Odd Lots

In 2011, then-Vice President Biden had a front row seat to a bruising debt ceiling standoff between President Barack Obama and House Speaker John Boehner. That fight arguably derailed the Obama presidency and the nascent economic recovery. After that experience, Biden and his team had insisted that this time they would not negotiate over a debt ceiling increase. Yet here we are, and the current administration is doing exactly that. According to the Treasury Department, we're just days away from the so called "X-date" (when a US default would occur) and both the White House and new House Speaker Kevin McCarthy have been debating what conditions a hike in the debt ceiling should come with. So how did they get into this situation? And what were the other options? On this episode we speak with Skanda Amarnath, executive director of Employ America, and Arnab Datta, senior counsel of Employ America, about the current state of play and how it might have been avoided.

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There's a lot of discussion these days about de-dollarization and whether the US dollar will lose its standing as the world's sole reserve currency. Generally, people seem open to the idea, but they also don't see many good alternatives out there. The renminbi is the obvious candidate to take share away from the dollar, given the size of the Chinese economy and China's role in global trade. But for various reasons, the currency isn't suited to be a global reserve currency. So what would it actually take to become one? And what would be the effects if it started to play a major role in global trade? On this episode of the podcast, we speak with Karthik Sankaran, a longtime FX veteran, about what China would have to do if it really has global aspirations for its currency, and why a more multipolar FX landscape might be good for world financial stability.

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A couple of years ago, it was an amazing time to have a truck or be a trucker. The goods economy was absolutely booming. Prices were booming. Supply chains were broken. Everyone wanted access to more freight. Fast forward to spring 2023 and the situation couldn't be more different. Prices have collapsed and the environment is now as bad for carriers as it was during 2019, which was a horrible year for the industry. In fact, conditions now might even be as bad as they were during the Great Recession. On this episode of the podcast, we speak with Craig Fuller, the founder and CEO of FreightWaves, and Rachel Premack, editorial director for FreightWaves, about the state of trucking, what the market says about the broader economy, and what it will take to turn the industry around.

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We're still in the middle of a "crypto winter" with the price of coins well off their highs from back in 2021. But debates over how to regulate them are heating up, with significant disagreements among US politicians and agency chiefs. At the recent ISDA Annual General Meeting, we sat down with CFTC Chief Rostin Behnam to talk about his view on crypto rules and more. Among the things we discussed are what constitutes a security or a commodity, market structure questions, new types of betting markets, and other matters currently facing the CFTC. 

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Terry Duffy is the chairman and CEO of CME Group, the world's biggest derivatives exchange and a trading behemoth whose name is synonymous with Chicago's financial industry. In this wide-ranging interview, Duffy talks about the big risks in the market he's seeing right now and how the CME is preparing for them. He discusses everything from complaints over a lack of liquidity in Treasury futures, to the impact of the debt ceiling on CME's risk management, interest rate hedging trends in the aftermath of the recent banking crisis, and the exchange's expanding suite of crypto offerings. We also talk about how Duffy is viewing the CME's future in Chicago and, finally, his take on the onion futures debate.

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Coming soon: When nerdy gamer Sam Bankman-Fried rocketed to fame as the world’s richest 29-year-old, he pledged to donate his billions to good causes. But then his crypto exchange FTX collapsed Billions of dollars were missing, and Sam was in handcuffs. Those who knew him were left wondering — who was Sam really? A well-meaning billionaire who made a mistake? Or a calculating con man? From Wondery and Bloomberg, the makers of The Shrink Next Door, comes a new story of incredible wealth, betrayal and what happens when “doing good” goes really really bad. Learn more here: https://podcasts.apple.com/us/podcast/spellcaster-the-fall-of-sam-bankman-fried/id1685258534

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The 2010s saw the rise of a number of digital media startups like BuzzFeed News, Gawker Media, Vice, Business Insider and others who were set to usher in a new era of news consumption, displacing legacy outlets like the New York Times and the Wall Street Journal. Now, by and large, that dream seems to have died. Gawker is gone. BuzzFeed News is closed. Vice has filed for bankruptcy. Insider recently had layoffs. So how did it all fall apart and what is the future for upstart media? In this episode, we speak with Ben Smith, editor-in-chief of Semafor and the author of the new book Traffic: Genius, Rivalry, and Delusion in the Billion-Dollar Race to Go Viral, to discuss his experience as the editor-in-chief of BuzzFeed News, and how times have changed so dramatically for online journalism. We also discussed what business models work today, the use of AI, and the future of news consumption.

