The James Altucher Show: Is The Fed playing Footsies with Inflation? And what's Talent!? With Tyler Cowen
In this episode, Tyler Cowen came on, and we gotta ask him about the inflation, and the economy! Then, of course, we talked about his new book, Talent: How to Identify Energizers, Creatives, and Winners Around the World. Listen to the full episode here:
An American economist, columnist, and blogger. He is a professor at George Mason University, where he holds the Holbert L. Harris chair in the economics department. He hosts the economics blog Marginal Revolution, together with co-author Alex Tabarrok. Cowen and Tabarrok also maintain the website Marginal Revolution University, a venture in online education.
1. Who is Tyler Cowen?
Cowen writes the "Economic Scene" column for The New York Times and since July 2016 has been a regular opinion columnist at Bloomberg Opinion. He also writes for such publications as The New Republic, The Wall Street Journal, Forbes, Newsweek, and the Wilson Quarterly. He serves as general director of George Mason's Mercatus Center, a university research center that focuses on the market economy. Since 2015, he has hosted the podcast Conversations with Tyler. In September 2018, Tyler and his team at George Mason University launched Emergent Ventures, a grant and fellowship focused on "moon-shot" ideas.
He was ranked number 72 among the "Top 100 Global Thinkers" in 2011 by Foreign Policy Magazine "for finding markets in everything". In a 2011 poll of experts by The Economist, Cowen was included in the top 36 nominations of "which economists were most influential over the past decade".
I think there's a 50% chance there will be a recession. But I'm hoping it's a fairly mild one, due to all the savings built up, some positive momentum in labor markets, and also some of the service sectors that are coming back.
2. There may be a 50% chance of a recession?
I would have six months ago, started and accelerated the rate hikes, even a year ago, in fact, and I would make it clear to the markets, I mean, business, and I would risk that recession and not, you know, play footsie. So as you said, a moment ago, the money supply has never been higher. So they've been talking about this game for many months. But we're still waiting to see it. Like they've still been doing quantitative easing. Well, that's like ending in May. Now we're in May. But my goodness, why did you wait till May what was wrong with January?
3. You're the Fed chairman, what would you do?
I'm cautiously optimistic but expecting a decent chance of a recession. Even though the yield curve right now is fairly steep, it's not inverted. I don't think yield curves predict very well, our saving grace, I think is a lot of sectors will be booming, just because other parts of the economy are coming back, like maybe more people will go to movies, right? Whatever it is, you think people will do more of that will boom, even in the middle of this recession. And that will be weird. It will not be fairly consistent across the broad recession.
4. Are you optimistic?
You mentioned India, there's so much more talent coming out of India today than, say 30 years ago. But so many people in India fall through the cracks, they never discovered they don't get to the right school. To a lesser degree. The same is true in America, we still have many forms of discrimination, not only the obvious ones but discrimination against ugly people against people who weigh too much. And so on me, I know all about that, that first one. And we just have these overly bureaucratized hiring processes full of Credentialism, which for some jobs is fine. But people, you know, the John Lennon's have today who are not going to college, or not getting the chances they ought to have?
5. It's still challenging to Find Talent
We're all born differently. I would say at the margin, I would prefer a hard worker to a lazy genius. But if you look at the people at the very top of their fields, you know, Magnus Carlsen or Pablo Picasso or Bill Gates, they are very, very, very smart. But here's the thing when you look at the data, other than people at the very, very top. smarts and achievement don't correlate that well. smarts and wages don't correlate that well. You simply need people who are smart enough. And then you're looking for Dr. Persistence, energy, a person's ability to work well with others and figure out how he or she fits into a team has much more to do with vital success than smarts. And smart people are exactly the ones who get that wrong. They think it's all about smarts because they're in a way flattering themselves.
6. Always hard worker to a lazy Genius
But I think it's interesting what you say about courage. John F. Kennedy wrote a book Profiles in Courage, right? When that book came out, no one thought the word courage was weird. Now you say and I agree. The word courage has become weird. That is a sign of how screwed up we are. I think Elon Musk has had courage. He will get out there. put himself out there. Say I'm gonna try this. I'm gonna get us to Mars. I'm gonna you know, do Tesla. People laugh at him. They short the stock. It's gone really well, so far. We'll see how it all finishes. But he has, in my opinion, remarkable courage.
7. Courage is not "Courage" anymore
And sometimes intelligence even hinders some people in getting that to work for them because they think they're too smart. They are used to being smarter than everyone. They don't ask for enough advice. They don't take in enough feedback, their feelings get to hurt when they've screwed up, you know, on that you'd prefer the more intelligent person. But as I said, achievement and intelligence are less correlated than smart people realize.