Deep Dive
Shownotes Transcript
Welcome to Sleep Money, your guide to the business and finance news of the week. I'm Felix Salmon of Axios. I'm here with Emily Peck of Axios. Hello. I'm here with Elizabeth Spires of New York Times. Hello. We are going to talk about stonks. The stock market is up. It is higher than it was at the beginning of the year. It is higher than it was on Liberation Day. What's up with that? We will answer later.
We will talk about a different stonk, United Health Group, which is down. It's lost half its value in the past month. Is this its comeuppance, a bad behavior? We will talk about other weird insurance stories, like can you insure against being arrested for killing someone? We have a Slate Plus segment on a $700 calendar that may or may not be able to save your marriage. It's all coming up on Slate Money.
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just buy and hold stock market indices and do no interesting fun things in the markets. Is that right? Elizabeth? I think that is mostly true. Although I will admit I bought a little bit of Nvidia on the dip. Oh, so you bought the dip. Oh my God. Elizabeth bought the dip. This is breaking news. But only Nvidia because I already thought it was underpriced. And then whenever it went 20 bucks lower, I thought, look at this. You're, you're a value investor.
You're like, there's a value for NVIDIA stock and it went below that and that's a buy signal. So you bought, you did Elizabeth, what millions, literally millions of American retail traders have.
have done over the past month, which is buy the fucking dip. And it worked out really well for you, at least so far on a mark-to-market basis. One assumes. I mean, yes, because NVIDIA's back above $3 trillion now. NVIDIA's doing great. Well, let's see. I bought it at $84, and this morning it is at $135. Pew, pew, pew!
That is amazing. I mean, that will buy you a new kitchen. That will, depending on how many shares you bought. So congratulations on being rich. Drinks are on, Elizabeth, next time we all hang out. And congratulations also to all of you lovely Slate Money listeners who ignored everything we said about don't try and time the market and instead...
try to time the market by taking advantage of the post-liberation day plunge to fill your boots with stocks, which is exactly what most retail investors did. Is that something people say? Fill your boots with stocks? I've never heard that before. It's an Englishism or maybe it's just a Felixism. No, no, it's Cockney. We come here every Friday to learn Englishisms and it never stops. So I admit that...
that I didn't buy the debt because I am a very boring Gen Xer who never does anything. But clearly there was selling on the way down. People were selling and the people who were selling were not small retail investors. They were, you know, big institutions who were convinced that the decades long American exceptionalism trade was over or whatever, yada, yada. And they were like caught flat footed. And I think a lot of what we've been seeing over the past few weeks is
is what's known in the markets as a pain trade where people like, you know,
sell because they think they're being smart. And then the market just moves against them because the market just always wants to make you feel stupid. I really buy into what James McIntosh wrote in WSJ, which is that before Liberation Day, I think the markets were pricing in a 10% tariff. Then Liberation Day happened and Trump announced these like bananas tariffs that were multiples more than 10%. So the stocks went down. And then it
It kept looking increasingly like Trump was making deals. And ultimately, it now looks like, oh, it's going to be a 10% tariff. So the market bounced back.
to where it was for the 10% tariff plus a little more. That's a good theory. I like it. Yeah, I think it's Stockholm syndrome. The markets are like, well, 10% is just the new normal. That's what we're dealing with now. Yeah, it was going to be a little bad. Then it was like, oh my God, it's the apocalypse. And we should maya culpa ourselves for saying it was the apocalypse, basically, when Barry Ritholtz came on the show. We were leaning apocalyptic. But as Robert Armstrong likes to say in the Financial Times,
Taco, Trump always chickens out, and the taco trade kicked in, and here we are now. But there are signs that things aren't like totally back, that American exceptionalism is somehow totally back. Right, Felix? Oh, absolutely. I don't think anyone is even making the claim that American exceptionalism is totally back. I think what people are doing is trying to place a narrative on the stock market.