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The Federal Reserve has hiked rates rapidly over the last 18 months, and yet inflation remains surprisingly high. Perhaps what's most surprising is that even in the most rate sensitive area of the economy -- housing -- the surge in mortgage rates hasn't had a significant cooling effect. Prices have barely budged and even the homebuilders have been booming again after a brief dip in late 2022. So what is happening now? Why did the rate shock fail to derail the industry? And what is the lesson that homebuilders have taken away from this cycle? On this episode, we speak with Zonda chief economist Ali Wolf about why and how the housing market is still broken despite this rate action.

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Nobody knows for sure who is going to make all the money when it comes to artificial intelligence. Will it be the incumbent tech giants? Will it be startups? What will the business models look like? It's all up in the air. One thing is clear though — AI requires a lot of computing power and that means demand for semiconductors. Right now, Nvidia has been a huge winner in the space, with their chips powering both the training of AI models (like ChatGPT) and the inference (the results of a query.) But others want in on the action as well. So how big will this market be? Can other companies gain a foothold and "chip away" at Nvidia's dominance? On this episode we speak with Bernstein semiconductor analyst Stacy Rasgon about this rapidly growing space and who has a shot to win it.

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Disruptions caused by the pandemic have revealed deep flaws in our supply chain for physical goods. Certain market failures that have been left to fester for years were suddenly exposed. But some parts of the economy were broken long before the pandemic, particularly anything having to do with care work. Various forms of childcare, daycare, eldercare and healthcare have seen costs explode, with services unevenly distributed, even as those working in the care economy often remain poorly compensated. On this episode, we speak to economist Nancy Folbre, professor emerita of economics at UMass-Amherst and director of the Program on Gender and Care Work at the Political Economy Research Institute, about why such crucial services are so broken in America.

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Some supply chain crises are acute. A bottleneck at the ports. A shortage of semiconductors. These can get fixed, to some extent, with concerted policy choices. But other crises are slower moving and don't have one easy fix. In the coming years, the bourbon supply chain could be under threat, due to a shortage of the specific type of wood used in the barrels made for aging the liquor. On this episode of the podcast, we speak with Penn State University forestry professor Calvin Norman about a looming shortage of critical white oak. He explains why the industry is potentially facing a shortfall, why other woods can’t be used to replace it, and what it would take to ensure that this critical tree remains abundant.

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There's been a lot of discussion about the possibility of "de-dollarization," or the idea that the world could move away from using the dollar as the de facto global reserve currency. Some of this desire makes sense. Not only has the Federal Reserve been hiking rates at the fastest pace in decades, which puts economic pressure on other countries through links to the dollar and US trade, but sanctions imposed on Russia have also made some nations more wary of relying on US financial assets and infrastructure. And in BRICS countries (Brazil, Russia, India, China and South Africa), there seems to be growing appetite to usurp the dollar’s hegemony. Of course, we've seen this kind of talk before, yet there has been little change to the dollar's special role. So is it different this time? On this episode, we speak with Paul McNamara, an investment director at GAM and a veteran of emerging markets, about what's driving this renewed clamor for de-dollarization.

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The big headlines from March's banking crisis have receded and balances at some of the Federal Reserve's emergency lending facilities, like the discount window, are starting to fall. But if you look closely, there are still signs of strain in the depths of the financial system. And of course, there are still plenty of worries about whether deposit outflows from banks will lead to a broader credit crunch that could tip the US economy into recession. On this episode of the Odd Lots podcast, we speak to Ben Emons, senior portfolio manager at NewEdge Wealth and a longtime portfolio manager at Pimco, about what the banking drama means for everything from US mortgage rates to the vast "repo" market that's often described as the plumbing of the financial system.

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Marijuana has been legalized in a number of places in the US now, but what New York is trying to do with its legal weed market is somewhat unique. Not only is the state trying to use legalized weed to raise tax revenue and create a new industry with lots of new jobs, it’s also trying to use its legalized cannabis market to rectify some of the wrongs of the past. In the third and final episode of this special Odd Lots series, we speak to those who have been affected by historic attitudes and policies towards drugs, and some of the state officials who are now trying to right these past injustices. 

