 16min

  What if the passive investing revolution (the idea that just buying the index and holding is the smartest thing most people can do) has quietly turned into something that no longer resembles the efficient market it was designed to track?Every month, $33 billion flows automatically from 401(k) contributions into U.S. equity index funds. That money doesn't stop to ask whether Nvidia is fairly valued. It doesn't check whether 50% of the S&P 500 being tied to AI makes sense. It just buys, systematically and relentlessly, concentrating more and more capital into fewer and fewer companies — and in doing so, may be inflating the very market it's supposed to passively reflect.Professor Kotlikoff sits down with Jack Schibli, principal at Lane Generational, for a wide-ranging conversation about the structural changes quietly reshaping the U.S. stock market. From the mechanics of passive investing to the fragility of private credit, the vulnerability of the insurance industry, and the real competitive threat of Chinese AI to the trillion-dollar data center build-out Wall Street is betting on.This is original, ground-level analysis from an investor who's doing the work most institutional researchers aren't.What You'll Learn:[00:08:06] The "Illiquid Jenga Tower" — Jack's original deep dive into the fragility of private credit[00:12:20] Why the insurance industry could be the next AIG[00:15:01] The redemption gate hiding in plain sight inside private credit funds[00:19:19] What would actually need to happen for a systemic market event[00:35:33] The illusion of diversification inside your index fund[00:37:30] Why China is winning the AI cost war[00:42:56] The IP transfer problem nobody's discussing[00:46:49] How passive investing mechanically inflates valuations[00:47:44] Apple's $1.46 trillion buyback problem[00:51:18] The inelasticity trap — and why it only gets worse[00:54:35] The pod shop dynamic: 440% leverage and no long-term thinking[00:58:25] How retail investors became 20% of daily trading volume[01:02:51] Palantir at 310x earnings — and Lululemon's collapse in reverse[01:10:28] The causal chain that's flipped: the market is now running the economy[01:12:05] The Bessent paradox — criticizing Yellen for exactly what he's now doingFeatured GuestJack Schibli is a principal at Lane Generational, an independent registered investment advisor accessible through Fidelity Investments. He studied economics with a minor in computer science at Middlebury College, trained as a competitive ski racer, and began his career working with Lane Generational co-founder Fred Lane at Raymond James. He writes a quarterly investment research blog at lanegenerational.com/insights, known for its original structural analysis of market dynamics, private credit, and AI-driven disruption. His recent pieces include "Poker Face," "The Illiquid Jenga Tower," and several widely circulated posts on passive investing mechanics.Resources MentionedLane Generational — Jack Schibli and Fred Lane's independent RIA, accessible through Fidelity Investments: lanegenerational.comLane Generational Insights Blog — Jack's quarterly research pieces, including "Poker Face" and "The Illiquid Jenga Tower": lanegenerational.com/insightsDisclaimer: Any opinions expressed on Economics Matters are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.Lane Generational is an SEC Registered Investment Advisor. The information provided is for educational and informational purposes only and does not constitute investment advice, and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. I, Larry Kotlikoff, am an investor with Lane Generational. This is not an endorsement, and I am not compensated by Lane Generational.
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  Why the Most Important Economic Story of Our Time Isn't the Tariffs — It's the Institutions 31.07.2026 1u 9min

  What if one of the most famous and widely cited findings in modern economics (that money doesn't really make you happier) turned out to simply be wrong? And what does the economist who proved it wrong have to say about where America is heading next?Justin Wolfers is not a typical economist. He's written landmark papers on happiness, divorce, racial discrimination in NBA officiating, corruption in college basketball, gender and wages, prediction markets, and the political economy of elections. He runs one of the most widely read economics Substacks on the internet, co-authored a leading undergraduate economics textbook, and once showed Danny Kahneman data that changed the Nobel laureate's mind on a question he'd spent decades answering.In this episode, Professor Kotlikoff sits down with the University of Michigan professor for a wide-ranging conversation that moves from the science of happiness to the economics of marriage and divorce, the crisis facing young men, the future of American institutions under pressure, and a closing argument for why — despite everything — there has never been a better time to be alive.What You'll LearnWhat You'll Learn:[00:09:03] Why Gary Becker is the most important economist of the 20th century[00:17:51] The radical idea that economists should tell people what to do [00:20:00] The ice cream story that turned Justin into a behavioral economist [00:34:57] Why your grandmother said "opposites attract" — and why she was wrong [00:37:54] The divorce statistic nobody is talking about [00:40:05] Why the 1950s marriage model was the historical anomaly, not the norm[00:42:01] The Easterlin Paradox — and why it was wrong[00:58:21] The 60/40 gender split in college enrollment [01:01:16] Is there a crisis of masculinity?[01:04:48] Why attacking institutions is the most dangerous economic move America can make[01:06:51] The optimist's closing argument [01:08:32] Why Justin named his Substack "Platypus Economics" Resources Mentioned:Platypus Economics — Justin Wolfers's Substack, with a simple mission: teach the world economics in an accessible way that helps us all collectively understand it better:https://newsletter.platypuseconomics.comPrinciples of Economics (3rd Edition) by Betsey Stevenson and Justin Wolfers — Amazon: https://www.amazon.com/Principles-Economics-Betsey-Stevenson/dp/1429237864Justin Wolfers's full research catalog — available at the National Bureau of Economic Research:https://www.nber.org (search "Justin Wolfers")Of Boys and Men: Why the Modern Male Is Struggling, Why It Matters, and What to Do About It by Richard V. Reeves — a Book of the Year according to The New Yorker and The Economist, and included in President Obama's 2024 summer reading list, tackling the structural challenges facing boys and men in education, the workplace, and family life:https://www.amazon.com/Boys-Men-Modern-Struggling-Matters/dp/0815739877Featured GuestJustin Wolfers is a professor of economics and public policy at the University of Michigan, a research associate of the National Bureau of Economic Research, a non-resident senior fellow at the Brookings Institution and the Peterson Institute for International Economics, and a visiting professor of economics at the University of Sydney. He earned his PhD from Harvard University and his undergraduate degree from the University of Sydney, where he won the University Medal. Named by the IMF as one of the 25 economists under 45 shaping how we think about the global economy, he is the co-author of a leading undergraduate economics textbook and the author of the widely read Substack Platypus Economics.Disclaimer: Any opinions expressed on Economics Matters are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.
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  Social Security Is Broke. Here's What That Actually Means for Your Check 29.07.2026 59min

