Ted Audio Collective.
HBR presents. Hi everyone, you're listening to After Hours.
I'm Yang Mi and I'm here with Felix and Mi here.
Hey guys. Hey Yang Mi, I'm here with you.
Hey Felix. Say Yang Mi.
So this is a bittersweet occasion because we are taping tonight our final episode of Season 2 I know.
before we go on summer hiking.
It's the end. To help us deal with our emotions, Mi here brought chocolate in.
Oh, how sweet. It's a very effective morning device.
Yes, so of course we'll be back in the fall with Season 3 but in the meantime what are you guys going to miss the most about our tapings?
You know, just to give you a behind the scenes perspective, there's this moment before we all start taping where we're all supposed to clap at the same moment in a synchronized way and I treasure that moment because it gives rise to so much humor and jokes about how many times three Harvard professors
have to clap to be synchronized.
It is a fantastic moment.
So that is one of my many favorite moments.
I see Galveston laughter.
There's always something funny.
There's always something unexpected.
It's just really fun to tape the show.
Yeah, I would have to agree with that.
Although I think I'm seeing both of you next week.
Okay. I think I heard of us that easily.
Yeah, exactly. So what we thought we would do tonight is in anticipation of the summer we're going to do a countdown of the stories that we are going to be watching and following closely over the summer.
All right? Yeah. As we head into the summer, what we thought we would do is share with you the stories that we're going to be keeping a close eye on.
We came up with a list of eight.
These are also the stories that I'm going to wish we could talk about.
That's like one way to think about this.
So we're going to do these countdown style.
So here we go. Number eight.
The number eight story that we're going to be paying attention to over the summer is TikTok.
I mean, besides spending an ordinate amount of time just watching TikTok videos, I'm also going to look very carefully at the business, and here's why.
Remember when Snapchat first came along?
It really remade the industry.
It sort of reset the direction of Instagram and other social networking sites.
And I think we're going to see that TikTok will do the same for social media.
And it's sort of interesting in two ways.
The first is, I think it's the first social medium where unapologetically it's completely AI driven.
You know, you can sign up today, and it knows nothing about your preferences and what you like, and it will start feeding you things that the algorithm decides.
So there's no sense that who you choose as a friend and that you have some influence over what you see in your newsfeed, it is really AI first, I think in a really radical way.
And then I think the second thing that is so interesting about it is they have managed to lower the barriers to engagement and the production of content to just an absolutely remarkable extent.
I mean, all the things that they do, starting from filters to you can take someone else's video and appear as an additional person in that video, and so on, and so on.
So they have hit on something, I think, that is going to be really interesting to watch, potentially game -changing for many other social media sites as well.
Yeah, you know, the reason I'm going to be keeping my eye on this one over the summer is that there are these platforms that come along and have the capacity to shape culture.
So Facebook came along, had a particular communication modality, a particular rhythm, a way to communicate.
And then Instagram comes along, and it's very different.
And then Snapchat comes along, and again, it provides a new communication modality with a different kind of cadence, a different kind of cultural dialect almost.
And the emergence of TikTok as yet again another way for a younger generation to communicate humor and intelligence and artistic creativity, it's really pretty inspiring to look at.
Yeah, I think in particular you mentioned humor, which I kind of think of as being very distinctive about TikTok, which is there's a piece of it which is enabling people to express humor and a point of view in a really distinctive way relative to the other media you described.
And that to me is really special about TikTok.
So that'll be fun to watch.
Okay. Number seven.
Number seven is the aftermath of India's election.
Yeah, so I kind of wanted to think about this because, you know, the Indian elections are really massive events, and the election result was really, I think, startling.
So Narendra Modi won a second term.
He won it in an absolutely convincing way, at a far greater margin than I think people would have anticipated.
And so just as backdrop, Modi has been in power for five years.
He is part of what is known to be a Hindu nationalist party, and thought to be kind of progressive on economic issues.