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In some respects, selling legalized cannabis should be like many other consumer goods business. You make a product people recognize and then sell it to as many of them as possible. But even if attitudes towards pot -- and the laws that govern it -- are changing in the US, there are still a ton of issues facing this new market. In the second episode of this three-part Odd Lots series, we take a closer look at the business of big cannabis. How are multi-state operators working out in places that legalized medical and recreational marijuana years ago? What are the opportunities and challenges of this new industry? And what do they say about the future of the New York market?

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New York City has long been seen as a holy grail for the legal weed industry, with millions of potential customers. And last year New York state started handing out licenses for its first recreational cannabis shops, the culmination of a series of moves that have seen marijuana decriminalized after decades of being illegal. So how is this new legal weed market supposed to work in a city with a long and complicated history with drugs, and what are the considerations going into its creation? In this first episode of a special Odd Lots series, we take a deep dive into what's going on with the legalized marijuana market in New York. We’ll spend three episodes exploring what the birth of this market looks like, how these businesses are setting up, and finally how New York is trying to address the social inequities of the past. 

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Over time, we expect the world to get richer. Yes, there are disruptions and setbacks (and we have seen several large ones in the last few years) but the expectation is to see growth and an increase in material wealth. And yet for years, many countries around the world have seen stagnation or outright reversal — particularly once you exclude East Asia. On this episode of Odd Lots, we speak with Henry Williams and David Oks, the authors of a recent piece in the journal American Affairs about what they call The Long, Slow Death of Global Development. They argue that traditional development models, particularly those built around manufacturing, have failed much of the world, with little prospect of improvement anytime soon.

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In August of last year, the White House signed the CHIPS and Science Act of 2022, a bipartisan effort to bring more advanced semiconductor manufacturing onto US shores. Of course, it already has plenty of critics. There are concerns that the bill is being larded up with red tape, or non-core progressive priorities, that will undermine the bill. On this episode, we speak to two leaders playing key roles in the act's implementation. Mike Schmidt, director of the CHIPS Program Office, and Todd Fisher, the program's chief investment officer, join us to talk about the act's goals, what's been achieved so far, and why they believe it can succeed.

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In the last month or so, two macro risks have become top of mind for investors. One is the stability of regional banks. The other is the weakness in the commercial real estate market. On some level, they're separate stories, but they're also linked, since regional banks tend to do more commercial real estate lending than larger, national banks. Of course, the links are complicated. CRE is not a monolith — and banks are just one source of financing for CRE projects, alongside private credit funds, insurance companies and other sources of capital. On this episode of the podcast, we speak with Jim Costello, chief economist for real assets at MSCI, about what to watch for.

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Nassim Taleb has never been shy about expressing his viewpoints on a wide range of topics. But lately he's been getting into verbal tussles with people who have long looked up to his wisdom. Whether it's Bitcoiners, venture capitalists, deadlifters, or anti-vaxxers, many people within these communities have admired his philosophy of antifragility. So why has he taken to arguing with them on Twitter? What exactly are they getting wrong about his ideas? And for that matter, why has he himself gotten into cycling lately? In this wide ranging conversation, the author of books such as Antifragile, The Black Swan, and Fooled by Randomness talks about all these topics and more — including how to think about reducing tail risk in one's own life. 

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For the most part, being a landlord, particularly in a major city, has been a good business to be in. Rents historically just go up — as do property prices. And there are multiple other ways to make money, as well. Plus, historically, politicians didn’t care much about the rights of renters, focusing much more on the concerns of homeowners. But the politics might be changing. And if the politics are changing, then the economics may change, too. On this episode of the podcast, we speak with Ben Carlos Thypin, a residential and commercial landlord in New York City, who tells us the golden age of being a landlord is over and why he plans to get out of residential real estate completely.

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One of the big mysteries in markets right now is why risk assets rallied so strongly into the new year even as policymakers were adamant that they would continue to go hard on inflation by raising rates. Sure, there have been some recent signs of a "soft" or even "no landing" scenario, but a lot of the price action seemed pretty dramatic, with investors dashing back to meme and tech stocks that were beaten down last year. Matt King, Citigroup strategist and Odd Lots favorite, has one explanation for the recent "dash for trash." He argues that even though many central banks around the world have announced that they're winding down several years of extraordinarily loose monetary policies, they've actually been adding liquidity to the financial system in recent months — almost $1 trillion of it. Now he says that extra liquidity is going away and it isn't at all clear if private businesses and investment will fill the gap.