  The headlines say Social Security is running out of money. But what if the real numbers are actually far worse than what the headlines are showing you, and the trustees' report is burying the truth in an appendix table that almost nobody reads?The 2026 Social Security Trustees Report just dropped, and the media coverage has been loud, alarming, and, still understating how serious the problem actually is. In this Substack Live conversation, personal finance journalist and retirement specialist Pam Krueger sits down with Professor Kotlikoff to cut through the noise, decode the actual math, and answer the question every pre-retiree and current beneficiary is asking: what does this mean for me?This is not a doom-and-gloom session. It is a clear-eyed, numbers-first look at what the system is, why it is broken, what fixing it would actually require, and what you can do right now to protect yourself.What You'll Learn:[00:06:26] The table buried in the Trustees Report that tells the real story — Table VI F1, hidden deep in the appendix, reveals the system needs a 46% payroll tax hike, not the 22% benefit cut the headlines are running with[00:08:54] The difference between the 2032 cash flow problem and the real, permanent problem — why the 22% cut number is actually the short-term version, and the true immediate fix requires a 31% permanent benefit cut starting today[00:10:01] Will Social Security checks actually stop? — the straight answer, with context on what "enough money to pay 70% of benefits forever" actually means for your household[00:12:11] How the pay-as-you-go system actually works — a plain-language breakdown of FICA taxes, covered earnings, the trust fund checking account, and why the demographics have turned against the whole structure[00:16:00] Why fertility rates are at the heart of this crisis — the U.S. fertility rate has dropped from 2.1 to 1.59, and what that means for the number of workers available to fund your retirement[00:17:23] The Ponzi scheme history nobody taught you — how every president from Eisenhower to Nixon took turns goosing benefits when the baby boom made it look affordable, and locked in promises the system can no longer keep[00:25:44] What younger workers should actually expect — Social Security will likely exist, but the tax burden on younger generations is the real threat, not elimination of the program[00:34:39] Why simply lifting the payroll tax ceiling is not the silver bullet it sounds like — and who actually gets caught in the crossfire[00:43:00] Larry's Personal Security Account proposal — a Singapore-style fully funded replacement for the current system, modeled on what major U.S. corporations did when their own pension Ponzi schemes ran dry in the 1970s and 80s[00:51:54] The three radical fixes that could actually work — reform Social Security at its core, adopt a Scandinavian-style healthcare system, and overhaul the tax structure. Tweaks will not cut it.Featured Guest:Pam Krueger is a personal finance journalist, entrepreneur, and co-host of the podcast Friends Talk Money with Terry Savage and Richard Eisenberg. Her Substack, Count Up with Pam Krueger, focuses on practical retirement preparation for people in the years leading up to retirement.Economics Matters: The Podcast is hosted by Larry Kotlikoff, Professor of Economics at Boston University.Disclaimer: Any opinions expressed on Economics Matters’ episodes are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.
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  The Man Who Beat Goldman Sachs at Stock Picking — From a Trading Desk in Memphis 23.07.2026 1u 21min

