It feels like there is a gigantic disconnect between how the stock market is doing, how the economy is actually doing, and people s feelings about the economy. Plus, another terrible crime story out of Charlotte, North Carolina, and the Somali-American fraud scandal continues to percolate.
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00:00:36.000Well, folks, it feels as though there is a gigantic disconnect between how the stock market is actually doing, how the economy is actually doing, and people's feelings about the economy.
00:00:46.000If you look at the statistics right now, the overall inflation rate in the United States is around 3%.
00:00:51.000That's 50% higher than the Fed's target rate, but it is, in fact, a sort of moderate inflation rate for American history.
00:00:58.000It's higher than it has been for the course of the last couple of decades when we had unusually low inflation rates, but it is not 8%, 10%.
00:01:07.000If you look at the overall unemployment rate in the United States, it is currently 4.4%.
00:01:13.000If you look at the average across the last 50 years of American history, what you see is that the average unemployment rate in the United States is closer to 6%.
00:01:21.000And of course, if you looked this morning at the opening of the Dow Jones Industrial Average, the Dow Jones opened nearly 48,000, which of course is historically high, very high.
00:01:31.000And in fact, the Dow Jones is up year on year about 8%.
00:01:34.000Okay, so these are big booming numbers.
00:01:37.000These are good numbers for the economy just overall.
00:01:41.000And there's reason to believe that the stock market is actually going to increase from here, even if people like me say that there is a bubble and that that bubble will inevitably burst.
00:01:51.000Because whenever you have a major new technology like say AI, there's an enormous amount of spending that goes into that new tech, big build out, more investment, many companies.
00:02:01.000And then the expectations are not met by reality.
00:02:04.000There's a bit of a bust, but the best companies survive and end up transforming the economy.
00:02:09.000That's the story with the automobile industry.
00:02:58.000It's based on a wide variety of experimental plays people figure are going to pay off in the long run.
00:03:04.000And so looking at their car sales is not a good proxy, says Tesla, for what the company is actually worth.
00:03:10.000Many Wall Street analysts think that the best way to value stocks is to compare their earnings yield, that's the earnings to price ratio expressed as a percentage with yields on ultra-safe government bonds.
00:03:20.000One popular version of that metric, known as the excess CAPE yield, uses SP 500 companies' average earnings from the past 10 years and adjusts both those earnings and the 10-year treasury yield for inflation.
00:03:33.000That is low by historical standards, suggesting the high prices of stock have shrunk the reward for owning them over bonds, but it's not unprecedented.
00:03:40.000It's actually up from 1.2% in January.
00:03:43.000Economic growth is also supporting earnings.
00:03:46.000Because while there is concern right now about job growth and while there is concern about layoffs at some major retail companies, the reality is that many people believe that job growth has slowed largely because of the sharply reduced illegal immigration happening in the United States.
00:04:04.000And holiday spending has been pretty strong.
00:04:06.000Weekly unemployment claims have remained pretty low as well.
00:04:09.000Now, again, we're still missing some statistics from the Bureau of Labor statistics, but it shows that things remain relatively robust.
00:04:17.000It is not, by the way, just about the big tech stocks.
00:04:19.000Now, I have said before that the vast majority of gains accreting on Wall Street are happening at the top end of the market.
00:04:27.000But that doesn't mean everybody else is doing poorly.
00:04:29.000The Russell 2000 index of smaller company stocks reached a record high last week.
00:04:34.000The S ⁇ P 500 Equal Weight Index, which gives the same influence to each company regardless of size, is also near a record, providing a hope that the tech-censored sell-off would not be disastrous, that even if the MAG 7 take a hit, that the rest of the stock market won't collapse.
00:04:48.000Inflation expectations are also anchored, meaning that nobody believes that the inflation rate is going to go down to zero at any point.
00:04:58.000But the Fed is looking at cutting interest rates anyway, and prospects for longer run economic growth have actually improved.
00:05:06.000Negative yields on tenured TIPS showed investors expect rates to stay at rock bottom levels for the foreseeable future.
00:05:13.000Yields have stabilized at pre-crisis levels.
00:05:16.000So says Thanos Bardas, senior portfolio manager, co-head of investment grade at Newberg or Berman, for a lot of investors, you have higher confidence to invest in general, whether it's equities or fixed income when real yields are positive.
00:05:27.000It looks like the economy is operating at potential or above potential.
00:05:30.000So in other words, things look like they should be pretty good.
00:05:33.000And it does look as though there is now a solid move in the Calci markets.
00:05:40.000There's a move in the prediction markets, not just in favor of a federal decision to cut rates by 25 basis points come December, but a massive move.
00:05:49.000If you recall, in November, for a little while, it looked as though the markets had moved in favor of the Federal Reserve maintaining its rates, that it would not, in fact, cut those interest rates, that there were worries about inflation, there were worries about affordability.
00:06:03.000And so the kind of going logic was that the Federal Reserve would keep rates steady.
00:06:07.000Well, for some reason, since then, there's been a gigantic spike in investment in that prediction market in favor of the cut.