and saying, well, stocks have gone back up. They're higher than they were on Liberation Day. They're up for the year, still down a bit from their late February highs, but they look very solidly priced. And everyone's like, if everything we thought about American exceptionalism
is true. And if everything we thought about free trade is true, then you wouldn't expect stocks to be doing so well. So what explains why stocks are doing so well, and there's a kind of implicit efficient market hypothesis type thing going on saying like, this is the wisdom of crowds, the value of the stock market reflects, you know, the best wisdom of the smartest people in the world, millions often buying and selling every day. And so there must be some kind of a story there
that explains what the stock market is doing. And I think my general opinion about this
is that, you know, there's that famous Ben Graham quote about how in the short term, the stock market is a voting machine. And then the long term, it's a weighing machine. Right now, we're in the short term. You can't take the random gyrations of the stock market, especially when it goes up and down by like 18% in the matter of, you know, 12 trading sessions. You can't take those as being like a considered weighing machine thing.
There's a bunch of voting going on. There's a bunch of like, frankly, there's a bunch of very rich, right leaning voters and retail investors who kind of like Trump still and who are like, yay, let's buy this market. And we don't know where it's going to shake out. It's still early. So like, it will become more obvious over time.
how this shakes out. It'll become more obvious over time whether we're in a recession now or not. Like the recession odds on Polymarket have come down significantly from like above 65% to sort of below 40%. So, you know, there's a lot of just known unknowns right now.
right now. Do you guys think that the markets are more reactive now than they were 20, 30 years ago? My hypothesis is the stock market at least might be because people have more information and such a glut of it all the time. Absolutely not. I think if you look at volatility in the stock market, the stock market has always been volatile. I think journalists have a very strong incentive and
intuition that any move in the market is in reaction to news because we're in the news business and we think that news is incredibly important and i don't think that everyone necessarily believed that quite to the same degree back in i don't know the 60s or 70s or whatever when stocks were also very volatile so yeah i think stocks are volatile i think they go up and down i think
certain things can be plausibly attributed to news. And, you know, we are going to be talking about United Health Group later on, and there's a drop in the share price. And it's pretty obvious that certain stocks drop on certain news, you know, and you can draw a causal relationship there. But when it comes to the market as a whole, and there are big headlines out of the White House and Munich Security Conference or whatever, you know, that's more about what
Nassim Taleb would say, like, fooled by randomness. You know, we always try to place a narrative into noise, even when it's just noise. Well, there was the instance, though, of the person with the Bloomberg X account. It wasn't actually Bloomberg, the media company, saying that Trump was going to affect a 90-day pause. And you saw the markets react to that immediately. So I did a deep dive into that. And it certainly was not that tweet that moved the market. The market moved before that tweet came out.
And the reason why the market moved was absolutely some piece of information saying that Kevin Hassett said that there was going to be a 90-day pause on all of the reciprocal tariffs except for China. And
then that piece of information found its way into a Reuters article. It found its way into that tweet. It found its way into various different things. Basically, then people started realizing that he hadn't said that when he'd appeared on the television earlier in the morning. And so then the market sold off. But it turns out that's exactly what it was true. It turns out that's exactly what Trump did. And my sort of
between the lines sort of guesswork here, and I have no inside information whatsoever, is that he genuinely did say that on some kind of call with someone and that it leaked, but it wasn't meant to leak or it was meant to leak or something. So we don't know what happened.
But yes, news definitely still does move the markets. I just think that we have seen definitely if you look at the drop in the market after Liberation Day, you know, that was like a 15% drop. And it took what, four or five trading sessions to do that. It wasn't just like, you know, here are the tariffs, here's the reaction.
It takes time for the market to incorporate new information. And as our colleague Neil Irwin always likes to point out, or often points out, or maybe said one time, in 08, the stock market didn't fall right away. The timeline I don't have in my head, but it was like we all knew this was going to be bad, but the market hit highs after that.