  What does it actually take to consistently beat the market when 90% of professional fund managers can't, and what is a Wall Street veteran seeing right now that has him warning ordinary investors to get off margin immediately?Steve Laffey has lived several lives in one. Raised in genuine poverty in Cranston, Rhode Island, he earned his way to Bowdoin College and Harvard Business School, landed on a trading desk at PaineWebber surrounded by guys with names ending in vowels, survived the crash of '87 up close, built Morgan Keegan into the most respected stock picking shop in the country according to the Wall Street Journal, returned to Cranston to become a two-term Republican mayor of a Democrat city, ran for president in the last election, and has spent the intervening years quietly running what he calls "the hedge fund I never started."In this episode, Professor Kotlikoff sits down with Laffey for a wide-ranging, story-driven conversation on how great investing actually works. The gut instincts, the discipline, the hard lessons, and the very specific warning signs he is watching right now in the current market.This is not theory. Every lesson in this episode comes with a story.What You'll Learn:[00:11:22] Lesson 1: "Eat like an elephant, poop like an ant" — ride your winners hard, but cut losers immediately and without emotion, no matter how right you think you are[00:13:08] Lesson 2: Never use margin — margin debt in the U.S. stock market has just hit an all-time high, and Laffey's single most urgent message is: get off margin now[00:29:36] Lesson 3: Crashes don't happen from all-time highs — they happen after a selloff has already begun and people panic, a pattern Laffey has watched repeat across four decades[00:43:36] Why Laffey doesn't own ETFs — when every stock moves together because of passive fund flows, being right about a company doesn't protect you from the market going down[00:51:54] The 15-stock rule that beat Goldman Sachs — why concentration and personal accountability beat committee-driven diversification every time, and why past 15 stocks you're just buying noise[00:45:00] The A2 Milk story — how a cattle show in Colorado, a book called "The Devil's in the Milk," and a hunch about Chinese baby formula led to buying a New Zealand stock at 20 cents and selling it at $9[01:00:32] The Galaxy Digital play — how Laffey found a Bitcoin company trading at 60 cents with $1.20 of Bitcoin on its balance sheet, on an exchange most U.S. institutions legally couldn't access[01:02:10] Why you should never watch CNBC — and what it means when a network that hated Bitcoin suddenly loves it[01:06:09] The Jim Cramer contrarian indicator — when Cramer declared oil "uninvestable," energy was at 3% of the S&P, its all-time low. Laffey bought. He made a lot of money.[01:16:33] The single most important thing to do with your portfolio right now — get off leverage, know your age, and never put yourself in a position where a 50% drawdown changes how you liveFeatured Guest:Steve Laffey is a former Wall Street trader and investment banker, one-time head of Morgan Keegan's nationally ranked stock research operation, two-term Republican mayor of Cranston, Rhode Island, author of Primary Mistake, and 2024 Republican presidential primary candidate. He has been a practicing private investor since leaving institutional finance and is a frequent public speaker on fiscal reform, investing, and American economic policy.Economics Matters: The Podcast is hosted by Larry Kotlikoff, Professor of Economics at Boston University.Disclaimer: Any opinions expressed on Economics Matters’ episodes are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.
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  The Man Who Invented the HSA Thinks We're Still Doing Healthcare All Wrong 09.07.2026 59min

  What if the most powerful tax-advantaged account in your financial life was designed by one economist with a better idea, and the full version of that idea was never actually implemented?You've probably heard of the Health Savings Account. You may even have one. But the man who invented it says the version Congress passed is a watered-down shadow of what it could be. And that's just the beginning of what's broken.In this episode, Larry Kotlikoff sits down with Dr. John Goodman, the Wall Street Journal's "father of HSAs," author of 16 books, Bill Buckley's primetime debate partner, and one of the four most influential figures in post-war American healthcare policy. This is a high value conversation between two economists who've spent careers trying to fix the same broken system with notably different tools.What You'll Learn:[00:09:06] The HSA origin story — how a Cato Institute assignment in 1990 produced the idea now powering 37 million accounts, and why every special interest in Washington opposed it[00:10:13] The design flaw Congress built in from day one — and what a "Roth HSA" would actually look like[00:19:16] Why Medicaid patients visit the ER 40% more after enrolling — and the HSA-based fix that hospital lobbyists killed before it got a hearing[00:34:43] The LASIK principle — why cosmetic surgery gets cheaper and better every year while everything else in medicine doesn't, and what that tells us about markets[00:36:24] The California reference pricing experiment — how one insurer drove hip replacement costs from $100,000 down to $30,000 statewide in just over a year[00:44:51] Why your employer plan was designed, possibly by accident, to attract healthy people and repel sick ones[00:21:17] The Columbia dissertation that caused a near-riot — Goodman's economic theory of democratic decision-making that predicted exactly why healthcare reform is nearly impossible[00:50:33] The Social Security and Medicare crisis Congress discusses privately but won't touch publicly — and why seniors must see something in it for themselves before any reform can happenFeatured Guest:Dr. John Goodman is president and CEO of the Goodman Institute and Senior Research Fellow at the Independent Institute. He is credited by the Wall Street Journal as the father of Health Savings Accounts and one of the four most influential figures in post-war American healthcare. Author of 16 books including Priceless and Patient Power (300,000 copies sold), he appeared approximately two dozen times as Bill Buckley's debate partner on PBS Firing Line.Resources Mentioned:Priceless: Curing the Healthcare Crisis: amazon.comPatient Power: amazon.comA Better Choice: Healthcare Solutions for America: amazon.comThe Goodman Institute: goodmaninstitute.orgFull John Goodman book catalog: amazon.com/authorEconomics Matters Substack: larrykotlikoff.economicsmatters.comEconomics Matters: The Podcast is hosted by Larry Kotlikoff, Professor of Economics at Boston University.Disclaimer: Any opinions expressed on Economics Matters’ episodes are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc.
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  "We're Running a 20th Century Operating System on a 21st Century Economy — And It's Crashing" 02.07.2026 1u 5min