00:06:15.000So either somebody's trading on inside information, which wouldn't be totally crazy, or it is quite possible that the Federal Reserve is looking at the kind of slowing employment numbers and the relatively mediocre inflation rate and saying that they are more worried about an unemployment increase than they are about an inflation increase.
00:06:32.000All of which means that if there's more money injected into the economy, the stock market is likely to continue going up and the unemployment rate is likely to stabilize.
00:06:40.000In just a second, we'll get to why people seem disturbed by the economy, even though the numbers are pretty good.
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00:08:26.000Imagine gathering the family this holiday season to watch all those old holiday mornings you recorded years ago, now crystal clear on the big screen.
00:08:33.000And we did this for my family and watching those old videos of me as a baby walking around my parents.
00:08:38.000And my parents have those same videos about their parents.
00:09:08.000And the answer, of course, is that what you are getting right now is an embedded feeling about inflation from before.
00:09:14.000People had an outsized expectation of what could be done when Trump entered office.
00:09:18.000Obviously, wages would have to increase an awful lot in order to make up for the inflation we have seen since 2020.
00:09:24.000We've seen this massive, massive inflation in costs since 2020.
00:09:27.000And that's because the government just helicoptered money around, which created gigantic inflation, less in terms of wages than in terms of costs, particularly in places like housing, which has a lot of obstacles to building new housing.
00:09:42.000Scott Besson, the Treasury Secretary, he says that the economy is continuing to outperform expectations.
00:09:49.000Mr. Secretary, a lot of people are out there holiday shopping.
00:09:52.000Here is how the president described back in April what to expect from this season.
00:09:57.000Maybe the children will have $2 instead of $30, you know?
00:10:01.000And maybe the $2 will cost a couple of bucks more than they would normally.
00:10:06.000Was the president's prediction then correct?
00:10:09.000Margaret, it's actually been a very strong holiday season.
00:10:12.000And we've seen across all the income cohorts thus far.
00:10:18.000And so there's nothing to say that they're $2 instead of $30.
00:10:21.000The president was wrong to predict lower numbers of purchases and higher prices.
00:10:27.000The economy has been better than we thought.
00:10:29.000We've had the 4% GDP growth in a couple of quarters.
00:10:34.000We're going to finish the year despite the summer shutdown with 3% real GDP growth.
00:10:40.000And Scott Bessant went on to say that one of the reasons we're seeing affordability problems is because of scarcity and overregulation due to Democratic policy, largely in blue cities, which is true.
00:10:50.000Democrats created scarcity, whether it was in energy or over-regulation, that we are now seeing this affordability problem.
00:11:00.000And I think next year we're going to move on to prosperity.
00:11:03.000You do think there is an affordability problem?
00:11:06.000Oh, I think the Biden administration created a terrorist.
00:11:09.000No, but now we're nearly 12 months in.
00:11:11.000You said the president would own the economy at this point.
00:11:13.000I said that the Biden administration created the worst inflation in 50 years and maybe for working Americans, the worst inflation of all time.
00:11:27.000Again, the thing that Americans expected is not a thing that could be delivered.
00:11:31.000What the Trump administration has largely done is stabilize prices, at least compared to wages.
00:11:35.000What they have not done is radically reduced prices because, in order, again, to radically reduce prices in any field, you need either a gigantic increase in supply or a radical reduction in demand.
00:11:46.000And when it comes to things like housing, even a radical increase in supply is going to take some time.
00:11:50.000And you're not going to get a reduction in demand for any of this stuff unless you actually see an economic recession, which is the opposite of what the Trump administration would like to see.
00:11:59.000There's a reason why Jamie Dimon is pointing out that the consumer is basically fine, but inflation is not going down, which seems to be correct.
00:12:05.000JPMorgan Chase CEO Jamie Dimon said on Sunday, in the short run, it looks like the American consumer is doing fine, is chugging along.
00:12:17.000Jobs are weakening, but just a little bit.
00:12:18.000Inflation is there and maybe not going down.
00:12:22.000Now, one thing that Diamond said that's really interesting is he's looking at AI and a lot of the concern right now, particularly among younger Americans, that AI is going to take their jobs.
00:12:30.000And what he says is jobs have gotten a little weaker, wages have gotten a little weaker.
00:12:33.000And when you talk to businesses, they're going to be a little bit more cautious hiring.
00:12:37.000That's just because they want to do more with less.
00:12:39.000I don't think AI is going to dramatically reduce jobs, unbelievably, next year.
00:12:44.000Now, next year, of course, is not the entire concern.
00:12:46.000There could be long-term job loss from AI in particular industries.
00:12:52.000But there is, in fact, a gigantic disconnect between how people are feeling about the economy, particularly young people, and what the economy is actually doing right now.
00:13:00.000And so we have to try and understand why that's happening.
00:13:02.000According to a brand new poll from Harvard Kennedy School Institute of Politics, more than 40% of 18 to 29-year-olds surveyed last month said they are struggling or just getting by.
00:13:12.000One quarter believe they'll be worse off financially than their parents.
00:13:15.000Now, again, to be fair, a lot of people struggle when they're 18 to 29 years old.