So Lehman Brothers collapses on September the 15th, 2008. The stock market bottoms, I think, in March 2009. It's like six months later. Yeah. So it takes time. To me, I just visualize like Wiley E. Coyote, I guess, when he runs off the cliff and he's still running and he doesn't realize that the
there's no ground underneath his feet. So there's that time between when he runs off the cliff and he doesn't fall, he's still running. To me, that's how the stock market operates. It's like trying to keep it up, trying to keep it up. And then something happens and it's just like, ah, and just down they go. So I feel like there's a bias towards up versus up.
versus, you know, there is a bias towards up in the market, or at least there certainly has been, you know, so far this century. Well, let me rephrase that there is a bias towards up in the market, the US market in general has been this astonishing up into the right force of wealth creation, the likes of which I can barely remember seeing anywhere else. I think possibly more people have made more money from US stocks over the past 15 years or so than like
any other form of wealth creation in the history of the world, pretty much. It's been amazing to see, but it also means that we have all forgotten the lost decade of the 2000s. If you basically look at what happened from 2000 to 2010,
stocks went sideways and no one made anything. Yeah. But I want to ask you, Emily, there is a narrative out there that what we said on the episode with Barry Reynolds was right, that, you know, this is the end of American exceptionalism, that tariffs are terrible, that the Trump administration is terrible, that stocks are overvalued in general, and it makes perfect sense for stocks to be 20 or 30 percent lower than they are right now. The
We all kind of realized this. Oh yeah, that kind of makes sense in early April after stocks had plunged and we're like, yeah, we thought that those high stocks were weird and now they're down and I feel poor, but like I can understand why stocks are low now.
And so now we get like a do-over. And if everyone who felt regret about not selling at the end of March, we get to sell now. This is your, what's it called in golf? Golf language. There's a golf metaphor here. Isn't it a bogey or something? No, it's not a bogey. I hate golf, so I don't. I hate golf.
In any case, there's an intuition to me that people maybe should be selling right now because this is their opportunity to sell while stocks are high, which they kind of regretted not doing when stocks had plunged.
but I don't think that's happening. A mulligan. Mulligan. There you go. Mulligan. Thank you. So I think that that's not what people are going to do because the lesson, and I feel this in my head, so I'll just speak for what I, my intuition, which is probably wrong, but like, I didn't put some of my 401k into cash ahead of like Trump coming into office, even though like
I kind of thought about it. We knew like it was going to be wild. And I was like, eh, 401k is forever. Like, let's just let it roll. I even wrote a story that was like, just be calm, just be calm.
chill but then after liberation day when the stock market fell so much i was like oh man i really should have done that i really should have put to cash i should have done something i feel awful like emotionally it was rough felix i know it's a while till i retire but it still feels closer than it's ever been before which is just literally is closer literally always closer than it was five minutes we're always getting one minute closer to death emily
Thank you, Felix. That's kind. But then now the stock market's so back and I'm like, oh, great. So I didn't make any mistakes. Um,
I did the exact right thing and everything's great now. And this is a reminder. It goes up. You did a good thing, but Elizabeth did the exact right thing. No, Elizabeth won. No, she wins. Do you two think we're out of the woods though? I mean, Trump's so volatile. He could in four weeks decide, eh, change my mind. Taco. We're recording this on Friday morning when he did just come.
come out and say, oh yeah, I'm going to put a whole bunch of extra tariffs on people. So yeah, the whole thing is going to be chaos. Chaos is going to be the new normal. There's a bunch of chaos coming up about tariffs. There's a bunch of chaos coming up about
the debt ceiling. There's a bunch of chaos coming up about the budget. There's almost certainly a bunch of like random geopolitical chaos that we don't even know is coming down the road. And to a greater or lesser extent, all of this stuff is going to get reflected in some degree of stock market volatility. And if you are a good passive buy and hold investor like me, then you just kind of say, well, I have no
ability to time the market. So my job is to just sit back and do nothing and check my 401k roughly once a decade. And that's the smart thing because you can't let it get to you financially like that. Can't let it get to you. That's right. But everyone does. And Emily is not alone in checking the value of her stocks. When I wrote that story, we wrote it together, Felix. I think the headline was like, just calm down about your 401k, whatever. I got hate mail about that. People were like, how dare you? That's so irresponsible to say that. But
Calm down, people. Calm down, I guess. The truth is we have no idea what's going to happen. Can we just be
Be clear about that. I'll say we are not registered investment advisors. Nor are we clairvoyants. We cannot see into the future. But here's what I will say to the columnists or whatever. The punditocracy. The punditocracy. If you're going to judge them when it goes down, you've got to judge them when it goes up. And that is, I believe, not the position any of those people want to actually be in. It's not a good... Measure them on policy. Measure them on impact on people.