  What happens when five completely unrelated thinkers, writing across five different decades, all point to the exact same moment in history as a coming crisis point...and that moment is now?Samuel Huntington, Neil Howe, Ray Dalio, George Friedman, and Peter Turchin never collaborated. All of them landed on the 2020s. In this episode, Larry Kotlikoff sits down with Bruce Mehlman — founder of Mehlman Consulting, former Assistant Secretary of Commerce for Technology Policy under George W. Bush, and author of the widely-read Substack Age of Disruption, for a conversation covering geopolitical aftershocks, political polarization, AI's economic risk, and whether the median American worker has gained any ground in fifty years.What You'll Learn in This Episode:[00:08:05] What the Iran conflict revealed about global supply chain fragility — and the permanent changes companies are making now[00:11:43] The "mid-2020s crisis" convergence — five major historical frameworks, developed independently, all pointing to right now[00:15:39] Why 11 of the last 13 federal elections have been "change" elections — up from just 3 of 10 in the 1960s and '70s[00:21:02] The staggering partisan perception gap — how badly Republicans and Democrats misjudge what the other side actually looks like[00:31:02] A sharp disagreement over whether AI is overhyped — Larry argues AI gets deterministic financial questions catastrophically wrong; Bruce pushes back with the early-aviation analogy[00:40:52] The "servant economy" concern — whether AI eliminates good middle-management jobs while leaving low-wage service work behind[00:48:38] A Social Security trustees report most people missed — the program is now 46% underfunded, requiring a payroll tax hike from 12.4% to 18.1% just to keep pace[00:27:30] The gut-punch question from The 5 Types of Wealth — how many more times will you actually see your aging parents?Featured Guest:Bruce Mehlman is the founder of Mehlman Consulting, a bipartisan firm that helps Fortune 500 companies and startups navigate policy and political risk. He previously served as Assistant Secretary of Commerce for Technology Policy under President George W. Bush and held roles at Cisco Systems, the U.S. House of Representatives, and a Washington law firm. He is the executive director of the Technology CEO Council and publishes the widely-read weekly Substack Age of Disruption, known for its data-driven infographics on political and technological trends, regularly cited by The Washington Post, Axios, Politico, CNN, Bloomberg, and Fox News.Resources Mentioned:Bruce Mehlman's Age of Disruption - https://brucemehlman.substack.com/ Six-Chart Sunday (#100) - How to Navigate an Age of Disruption" — https://brucemehlman.substack.com/p/six-chart-sunday-100-how-to-navigate "Six-Chart Sunday – Stuck" - https://brucemehlman.substack.com/p/six-chart-sunday-stuck The Storm Before the Calm by George Friedman - https://www.amazon.com/Storm-Before-Calm-Americas-Discord/dp/0385540493The Fourth Turning by Neil Howe - https://www.amazon.com/Fourth-Turning-American-Prophecy-Rendezvous/dp/0767900464Changing World Order by Ray Dalio - https://www.amazon.com/Changing-World-Order-Nations-Succeed/dp/1982160276The 5 Types of Wealth by Sahil Bloom - https://www.amazon.com/Types-Wealth-Transformative-Guide-Design/dp/059372318XThe Vertigo Years by Philip Blom - https://www.amazon.com/Vertigo-Years-Europe-1900-1914/dp/0465020291Larry Kotlikoff's Substack, Economics Matters (link: larrykotlikoff.economicsmatters.com)
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  The Man Who Turned Down $1.3 Million to Stay in School — And Changed Medicine Forever 25.06.2026 1u 20min

  What does it actually take to solve a scientific puzzle that stumped researchers for fifty years — and why are the same AI tools that cracked it still getting basic financial math catastrophically wrong?In 2024, Demis Hassabis won the Nobel Prize in Chemistry for something that sounds almost too ambitious to be real: teaching artificial intelligence to predict the three-dimensional shape of any protein, a problem that had resisted traditional science for half a century. The breakthrough, called AlphaFold, has already mapped over 200 million proteins, a feat with profound implications for how we understand and treat disease.In this episode, Larry Kotlikoff sits down with Sebastian Mallaby, the New York Times bestselling author and veteran journalist behind The Infinity Machine, his deeply reported new biography of Hassabis and the rise of DeepMind. Mallaby walks through the improbable arc of Hassabis's career - from chess prodigy to video game programmer to the architect of some of the most consequential AI breakthroughs of the last decade. Then turns to a sharper, more urgent question: what can AI actually be trusted to get right, and where does it quietly, confidently fail?What You'll Learn:[00:32:01] The $1.3 million check Demis Hassabis turned down — and why he chose to study computer science instead of cashing in on his teenage video game fortune[00:33:00] Why AI was considered a dead field as recently as 2012 — and how Hassabis convinced Peter Thiel to fund a company built on a technology that, at the time, couldn't do much of anything[00:34:05] What "agentic AI" actually means — and how DeepMind's early systems learned to master Atari games through pure trial and error, years before "agentic" became a buzzword[00:35:08] Reinforcement learning vs. deep learning, explained simply — the difference between an AI that learns from reading and one that learns from doing[00:43:56] How neural networks actually work — a plain-language breakdown of "weights," layers, and how a system tweaks itself toward a correct answer through millions of small adjustments[00:41:00] Why AI is fundamentally inductive, not deductive — and why that distinction explains both its remarkable strengths and its most dangerous blind spots[01:04:57] How AlphaFold's protein-folding breakthrough connects directly to disease research — including new frontiers in understanding conditions like Parkinson's[01:05:59] Inside Isomorphic Labs — Hassabis's newest venture, aimed at using AI to dramatically accelerate (not replace) the drug discovery pipeline[01:16:00] Why AI tools are getting deterministic financial questions wrong — Larry's own real-world tests show major AI models disagreeing wildly on life insurance needs, optimal savings, and Roth conversion strategy, even though these problems have one mathematically correct answer[01:12:43] What this means for the future of work — a candid exchange on AI adoption timelines, productivity's "jagged edge," and whether human labor markets have time to adjustFeatured Guest:Sebastian Mallaby is an award-winning journalist and author of six books, including the New York Times bestseller The Infinity Machine: How an AI Pioneer Reshaped the Future, as well as The Power Law: Venture Capital and the Making of the New Future and More Money Than God. A former correspondent for The Economist and longtime member of the Washington Post editorial board. He co-hosts the podcast The Spillover with Rebecca Patterson of the Council on Foreign Relations.
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  The Regime We Were Supposed to Topple Just Got Stronger 25.06.2026 1u 7min