There's been some disappointment on the economic side, but the fact that he won in such a decisive way means that I think India has really changed in a deep way.
And I was speaking to a friend who's a political scientist, and she framed it as, India was born as a Hindu country with Modi's re -election.
It has become a Hindu country, which is such a dramatic statement because of the secular origins of India.
And so the way Modi handles this re -election, I think is going to matter enormously to India, meaning if he views it as a vindication of that vision, we could see India go in that direction more and more.
And then, of course, it's a canary in the coal mine for the world.
He labeled himself the Chokidar, which is the night guard, when there was an attack in Kashmir.
So there's this canary in the coal mine aspect to this, which is people seem to like strong men at this time, and they're voting them in many places in the world.
So I think it's just a completely transformational moment in India's history.
I think it's going to be really interesting on its own and then as the signal for whether these kinds of more autocratic rulers are getting vindication in electoral processes.
And what does that mean for us going forward?
So I think that's a hugely interesting story.
You do see this in country after country.
This cult of personality, whatever you want to call it, the charismatic leader.
You see this in country after country, even countries that you thought were heading toward more bureaucratic forms of leadership have tilted now back.
But I think this is part of what happens in this populist moment, which is people look for saviors and they look for strong men.
And it tends to be men, and that is part of what's happening here.
And an interesting return of religion as part of the national identity.
And if you know the Indian history and the importance of secularism, you really wonder if that moment has passed in some deep way.
And so I think it's just a really fascinating time and something to watch.
Yeah. Okay. Number six.
We have many more IPOs coming this summer as well as into the fall.
So I'll name some of them.
Airbnb coming down the pipe, WeWork, Postmates, Slack, Peloton.
I mean, my initial reaction is just, gosh, this is going to end poorly.
It does really feel like a rush into this buoyant market in order to kind of capitalize on valuation levels.
And we talked previously about kind of different motivations for going public.
And this just feels like a rush at a time before things kind of turn against you.
Although Airbnb seems most ready, wouldn't you?
I agree. Would you agree with that?
That one feels most ready.
Yeah, I was just going to say, I feel different, right?
Yeah, they feel different.
They feel the most prepared, the most mature.
And so it'll be interesting to keep an eye on those.
At number five, we are all keeping our eye on the various policy ideas coming out from the candidates running for Democratic nomination in the US presidential election.
It's super interesting how the proposals move over time, right?
So, for instance, when you take college for everyone or Medicare for all, then, of course, the moment most candidates seem to agree that this is a good idea, or at least no one wants to stand out by saying, no, I think it's really terrible.
That's also not great for the candidates because in such a large democratic field, you need to stand out.
You need to stand for something.
So we'll see if that holds throughout the summer.
But in a way, I think the policy proposals have gotten more aggressive, have gotten more all -encompassing.
Elizabeth Warren, I think, has a plan for every contingency that you can think of for the next 8 ,000 years.
But that, to me, is what's really interesting about this Felix, which is you have candidates who are really setting up policy shops, and they're not trying to avoid policymaking.
They're actually getting super aggressive about the precision with which they express these ideas.
And so it's been a long time since we've had candidates go out there and put out detailed plans in the election.
And in fact, I don't think Obama really did that to a similar degree, not even Clinton or Bush.
It's been a long time, and now we are going to have a whole summer of people putting out big ideas on tax policy, on higher education.
Some of the ideas are terrible, but it's going to be really exciting to have that genuine debate.
But do you think it's really meaningful?
Yeah, I've got to confess, I'm a little bit more cynical about it.
I think it's become a bit of a rhetorical device.
I mean, if you think about it, this is not how policy gets made.
Policy gets made through negotiation in Congress.
That's how it gets made.
And so when you're evaluating candidates, you want a sense of what they believe, where they stand on issues, and what amount of wiggle room are they willing to give a particular issue.
And that wiggle room piece of it is really important because that's where negotiation comes in, and that's when being able to work across the aisle comes in and creating actual policy.