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The tech world is in a precarious moment. Valuations are down. The IPO window seems shut. SPACs are a thing of the past. And the industry's pre-eminent bank just went bust. So what now? Where are the opportunities and what should people look for? On this episode, we speak with Betsy Cohen, the veteran dealmaker, SPAC innovator, and the co-founder and chairman of investment firm Cohen Circle. We discuss the state of the tech market and how Silicon Valley Bank failed at Banking 101.

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When Silicon Valley Bank failed, the government stepped in and guaranteed that all accounts — even those well above the FDIC threshold for deposit insurance — would be made whole. So now people are wondering whether all accounts at every bank are implicitly guaranteed, regardless of their size. But if they are, then what is the point of private, for-profit retail banking? On this episode of the podcast, we speak with Saule Omarova, a professor at Cornell Law School. She had been nominated by President Biden to head the Office of the Comptroller of the Currency, but was forced to withdraw due to fierce opposition from the banking lobby. That opposition was based, in part, on her endorsement of public checking accounts at the Federal Reserve. But what was a seemingly "out there" view a year ago, is now firmly within the Overton Window of political possibilities. On this episode, we discuss the SVB disaster, what it means for banking, and the case for a public option.

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Markets are suddenly on edge due to strains in the financial system. But banks aren't the only source of stress. Pockets of the commercial real estate market — which is worth around $20 trillion — are showing cracks as well. Higher interest rates are one factor, but also a lot of commercial office space is still not at pre-Covid capacity levels, putting pressure on income. So where are the trouble spots? And who is holding the bag? On this episode of the podcast, we speak with Rich Hill, head of real estate strategy & research at Cohen & Steers, about the state of the market.

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Zero- and one-day options give investors the ability to bet on the daily moves of the S&P 500. In recent months, both big institutional investors and retail traders have gotten in on the action, creating a boom in trading volumes of these short-lived contracts and sparking an intense debate over their effect on the market. So what exactly is driving their popularity and why are some Wall Street analysts so divided on whether such options will cause a rerun of the “volmageddon” that we saw back in early 2018 and that caused a big drop in stocks? Nomura Securities International Inc. strategist Charlie McElligott walks us through these new trading contracts, explaining how they work, why people are snapping them up, and what their impact on the market could be.

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Whenever a major financial institution collapses and needs a bailout, it's easy to say, "Where were the regulators?" But that's only a useful question if you can pinpoint the specific regulatory choices that led to any particular situation. So what caused Silicon Valley Bank to implode? On this episode of the podcast, we speak with Columbia Law School professor Lev Menand, who discusses the defanging of bank supervisors in the run-up to this fiasco. With proper oversight, someone might have caught and put a stop to the unique set of risks the bank was taking. But without proper oversight, they were encouraged to go for all-out growth, regardless of the ultimate social cost. We also discuss legislative changes over time that led to this buildup of risk.

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Silicon Valley bank collapsed at record speed. And the world is still trying to figure out what went wrong? How did a bank with a strong history, a strong brand, and a fairly conservative investment portfolio go belly up so fast? On this episode of the podcast, we speak with Dan Davies, a Managing Director of Frontline Associates, who previously worked as a bank analyst. He explains why the bank's customer base turned out to be so much more flighty than expected, and why the bank reached for yield buying long-dated Treasuries at a time of ultra-low interest rates. We discuss what to watch next, and why he's concerned that the initial salvo to stanch the bank run may not be enough.

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In the short term, the Federal Reserve's job is straightforward. Raise or lower interest rates in order to meet its employment and inflation targets. But over the years, it has evolved to do a lot more than just set the price of short-term bank borrowing. With each successive crisis, the Fed has taken on new powers and responsibilities to stabilize finance, markets and the broader economy. And with Washington characterized by partisan gridlock, the Fed is seen as the one entity that can actually move with some agility when it's needed. On this episode, we speak with Jeanna Smialek, a Fed reporter at the New York Times, and the author of the new book Limitless: The Federal Reserve Takes on a New Age of Crisis, about the history of the Fed and how it became so powerful.