  What if everything you've been told about the new Iran deal — and what "winning" the war even meant — is built on a comparison that doesn't hold up, and a strategic outcome that's the opposite of what most commentators are claiming?A 14-point memorandum is about to be signed in Switzerland, and the headlines are already calling it weaker than the 2015 Obama-era nuclear deal that Trump once tore apart. But according to Adam Garfinkle - veteran foreign policy analyst, former editor of The American Interest, and author of the forthcoming book The Age of Spectacle - that comparison is fundamentally misleading. The real story is stranger, more consequential, and far more relevant to your daily life than a nuclear negotiation: it's about what happens to a society that has stopped reading, stopped distinguishing fantasy from fact, and is now heading into midterm elections where the rules themselves may not hold.In this episode, Alex Kotlikoff sits down with Garfinkle to unpack the actual strategic outcome of the Iran conflict, why the regime may have emerged stronger rather than weaker, and how a deeper cultural shift (one Garfinkle has spent a career studying) is reshaping American democracy itself.[00:02:22] Why comparing this new Iran deal to the 2015 JCPOA is misleading — the contexts are not remotely the same, and treating them as equivalent distorts the real picture[00:06:39] How the Iranian nuclear program was actually crippled — not in the recent skirmishes, but in the "12-day war" of June 2025[00:09:13] The unintended consequence of targeting Iran's senior leadership — how the strikes may have produced a more nationalistic, more competent, and more entrenched regime rather than a weaker one[00:10:39] The psychological effect on ordinary Iranians — why surviving a massive US-Israeli attack has pushed many toward resignation rather than rebellion, delaying any hope of internal regime change[00:13:01] The "balance of interests vs. balance of power" principle — why raw military superiority doesn't determine outcomes, and how this echoes a lesson from Vietnam[00:29:00] Introducing "The Age of Spectacle" — Garfinkle's framework for understanding how digital technology is replacing shared reality with personalized fantasy[00:34:01] The "first post-literate American war" — how declining literacy has fundamentally changed the way Americans understand conflict, politics, and the world around them[00:40:28] The literacy statistic that explains a lot more than you'd think — an estimated 50-60% of American adults read at a sixth-grade level or below[01:04:00] What could happen to the 2026 midterms — the scenarios Garfinkle considers most plausible, including legal challenges to majority-minority districts and pressure campaigns at the local level[01:05:05] A possible fix already proven at the state level — how California depoliticized redistricting, and why Garfinkle supports a constitutional amendment banning gerrymandering nationwideAdam Garfinkle is a veteran international affairs analyst and writer, formerly the founding editor of The American Interest and a longtime contributor to U.S. foreign policy discourse. He publishes regularly on Substack at The Raspberry Patch, where he has written extensively on the Iran conflict since its outset. His forthcoming book, The Age of Spectacle, examines how communications technology has reshaped American political consciousness from the Korean War to the present day.The Raspberry Patch — Adam Garfinkle's Substack, including his ongoing series of essays on the Iran warThe Age of Spectacle — Garfinkle's forthcoming book on media, technology, and the erosion of shared reality (publication details pending)"Why Elite College Students Can't Read Whole Books" — referenced Atlantic article by Rose Horowitch on declining literacy among university studentsWhat You'll Learn in This EpisodeFeatured GuestResources Mentioned
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  The $83 Billion Scam Hidden Inside Medicare (And the Economist Who Proved It) 09.06.2026 58min

  What if the system designed to protect your health in retirement was actually engineered (from the inside) to profit from keeping you confused, underserved, and locked out of the care you've already paid for?You've spent decades paying into Medicare. You've done everything right. And yet, as you approach the years when healthcare matters most, the system greeting you on the other side is riddled with hidden traps, gaming, and a funding crisis that Washington refuses to look at directly.In this episode, Professor Kotlikoff talks with his Boston University colleague Dr. Randy Ellis, one of the world's foremost health economists and the architect of the very risk-adjustment formula that determines how much the government pays your Medicare Advantage plan. He literally built it. And he's saying it's being exploited in ways that are costing taxpayers $83 billion a year, with your care hanging in the balance.Time Stamped Learnings:[8:27] Why Medicare Advantage plans are paid billions more than they should be, and how insurance companies game the diagnostic coding system to pocket the difference[9:00] The "cherry-picking" crisis nobody in Washington wants to admit: how private health plans are specifically designed to attract healthy enrollees and quietly push sick ones back into traditional Medicare[10:24] Why the formula running your Medicare payments is 30 years old (built in the 1990s, implemented in 2002, and barely updated since) while insurance companies have decades of new data and technology to exploit every loophole[23:00] What Europe is doing right, and why countries like the Netherlands, Germany, and Belgium are delivering better health outcomes at nearly half the cost per GDP[41:14] The age-65 cliff that's trapping older Americans in jobs they don't want, just to hold onto insurance before Medicare kicks in, and a smarter way to phase that transition[39:16]The Ellis Plan: a bold, practical reimagining of how America could restructure its entire healthcare system (without starting a political war)[48:38] Why your kids and grandkids are the ones who will ultimately pay for every year we delay fixing this, and what the math actually looks like[54:46] The risk adjustment fix that could make insurance companies actually want to enroll sick people AND save Medicare billions in the processFeatured GuestDr. Randy Ellis is a Professor of Economics at Boston University, Past President of the American Society of Health Economists, and author of more than 150 academic papers and reports. With over 11,000 Google Scholar citations, he is best known for developing the HCC Risk Adjustment Formula — the model used to calculate Medicare Advantage (Part C), Medicare Part D, and Obamacare marketplace payments. His current research, developed alongside collaborator Dr. Arlene Ash, proposes a modernized risk adjustment framework that could save the Medicare program $83 billion annually.What You Walk Away WithAmerica spends over 18% of its GDP on healthcare, and is on a trajectory toward 20%. Sweden spends 11% and ranks 4th in the world for health outcomes. We rank 21st. This is policy failure compounded by decades of inaction, gaming, and a political culture too proud to look abroad for better answers. If you're approaching Medicare age, actively enrolled, or simply trying to understand why your premiums keep rising faster than inflation — this conversation is essential listening.
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  Are Netanyahu's Policies Reshaping Israel For the Better Or Worse? 21.05.2026 51min