And what you're seeing instead is just a race to put various stakes in the ground with this notion that this is what I'm going to do if I'm president.
I don't know, there's a part of me that feels it's disingenuous, particularly among people who have been around the game long enough to know that that's not how it works.
I think my sense is where it gets off the rails is there's this thing called an election before.
And I think the election itself is influenced by a sense of who the person is, and a general sense of the policy direction much more than by any sort of detailed plan.
I remember a really interesting study that they looked at young people who get most of their political information from late night comedy.
So compared to people who get their news mostly from television, the people who got everything from late night comedy, they actually didn't know much about the detailed policy proposals.
But when you ask them about the character of candidates, who you can trust, who you cannot trust, what's their personality like, they were far more informed.
They had a far sharper image.
And I think it speaks a little bit to the job really is to communicate who you are and what you're likely going to do if you win the presidency.
And what I think is not right is like, in a way, it's almost a symbol for how far the policy elites are from what's going on in people's lives every day, that they think the best way to communicate is with some 5 ,000 page plan about how this and that is going to work.
That's not really true.
Well, it's interesting because different candidates have different ideas, right?
So Warren is doing the serious policy thing.
Biden is doing the more traditional, I take it to be less kind of plan oriented, but like I'm a good guy, I can win Pennsylvania and Wisconsin.
Kamala Harris is kind of in between.
Bernie's got his own thing.
So we see actually people with very different strategies.
And I don't think necessarily that the precision of these plans is going to help people win.
But just the intellectual ferment and the kind of ideas that are getting tossed around is pretty important in terms of the way this will end up getting played out, I think.
Okay, number four on our list.
The sexy topic of interest rates.
Oh, oh. We hear. You cannot even contain yourself.
Well, look, I think something really important has happened relative to six months ago where everyone was trying to think about how rates were going to be rising.
You know, Powell and the Fed have reversed themselves, and now we're talking about significant rate cuts.
And the way that plays out over the next couple of months is going to be hugely important.
So first, markets have begun to capitalize them in, right?
So they're expecting these significant rate cuts.
And then there's also this political dynamic, which is, to me, completely crazy, which is Trump had kind of wanted to bend the Fed to kind of cutting rates and not raising rates.
And in a weird way, the Fed has proved accommodating, and they're now saying things like, well, trade is a really big problem.
There's a lot of uncertainty about that.
So now we have to cut rates, which is kind of just an upside down world where now rates and monetary policy is being used to accommodate what is an otherwise kind of crazy policy in a different dimension.
Is it your sense that in recent months the Fed has lost credibility?
It is problematic to see the responsiveness of the Fed to crazy policies that the executive branch is pursuing and in the process also accommodate exactly what the executive branch wants to do.
Another reason why it's going to be very interesting to watch what happens when they lower interest rates is that I think we still have quite a shallow understanding why an economy that is as strong as the economy today, and then pretty dramatic increases in government debt on top of that, and you just
don't see any pressure on rising interest rates.
Like, what is it about this new world, this new equilibrium, where it seems like governments can borrow pretty freely, we seem to live in a world where rates are just not going to increase as quickly as they used to.
And so that's also an interesting piece of this, which is, yes, unemployment has continued to be very, very low, and yet we are somehow obsessed with priming the pump on top of what was a very large fiscal maneuver with the TCGA.
So that's a really puzzling piece of all this.
So I think it's going to be fascinating.
Or I should say more fascinating than it would usually be, because it's always fascinating.
Oh, God. Okay. Save us.
Number three on our list is big tech.
It is hunting season for big tech.
The conversation around antitrust is beginning to reach a bit of a fever pitch, so we will all be keeping an eye on that this summer.
Yeah. And the amazing thing about this is it's widespread.
So it's not just one company.
It is almost every large tech company is in the crosshairs.
So this is now taking on a whole new level of people being worried about bigness in tech in new ways.
