Welcome to This Week’s Leyendecker View
[ChatGPT-5] is a team of PhD Level experts in your pocket.
– OpenAI CEO Sam Altman
FAVORITE READ OF THE WEEK
How to escape the “dopamine crash loop”
And rewire your curiosity.
Niall Ferguson talks to Javier Milei
The “chainsaw” way of thinking.
FAVORITE POD OF THE WEEK
Fervo execs join the Veriten podcast
Houston geothermal company is rocking!
THINKING OUT LOUD
Will US Tariffs Save Globalization?
Why a reset might be the only way forward
The US is now more than $37 trillion in debt. People are worried—and for good reason. But what’s behind it? How did we get here? And what does it have to do with the broader global economy?
To understand that, we have to rewind to the aftermath of World War II. After the war devastated Europe and parts of Asia, the United States stepped in—not as a conqueror (because, after all, the US is not an empire), but as a stabilizer. We invested heavily in helping countries rebuild. That effort wasn’t just humanitarian—it laid the foundation for what became modern globalization. For decades since, the U.S. has been the bedrock of global economic stability, often footing more of the bill than most Americans realize.
We’ve provided military security, financial liquidity, and—most importantly—a massive consumer market that much of the world has come to rely on. In short, since WWII’s end, the global economy has been riding the momentum of American strength and American spending.
But over time, that generosity has started to backfire. The U.S. now runs a constant trade deficit, importing far more than we export. At the same time, we send billions abroad in foreign aid and remittances every year. Our consumer demand fuels growth in other countries, while we borrow more and more to sustain it. The result is a deep imbalance—one that leaves U.S. taxpayers, employers and consumers effectively subsidizing other nations’ growth while our own fiscal foundation weakens.
Some argue that foreign investment makes up for our trade deficit. But that’s only partially true—and the type of investment matters. Foreign direct investment—like building a factory—can create jobs and support local economies. But foreign financial investment mostly flows into markets, not main street. It benefits investors more than workers, and it enables more borrowing rather than building.
At the same time, the dollars we send overseas (remittances and $100B in foreign aid annually) aren’t being recycled into our economy. They’re stimulating growth abroad, not here at home. This dynamic may have been sustainable for a while, but the math no longer works. Interest payments on our debt are growing rapidly, squeezing out spending on the things that actually drive long-term prosperity—like infrastructure and innovation.
If the US were to fall into a debt-driven recession, the ripple effects would be global. American consumer demand would dry up. Capital would flee emerging markets. Fragile supply chains could snap. The global system isn’t built to withstand a major crisis at its core—as we all learned during Covid.
So what’s the answer?
One response is the use of strategic tariffs. President Trump’s tariff policy has been controversial, but there’s a case to be made that it isn’t anti-globalization at all. In fact, it might be one of the few tools left to save it.
Tariffs serve a few key functions. First, they raise revenue without raising taxes on American workers or businesses. That’s especially important as we look for ways to reduce our deficit.
Critics are right to point out that tariffs can raise prices. They can. But companies have choices: pass the cost to the consumer or find ways to innovate, cut costs, and boost productivity. And when the stakes are this high, a little pressure might be exactly what’s needed to drive real change. Let’s not forget that necessity is the mother of invention.
Tariffs also create price pressure that can encourage companies to bring production back to the U.S. And tariffs can be a powerful negotiating tool. We’re already seeing countries—and many American companies—make new commitments to invest in US factories and jobs, even if the actual dollars haven’t been invested just yet.
When it comes to trade, we can’t keep playing the same game and hoping the outcome will change. For decades, other countries have benefited from open access to US markets while keeping barriers in place for American exports. That’s not sustainable. Strategic tariffs—used thoughtfully and temporarily—can help rebalance the system. They create the incentive structure needed to push trade partners toward more fair and reciprocal agreements. And they provide incentives for domestic companies to invest more in our country instead of overseas.
The truth is, globalization doesn’t need to end—but it does need to evolve. If we don’t address these underlying imbalances now, we risk facing a far more painful correction down the line. The longer we wait, the fewer options we’ll have.
So no, tariffs aren’t a magic bullet. But they’re not the enemy, either. They’re a tool. And if used wisely, they might just help us preserve the global system that, for all its flaws, has created enormous prosperity.
The choice isn’t between globalization and isolation. It’s between responsible course correction now—or a chaotic collapse later.
THE RANDOMS
Will Trump’s tariffs cause US automakers to retreat from their massive over investment in EVs?
Western auto companies don’t seem to understand that what most consumers need is a $20,000 vehicle, not some fancy, expensive gadget car. Most Americans can no longer afford a new car.
The dramatic change needed to stop the trend of massive fiscal deficits and government debt growth will likely come with some uncertainty and economic pain. It’s like that old saying: No pain, no gain.
This reminds me of the way American life seems to operate: If it ain’t broke, don’t fix it. But if it’s broke, fix it immediately! Maybe that’s why years ago I started calling Baby Boomers the “Burger King generation”—“I want it my way, and I want it now!”
England and France are threatening Israel if they don’t quickly resolve the Gaza war. Exactly where is their leverage against Israel?