  Can Israel reverse its political and social trajectory as elections approach amid ongoing wars and rising international isolation? Economics Matters co-host, Alex Kotlikoff, reunites with Israel's most influential and consequential economist, Eytan Sheshinski, to discuss Benjamin Netanyahu’s long tenure and the impact of his right-wing coalition. The discussion ranges over Israeli domestic policy, geopolitics, the Iran war, and the upcoming Israeli election. Additional talking points include:Polling that shows a narrow opposition edge that would end Netanyahu's 17-year run as Prime MinisterThe impact of prolonged conflict on hostages and society.A brain drain of about 80,000 people since October Economic strains from reservist mobilizationRising debt and deficitsGrowing official and unofficial boycotts affecting academia and Israel’s global standing. Israel-US relations, shifts in American Jewish and Democratic support, and campus antisemitism debatesPreventing Iran from acquiring nuclear weaponsHopes for regional change tied to government change.Time Stamps:00:00 Eytan's history and professional background01:27 Elections and Netanyahu03:02 Coalition and Ultra Orthodox10:54 Judicial Reform Protests12:45 Smotrich Ben Gvir Explained17:27 Cultural Decline Brain Drain21:37 War Economy and Boycotts28:28 Rightward Shift and History33:10 US Jewry and Campus Politics41:05 Iran War and Nuclear Threat47:40 Global Outlook US China NATO49:41 Closing Thoughts and Farewell
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  Andrew Fesiak's Update on the Ukraine War 08.05.2026 1u 3min

  Andrew Fesiak rejoins Economics Matters with reassuring news about the war in Ukraine. As I'm traveling in Europe until early June, my son and occasional co-host, Alex, interviews Andrew.  This is Andrew's 6th appearance on Economics Matters. He is, as ever, fully up-to-date on what's happening for real in Ukraine. Indeed, our military and everyone in the Administration, particularly the President, would do well to watch this podcast. Ukraine, it seems, is acquiring more and better cards than Russia and doing so at an accelerating pace. Where and when this will end is largely in Putin's court. But, as Andrew points out, and which the Wall Street Journal confirmed the next day, Ukrainian drones and missiles are hitting Russia everywhere that Putin looks. And, as he looks, he realizes he can't hold the regular May Day parade, i.e., with scores of tanks, missiles, and other military equipment. Doing so risks their parade-time destruction. Imagine the message that would send to the World. Hence, as Andrew predicted and the Journal has since confirmed, May Day in Russia will be an equipment-less parade  -- one that's as short as possible, permitting Putin to dive back into his bunker in record time. Andrew is Senior Consultant at Black Trident Defense and Security Group. He’s an expert on Ukrainian and Russian relations, politics, history, culture, and the ongoing war. Andrew has lived in Ukraine for decades, having emigrated from Canada. His grandparents and parents were Ukrainian (as was one of my grandfathers). 
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  Economics-Based Financial Planning with Wade Pfau's Retirement Income Institute 27.04.2026 1u 39min

  This will be of interest to anyone who seeks more money, less risk, and a better life. Wade Pfau is one of our country’s truly exceptional thought leaders when it comes to personal finance. He holds a PhD in economics from Princeton as well as the CFA and RICP® designations. Wade is a professor of practice in the Retirement Income Certified Professional® (RICP®) Program at The American College of Financial Services.Wade asked me to use my company’s MaxiFi Planner software to illustrate economics-based financial planning. Whether you are new to economics’ prescriptions for handling your financial life or have been applying its prescriptions for years, you’ll find this presentation of interest.
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  Kevin Esler Returns to Build You A TIPS Ladder 30.03.2026 1u 8min