00:13:20.000Now, I was a Harvard law school graduate, and I remember essentially living paycheck to paycheck with my wife for at least several years early on in our marriage.
00:13:29.000I remember there was a point where we were thinking of taking out a second credit card in order to pay off the first credit card.
00:13:35.000We were, I think, down to $2,000 in our savings at one point.
00:13:38.000So it's kind of normal to struggle when you're 24, 25, 26 years old.
00:14:53.000Democratic socialism, however, is down dramatically.
00:14:56.000So these sort of Bernie Sanders wild redistributionism schemes, 39% said they supported that in 2018, 40% in 2020, only 29% today.
00:15:07.000So capitalism, according to this Harvard Kennedy School Institute of Politics poll, according to that poll, young people still favor capitalism over democratic socialism by 10 percentage points.
00:15:18.000As for socialism proper, like the nationalization of resources, only 21 percent of young people say they support that ideological category, which again is really, really interesting.
00:15:29.000In other words, they don't know where to turn.
00:15:32.000The one thing that it seems like they want is quote unquote strong leadership.
00:15:36.000When people don't know where to turn and they want strong leadership, that is not necessarily a wonderful thing.
00:15:42.000Now, as far as right track, wrong track, when you look at this youth poll, what it shows is that a huge number of people believe that the nation is headed into the wrong track.
00:15:53.0004% of Democrats, of course, say the nation is headed in the right track.
00:15:56.000They're very upset with President Trump.
00:15:58.00033% of Republicans say that the nation is headed on the right track, 27% wrong track, 39% unsure.
00:16:05.000So those aren't similar numbers even among Republicans.
00:16:09.000More than half of Hispanic and black respondents report financial hardship compared with 39% of white peers.
00:16:14.000Financial insecurity is sharply higher among non-degree holders, 53%, than among college students, 28%, and graduates, 32%.
00:16:24.000And again, economic pressure is the defining force in young people's lives.
00:16:52.000But to pretend that unemployment rates are just gigantic among young people, particularly college graduates, would be to ignore the actual statistics.
00:17:00.000The unemployment rate for new law school graduates, for example, like the more educated you are, the better chance that you're about to get a pretty good paying job.
00:17:07.000That seems to be the pattern that has resulted in some pretty terrible college policy in which we seem to believe that if we artificially inflate the number of people who go to college, then we will also artificially inflate their career prospects, which, of course, is really, really silly.
00:17:21.000It turns out that when you look at the bell curve of earnings, that bell curve remains, even if you take the entire bell curve and shift it up by two years in terms of years of education obtained.
00:17:32.000By the statistics, the unemployment rate for new law graduates is somewhere between 4.5% and 5%.
00:17:37.000For overall engineering graduates, that'd be like electrical, petroleum, mechanical, the overall employment rate is 0.9 to 2.3%, which is really, really low.
00:17:45.000It's basically a 0% unemployment rate.
00:17:49.000So those would be a lot of the jobs that are currently being ignored in favor of liberal arts majors, which again is one of the reasons why the government should not subsidize majors that are unlikely to earn out.
00:18:00.000Computer science and computer engineering, that may be one area where AI is cutting in because AI is designed by engineers to replace engineers in many ways.
00:18:41.000And if you're looking, for example, at the price of housing and the elevated price of housing, it's very difficult to average the elevated price of housing between areas of the country that are more suburban or rural and big cities.
00:18:54.000Big cities universally have gone way up because more Americans have moved to those cities and fewer Americans are moving away when the opportunity does not present itself.
00:19:02.000This is why a few weeks ago, people seemed to get very uptight when I said, listen, there are things we can do in places like New York City to lower housing prices, create more affordability.
00:19:33.000And so, just again, supply and demand suggest that when demand is really, really, really sky high, like it is in big cities like LA, Chicago, New York, that the housing price is going to be higher than it is where demand is not nearly as high.
00:19:49.000And so, the point I made is: if you're a young person, if you're 20 years old, 21 years old, and you're struggling to afford a place in New York City and you can find a comparable job in Minnesota, you might want to think about moving because just for your own betterment of life, it might be worthwhile to consider not being in New York.
00:20:04.000And this notion that you are owed the same level of affordability in New York as you are in Des Moines, Iowa or Minnesota or something, that's silly.
00:20:17.000I also wish for a pony that craps gold, but that's not actually how reality New York will never be as affordable as St. Petersburg, Florida.
00:20:35.000But one of the reasons that you're seeing unaffordability, particularly in major urban areas, is because of high demand and low supply.
00:20:42.000Well, the high demand is part of that equation.
00:20:44.000And it is true that the myth that young people have been sold that they never need to move at any point, especially when they are young, before they have kids, when they are first getting out in the world, that's had a real impact in terms of public policy and in terms of pricing.
00:21:01.000And all these factors have to be taken into account when we determine why things are unaffordable.
00:21:06.000Because the question is why things are unaffordable, not whether it is moral for things to be unaffordable or not unaffordable.