Perhaps we won’t get a full-on recession. But we might be missing recessions in industries. The domestic oil and gas industry had a pretty bad recession between 2015 and 2020. The renewable energy and energy transition businesses now seem to be in a recession. Which industry is next? How about the restaurant industry?
One in 10 US adults is now supposedly a millionaire, but they aren’t living large these days.
Just a reminder: Members of Congress regularly outperform the Wall Street indexes. But is Congress starting to realize this reduces voter confidence in Washington?
ECONOMIC NEWS
Economy
Pharma inflation is massive
Labor market weaker than expected
US economic growth pops
JPMorgan had predicted recession
Top earners falling behind on payments
Higher wages aren’t helping many families
Labor
Finding a job online is a nightmare
AI job cuts are accelerating
Hiring and available jobs decrease in June
With AI, Amazon needs fewer workers
The Loan Star
Apple has big Texas investment plans
Tesla signs $16.5B Texas Samsung deal
Austin rocket company files IPO
Texas-based AI education company going national
BUSINESS
Finance
Is JPMorgan’s Dimon plotting a presidential run?
Foreigners hold $31T of US financial assets
Which is right: equity market or bond market?
Continuation vehicles are the new exit
S&P returns from 1950-2024
Real Estate
A rent or buy calculator
Lower rates won’t help homebuyers much
More home buyers are over 70 than under 35
Tech
Trump wants more US-made chips
Tech’s new big customer—the war industry
Meta has the iPhone in its crosshairs
Big tech are the new infrastructure companies
AI
Big upgrade from OpenAI today
Illinois bans AI therapists
Is AI a sustainable boom or a gold rush?
AI’s first step to replace schools
AI data centers dominate Wyoming’s power demand
Can AI help cut the federal budget?
Energy Transition
Earth’s core is leaking out
Is sanity coming to the climate debate?
India’s coal champion reopens dozens of mines
THE NATION
The Washing-Tone
Trump wants a Census of just citizens
Trump helps automakers
Liberal court supports Trump
Trump demands lower drug prices
Team Trump incentivizes more private savings
Climate regulation gets its own “liberation day”
Tariffs
No tariff problems for Silicon Valley or Wall Street
The sneaky Trump luxury tax
South Korea pitches US shipbuilding support
US exporters get big Trump boost
Social Trends
The conservative NY Post heads to California
Is trading the city for the farm a new trend?
Children today suffer a play deficit
The Georgia high school abomination
GEOPOLITICS
Global
Mexico has a really big cartel problem
Time for Indonesia to shine
IMF ups global growth forecast
Moody’s raises Argentina’s bond rating
Europe
Most Germans don’t care about their country
Eurozone economy shows signs of resilience
The largest European oil find in a decade
Europe can’t keep its defense promises
Ukraine
Trump uses India as leverage with Putin
NATO gets behind Ukraine
Europe seeks to punish Russian collaborators
Russia launches massive attack on Ukraine
Middle East
Israel strikes $35B gas deal with Egypt
Will Israel take over Gaza?
Iran executes a nuclear scientist
Hamas’ strategy is to disrupt aid
A water crisis plagues Iran
US conducts rare raid in Syria
China
China and Kuwait announce closer military ties
New drug from China is super lethal
China’s $167B dam project
China wants global AI governance
War Creep
Australia and Japan get cozier
Trump repositions nuclear subs
India and Philippines join forces in South China Sea
China doesn’t like Japan’s space build-up plan
MAKING A BETTER YOU
Mind
Get more quiet time.
Saying “no” without causing offense
How to build “cultural intelligence”
Beekeeping, good for your mental health
Body
Get more outside time.
Japanese walking is good fitness
Make mosquitoes stop biting you
10,000 steps debunked
FUN STUFF
Let your hair down, baby! Even if you’re all alone.
The Extraordinary
Plastic foam man floats to freedom in South Korea
Great thoughts on getting older
The longest English word has 189,819 letters
How early in life do we learn empathy?
Music That Found Us
Blade Runner score, Danish version.
A 2004 version of “While My Guitar Gently Weeps.”
Ashley Gorley’s 83 #1 hits include:
Carrie Underwood’s “Don’t Forget to Remember Me.”
Brad Paisley’s “American Saturday Night.”
Weezer’s “All My Favorite Songs.”
Worth a Watch
Thank goodness for Naked Gun silliness.
Fantastic Four: First Steps worth a watch.
A Big Bold Beautiful Journey
It’s Vacation Time
A super beach holiday at the Great Lakes
The most beautiful towns in the US
The Yum Yums
Simple baked salmon
Simple grilled salmon
Garlic butter salmon
Honey butter glazed salmon
Chili crisp and honey roasted salmon
Pistachio-crusted salmon
Firecracker salmon
Salmon burgers with pickled cucumbers
PARTING THOUGHTS
Summer afternoon—summer afternoon; to me those have always been the two most beautiful words in the English language.
– Henry James
IN CASE YOU MISSED IT
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The Luddite Prophecy
July 25, 2025
A Turnaround Story
July 18, 2025
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