  Forget what Wall Street says, risky investing is an option, not a starting point when it comes to your financial plan. No investment is perfectly safe and Economics Matters does not provide investment or any other form of financial, tax, or insurance advice. What this blog and podcast do is discuss options. Because TIPS -- Treasury Inflation Protected Securities -- are U.S. Treasury bonds, but ones that are protected against inflation, they are, arguably, the safest asset on the planet. As I write, the 30-year TIP is yield north of 2.6 percent real. That's very high historically speaking. TIPS yields on shorter maturity are also unusally high. Yes, Uncle Sam could default on his debt, but there are many moves he can take to get his fiscal house in order short of default -- something that would destroy all financial assets. Given this, given the high yields on TIPS, given the stock market's high volatility, this may be the time to lock in future real income. Kevin Esler returns on Economics Matters for his third appearance to walk us through his remarkable and totally free tool -- tipsladder.com. For those who haven't used tipsladder.com, this episode will show you everything you need to know to build your own ladder. For those who have used tipsladder.com, this podcast will be a refresher, but also show you tipsladder.com's latest features. Kevin is a retiree from Australia with an extensive background in software and technology, which he leveraged into a series of top software engineering jobs at a range of leading companies including IBM, HP, and Disney Plus. After moving to the US he settled into a series of roles that saw him specializing in evolving technology and software development. Kevin is uniquely positioned as an authority due to his multifaceted expertise in tech and finance, particularly in understanding and managing investment strategies involving Treasury Inflation-Protected Securities (TIPS).
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  Fixing Personal Finance With John Campbell 20.03.2026 1u 3min

  John Campbell has made major contributions to the fields of macroeconomics and finance, solved a number of critical problems in both fields, and received all manner of fully deserved top awards in economics and finance. Grab a copy of his outstanding new, co-authored book, Fixed. It will turn your stomach, but keep you safe from Wall Street's terrible financial predation.  He is the Morton L. and Carole S. Olshan Professor of Economics at Harvard University, where he has taught since 1994.Campbell delivered the Ely Lecture to the American Economic Association in 2016 and served as President of the American Finance Association in 2005. He is a Research Associate and former Director of the Program in Asset Pricing at the National Bureau of Economic Research, a Fellow of the Econometric Society and the American Academy of Arts and Sciences, a Corresponding Fellow of the British Academy and Honorary Fellow of Corpus Christi College, Oxford, and holds honorary doctorates from BI Norwegian Business School, the University of Maastricht, the University of Paris Dauphine, and Copenhagen Business School. Campbell co-founded and serves on the board of Arrowstreet Capital, LP, a Boston-based quantitative asset management company. 
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  Can the Republican Party Survive the Trump Administration 11.03.2026 1u 22min

  World-Renowned, Fantastic Economist, and Former CEA Chair, Gregory Mankiw, Discusses his Career, the Iraq War, Trump Policy and Advisers, and His Top Research HitsGreg may be the world's most influential economist as millions of students, in the US and abroad, have studied introductory economics and intermediate macroeconomics using his leading text books. He's also been a major US policy player, including serving as Chair of the President's Council of Economic Advisers under Present George W. Bush. But Greg's greatest contributions have been to macroeconomics. One of his early hits explains that the relatively small costs of individual firms adjusting their prices can lead to slow micro adjustment and remarkably major macroeconomic problems, including exacerbating business cycles.  A second major contribution concerns the degree to which households are cash-flow constrained and, as a result, make the economy far more volatile. A third article tests and partially rejects the Solow Model, a central model of national saving. A fourth shows, paradoxically, that competition in the face of monopoly can be inefficient.  A fifth helps explain stock market volatility. A sixth helps understand the dynamics of inflation and unemployment based on slow acquisition of information of price setters. Greg describes these contributions as part of our wide ranging, fascinating conversation.  Gregory Mankiw's BioN. Gregory Mankiw is the Robert M. Beren Professor of Economics at Harvard University. As a student, Greg studied economics at Princeton University and MIT. As a teacher, he has taught macroeconomics, microeconomics, statistics, and principles of economics. Professor Mankiw is a prolific writer and a regular participant in academic and policy debates. His research includes work on price adjustment, consumer behavior, financial markets, monetary and fiscal policy, and economic growth. His published articles have appeared in academic journals, such as the American Economic Review, Journal of Political Economy, and Quarterly Journal of Economics, and in more widely accessible forums, such as The New York Times, The Washington Post, and The Wall Street Journal.He has written two popular textbooks—the intermediate-level textbook Macroeconomics (Worth Publishers) and the introductory textbook Principles of Economics (Cengage Learning). Principles of Economics has sold over four million copies and has been translated into twenty languages. In addition to his teaching, research, and writing, Professor Mankiw has been a research associate of the National Bureau of Economic Research, an adviser to the Congressional Budget Office and the Federal Reserve Banks of Boston and New York, and a member of the ETS test development committee for the advanced placement exam in economics. From 2003 to 2005 he served as Chairman of the President's Council of Economic Advisers. Disclaimer --  Any opinions expressed Economics Matters' posts are those of the authors and guests. These are not the opinions of Boston University or Economic Security Planning, Inc. 
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  Glenn Loury on the Country and Race Relations 26.02.2026 59min