00:21:14.000Well, one reason is because, according to our sponsors at Comet, a project of perplexity, I asked: are 21-year-olds moving less today in the United States than they did in 1980?
00:21:24.000And is that creating upward pressure on housing prices and downward pressure on wages in major cities?
00:21:29.000And the answer is: yes, residential mobility among young adults has fallen substantially since 1980.
00:21:34.000And this reduced movement is one factor among several that can raise housing costs in thriving cities that its effect on wages is more complex and not uniformly downward.
00:21:42.000Data from the current population survey and related research shows a broad long-run decline in U.S. residential mobility since the 1980s.
00:21:50.000In the 1980s, about 20% of Americans moved every year.
00:21:54.000By 2018, 2019, only about 10% did, with especially steep drops among young adults and in short-distance moves.
00:22:02.000So, what is the effect on housing prices?
00:22:04.000Lower mobility can reduce the flow of people from high-cost, opportunity-rich metros to cheaper areas, keeping demand high in superstar cities, while supply is constrained by zoning and other limits, which tends to push up prices and rents.
00:22:15.000One of the things that happens in overcrowded cities is NIMBYism.
00:22:18.000People don't want a gigantic apartment building going up right next door to them in major cities sometimes.
00:22:24.000They don't want a gigantic block that is filled with cheaper housing going up right next to where they live, may lower their real estate values.
00:22:32.000And so, they vote to stop all of that.
00:22:37.000Now, you can try to ban those sorts of regulations and stop those sorts of regulations, and that would be good.
00:22:41.000But is that going to solve the problem?
00:22:43.000Obviously, it's not, which is why you've seen mass population movement from North to South.
00:22:47.000It's why you've seen in migration to popular regions like the Sunbelt, according to Comet.
00:22:54.000Now, again, standard economic theory predicts that more workers moving into a city should put downward pressure on wages there unless local productivity or demand rises enough to offset the larger labor supply.
00:23:05.000So, this is the other problem: if you have a lot of people who are in a city and you have more people moving to that city, that is creating more demand for housing and it is going to mean less available supply of jobs, right?
00:23:18.000Because you have more people who are seeking the same job.
00:23:20.000That creates competition for the jobs, which means that the wages tend to be lower.
00:23:24.000So, this would explain some of the affordability dislocation.
00:23:28.000And in fact, when you ask Comet, what percentage of the American population lived in major metros in 1980 compared to today, in 1980, roughly three quarters of Americans lived in major metros.
00:23:43.000According to the Census Bureau, about 76% of the U.S. population lived in metro areas in 1980, which meant that a quarter of Americans did not.
00:23:52.000Okay, so that meant less upward pressure in these major cities.
00:23:55.000As of 2024, non-metropolitan counties held 14% of the U.S. population, implying that 86% live in metro areas under current federal definitions.
00:24:06.000So more and more people have been moving to these cities and fewer and fewer people are leaving.
00:24:10.000So again, none of this is inexplicable.
00:24:14.000It does mean that how do you solve some of this stuff?
00:24:18.000Well, number one would be you need to get rid of subsidies that lie to people because subsidies that pretend that affordability can be achieved simply through signing people checks.
00:24:27.000When government checks go into an area, affordability is usually not the result.
00:24:32.000Inflation is usually the result in cost.
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00:27:22.000So what exactly can President Trump do?
00:27:24.000The Trump team is trying to get him to focus in on affordability concerns.
00:27:28.000According to the Wall Street Journal, just before President Trump left the White House for Thanksgiving, top aides met with him in his private dining room to discuss inflation and the economy in hopes he would calibrate his message on affordability.
00:27:39.000In another meeting last month, this time in the Oval Office, AIDS presented Trump with surveys from one of the president's own pollsters detailing voters' concerns about cost of living.
00:27:46.000His team has begun showing him social media posts that illustrate how Americans view the economy.
00:27:51.000Top aides have taken turns talking to their boss about his economic messaging and the need to emphasize what voters are feeling.
00:27:56.000Almost every senior White House official is involved in this effort.
00:27:59.000So far, Trump has largely avoided any I feel your pain messaging telling AIDS the economy is strong.
00:28:04.000I mean, again, this is one area where I have serious empathy for the presidents of the United States.
00:28:08.000As a facts, not feelings guy, I get the aversion to saying, yes, all your concerns are totally justified.
00:28:14.000And I understand why people feel things are unaffordable.
00:28:17.000Also, there are decisions that people can make in some circumstances in order to make things less unaffordable.
00:28:24.000And when Trump looks at the broad-scale federal economy, he's thinking to himself, what are the things I'm supposed to do that I am not currently doing?
00:28:32.000He has dismissed Washington's focus on affordability as a trap set by Democrats, intent on papering over the administration's economic achievements.
00:28:39.000In many private conversations, Trump has argued former President Biden was responsible for inflation, not him.
00:28:44.000And again, I have nothing but sympathy for the president on this.
00:28:52.000Well, one thing could be to present a plan.
00:28:56.000Okay, so what exactly should that plan be?
00:28:59.000Well, part of that plan should be making clear to the American people where the jobs are, where the opportunity is.
