1929 vs 2025: Andrew Ross Sorkin on Crashes, Bubbles & Lessons Learned

About this video

• Video Title: 1929 vs 2025: Andrew Ross Sorkin on Crashes, Bubbles & Lessons Learned
• Channel: All-In Podcast
• Speakers: Chamath Palihapitiya, Jason Calacanis, David Sacks, Andrew Ross Sorkin, (and briefly) Friedberg
• Duration: 00:50:49

Overview

This video is an interview with Andrew Ross Sorkin, author of "1929: Inside the Greatest Crash in Wall Street History--and How It Shattered a Nation." The discussion draws parallels between the 1929 stock market crash and the current economic climate, exploring the setup, key players, and lessons learned from both periods. Topics include the role of speculation, technology, government regulation, and the potential for future economic downturns.

Key takeaways

• The 1929 Crash Setup: The crash was preceded by a period of increasing consumer credit (starting around 1919 with General Motors), a lack of risk underwriting, no SEC or significant regulations, and a "go-go" era of rapid stock market gains (48% in 1928). Technological advancements like radio (analogous to AI today) and a desire to "democratize finance" also fueled the speculative bubble.
• Character-Driven Narrative: Sorkin's book focuses on the personal stories and motivations of key figures like Charlie Mitchell (head of National City Bank, likened to Jamie Dimon or Michael Milken) and Carter Glass (a prominent critic of Mitchell's practices), illustrating the human element behind the financial events.
• Modern Parallels and Differences: While there are similarities to 1929 in today's markets (e.g., speculation, easy money, technological disruption), Sorkin notes differences, including the presence of the SEC and other regulations. However, he acknowledges that human nature's desire for "more" and the tendency to find speculative loopholes persist.
• The Role of AI and Productivity: The conversation touches on AI's potential impact, with some arguing it's propping up the economy, while others believe it's a natural cycle of creative destruction that will eventually lead to quality improvements and shifts in employment.
• Socialism vs. Capitalism Debate: The rise of socialist sentiment after the 1929 crash is discussed, contrasting with today's conversations. The New Deal and WWII are seen as significant interventions that shifted the economic landscape and created new societal promises.
• Government Spending and Debt: The discussion highlights concerns about current government overspending and overpromising, which distorts markets and can lead to inflated costs in areas like education, housing, and healthcare. The challenge lies in convincing the public to accept "less" in exchange for fiscal sustainability.
• Tariffs and National Security: The use of tariffs for national security and industrial resilience (e.g., the auto industry) is debated, acknowledging the trade-off between potentially higher costs and strategic independence.
• Movie Rights and Journalism: Sorkin discusses the potential for his book to be adapted into a film, emphasizing its character-driven nature. He also reflects on his role as a journalist and observer in the financial world, contrasting it with being an active market participant.