Plain English with Derek Thompson The End of the Everything Boom (Plus: The Federal Reserve's Risky Move)
Jun 15, 2022
Kevin Roose, a New York Times technology and economy expert, joins to discuss the end of the 'everything boom,' where asset prices soared but are now plummeting. They dissect the Federal Reserve's significant interest rate hike, exploring its implications for borrowing costs and consumer habits. The conversation also touches on the unsustainable nature of millennial subsidies in gig work, exemplified by the rise and fall of MoviePass. Lastly, Roose shares insights into the struggling cryptocurrency market and its parallels with past financial crises.
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The Everything Boom
- The "everything boom", a period of consistent market growth across various asset classes, was fueled by low interest rates.
- This era, marked by easy money and risky investments, has now ended.
ZIRP's Influence
- Low interest rates (ZIRP) distorted the economy, making risky ventures seem rational.
- This led to inflated valuations of companies like dog-walking apps and fueled the rise of crypto.
Early Signs of the Boom
- In 2014, Neil Irwin noted historically high prices across various asset classes.
- This fueled riskier investments, leading to the "millennial consumer subsidy."