Brad Setser on the Damage From Trump's Gigantic Tariff Shock

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Hello, and welcome to another episode of the Odd Lots podcast. I'm Tracy Alloway. And

I'm Joe Weisenthal.

Joe, another day, another emergency podcast.

We're gonna do a lot. This is a fact. We this is the I

should just resign myself to this inevitability. Right?

The story of the tariffs, the market reaction, the global reaction is the central story of our time, one of the biggest stories of our entire career. I think perhaps depending on how things could go, a bigger story than the past two big stories of the great financial crisis and the COVID shock. We're gonna be doing a lot of episodes about what this all means. This

is what is mind blowing to me because when 02/2008 happened, I remember thinking this was the biggest thing that had ever happened in modern finance and the modern economy. And then in 2020, I remember there was a very vibrant debate about whether or not the pandemic and the market sell off would end up being the central crisis for a new generation. Yeah. And I think in retrospect, it certainly was. A lot more people remember 2020 than they remember 02/2008 now. And here we are, you know, just five years later, having another discussion about how big this is inevitably going to be. So on that

Totally. You know, I'm just gonna make one short comment here, which is why I think this might be end up being a bigger story story than the great financial crisis potentially. And that is banking crisis happen. They happen around the world. They've happened in The US. They've even happened in The US between massive crises. And there is a playbook, and there's a response, and you try to reflect the economy and your stuff like this. This is different because this is a policy choice purposely aimed to completely reorient America's relationship with the rest of the world and reorient the internal