00:29:08.000So if you're going to talk about subsidizing people to do things, perhaps the administration should consider the possibility of helping to subsidize people moving from more expensive areas to less expensive areas where the jobs are, or continuing to facilitate through federal regulation tax breaks for moving from a high-tax area to a low-tax area, or from a more unaffordable place to a less unaffordable place, to a more affordable place.
00:29:33.000Those might be some things that we could think about doing.
00:29:36.000However, the easiest political path is always to find an enemy and then club him with a bat.
00:29:41.000And the president seems to have settled on the idea that there is food price fixing, and that's why all of this is happening.
00:29:46.000Now, this is, again, just a variation on a theme that Joe Biden tried.
00:30:21.000I mean, one way you can lower the food prices, presumably, is to get rid of some of the tariffs on some of the food prices.
00:30:25.000We've already done that on things like coffee and bananas.
00:30:31.000But again, the disconnect between the statistics on the economy and how people feel about the economy, a large part of that is attributable to not only media coverage, which of course is very anti-Trump, but also it is attributable to the fact that there is an economic hangover from the Biden administration that is very real.
00:30:49.000And now Trump's been the president for a year.
00:30:50.000So you own whatever is happening now, even though it was really embedded from a year ago.
00:30:55.000And also the fact that a huge percentage of people are now living in major metro areas.
00:31:01.000And those areas are, in fact, more unaffordable than other outlying and surrounding areas.
00:31:05.000And people are moving less because they've been told over and over and over again that it should be somehow affordable and, in fact, thriving to live in New York City when you are 21.
00:31:15.000And you see, people are 21 comparing themselves to people who are 50.
00:31:18.000Why don't I live the life that my father, my grandfather lived?
00:31:22.000Well, you are living a better life than your father or grandfather did at the same age.
00:31:27.000But you're not living a better life than your grandfather does now because your grandfather is 70 and he's been in the workforce for the last half century.
00:31:35.000Well, one thing that the Trump administration is doing with regard to the economy, aside from talking about the stock market success and the unemployment rate, one thing that they are doing is redirecting away from that and toward the crime issue.
00:31:46.000So another horrific crime happened in Charlotte, North Carolina.
00:31:51.000Yesterday, there's a very fraught Senate race for Republicans that is happening in the next election cycle.
00:31:57.000That is an open seat because Tom tell us the Republican senator is stepping down and Michael Watley is running against Roy Cooper in that seat.
00:32:04.000That is going to be an extraordinarily expensive race.
00:32:07.000If Republicans lose the North Carolina Senate seat, that takes them down to 52.
00:32:13.000It's also a decent bellwether for what happens in 2028 because if Republicans are losing North Carolina across the board, that's a real problem for whomever is the nominee in 2028.
00:32:22.000And so Charlotte, North Carolina is sort of epicenter of purple politics right now.
00:32:26.000According to the Daily Wire, a twice-deported illegal immigrant with a rap sheet allegedly brutally stabbed a man on a Charlotte, North Carolina train.
00:32:33.000Honduran illegal immigrant Oscar Gerardo Salazarno Garcia is accused of stabbing a man with a large fixed-blade knife on the light rail on Friday, leaving him in critical condition.
00:32:43.000He was first deported from the United States March 9th, 2018, before he crossed the border illegally again, and then was removed again in 2021, according to the Department of Homeland Security.
00:32:51.000He then sneaked back in undetected for a third time on an unknown date.
00:32:56.000He was previously arrested for aggravated battery with a deadly weapon, destroying evidence, resisting arrest, using a false ID.
00:33:01.000He also has convictions for robbery and illegal reentry.
00:33:04.000Homeland Security Secretary Christy Noam called it a heinous attack, saying her agency has taken action to ensure he faces justice.
00:33:11.000Noam said that ICE lodged an arrest detainer to ensure that this particular stabber is not released back into North Carolina neighborhoods.
00:33:20.000But she said, we cannot guarantee the country will honor the detainer since they have a history of not cooperating with ICE.
00:33:26.000Both President Trump and the Transportation Secretary Sean Duffy commented on the incident.
00:33:30.000President Trump put out on Truth Social a statement, another stabbing by an illegal migrant in Charlotte, North Carolina.
00:34:33.000Remember, the federal government was ripped up and down under President Trump for the great crime of sending federal agents into MacArthur Park, which we were told is a place kids play.
00:34:41.000I used to live in L.A. You generally don't send your kids unaccompanied to MacArthur Park.
00:34:46.000According to the New York Post, MacArthur Park has erupted into LA's Fentanyl Ground Zero, a collapse and chaos-soaked war zone where overdoses hit by the hour.
00:35:42.000Meanwhile, over in New York, Zorhan Mamdani says that he is going to end homeless camp sweeps, which, of course, is going to make the city significantly more unlivable.
00:35:54.000According to Michael Goodwin, writing for the New York Post, the new mayor inadvertently revealed he has learned nothing about homelessness when he announced on Thursday his administration will not dismantle the fetid camps springing up around the city.