Have people lost their jobs? You know, are people struggling to pay their bills going into debt? Uh, is the America standing in the world different? Like,
the stock market isn't the gauge for judging a politician, I don't think. But the 10-year bond yield? Maybe that. The 10-year bond yield is a much better gauge of how he's doing and what he's doing. And that spiked after Liberation Day and it's still significantly higher than it was before Liberation Day. The 10-year bonds have not come back. Remember that bond prices move inversely to yields. And so...
Yeah, people are sitting on losses on their long dated bonds and that's whatever, you know, bonds go up, bonds go down. But more importantly, that is the benchmark interest rate for corporate America and for individuals getting mortgages. And so long as the 10 year bond yield remains high, the housing market is going to remain very slow and sluggish and market and prices aren't really going to clear. And it's going to act as a drag on the economy. And,
You know, is that mostly tariffs? No, I'd say that's probably mostly fiscal. You know, this is bond vigilante saying we want a smaller fiscal deficit. And if you insist on extending the Tax Cut and Jobs Act, then that is going to mean a much larger fiscal deficit. And that's not good. And we're going to require lots of extra money to fund that deficit. But yeah, like that is the number I think that people should be concentrating on much more than the S&P 500.
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at 1password.com slash money, all lowercase. That's 1password.com slash money. But yes, while the rest of the market was booming, including Elizabeth's beloved NVIDIA, one stock in particular, what used to be the biggest Dow component in terms of nominal share price and is now no longer, has been imploding. UnitedHealth, which was...
640 ish dollars a share just a couple weeks ago is now what 250 something like that it's kind of impressive how far it has fallen and Elizabeth you are going to explain how this is like a bunch of
evil capitalists getting their come up and they're just desserts. Well, they have the perfect storm of bad shit happening all at once. There's potentially a criminal fraud investigation by the DOJ into their Medicare advantage practices. There's also already a civil investigation into their billing practices. There are a
And this is on top of, you know, their chief executive getting shot last year and people kind of cheering it because they hate their insurance companies so much. But at any rate, the stock has fallen 50% in the last month. This is all a bit confusing to me. And to be clear, like there are two CEOs who are no longer with us. There's the CEO of United Health Group who announced his resignation this week.
And then there was his underling who ran the insurance subsidiary who was shot to death last year. And when that happened, when the assassination happened, the stock barely wobbled.
And when the whole, you know, Luigi becoming a meme thing happened, the stock kind of went up and went down. Like the stock market, the traders, the market didn't seem to care about that. Whereas the big CEO of the combined company stepping down this week, that really did move the stock. The various government investigations, I feel like, especially if you're in a highly regulated industry like health insurance or
or healthcare. Everyone is always under investigation all the time for everything. And the Medicare Advantage stuff has been deeply reported on for years by ProPublica and many other folks. And plus, UnitedHealth Group denies that it knows anything about this and hasn't been told anything about an investigation. It feels kind of weird that the Wall Street Journal would know about it when their company doesn't. And so I'm like a little bit confused why that would move the stock so
so much. I think investigations into these things on a civil basis are pretty common. I think criminal fraud investigations are not. So I'm just looking at a Reuters piece and they have a nice timeline. So basically after Brian Thompson was shot, the stock dropped
kind of came back and then the Q1 earnings miss, it dropped a whole bunch again. And then the CEO steps down, it drops a bit more. But I think it's what Elizabeth was saying. There's this perfect storm. The Wall Street Journal, which just won a Pulitzer for its coverage of this Medicare Advantage stuff. And
and other outlets have been hammering this company, which is the biggest provider of Medicare Advantage in the country, and has been doubling down on that Medicare Advantage thing, whereas a lot of other insurance companies have pulled back. Other companies like CVS, their stock has gone down too, have been struggling as the insurance industry overall has been struggling, but none has been struggling as much as UnitedHealth. And whereas the other insurance companies and healthcare companies sort of pulling back on
On Medicare, my understanding from reading all the reporting is that, or not all, some of the reporting, is that UnitedHealthcare, instead of pulling back, has just like really doubled down on Medicare Advantage. And I think that's just making them look really, really unappealing right now. And layer onto that what this White House is doing with healthcare and healthcare spending, which is like a big damper on the industry as well. It's not looking good for UnitedHealth.