And I think some of those are actually maybe well founded, but there's this kind of broad brush anti -bigness thing that's happening, which is really quite problematic.
And my fear is it's going to be that, as opposed to something a little bit more textured about which markets are really anti -competitive and which ones aren't.
I think what we're going to see is the manifestation of what is populism into this antitrust space where bigness equals badness.
And that, I think, is quite complicated.
And how the tests will turn out, I think, is a really interesting thing to watch, because generally speaking, you would say that, oh, antitrust is here to protect consumers so that these really large companies cannot take advantage of consumers.
And then you look at the space and, you know, basically Facebook products are free, Google products are free, Amazon products are as cheap as they can possibly get.
So you need some other justification for even, you know, the DOJ or the FTC becoming active on antitrust grounds.
And so then, of course, you could say, oh, maybe it's things like innovation.
And I think to prove in a court of law how much innovation would we have had if it hadn't been for these really large tech companies, frankly, like I cannot imagine how on earth you would do that.
And so what the new standards are going to be if, in fact, we get new standards and how they're going to be applied?
I think super, super, super interesting.
You know, we have all said this so many times on this podcast with respect to this topic.
That is, we need to be so clear -headed about what problem we're trying to solve.
To your point, Felix, there is a scenario where, let's say, Amazon gets broken up and they have to spin off AWS, which will then result in them having to raise prices in their retail store, which means consumers are worse off.
So is that the problem we're trying to solve?
Is it the privacy problem that we're trying to solve?
It's a privacy problem.
Is it better for Alphabet to have all of our data or to spin it off into ten pieces and to have all ten of those companies have all of our data?
Not clear how it's going to solve that problem.
And I think what concerns me is so much of this energy seems to be coming from this idea that somehow these companies have too much power, and I think that's tied up in notions of wealth and who is capturing the wealth in a particular economy.
And the only thing I will say there is that there is a very realistic scenario in which these big companies get broken up, and one result of that is an even larger wealth creation opportunity for all of these companies that end up breaking off.
So for example, if YouTube became an independent company, what you'll see is massive wealth creation.
You'll see investors went out.
You'll see executives went out.
If Instagram gets spun out, you will see massive wealth creation.
So I think we have to be really careful about what is the problem we're trying to solve, and it's not enough to simply be uncomfortable with something being big.
Okay, number two. The number two story we're going to be keeping an eye on this summer is the climate change story, but in particular with respect to weather patterns.
And this one I think is really interesting because there is so much evidence that even among people who are climate change skeptics, the one thing that tends to begin to change our mind is if you live in an area where you begin to experience extreme weather patterns year after year after year, and you
see this happening in the Midwest, for example, where more and more people are beginning to really question their beliefs as a result of all the extreme weather patterns they're experiencing, I think we all have that on our radar.
Yeah, and it's an odd dynamic, right?
Which is no one wants to hope for more extreme weather, although there is a sense in which that extreme weather might give rise to a greater appreciation for what these dynamics are.
I think the other piece of it that to me is fascinating, and it may be a little bit kind of lower frequency than this summer, but at some point we're going to start to see real migration that is triggered by climate change.
And that is going to be really interesting to me, because once places become uninhabitable in new ways and we see migration, I think that leads to a political salience that is really, really strong.
And I think another angle of the weather story that I find particularly interesting that I'll watch out for is the cost associated with the problem, the extent to which they're going to be socialized versus privately born.
So say, are we going to spend massive amounts of money on building protective infrastructure to keep the houses that are close to the coastline, to keep those houses safe?
Or is it going to be the case that simply your insurance rate goes up?
And maybe at some point in time it makes no sense for anyone to live there, because it's just prohibitively expensive.
OK. And then the number one story that we're all going to be following this summer is the US -China relationship.
One of the ripple effects that I'm closely watching is what happens to global supply chains.
And it's particularly interesting because so many of the critical firms are located in Taiwan.