00:36:06.000The reason he claimed is that Mayor Adams' policy of removing the camps lacks compassion and has not led to the people involved being placed into permanent housing with appropriate social services.
00:36:15.000Mamdani said, if you're not connecting homeless New Yorkers to the housing they so desperately need, you cannot deem anything you're doing to be a success.
00:36:22.000And then he said, whether it's supportive housing, whether it's rental housing, whatever kind of housing it is, because what we've seen is the treatment of homelessness as if it is a natural part of living in the city, when in fact it's more often a reflection of a political choice being made.
00:36:34.000Well, it is a reflection of a political choice being made, a choice to let people sleep out in the open, do drugs in the open, and live in their own filth.
00:36:43.000I mean, I used to live in L.A., I watched the homeless problem take over the entire city.
00:36:47.000Apparently, Zorhan Mamdani wants to do that in New York as well.
00:36:50.000These local governance issues are going to be a major issue come 2026 and 2028.
00:36:56.000Meanwhile, controversy continues over the immigration situation with regard to Somali Americans in Minnesota.
00:37:02.000All of this, of course, is tied into Joe Biden's radical open borders policy.
00:37:07.000And that is tied into stories like the story that we just saw in Charlotte, where people are repeatedly crossing the border over and over and then committing crimes.
00:37:14.000According to the New York Times, in the weeks after Joe Biden was elected president, advisors delivered a warning his approach to immigration could prove disastrous.
00:37:21.000By the way, I do find it hilarious that these stories are now being reported in December 2025.
00:37:27.000So if this was happening four years ago, four and a half years ago, shouldn't we have been told that the immigration problem was an actual problem four and a half years ago by places like the New York Times at a higher pitch than they were doing at the very least?
00:37:43.000Biden has pledged to treat unauthorized immigrants more humanely than Trump, but Biden was now president-elect.
00:37:49.000His positions threatened to drastically increase border crossings.
00:37:51.000Experts advising his transition team warned in a Zoom briefing in the final weeks of 2020, according to people with direct knowledge of that briefing.
00:37:57.000That jump, they said, could provoke a political crisis.
00:38:00.000Chaos was the word the advisors had used in a memo during the campaign.
00:38:04.000They offered a range of options to avert that crisis by better deterring migrants.
00:38:07.000Biden seemed to grasp the risk, but he and his top aides failed to act on those recommendations.
00:38:13.000A New York Times examination of Biden's record found that he and his closest advisors repeatedly rebuffed recommendations that could have addressed the border crisis faster and eased what became a potent issue for Trump as he saw its return to the White House and justify the aggressive tactics roiling American cities today.
00:38:28.000Former Biden administration officials told the Times that Biden and his close circle of confidence, including Ron Clain, Mike Donnellin, Jennifer O'Malley-Dillon, and Anita Dunn, made two crucial errors.
00:38:37.000First, they underestimated the scale of migration that was coming.
00:38:40.000Second, they failed to appreciate the political reaction to that migration, believing that stronger enforcement would alienate Latino and progressive voters, and that a border surge would not be an important issue to most voters.
00:38:50.000And of course, that turned out not to be true at all at all.
00:38:54.000Well, the consequences of open borders policy have been disastrous, obviously.
00:38:59.000And the most obvious iteration of a gigantic open borders policy is not merely the number of illegal immigrants in the country, generally speaking.
00:39:07.000It is enclaves of immigrants who also came here legally through the expansion of the definition of asylum and refuge to include hundreds of thousands of Somali immigrants living in the United States.
00:39:21.000This has broken out into the open, obviously, in the aftermath of this $1 billion welfare fraud that encompassed a wide variety of members of the Somali community in Minnesota.
00:39:31.000The media have chosen to take one angle.
00:39:33.000Their angle is that it's racist to notice this.
00:40:16.000No, their appearance alone can't raise reasonable suspicion.
00:40:20.000It's articulable facts, a lot of different facts taken into consideration.
00:40:23.000And the Supreme Court just backed the Trump administration up on this.
00:40:27.000I know a lot of the media said, oh, the Supreme Court just justified racial profiling.
00:40:31.000That's not what the Supreme Court said.
00:40:33.000Supreme Court said they agree with the way these operations are being conducted because the standard of reasonable suspicion is being used by both ICE and the Board of Patrol in the interior operations.
00:40:43.000Again, the basic idea here is going to be, apparently, that it is very bad for Homeland Security to try and track down illegal Somali immigrants because it must be race-based, as opposed to the fact that there are, in fact, illegal Somali immigrants living in Minnesota.
00:40:59.000I mean, this is a point that Homan is making to Dana Bash.
00:41:01.000He says, listen, there is a large illegal Somali community in Minnesota.
00:41:07.000There's an illegal alien community, a large illegal alien community there.
00:41:11.000Look, if you're a U.S. citizen, you know, you have nothing to fear.
00:41:17.000And also, if you're a resident alien, you have a felony conviction by statute, you could be set up for deportation.
00:41:23.000So we're looking for public safety threats, national security threats, and illegal aliens.
00:41:28.000Nothing's changed, Dana, from day one.
00:41:31.000Okay, so, I mean, he is right about that.