So we should talk a little bit about Medicare Advantage, which is basically an Obama era invention that is a sort of quasi-privatized form of Medicare. Instead of being on Medicare and the government paying for your health, you basically go to United Health Group or someone like that, and you get them to treat you, and they wind up getting paid insurance premiums by the government. And
The way that the insurance premiums are calculated is a function of how sick you are, basically, because obviously sicker people require more health care. And so if they were on normal Medicare, the government would pay more to treat them. So if they're on Medicare Advantage, the government pays more to insure them.
That makes sense. But what that does is it gives insurers an incentive to basically say that all of their patients are incredibly sick. And so there's a bunch of reporting from the Wall Street Journal and lots of other people about, you know, a bunch of elderly patients suddenly seeing their health reports and lots of terrible diseases that they had no idea they had. And it's all because it's a way of increasing Medicare advantage.
premiums from the government to their insurer. And it is a scandal. And insofar as United Health Group has lent into this, they are the most exposed to any kind of crackdown on it. And to Elizabeth's point, they are probably the most exposed to a potential criminal prosecution, although I'm a little bit unclear whether
What kind of criminal remedy would be particularly bad for them since you can't send a corporation to jail? But the bigger picture, I think, is this meme that's kind of floating around the stock market these days. The United Health Group was basically making lots of money by doing terrible things to patients like
signing them up, you know, by saying that they had a whole bunch of diseases that they didn't and denying them insurance and all manner of other things. And then after the assassination, they basically stopped doing quite as many of those terrible things. And when they stopped doing quite as many of those terrible things, suddenly they had a massive earnings miss and
And the stock fell out of bed and it's just been down into the right ever since. And that the only thing that was ever keeping the stock up was a bunch of, you know, quasi legal or possibly illegal shenanigans. And that it all feels a little bit like, I don't know, GE under Jack Welch, where like the minute you take away the, you know, all of the craziness that was keeping the stock afloat and the quarterly earnings going, like there's nothing there anymore.
There's also a funny shareholder lawsuit where the shareholders are alleging that UHC failed to inform them that their previous good profits were a function of basically screwing over customers. And then after Brian Johnson was murdered, they sued on the basis that UHC did not explicitly tell them that they were going to stop screwing over customers and therefore be less profitable. Oh.
The only trouble with this is there's no evidence that they've, quote unquote, stopped screwing over customers. Beyond the lower quarterly earnings, right? The real evidence we have is that the people they're screwing over, the institution they're screwing over is the federal government. And I guess you could argue taxpayers because they're scamming Medicare Advantage. That's where the evidence is, the actual evidence.
big picture reporting. It's a bit unclear to me how much of UnitedHealth Group's profits come from Medicare Advantage. I mean, they are a massive company. I would like to just take a moment to acknowledge Optum, which is UnitedHealth Group's physician arm. They have basically bought up all these private doctor practices over the past, at least since Obamacare was passed. And that's like the big juicy part of their business. And
And if you sort of like look at Optum for two seconds, like you definitely could make a kind of argument for like why it's not serving people very well. I mean, I have Optum by me and it's like, if you want to call and talk to a doctor, like good luck, set aside an hour. Maybe one will call you back at some point, press one or menu options have changed. No, press three. No, wait, press zero. I don't know. What's your name? Like, it's just...
a nightmare. And then good luck seeing a doctor. You're going to see like a nurse. You're going to see a physician's assistant. You're going to see the physician's assistant assistant. You're going to get referred somewhere else. And then maybe one day you'll see a doctor. So I understand all of that, but I'm just saying, I don't see the evidence is more along the lines of the health insurance business isn't doing well. Plus this company is overexposed to this one piece where it seems to be doing stuff that the government doesn't like anymore. And that's actually the problem. It's not like
No, no, you can't, you can't trace it back to that. But I will say that I'm generally in favor of nurses doing nursing type things and not everything having to be done by a doctors. Nursing is a very good thing.
