‘This is Something that Traditional Economics Isn’t Prepared to Deal With’

The Ezra Klein Show

New York Times Opinion

Society & Culture, Government, News

4.6 • 11K Ratings

🗓️ 23 December 2025

⏱️ 78 minutes

🔗️ Recording | iTunes | RSS

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Summary

This is the strangest economy I’ve seen in my lifetime. If you just looked at the macro data — the jobs numbers, G.D.P., the stock market — things look pretty normal. But they clearly aren’t normal. The Trump administration spent the year upending the global trade system while tech companies spent hundreds of billions of dollars on A.I., a technology that could potentially displace many of our jobs. And people don’t feel normal, either. Survey data shows that the vibecession rages on. Tracy Alloway and Joe Weisenthal are the co-hosts of the excellent economics podcast “Odd Lots” and have closely followed all the chaos this year. So I wanted to have them on the show to explain what the hell is going on. Mentioned: Charts Odd Lots The Three-Body Problem by Cixin Liu “The Vibecession: The Self-Fulfilling Prophecy” by Kyla Scanlon “Everyone is Gambling and No One is Happy” by Kyla Scanlon Book Recommendations: Breakneck by Dan Wang North Woods by Daniel Mason A Marriage at Sea by Sophie Elmhirst The Digital Reversal by Andrey Mir Orality and Literacy by Walter J. Ong No Sense of Place by Joshua Meyrowitz Thoughts? Guest suggestions? Email us at [email protected]. You can find transcripts (posted midday) and more episodes of “The Ezra Klein Show” at nytimes.com/ezra-klein-podcast, and you can find Ezra on Twitter @ezraklein. Book recommendations from all our guests are listed at https://www.nytimes.com/article/ezra-klein-show-book-recs. This episode of “The Ezra Klein Show” was produced by Rollin Hu. Fact-checking by Annika Robbins, with Kate Sinclair and Mary Marge Locker. Our senior engineer is Jeff Geld, with additional mixing by Isaac Jones. Our executive producer is Claire Gordon. The show’s production team also includes Marie Cascione, Annie Galvin, Michelle Harris, Kristin Lin, Emma Kehlbeck, Jack McCordick, Marina King and Jan Kobal. Original music by Pat McCusker. Audience strategy by Kristina Samulewski and Shannon Busta. The director of New York Times Opinion Audio is Annie-Rose Strasser. And special thanks to Kimberly Clausing, Natasha Sarin and Kyla Scanlon.

Transcript

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0:00.0	Before we begin today, and this is a fun one, this episode discusses some charts.
0:05.2	So if you would like to see them as we're discussing them, you can watch the episode on YouTube,
0:10.1	or you can find a link to all the charts for a long time.
0:42.0	I've covered the financial crisis.
0:43.4	I covered the pandemic.
0:44.8	I cannot remember a stranger and more chaotic year in the economy than this one.
0:49.7	A year where it is so unclear what the story was and how it would actually turn out.
0:55.7	Other years, the economy is bad, it's good, but what is the economy right now?
1:01.0	From the tariffs and liberation day and then the deals and the pauses and the carve-outs,
1:08.2	what is our tariff policy now?
1:10.7	To the giant AI buildout that is keeping the economy afloat, but is that a bubble?
1:16.5	Does it herald massive labor market disruption?
1:19.2	Is it good for us?
1:20.0	Is it bad for us?
1:20.7	Good for whom?
1:22.1	Bad for whom?
1:23.9	To the economic data, which has become completely divorced from how people actually feel about the economy.
1:30.3	If you look at consumer sentiment, people feel like the economy is as bad as it was at the depths of previous recessions.
1:38.4	And yet the economic data, the job market, wages, inflation, kind of looks okay.
1:43.4	So there is this divorce between how people feel about the economy
1:46.6	and what we can see in the economy.
1:49.0	How do you make sense of all this?
	...

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