Don’t Panic—Yet

Welcome to This Week’s Leyendecker View

Expertise is the credential. The credential is not the expertise.
– Ted Gioia

FAVORITE READ OF THE WEEK

Richard Bernstein Warned Us About DEI
A NY Times writer, no less.

THINKING OUT LOUD

Don’t Panic, Yet

Anyone keeping a close eye on mainstream financial news the last few weeks is probably also keeping antacid and sleep aid pill makers in the chips. We are being told that the world is falling apart because Trump is a dictator and bumbling idiot.

When the media is pumping up the panic quotient, it’s important to bear in mind it is to their benefit to do so. Being hysterical is much easier than being thoughtful and objective. And fear grabs eyeballs far more effectively than nuanced arguments that take time to tease out. In such moments, we do ourselves a favor by trying to step back to see the forest for the trees.

Let’s remember that the great majority of Trump voters put him in office to make dramatic change. Let’s also remember the numerous Wall Street pundits and economists who have been lecturing us on our catastrophic future if we don’t get our federal spending and debt growth under control.

Team Trump’s tariff approach may seem chaotic and arbitrary. But this is because they know they have a small window to attempt big, structural change. Their objective is to be able to show that bold tariffs forced successful trade renegotiations, which will improve the underpinnings of the American economy in time for the midterms. If they can’t show productive progress, they lose. Then Trump’s political capital is squandered, and the window of opportunity to achieve the fairer trade vision Trump has been talking about since the 1980s closes.

Keep in mind that politicians are self-preservationists—perhaps the ultimate. Trump may be operating under the belief that he has to go big and bold out the gates to shock nations into coming to the table, fast, to come up with new trade deals that are mutually beneficial.

To this end, we will probably see lots of change in the tariff programs over the rest of this year, as Trump negotiates with more nations.

We might be naïve to think dramatic positive change in our domestic economy can come without some level of temporary pain someplace, maybe many places. Today, this is most evidenced in the stock market.

So how about that stock market? One year ago, the S&P 500 index was around 5,000. Yesterday, it closed at 5,484.  Five years ago, the S&P 500 index was around 3,000 and yesterday it closed at 5,484. Do those numbers sound like panic time?

Another thing we might be wise to keep in mind: The stock market gains from the past five years are likely attributable to the massive fiscal and monetary stimulus in that time. Something around $7 trillion was injected into the domestic economy, either through fiscal or monetary stimulus, to ensure we did not go into a Covid recession, or worse.

All that money worked its way into increasing the value of financial assets, as I discussed in a recent essay, “You Didn’t Build That.” All that financial stimulus also boosted consumption, which kept us out of a deep recession. But now, we’re not going to have trillions and trillions more of stimulus to keep our economic wheels on.

So we have to make a choice. Do we want to remain addicted to funny money heroin, or do we want to rebuild our economy to become more productive?

The former requires kicking the can down the road yet again while systemic risk continues to escalate, with the potential to explode even more spectacularly down the line. The latter requires big, bold risk today with the potential for a better reward tomorrow. But as I also wrote a while back: “No Pain, No Gain.” If we are honest with ourselves, we will all admit some pain will happen along the path to structural and productive economic improvement.

I expect by year end most, if not at all, of our tariff circumstances will somehow be worked out. This doesn’t necessarily mean we will be back on an easy streak, but we will hopefully be on a new path that takes us to a more productive economy—one that provides better economic outcomes to the great majority of our population, not just the wealthiest among us.

Now is the time to chill. This is not a FOMO world anymore, where we believe the stock market will only go up forever. That’s the world of easy money, and that world is behind us. That’s not to say that the US government won’t be in a very large deficit this year, or maybe even next. We must not forget that even the heroin addict needs methadone to kick the habit.

THE RANDOMS

Googled yourself recently? Might be worth it. Google has updated its “Results About You” tool. If you’re finding Google a bit too excited to share things about you right at the top of the results page, here’s how to delete your data.

Here’s a catch-22 for you: Our obesity epidemic tells us that we buy and eat too much food. And the explosion of personal storage units and record credit card debt tells us that we buy too much stuff for our homes and ourselves. If tariffs and/or a recession means we buy less stuff, then we should be healthier and less encumbered by stuff and debt. But, unfortunately, that would be terrible for our economy. Now what does that tell us?

Given the enormous lack of trust people today have in government, politics, education, media and more, maybe it shouldn’t surprise us that religion is on the rise.

They’re saying that Boston’s economy could be at risk as Trump focuses on education reform. Does that tell us Boston’s economy is too concentrated? Harvard Business School certainly teaches that too much customer concentration is risky for a business.

I don’t think AI will ever replace human decision-making because it lacks a sense of mortality. Knowing that we will die is what gives our lives meaning, emotion and, ultimately, motivation. It’s what makes us human. So long as AI lacks a sense of mortality and, consequently, humanity, it cannot fully mimic or replace us. 