very skilled and noble profession in which you give nurses a lot more respect than we do. I wasn't talking about nurses though. I said physician's assistant and I'm not trying to cast aspersions on physician's assistants, but like sometimes you need to see the doctor. Yeah, no, sometimes you do and sometimes you don't. And I think that this is the thing, like that kind of triage needs to be managed better. And I do not for a minute think that Optum does it well. But similarly, I, you know, I think that
Donald Trump's valiant attempt to try and bring down drug prices by saying that the US government won't pay more than any other foreign government. I don't think it's going to work very well, but I think it's his heart is in the right place. You know, healthcare in America is ludicrously expensive and anything that can make it cheaper is a good idea. And part of the reason why it's so expensive is the doctors are paid way more.
in America than they are in any other country. And so if we can basically take a bunch of the very expensive stuff that doctors do and make it stuff that physicians assistants and nurses do and like leave the doctors to the very high value, you know, diagnosis and talking to patients that yeah, so much the better. But yes, I don't believe for a minute that United Health Group has cracked that particular code better than anyone else. I don't want to fight with you right now.
I think we broadly agree. I just had a bad experience with desperately needing a doctor for like three weeks and like... Yeah, and that's wrong. It was obviously terrible. Yes, exactly. And then I had this like control experiment where I switched to a doctor who owns his own practice. It was like the sun came out after a long rainstorm.
And I just read that only half of all the doctors work for themselves anymore in the United States because private equity and United Healthcare through Optum has bought up all these doctors groups and consolidated them and like corporatize them. And like the whole system is a mess. My doctor works at some like big hospital group. Yeah. A lot of them are subject to like all these rules. You have to see X number of patients per
hour you have to do X numbers of surgeries a year like this is a big mess like of course this company stock is down at this point things are bad yeah you can
You realize you're doing exactly what you said we shouldn't do with the stock. You know, we're like, just because you hate Trump doesn't mean you should, you know, cheer when the stock market goes. Now you're like, just because we hate insurance companies does mean that it's all because of the insurance companies doing bad things at the stock market. The stock is down. Well, I just, yeah, I guess I just wanted to rant. So we can cut this if people want. I feel like a rant about health insurance is fine. And, but,
The degree to which UnitedHealth Group brought this all on itself by doing bad healthcare, I think the jury is still out on that.
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We are all better with help. Visit betterhelp.com slash slate money to get 10% off your first month. That's betterhelp.com slash slate money. All right. But since we're on the subject of insurance, Elizabeth, can you explain to me, is it now possible to buy insurance against killing someone?
Yes, it is. Apparently there are insurance companies now that are particularly busy in stand your ground states where if there's a possibility that you might kill someone supposedly in self-defense, they will insure you against things like your bail, your legal costs, and even crime scene cleanup, which is terrifying, but.
Crime scene cleanup? Are people like normally on the hook for crime scene cleanup costs? If I kill someone, they're like, okay, we're sending you a bill for the crime scene cleanup. I guess they are. If they're found guilty, maybe they are. I don't know. I assume they wouldn't include it if it wasn't a thing. I thought she meant like after you do the murder, you like call them and you're like, can you help me clean up?
And they wipe it all down. I don't think that's it. No. So the first thing we need to say here is most people who get arrested after killing someone with a gun claim to have been acting in self-defense. That is the standard defense claim. And then it makes its way to trial or doesn't and the jury believes you or not. But if that claim stands up in court, then you, in most cases, are acquitted.
And obviously criminal defense is an expensive thing. So people who own guns are like, well, the whole point of owning a gun for many people is because they think that they might need to use it in self-defense. If they do use it in self-defense, there is a non-negligible chance that they will get arrested. If they are arrested, they're going to need a lawyer. That lawyer is going to be expensive. And so...
It kind of makes sense for them to buy insurance to cover their legal costs in that eventuality. The interesting thing about the insurance situation, however, is that this doesn't seem to be like most insurance where like you pay a bunch of insurance premiums to the insurance company and then the insurance company uses most of those premiums to pay out on people who are being insured.