00:41:33.000Meanwhile, the administration is saying, listen, Minnesota, if you don't fix your Medicare fraud problem, you're going to lose your Medicaid funding.
00:41:39.000Why should the American taxpayer have to subsidize your state fraud?
00:41:45.000Either fix this in 60 days or start looking under your couch for spare change because we are done putting the bill for your incompetence.
00:41:53.000This administration will never stop fighting to protect the vulnerable Americans who rely on these programs and the taxpayers who fund them.
00:42:00.000We're going to crush waste, fraud, and abuse.
00:42:05.000And that is Dr. Mehmet Oz, who, of course, is presiding over CMS, which is the service that has to determine whether, in fact, waste, fraud, and abuse are happening inside Medicaid.
00:42:13.000And again, apparently, the left-wing response to this is not to call out the fraud or to fight the fraud.
00:42:19.000It's to call anybody who notices it racist.
00:42:22.000So here, for example, is a host on MS Now asking Keith Ellison if they'll arrest ICE agents.
00:42:31.000Should the police officers be, I guess, arresting ICE who they feel are doing it using excessive force?
00:42:39.000Look, the police chief, Brian O'Hara, great man, by the way, is well able to speak for himself.
00:42:48.000But I think what he's hoping is to prevent.
00:42:52.000This is why he's making the comment now so that it doesn't ever come to that.
00:42:57.000So that one, ICE agents will observe the requirements of the law and that officer and that they will know that we're not going to stand by and let them break the law.
00:43:11.000You got Keith Ellison, that's the state attorney general in Minnesota, claiming that ICE is going to be held accountable to the law while he presided over a state that allowed $1 billion in welfare fraud from a Somali community allied with, wait for it, Keith Ellison, Ilhan Omar, whose district this took place in.
00:43:25.000She, of course, is very upset with the presidents of the United States for noticing.
00:43:29.000So she went after Stephen Miller, who is the immigration advisor, the top immigration advisor for President Trump, calling Stephen Miller, who happens to be Jewish, a Nazi.
00:43:41.000When I think about Stephen Miller and his white supremacist rhetoric, it reminds me, yes, it reminds me of the way the Nazis described Jewish people in Germany.
00:43:54.000And, you know, as we know, there have been many immigrants who've tried to come to the United States, who've turned back, you know, one of them being Jewish immigrants.
00:44:05.000Listening to this woman gallivant around talking about the plight of Jewish immigrants to the United States during the Holocaust as a supporter in rhetoric of Hamas, Hezbollah, and every other terrorist group attempting to exterminate Jews all over the world.
00:44:30.000And they have to wait for the American people, presumably, to get used to the new level of inflation that is just a part of our lives now.
00:44:37.000Meanwhile, the president is apparently unhappy with Christy Noam.
00:44:41.000According to the bulwark, two unnamed former DHS officials who served under both Biden and Trump say that Trump is indeed considering moving on from Christy Noam potentially really soon.
00:44:50.000A third ex-DHS official who served under both described the situation as fluid.
00:44:54.000Now, of course, this could be nonsense.
00:44:55.000You have unnamed officials who served under both Biden and Trump, meaning they're not Trump loyalists.
00:44:59.000So they could be attempting to undermine Trump by attacking Christy Noam.
00:45:02.000Apparently, Trump personally likes Noam, but a lot of White House officials are frustrated with her leadership, specifically her employment of chief advisor Corey Lewandowski, who, according to sort of most reports, is allegedly her boyfriend.
00:45:17.000A big-name Republican could theoretically replace her.
00:45:20.000I think it is unlikely that Christy Noam goes, but it doesn't mean that it's totally impossible.
00:45:25.000The other official who supposedly was on the hot seat, but who actually is not, is the Secretary of War, Pete Hegseth.
00:45:30.000So Hegseth over the weekend did an interview in which he talked about the fact that the Washington Post had promoted a false story, which is that he literally argued in favor of a double-tap strike on people who are just floating around in the water.
00:45:43.000That report was basically debunked by the New York Times.
00:45:45.000Here was Secretary of War Pete Hegseth at the Reagan National Defense Forum.
00:45:50.000Did you at any time say that everybody on board should be killed?
00:45:55.000Does anybody hear from the Washington Post?
00:45:58.000I don't know where you get your sources, but they suck.
00:46:03.000Anybody that's been in the situation room or they've been in the war room there, Secretary's office, know you don't walk in and say, kill them.
00:46:21.000So, again, he is openly denying that report.
00:46:24.000He said, we're tracking narco-terrorists and killing them.
00:46:27.000The thing that I think most Americans who follow the news very closely need to understand about how all Americans follow the news is that people get a gestalt sense of the news.
00:46:34.000What that means is that they have sort of an overall picture of the things that are happening without following the details.
00:46:39.000So, well, everybody who is nitty-gritty involved in the grime and details of politics is very focused in on who said what and when and when was the order given.
00:46:48.000Most Americans are going to take away Pete Hegseth wants to kill narco-terrorists trying to ship fentanyl and cocaine into America, and people opposing him don't want him to do that.
