Are We Headed For a Recession? + How Tariffs Hurt Housing (Live at SXSW)
Mar 13, 2025
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At SXSW, Ed and Scott tackle pressing topics like Apple's delay on AI updates and Sony's battle with deepfakes. They unpack why major banks are sounding alarms about a possible recession, linking it to stock market woes. A deep dive into tariffs reveals how they’re driving up housing costs, raising questions about the notion of homeownership as a wealth-building strategy. The conversation wraps up with audience questions, emphasizing the evolving challenges young buyers face in today’s volatile market.
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Quick takeaways
Apple's delay in AI updates for Siri raises concerns about its internal management and innovation strategies amidst growing scrutiny.
Major banks are predicting increased recession risks, fueled by rising unemployment and diminished consumer sentiment, leading to economic uncertainty.
Tariffs are exacerbating housing costs, creating challenges for home ownership, necessitating innovative policies to improve housing affordability and supply.
Deep dives
Apple's AI Update Delays
Apple has postponed the release of new AI updates for Siri due to unresolved bugs, marking a rare setback for the tech giant. Observers note that Apple has traditionally avoided product delays after announcements, raising concerns about its internal management of the AI division. This situation comes as Apple faces increasing scrutiny over its innovation strategies, with many products, including headsets, struggling to meet consumer expectations. Analysts suggest that the company may be overvalued given its stagnant growth compared to peers who have shown more robust performance.
Sony's Response to Deepfake Technology
Sony has taken proactive measures by removing over 75,000 deepfake recordings of its artists, including popular musicians like Harry Styles and Beyoncé, citing potential commercial harm. This action highlights the growing concern surrounding deepfakes and intellectual property rights, especially as cases of misuse escalate. The implications of deepfake technology are significant, as they can damage reputations and foster misinformation, drawing attention to the need for regulatory responses. As instances of deepfakes rise exponentially, calls for stricter regulations and protections against misuse are becoming increasingly urgent.
Concerns Over DeepSeek AI
The U.S. government is contemplating a ban on DeepSeek, a prominent AI chatbot, due to national security concerns, following similar actions by South Korea. The proposed ban reflects worries about the potential security risks posed by foreign technologies, especially those linked to China. Advocates for the ban argue that such measures are necessary to protect user data and maintain national security integrity. Simultaneously, this debate draws attention to the broader issue of AI regulation and the need for cohesive policies to address the rapid advancement of AI technologies.
Economic Recession Predictions
JP Morgan and Goldman Sachs have raised the probability of a recession in the U.S., highlighting potential economic contraction driven by factors like rising unemployment and declining consumer sentiment. These forecasts coincide with a notable dip in stock market performance, indicating brewing economic challenges. As predictions of recession loom, concerns about the sustainability of economic growth are becoming prevalent. The discussion suggests a need for urgent policy responses to mitigate adverse economic impacts and restore consumer confidence.
The Shift in Housing Affordability
Housing affordability is becoming a pressing issue, particularly with home prices reaching historical highs, making it increasingly difficult for younger buyers to enter the market. The U.S. is witnessing a significant disconnect between average wages and housing costs, with a recommendation for deregulation to stimulate new housing supply. Cities like Austin have noted successful initiatives that have increased supply and lowered rents, suggesting a possible pathway forward for other regions. Currently, the conversation emphasizes the necessity of innovative policies that ensure affordable housing options while addressing an overabundance mindset towards home ownership.
From the Vox Media Podcast stage at SXSW, Ed and Scott discuss Apple’s decision to delay AI updates for Siri, Sony’s fight against deepfakes, and why the United States is considering banning DeepSeek. They then break down why the big banks are predicting an increased recession risk, exploring the recent pain in the stock market and the potential fallout if a recession hits. They also discuss how tariffs are driving up the cost of building a home, and Scott challenges the notion that home ownership is the best path to wealth. Finally, Scott fields some audience questions to close out the show.