The payout rates seem to be like 15 or 20 percent. And that most people, it turns out, are just paying way above the market for insurance that they're never going to claim on. And this is an incredibly profitable line of business for these insurers to be in. Yeah. It also one critique of it is that it creates a little bit of a moral hazard for
No shit. People who don't understand stand your ground laws at all and think that it means you can shoot at anything you find threatening. Like one guy murdered somebody at his neighbor's house because he said he thought the guy was breaking into his neighbor's house. And it's like, that's not even what stand your ground means. Stand your neighbor's ground. Yeah. Yeah. But the idea is that some people may view it as insurance against any murder they're already planning to commit. And so there was one case where a woman did plot to kill, I think her ex-husband,
And she bought a gun and the insurance on the same day. And right after she shot him, she called the insurance company to get it taken care of. Did that work out for her? It did not.
Yeah, it does seem like we're building up a kind of big moral hazard with the one-two punch of the stand your ground laws, which is it now like half the states have laws like that or a third or something? Plus the insurance. And then, you know, now we have a lot of policy loosening gun laws or heading in that direction. That's been the trend over the past, what, two decades? Cool. Yeah.
Emily, what was that other weird insurance thing that we stumbled across this week? Oh, yes. The Financial Times had a piece about Lloyds of London. They just launched a product where insurers, they're going to cover losses caused by AI chatbot errors. This is for businesses that invest in AI or use AI. If there's a big error, their chatbot makes up a sale or a freebie that they didn't want to do, stuff like that, then they'll pay it out, the insurance company.
So a little bit of like media literacy thing here. Anytime you see one of these stories and then you see the words Lloyd's of London, it's not a real insurance line. Lloyd's has a million different syndicates who will insure the weirdest things. And if you ever see some story about, I don't know,
Lionel Messi's right leg has been insured for $50 million or something. It's always Lloyd's, right? It's always like these weird quirky things, which a bunch of Lloyd's syndicates have decided they're going to send out a press release about. So, so long as this like, you know, companies are buying insurance to insure against rogue AI chatbots thing remains a Lloyd's thing, I'm going to come out and say it's not really a real.
thing. Did you see a future where there's a category of super catastrophic insurance that really does revolve around AI? That doesn't seem crazy to me. Well, not really. No, because who would you buy that insurance from? Given that the thing that everyone is worried about when it comes to AGI is, you know, Skynet is going to become conscious and kill us all. Like,
Great. It's hard to find an insurance company to insure against that. There was a fascinating story in The Atlantic this week about how Ilya Sutskeva, the chief scientist at OpenAI, kept on talking about the bunker that they would all move into before they released the AGI.
And that somehow they were going to create this bunker and then release the AGI into the world. And then somehow the bunker would try to be insulated from the AGI, but then the rest of the world could all get exterminated somehow if it all went badly. Like, that's not something you can insure against. But anyway, this insurance, it's underwritten by Lloyd's, but it was developed by a startup, a Y Combinator-backed startup called Armola. Right.
Of course it was. And what they want to do is they want more companies to use AI. So they developed this insurance to encourage them. Like, oh, don't worry if your chatbot starts saying bad stuff about your company, we will insure you against lawsuits. So use AI.
Or if like this weekend X's AI chatbot Grok could not stop talking about white genocide. Yeah. Which apparently this is kind of fascinating. This is all part of a dark ops operation by DeepSeek and that the big AI companies are
using nefarious tactics against each other, you know, DeepSeek or some other AI company or Anthropic or Perplexity or someone will be like tweeting out images that look totally benign. But then when Grok ingests them into its learning models, they have hidden features that make Grok go completely crazy. And that there are certain like mathematical calculations that Grok used to be really good at and now it's really bad at because it's been sort of
by looking at certain images on Twitter. And this kind of spy versus spy aspect of the AI wars is hilarious to me. Is that true? I have no idea. This podcast is brought to you by Progressive Insurance.
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Should we have a numbers round? Elizabeth, do you have a number? So my number is $4,000 and that's the annual fee to be in the private dining room at Mary Lou's Montauk, which is a restaurant that's opening very soon in Montauk in a space that is supposedly a cursed space because they've had so many turnovers of restaurants. It's like,
on a harbor, nobody really wants to go there. But anyway, they have a very successful Palm Beach restaurant that has a similar model. So you pay the $4,000 annual fee, and then you make a commitment to spend at least $2,000 over the summer there in a restaurant that has not opened. And apparently they are doing pretty well.