So take Foxconn. Last week there were all these rumors that Foxconn had stopped producing some products for Huawei, which then, of course, would have huge implications for Huawei.
If these critically important firms at some point in time have to choose, are we going to play in the US part of the world, or are we going to play in the China part of the world?
That would be super interesting to watch how they make that decision and what the consequences are going to be.
Yeah, I mean, I think there's the supply chain issue, and then there's this kind of firm level issue of how we should think about purchasing Huawei products or not purchasing Huawei products.
So not just the relocation of production and supply chains, but just all these basic purchasing decisions about who you do business with, which is now in jeopardy.
I think the final piece of this that I think is so fascinating to me is so much of this depends on the political calculus for Trump to kind of keep this dispute alive, which is I've kind of become convinced that he perceives this to be good for him.
And so we're not dealing in a bargaining space where, oh, we can get to a good outcome maybe because you give me something and I can give you something, this feels to me like a bargaining space where, like with immigration, he just may like the issue.
And if he just likes the issue, then I don't know how to think about these next couple of months, because then it's not about kind of efficient bargaining or giving me this or I'll take this, but it's just about keeping the issue alive.
And that's kind of, in a way, kind of just terrifying, because I don't know how that ends up.
I don't think any of us knows how that ends up, other than he's got to keep the issue alive.
And in a way, the same is true for Xi Jinping, right?
I was in China this past week and he spoke about the trade war in very emotional terms.
So almost, you know, not so much about the nuts and bolts of trade and who's right and who's wrong and what about IP protection, but very much sort of in the vein of this is all about humiliating China.
Right. And I think the Chinese are not really used to their leaders being very emotional, because before Xi Jinping, they had a series of leaders who were more cold technocrats, not really charismatic to begin with, but also this connects directly back to, you know, the British taking Hong Kong, the Japanese
occupying Shanghai.
And it's essentially the story whenever China finds its footing, whenever China grows and is doing well, the inevitable reaction is that everybody else seeks to humiliate the nation.
There's such a deep thread in the history.
Once you start to play on these emotional terms, it's really difficult to go back as well.
You know, I continue to be so concerned about the fact that in a dispute like this, the short -term pain isn't really experienced by American consumers.
In other words, you can turn on the television, you can hear pundits talk about, oh, if there's a trade dispute, your prices might go up by this much or it might affect you in this way.
But the truth of the matter is, I think most citizens sort of absorb this information, and they don't really feel anything in a direct way.
And so in the short term, it just feels like a war of words that kind of go back and forth.
And yet underneath those words, there are fissures being created that are not going to be very easy to mend.
And the long -term effects of this, not just in terms of smaller things like the prices we pay for things or the quality of the goods that we buy, but things like geopolitical alliances and the extent to which we can continue to take for granted ongoing prosperity and global security.
These are things that I don't think are sharply felt by the population right now.
And so I'm very, very concerned about that one.
Okay, so those last two are particularly heavy.
And I have to tell you, that's going to make me miss talking to you guys about all this stuff even more.
Because at least usually we're able to consult each other.
Yeah, but now we're going to be like watching these depressing stories all summer long without each other.
But it'll be okay, because we'll be back in the fall.
Maybe everything will be better in the fall.
Maybe everything will be better.
Yeah, maybe when we get back in the fall.
Or if we spend enough time on TikTok, then everything will be okay.
Yeah, I think that's definitely an option.
Okay, guys, I have a recommendation for you.
Masters of Scale, the podcast.
We're all familiar with this podcast.
They are friends of ours.
It's hosted by Reid Hoffman, who is, of course, the founder of LinkedIn, the co -founder of PayPal.
And it's one of the most thought -provoking podcasts out there, particularly for those of you who are interested in entrepreneurship in any form.
Well, they are taking their podcast on the road, and they will be doing its first ever live podcast in Boston this summer on July 23rd at the Wilbur Theater.