00:47:01.000The days in which these narco-terrorists, designated terror organizations, operate freely in our hemisphere are over.
00:47:09.000These narco-terrorists are the al-Qaeda of our hemisphere, and we are hunting them with the same sophistication and precision that we hunted Al-Qaeda.
00:47:21.000And we will keep killing them so long as they are poisoning our people with narcotics so lethal that they're tantamount to chemical weapons.
00:47:31.000So, again, it's going to be very tough for Democrats to argue against this, but Trump and his entire administration have the magical gift of being able to get Democrats to defend literally anything up to and including narco-trafficking.
00:47:43.000Adam Schiff, who you'll recall from his ridiculous Russia gate nonsense for years on end, he says that the strikes on these boats are unconstitutional and morally repugnant.
00:47:52.000I would actually say that they're trying to ship drugs into the United States would be more morally repugnant if we're going to try to put a marker on it, but okay.
00:48:00.000Based on what you know, do you believe these boat strikes are legal?
00:48:16.000We should do everything lawfully that we can to stop the scourge of drugs coming into this country, but this is not at all lawful or constitutional.
00:48:26.000And frankly, if the Pentagon and our defense secretary are so proud of what they're doing, let the American people see that video.
00:48:40.000Tom Cotton, the senator from Arkansas, he properly says, listen, if there's a boat loaded with drugs to kill Americans, it's a valid target and we should blow it out of the water.
00:48:48.000Any boat loaded with drugs that is crewed by associates and members of foreign terrorist organizations that are trying to kill American kids, I think is a valid target.
00:49:56.000Well, I'm curious about your pushback on that particular point.
00:49:59.000With your previous guest, you had zero pushback because he's giving the Democrat talking points like you spew every single week, which is probably why your ratings are so bad.
00:50:07.000But to make the point, what I'm saying is that you're trying to divert here the attention from what the American people actually support.
00:50:17.000So again, it's going to be hard for Republicans to defend that.
00:50:20.000I mean, if the best that we can do is just slapping George Stephanopoulos, I mean, it's fine, but I'm not sure that it's going to do the work.
00:50:25.000Meanwhile, another pardon of Trump's has now gone awry, according to MediaITE in a blistering post to Truth Social early on Sunday.
00:50:32.000The president has now bashed Representative Henry Quear of Texas for announcing his intent to run for re-election as a Democrat after receiving a pardon from the president, who's facing charges for allegedly taking over $600,000 in foreign bribes.
00:50:47.000The Democrats, under the crooked Joe Biden administration, who always use extreme force and jail time to destroy their political opponent, wanted to put Congressman Henry Quayar and his wife, Imelda, in prison for 15 years, which I predicted these radical left lunatics would do.
00:50:59.000And they never stopped wanting to fulfill this evil quest.
00:51:01.000The Dems mercilessly went after Henry with everything they had.
00:51:04.000They were looking to destroy him, his lovely wife, his two young daughters, and anyone close to them.
00:51:08.000When the Democrats overwhelmingly lost the 2024 presidential election and power with it, they regardless did everything they could to keep going after the Queer family.
00:51:15.000The Dems were vicious and all because Henry strongly wanted, correctly, border security.
00:51:23.000Quote, only a short time after signing the pardon, Congressman Henry Queyar announced that he will be running for Congress again in the great state of Texas, a state where I received the highest number of votes ever recorded as a Democrat, continuing to work with the same radical left scum that just weeks before wanted him and his wife to spend the rest of their lives in prison and probably still do.
00:51:39.000Such a lack of loyalty, something that Texas voters and Henry's daughters will not like.
00:51:42.000Oh, well, next time, no more Mr. Nice Guy.
00:51:50.000It is not my favorite part of the Constitution.
00:51:53.000It is typically misused by members of both parties, and this one seems like a giant fail.
00:51:59.000Okay, meanwhile, in meaningless news, the Trump administration has secured the World Cup for the United States.
00:52:08.000And this means it was time for President Trump to receive an award from FIFA.
00:52:12.000I mean, listen, I'm glad that the World Cup is coming to the United States, though I have no great adherence to soccer at all.
00:52:20.000Nonetheless, the president was joined by FIFA president Gianni Infantino for the World Cup draw at the Kennedy Center.
00:52:26.000And there, Trump was given a prize, which I have to say, this is quite an ugly trophy.
00:52:32.000I mean, really, really an ugly trophy.
00:52:35.000Like, I have a bizarre sort of predilection for hideous trophies and hideous statues.
00:52:41.000My favorite is of a soccer player, Ronaldo.
00:52:43.000It is one of my favorite things in the world: a horrible statue of Ronaldo that does not appear to be him.
00:52:48.000It appears to be some sort of bizarro Superman version of Ronaldo.
00:52:52.000Anyway, here was Trump receiving this award, which appears to be a set of human hands springing from the bowels of hell and holding up the globe.
00:56:54.000If we are too busy squabbling amongst ourselves to take up arms against him, here is your hope: a king will arise to hold all Britain in his hand.
00:57:04.000A high king who would be the wonder of the world.