I really like this model. I think this makes a lot of sense to me because people are like, oh yeah, I love the idea of going out to the end of the pier to have a lovely meal. But then by the time Saturday night rolls around and you're exhausted from a long week and you've had a massive commute on the Long Island Expressway or something, you just can't be arsed and so you never really go. But if you pre-commit
by spending $4,000 and then promising to spend another $2,000, then you kind of get roped into the sunk cost fallacy. And you're like, well, I have to go now. And that's how the restaurant basically gets people to actually come in is by saying, well, you've paid for it. So the marginal cost of coming in is zero at this point. So you may as well do it. And I think maybe that will work.
How important would it be, though, that the food actually be good? Or the experience actually be good? Oh, in the Hamptons? That's the last thing anyone cares about. No one's even eating anymore with the Ozempic. Exactly.
Emily, what's your number? 2,750. That is the number of Barbie dolls and friends of Barbie doll friends examined in a new study that came out this week. The study was done by three podiatrists and one occupational therapist slash Barbie enthusiast, and including one man who calls himself a diversity hire. They embarked upon a study of Barbie's feet, which when Barbie was first introduced were, you know, up, high heels. Remember Margot Robbie in the movie? Up feet.
And now only 40% of the dolls have the up feet. And they looked across time and they found as Barbie got a career, she was more likely to have flat feet. So all the Barbies with jobs have kind of flat feet, whereas the more fashion-oriented Barbies have the high heel feet. And they did this study for reasons. I thought it was interesting. And that is my number. Wait, it used to be 40. Is it still only 40% of the time or is it more than that now?
Okay, never mind. It's not important. We will leave that to the podiatrist. No, it was 100% of the time when Barbie was first born. And now 40% of the time she's got the high heel feet. Right, so the flat feet are now 60% of the majority. Yeah, majority of the time she's flat footed. Correct. Thank you.
Yay. Talking about majorities, my number is 17, which if you look at the 25 wallets with the most Trump tokens in them, and this is an important number because if you're a holder of a
wallet with Trump tokens in it, then you get to go to something that was advertised as a White House reception, but might not actually be at the White House anymore. It might now be somewhere else in Florida or something. But in any case, you get to go to a small little reception with Donald Trump, you and 24 of your crypto friends and Donald Trump. And if you look at those 25 wallets,
At least 17 of them have received funds from non-U.S. crypto exchanges that are off limits to Americans. So this is basically a bunch of foreigners buying access to the president by buying his token. No, Donald Trump. What? This is really surprising. I thought he was so, you know, would never do a thing like that. I mean, I guess it's cheaper than a jet, right?
I'm not sure about this $400 million Qatari plane. There's a rumor that the Qataris just couldn't afford to keep it going anymore and it's more of a liability than an asset and so they're happy to like harm it off to the Americans. Because it costs how much to have a jet? I think this one costs like upwards of $40 million a year just to keep running. So,
So I don't want that present of the present of you have to now spend $40 million a year on the present I gave you. No, thank you. Just give me flowers. Chocolate. Yeah. I mean, if I gave you a kitten, you'd need to pay for upkeep, but upkeep on the kitten is definitely cheaper than upkeep on the 747. Yes, definitely. We do not need to fact check. Also kittens make you happier than 747. Well, that'd be nice to have a private plane, wouldn't it?
No, I'm anti-private plane. But you see the appeal. I can see the appeal, but I feel like it would just make you a bad person. And being a bad person isn't nice. Very good. Very fair. On which note, I think we're going to wrap it up.
this week thank you for listening to Slate Money thank you to Shana Roth and Jessamyn Molly and Merritt Jacob for producing thank you for being a Slate Plus member if you are there's a wonderful Slate Plus coming up on Elizabeth the $700 calendar that supposedly saves marriages on that and failing that we will be back next week with even more Slate Money Slate Money
I'm Leon Nafok, and I'm the host of Slow Burn, Watergate. Before I started working on this show, everything I knew about Watergate came from the movie All the President's Men. Do you remember how it ends? Woodward and Bernstein are sitting with their typewriters, clacking away. And then there's this rapid montage of newspaper stories about campaign aides and White House officials getting convicted of crimes, about audio tapes coming out that prove Nixon's involvement in the cover-up. The last story we see is Nixon resigns. It takes a little over a minute in the movie.
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