So if you happen to be in Boston over the summer, then my recommendation is that you check out Masters of Scale live in Boston.
That's my recommendation.
That's a great recommendation.
I mean, it's particularly interesting because Reid has all of these really high -profile guests.
It's basically a who -is -who in Silicon Valley.
And maybe because they all know each other, they're very frank about what works and what doesn't work in their organizations and how they came across particular solutions.
So if you're interested in an inside view of what it means to build one of these really large businesses, it's definitely a fascinating lesson.
Great. How about you, Felix?
I have a recommendation that has to do with something that I tried a long time ago and then didn't like so much.
And I went back and really have come to love.
And that is DuckDuckGo.
So I forget now four or five years ago, I remember downloading DuckDuckGo to my phone and everything they say is actually true.
So when you search for something, every single person gets exactly the same search results.
The search results are not personalized in any way because they don't keep any personal information.
But back then, I was not convinced that the results are as good as the results of Google.
And I've been using it for the past month or so, and it's fantastic.
Really? It's really great.
I mean, I cannot tell you.
So I don't, you know, I don't spend my time doing Google DuckDuckGo searches and comparing them.
But everything I want to...
You spend your time on TikTok.
Yes, exactly. I don't have time because I need to watch TikTok so much.
But everything I look for shows up the way it's supposed to show up.
If you're super, super nervous about your privacy, they now offer a tour onion service where traffic gets routed in unpredictable ways so that no one really can know where the traffic came from.
It's fabulous. And it's the one alternative where you know your privacy.
You know, their privacy policy is actually super, super simple because they can just say we safeguard your privacy.
That's it. Awesome.
Okay. Mehir, what you got?
I have a recommendation slash resolution.
So I think the summer is the time to divorce from the devices.
And so I've begun the process of trying to take several steps to kind of reduce screen time during the summer.
For example, I got an old fashioned alarm clock.
I'm going to move away from the phone.
What, are you going to buy a, what, VHS recorder next?
8 -track? Look, I think this is like the crisis of our times.
I think like we all need to like unplug.
And so I'm just trying to really cut back.
So this Moment app is helping now these concrete steps of I'm not posting as much on different social media.
And I really want the summer to be a time where, especially with this Moment app, to track my usage so that I can bring that number.
I set a 40 % goal. But I think we should all set a pretty aggressive goal for lower amounts of screen time.
So do you even know how much time you spend on devices now?
Well, yes, a Moment is an app that helps track that.
And there are several other apps that allow you to do that.
And I want to kind of take the opportunity at the beginning of summer to be much more conscious and deliberate about the choices I'm making.
So are you going to order a printed newspaper?
Actually, I am. So I've been thinking about doing it for a while.
And I think it's going to be great.
And I love reading a newspaper.
And I love reading hard copies.
And so I think it's time to, like, do some of those radical things.
We're asking you questions like you're some strange specimen that we need to study.
He is a strange specimen.
I confess that by publicly doing this, I'm trying to bind myself to actually...
Of course, we're going to ask you.
Because you can ask me this in September.
Yes. And I really want to have a good answer for you.
So you know the one thing I have decided to do is I am going to take a social media hiatus this summer.
Me too. Which isn't that hard because I'm not really...
Well, that's what I've already started to do.
But exactly. But you guys are on Twitter, right?
I thought I'm missing out big time by not being on Twitter.
Well, I'm going to take a hiatus over the summer.
And then I'll come back.
So I'm not giving it a forever, but I'm taking...
Yeah, I think the summer is the time we should all be spending a lot less time on that stuff.
So there you go. That's my recommendation slash resolution.
Okay. So before we close out, just one final thank you to all of our listeners out there.
It's been a fantastic season.
We've had a blast and we will be back in the fall with season three.
This is after hours from the HBR podcast network.
You guys aren't going to say anything?
Yeah. You tied it up so nicely.
Perfect. All right.
Hey. Hey.