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The persistence of inflation is a bit of a mystery to economists. Many of the shocks of the last few years have faded. And the Fed has raised rates aggressively, with seemingly only a modest impact. So why are companies still raising prices? If you listen, they actually explain a lot of their reasoning on corporate conference calls. On this episode of the podcast, we speak with Samuel Rines, managing director at Corbu, who has gone through numerous transcripts and come to the conclusion that management teams are still being rewarded for "price over volume" strategies. Companies in this environment are happy to sacrifice a bit of volume sales in order to keep moving through large price increases. He walks us through what he's learned from companies like Wingstop, Tractor Supply, and PepsiCo. And he talks about what you should expect to see when the inflationary urge finally starts to crest.

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Crypto is facing two distinct, yet related problems. First, a bunch of people have lost money due to the decline in coin prices and the collapse of major firms, such as FTX. At the same time, regulatory scrutiny is also increasing. And of course, the reason that scrutiny is increasing is in part due all the lost money. So how is the industry dealing with all this? On this episode of the podcast, we speak with Brian Armstrong, the co-founder and CEO of Coinbase, the biggest crypto exchange in the US. He talks about the trajectory of the industry, where he sees it going, the impediments it faces, and much more.

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Homebuilders have experienced major whiplash over the last few years. The pandemic originally caused them to slam the brakes on new development. Then the housing boom happened and they raced to catch up and build — but then they ran into supply-chain constraints. Then in 2022, the interest rate shock put the market into a freeze. But before that building can begin, how do developers find completely unused land and turn it into new homes? Who takes on that risk? Who buys and brokers that land? On this episode of the podcast, we speak with Chase Emmerson, the co-CEO of Emmerson Holdings, an Arizona-based boutique land investor. He explains the process of securing land, getting it permitted for development, obtaining water rights, and more. He also walks us through what he's seeing in the housing market right now.

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The vast majority of urban apartments in the US are geared towards single occupants, couples without kids or maybe young professionals with roommates. It's hard to find apartments with the kind of layout that would fit families. Anyone who's gone looking for that type of space is probably familiar with bedrooms that look and feel like closets, or if you do find an apartment that has multiple good-sized bedrooms, it probably costs a fortune. So why is this the case? Why is so much apartment construction skewed towards non-families, and why does there seem to be an inherent assumption in the real estate market that families will always want to live in houses out in the suburbs? On this episode of the Odd Lots podcast, we explore the hidden incentives and regulations that deter builders from making more family-friendly buildings. We speak with real estate developer Bobby Fijan, and also Stephen Jacob Smith, executive director at the Center for Building in North America, for their perspective.

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The Federal Reserve has been raising benchmark borrowing rates at the fastest pace in decades, but the interest rate paid out to millions of people with bank accounts is still stuck at almost zero. According to data from Bankrate, the average interest rate on savings accounts is just 0.23%. So what's going on? Why have many banks so far avoided raising what they pay out to depositors even as the Fed hikes, and will that eventually change? What does it mean for the financial system and also economic policy given that higher rates are, in theory, supposed to encourage less spending and more saving in order to curb higher inflation? On this episode, we dig deep into the making of bank deposit rates with Barclays strategist Joe Abate.

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It's been one year since Russia invaded Ukraine in an event that set off a chain reaction of both geopolitical and economic consequences. So what have we learned from the past twelve months? And what is the future of this ongoing conflict? On this episode, we speak with Robert Papp, a retired senior executive at the CIA about what to watch when it comes to the weeks and months ahead. Before joining the CIA, Robert was a cryptologist in the US Navy and also studied Russian and Russia's economic history. He walks us through key questions, including how things are going for either side, and the role of both economic and information warfare in the conflict.

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President Biden came into office with an incredibly slim legislative majority. And yet despite just 50 Democratic seats in the Senate, the first two years of Biden's Presidency saw the passage of some extremely ambitious laws. The potential exists for the infrastructure bill, the CHIPS Act, and the Inflation Reduction Act to reshape the economy in ways that we haven't seen in a long time. Brian Deese has been the head of the National Economic Council these last two years, and was thus directly involved in the passage and shaping of these laws. So what will they accomplish, and how will they ultimately be judged. We spoke to Brian in his final week in the NEC role about this new era of "industrial strategy", and what he learned during this two-year stint.