Through his attacks on higher ed, is Trump trying to expose elite universities and colleges as mouthpieces of the progressive left? Democrats dominate faculty at elite universities. Republicans either teaching or in administrative roles in our “elite” schools are a tiny minority.

Have some of the large institutional money managers like BlackRock and Blackstone gotten so big they present a too-big-to-fail risk?

Why is the world so uncertain right now? Maybe it’s because you can’t model step change, nor predict how it will play out. Step change sucks because there are no trend lines to predict or follow.

Looks like the World Economic Forum’s global leader, Klaus Schwab, may have been misappropriating funds and taking inappropriate privileges. What’s that they say about power?

ECONOMIC NEWS

Economy

The most taxed states in the country
Credit card companies brace for downturn
Recession definitely coming for DC
Boeing sells tech gem to raise cash
Credit card problems at 13-year high
Income needed to be middle class, by state

BUSINESS

Finance

The rich keep getting richer, and faster
Private equity loses its luster
Yale looks to cut PE allocation
Harvard doing the same
Where to find good bond yields
Does US have a shadow bank problem?

Real Estate

New home sales surge ahead of tariffs
Trade war to increase demand for US warehouses
Florida condo owners desperate to sell
McMansions are a thing of the past
Big number in NYC inherit their homes

Tech

EU fines Apple and Meta
Intel to cut 20% of staff
Will OpenAI buy Google Chrome?
Delete yourself from the internet

AI

UAE to use AI to write laws
AI movies haven’t scratched the surface
Will AI save the news?
The coming great AI age

Energy Transition

BP paying the price for green failures
12 climate startups to watch
New Chinese EV battery breakthrough
Airbus can’t deliver on green ambitions
The big battery fire risk

THE NATION

The Washing-Tone

Consulting firms have been milking government
State department faces major cuts
Trump shoots down millionaire tax
Tax cuts and debt limit raise are coming

Tariffs

Some auto tariffs are tweaked
China warns world not to side with US
We will fight to the end, says China
Cheap Chinese goods gotta go somewhere
Where US food comes from

The Tariff Effects

Audi looks to open a US plant
Roche commits $50B to new US investment
UK company to double US factory size
Thrift stores set for a windfall
South Korea won’t fight Trump tariffs
Nvidia commits to Texas investments

Social Trends

Elite universities must borrow money
Border crossings grind to a halt
Hollywood narratives are a problem
Daily internet activity, from Visual Capitalist

The Man Crisis

Charts showing the decline of men
They don’t think college is worth it
Building a better manosphere

GEOPOLITICS

Global

US wants reform at IMF and World Bank
India and Pakistan tensions grow
Canada, future housing factory of the world?
Kazakhstan has big rare earth discovery
Three reasons why nothing will be the same
It sucks to be a mid-sized country

Europe

UK to up weapons production
Greece’s economy is hot
The EU’s hostile trade rules
Rural Spain backs wine, not wind

Ukraine

The Trump plan to end the war
Zelensky puts up peace plan roadblock
Russia not cooperating either
Japan ready to help Ukraine
Germany ready to step up help

Middle East

US and Iran willing to talk more
US strikes Yemeni port
Islamic Jihad fires rockets at Israel
Israel wants to annex part of Gaza
Abbas to Hamas: Free hostages and get out

China

China works Middle East nuclear deals
China tests non-nuke H-bomb
China muscles in on South Korea

War Creep

Vietnam to buy F-16 fighter jets
A Sweden-Finland alliance
How national humiliation starts wars
The US needs weapons in space

MAKING A BETTER YOU

Mind
Get more quiet time.

Easiest way to feel more organized
Quit looking for quick answers
How the brain creates heaven

Body
Get more outside time.

Hitting peak fitness after 40
A simple technique to fall asleep
Dirt under your fingernails is good

FUN STUFF

Let your hair down, baby! Even if you’re all alone.

The Extraordinary

Watch a chameleon change color, WHOA!
The most misunderstood concept in physics
Digital twin organs are coming

Music That Found Us

The electric and eclectic, Laurie Anderson.
Mumford and Sons, “Where It Belongs.”
Their new single, “Rushmere.”

Worth a Watch

Sinners has lots of thumbs up.
Daisy Ridley channels Die Hard in Cleaner.
Jack Quaid can’t feel pain in Novocaine.
Ben Affleck returns in The Accountant 2.
Soderbergh snaps back with his sharp Black Bag.

The Yum Yums

Classic shrimp scampi, yum yum.
The conqueror who changed Indian food
How healthy are avocados?

PARTING THOUGHTS

If you’re early on in your career and they give you a choice between a great mentor or higher pay, take the mentor every time. It’s not even close.

–Stanley Druckenmiller

IN CASE YOU MISSED IT

Why Manufacturing Matters
April 18, 2025

You Didn’t Build That
April 11, 2025