  Glenn is an absolutely brilliant economist and a public intellectual extraordinaire. In addition, Glenn is the pioneer of podcasting by academic economists. Glenn's remarkable podcast -- The Glenn Show -- debuted in 2008. In this episode of Economics Matters -- the Podcast, I ask Glenn to talk about the Glenn Show, including the topics and guests he's had during the show's now almost two-decade run. But as you'll hear/see, Glenn also uses this occasion to vigorously convey his long-held positions on race relations and the path to improving them. In particular, he makes a very strong case that Black America cannot expect White America to improve its position in society. As Glenn puts it, "No one is coming to the rescue." This is a marvelous podcast from a person who has dedicated a major part of his life to providing a national, politically incorrect conversation on issues of pressing concern, no matter their sensitivity. Glenn's Short Bio:Glenn C. Loury, Merton P. Stoltz Professor Emeritus of Social Sciences, Professor Emeritus of Economics, and Professor Emeritus of International and Public Affairs, is an academic economist who has made scholarly contributions to the fields of welfare economics, income distribution, game theory, industrial organization, and natural resource economics. He is also a prominent social critic and public intellectual, having published over 200 articles in journals of public affairs in the U.S. and abroad on the issues of racial inequality and social policy. A Fellow of the Econometric Society, a Fellow of the American Academy of Arts and Sciences, and a past Vice President of the American Economics Association, Prof. Loury has been a visiting scholar at Oxford, Tel Aviv University, the University of Stockholm, the Delhi School of Economics, the Institute for the Human Sciences in Vienna, and the Institute for Advanced Study at Princeton. He is a member of the Council on Foreign Relations, and was for many years a contributing editor at The New Republic magazine.The Glenn Show is a podcast and video series hosted by economist Glenn Loury, a professor at Brown University in Providence, Rhode Island.  Glenn, a self-described Black conservative, provides heterodox perspectives critiquing both progressive and conservative extremes. The show is rated right-center biased but high in credibility for its analysis grounded in real eventsIt features in-depth conversations with guests from academia, journalism, and public affairs, focusing on race, inequality, economics, politics, and social issues. Episodes often include regular discussions with linguist John McWhorter on race and politics, alongside solo commentary and live Q&A sessions. Recent topics have covered U.S. foreign policy, identity politics, free speech, and events like ICE incidents or Epstein files. The show is available on Substack (glennloury.substack.com), Apple Podcasts, Spotify, YouTube, and Bloggingheads.tv, with weekly updates and paid subscriber exclusives like early episodes and bonus content. It originated on Bloggingheads and continues through Loury's independent platform.
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  The Domestic and Global Impacts of America's Fascist in Chief 24.02.2026 1u 1min

  Martin Wolf is Chief Economics Commentator at the Financial Times, London. He was awarded Commander of the British Empire in 2000 "for services to financial journalism". This is Martin's third appearance on Economics Matters -- the Podcast. Martin's 2023 book, The Crisis of Democratic Capitalism, warned that liberal democracy was in recession, with authoritarianism on the rise. Two years later his dark vision has become America's reality. In this riveting interview, Martin spells out just how quickly our Shining City on the Hill is becoming a dark and foreboding dungeon with our great leader closely following the footsteps of history's megalomaniacs. Don't miss this opportunity to hear from the world's best informed and impressively clairvoyant global and political economist.  Martin is simply brilliant in both the British and American meanings of that word. 
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  World Class Economist on the Chances of a Crash in the Near Future 10.02.2026 1u 1min

  Are we about to have another financial meltdown or at least a major crash? Is this the time to get liquid and stay poised to buy low rather than lose high? Please let one of the world's top financial guru's, John Rutledge, provide his deeply informed sense of the current financial system. John focuses on times the economy is out of wack -- far from equilibrium is his language.  He is Chief Investment Strategist and a member of the Investment Committee at Safanad, a global principal investment firm in New York, London, and Dubai. He is Economics Contributor for CNBC, and Senior Research Fellow at Claremont Graduate University where he teaches and chairs dissertations in the economics and finance PhD program. He sits on a number of boards of directors for public and private companies.John's Extraordinary ResumeOne of the architects of the Reagan Economic plan and has advised the Bush administration on both tax policy and the reconstruction of Iraq. Honorary Professor at the Chinese Academy of Sciences. He is Chairman of Tara’s Kids, a non-profit organization that builds libraries for schools in remote villages in China and Tibet. After tours of duty in both academics and government policy, he has started, run, chaired, owned and harvested dozens of companies, and has managed money in marketable securities, private equity, and real estate.Too many more accolades to list...
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  Anders Åslund, the Premiere Global Economist, Is Back to Discuss Geopolitics Under Trump 27.01.2026 55min

  President Trump's interest is largely self interest. According to The NY Times, he has personally pocketed $1.4 billion over the past 12 months. While not stuffing his pockets and those of his family, he has transformed our "shining city upon a hill" into a quasi-fascist state, sold out our allies, upended the rule of law, deployed a private army that murders American citizens in broad daylight, orchestrated political witch hunts, and abrogated our civil liberties, including, of late, the right to bear arms. Whether we'll have a fair and free election in November is anyone's guess. How much of Trump's behavior is dictated by Putin, an inner demon, mental illness, or avarice, no one can say. But the world no longer respects America. It fears and despises America. And it is realigning away from America at a rapid rate. I've invited Anders Åslund back to Economics Matters -- the Podcast to assess the damage, and its perilous implications. Per Anders Åslund is a Swedish economist and former Senior Fellow at the Atlantic Council. He is also a chairman of the International Advisory Council at the Center for Social and Economic Research (CASE). His work focuses on economic transition from centrally planned to market economies. Åslund served as an economic adviser to the governments of Kyrgyzstan, Russia, and Ukraine and from 2003 was director of the Russian and Eurasian Program at the Carnegie Endowment for International Peace. Åslund was an advocate of early, comprehensive, and radical economic reforms in Russia and Eastern Europe.[1] He worked at the Peterson Institute for International Economics from 2006 to 2015. In 2013, neoconservative David Frum wrote that "Anders Aslund at the Peterson Institute is one of the world's leading experts on the collapse of the planned Soviet economy." From 2010 to 2013 and again in 2022 he contributed to The Moscow Times, an independent English-language newspaper; he is also a long-time contributor to the Kyiv Post.[3]