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The US is in the middle of another debt ceiling fight. The expectation is that it will get lifted before we hit the so called "drop dead" date — but what happens if Congress does not authorize more debt financing? What are the options for the government? Does this automatically lead to default? And if the US does default on its debt, what does that mean for the financial system and the real economy? On this episode of the Odd Lots podcast, we speak with George Pearkes, macro strategist at Bespoke Investment Group, about how the debt limit actually works, and we attempt to get an understanding of what to expect if we reach this uncharted territory.

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The US labor market looks rock solid. The unemployment rate is at its lowest level in 50 years, while layoffs continue to trend downward. But there's one glaring exception and that's the tech industry. Nearly every major tech company has announced layoffs in the last few months, which is exactly the opposite of how things played out over the last decade, when the sector was a bright spot in an otherwise sluggish job market. So what's going on? Why now? Who is getting cut? And will these tech workers quickly find new jobs? Can they apply their skills to the burgeoning AI space? On this episode of the podcast, we bring back Patrick McKenzie, the author of the Bits About Money newsletter, who previously worked at Stripe for six years. He talks about the current trends in tech employment and why it's still a good idea to become an engineer.

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In the wake of the Great Financial Crisis, the work of John Maynard Keynes experienced a revival, as people sought answers to the problem of sluggish growth. In this cycle, sluggish growth isn't the problem. If anything, you hear business leaders and central bankers talking about the labor market being "too hot," and the need for the unemployment rate to rise. So what explains the current dynamic? And how can we sustain a hot economy without the pain of inflation? Perhaps the work of the lesser-known Polish economist Michał Kalecki holds the answers. Like Keynes, he also viewed the free market as being inherently unstable, but he came to different conclusions about why. He also explored the political economy of full employment and why this condition frustrates business leaders. On this episode, we speak with Jan Toporowski, professor of Economics and Finance at SOAS University of London, about Kalecki's work and how it can help us understand today's economy.

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The new season of Bloomberg's Foundering podcast retraces the life and gruesome death of John McAfee. In the 1980s and ’90s, the McAfee name was synonymous with computer antivirus software, and he helped establish the modern cybersecurity industry. But afterward, his life took a strange and dark turn. He was accused of murder, an allegation he denied, and then went on the lam. He sought to reinvent himself as a cryptocurrency guru and as a candidate for US president. Reporter Jamie Tarabay interviews McAfee’s colleagues, acquaintances, investigators and family members to demystify lies he told throughout his life, reveal the secrets he kept and resolve questions surrounding his public and decades-long self-destruction.

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The Federal Reserve raised interest rates at the fastest pace in decades in 2022. But despite the rapid shift in borrowing costs, not much in the financial system actually 'broke.' Stocks and other risk assets went down, but aside from a few issues like the gilt market drama in October, we didn't see a big systemic event. On this episode of Odd Lots, which was recorded live at the Credit Market Structure Alliance conference in New York, we speak with Fabio Natalucci about how he's thinking of financial risk right now. Fabio is the Deputy Director of the Monetary and Capital Markets Department at the International Monetary Fund and he writes the IMF's annual financial stability report. He walks us through the key risks he sees as still lurking in the system, as well as what's changed since 2008.

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After a decade of dominance, 2022 saw tech stocks badly underperform the rest of the market. However, so far in 2023, tech stocks and other speculations have surged again. According to Steve Eisman, what we're seeing is the natural process by which a "paradigm shift" is playing out in stocks. Eisman, a portfolio manager at Neuberger Berman, won big betting against CDOs during the Great Financial Crisis and was famously depicted in the book and movie The Big Short as one of the few investors who got it right. In this conversation, he talks about lessons learned from his career in investing, how and why big shifts happen in markets, the state of the financial system, and what sectors could win over the next decade.

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It was looking bad there for awhile for Team Transitory. Anyone who had previously even uttered the word "transitory" in regards to inflation was regretting having used it. But lately the term is creeping back in, particularly as inflation decelerates while the unemployment rate remains low. So was the transitory perspective right all along? And is the fabled "soft landing" actually here? Macquarie Capital strategist Viktor Shvets believes it is. On this episode, the return Odd Lots guest gives his view of the economy and why he never gave up on his transitory stance. He talks about why inflation is falling and how many sources of anxiety — from geopolitical risk to deglobalization — won't materialize in the manner that many people are expecting.

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Rent inflation went wild in 2021 and 2022, turning it into one of the most substantial drivers of overall inflation. But good news: it seems pretty clear that rents are now finally falling. Private sector measures, from companies like Apartment List and Zillow are starting to show a clear decline. So what's changed? How hard could rents drop? And could a renter in a place like New York City actually get a rent reduction? On this episode of Odd Lots, we speak with Chris Salviati, the top housing economist at Apartment List, to discuss what's changed and what 2023 has in store.

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Southwest Airlines had a disastrous holiday season, thanks in part to a software bug that left crews out of place and grounded thousands of flights. But Southwest isn't alone in having software in the headlines lately. The New York Stock Exchange recently had a software error that caused weird pricing on stocks and the FAA had its own computer issue that grounded planes earlier this month. So what's the deal with corporate software? Why do these crashes happen? And why does the user experience typically leave something to be desired? On this episode of the podcast we speak with Patrick McKenzie, an expert on engineering and infrastructure, who writes the Bits About Money newsletter and recently left payments company Stripe after six years. We talked about the challenges of keeping any software system alive after years of upgrades and updates, the distribution of tech talent across industries, and whether non-tech companies can close the gap with Silicon Valley.

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The price of eggs rose 60% in 2022, as measured by the Consumer Price Index. Meanwhile, wholesale egg prices are up 300% in the last year, creating a chart that looks almost parabolic. So what's going on? And is there any relief in sight? On this episode, we speak with Glenn Hickman, president of Hickman's Family Farms, an Arizona egg farm with roughly 10 million chickens. Glenn explains why egg prices have been shooting higher, the role of the Covid-19 pandemic, and how farms are responding to the outbreak of avian flu.

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Over the last year, numerous things have gone wrong for the crypto industry. (Too many to list.) But one thing we've learned is that there's an incredibly high degree of interconnectedness between various firms, all borrowing and lending from each other in a way that created a tremendous amount of fragility. A key entity in all this is GBTC, the Grayscale Bitcoin Trust, which was one of the first regulated entities that allowed ordinary investors to get Bitcoin price exposure. Over time, this trust turned into a behemoth, with numerous players making massive leveraged bets on it. On this episode, we speak with Ram Ahulwalia, the CEO of Lumida Wealth, who explains how the fund works, how the trade worked for investors, and why it's ended in tears for so many players.

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In economics, there tends to be two dominant ways of thinking about inflation. Either you agree with Milton Friedman, who described inflation as always and everywhere a monetary phenomenon (the result of too much money printing). Or you're more of a New Keynesian who thinks that higher prices are all about the relationship between demand and capacity. In a new paper inspired by Odd Lots and the series of disruptions that have rocked the economy since the global pandemic, UMass Amherst Economics Professor Isabella Weber describes a potential third way of thinking about inflation. She identifies systemically significant sources of inflation, or industries that could end up having a broader impact on a wide variety of prices. The hope is that by identifying these important sources of inflation early, policymakers can put in place measures to make sure price increases don't get out of hand. 

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While electric vehicle use is growing rapidly, the internal combustion engine remains completely dominant in the world of heavy trucks. At some point in the future, Tesla has a plan to commercialize an electric semi, but nobody really knows when. Meanwhile, other entities are looking to compete in the world of industrial vehicles. Chace Barber is a former trucker in the logging industry, which has some very different characteristics than the type of freight trucking you typically see on a highway. When you're driving over the Rocky Mountains, without easy proximity to mechanics, tow trucks or service stations, you need power and reliability. His company, Edison Motors, is building its own trucks with a hybrid diesel-electric approach that it sees as a better path forward. On this episode, we discuss the challenges of hauling logs, as well as how it's possible for a small entity to get in the game of building such large industrial equipment.

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The discount window at the Federal Reserve allows banks to borrow money at an above-market rate in exchange for high-quality collateral. The facility is always available to use, but typically nobody does. Not only is the borrowing costlier, there's also a "stigma" associated with its usage, since the perception is that if you use it your institution might be in some kind of financial distress. So why has some entity (or multiple entities) been using it lately? On this episode of the podcast, we speak with Bill Nelson, chief economist at the Bank Policy Institute and a former employee of the Federal Reserve who helped design and manage the discount window for 10 years. We discuss what the program is, its history and how it's used today.

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