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may change. Robinhood is not a bank. Hello

2:00

everyone, you're listening to After Hours. I'm

2:02

Felix. I'm Mihir. Good to

2:04

see you again, Felix. Yeah, it's great to be

2:06

with you. So I have to say I'm enjoying

2:08

this time of year. The cold

2:10

weather. Yeah, exactly. I

2:13

am feeling that afterglow of finishing a

2:16

lot of teaching. That was a lot

2:18

of work. It was really fun. And

2:20

it's almost a little bit of ambivalence because you're

2:22

going to miss it, but you're also so

2:25

happy it's over. Yeah. At one at the same

2:27

time. Right. Exactly. You're feeling both those things at

2:29

the same time. I

2:32

had such an interesting week.

2:34

I taught in three very

2:36

different executive education programs. And

2:38

I have to say business people,

2:40

in particular maybe in the popular press,

2:43

they don't always get the

2:45

most respect. But if

2:47

you sit in these conversations and

2:50

you listen to how incredibly

2:52

thoughtful, informed, concerned,

2:55

motivated everyone is,

2:58

such a thrill. So what do we

3:00

got today, Felix? So I

3:03

have many questions for

3:06

you around this issue

3:08

of concentration

3:10

in stock performance. So

3:13

the market is up quite considerably. But

3:15

if you look at what other companies

3:17

that are driving the rally, it's

3:20

a surprisingly small number. And

3:22

I'm curious, should I be

3:24

worried? Should I be concerned? Is there

3:26

maybe a good sign of things to

3:28

come? I would love to talk

3:30

about that. That would be great. That sounds wonderful. And

3:33

what do you have for me here? Well, this is

3:35

a hard thing to talk about, but I wanted to

3:37

talk a little bit about campuses. Over

3:39

the last several months, campuses have

3:41

become front and center in

3:44

the debates around not just what

3:46

is happening in the Middle East,

3:48

but in the way campuses should be conducted and

3:51

the way people on campuses are reacting

3:53

to what's happening. And I'm curious why

3:56

campuses, which we both dearly love for all

3:58

the reasons we started with, have

4:01

become so front and center and whether

4:03

they deserve that and whether something is

4:05

deeply wrong on campuses or if

4:08

things are okay and it's a weird topic

4:10

Felix it's a hard topic but I thought

4:12

we should at least share our views on

4:14

what is going on on university campuses interesting

4:16

close to home let's try it we will

4:18

try okay

4:25

Felix stock market concentration what's on your

4:27

mind I know who thought we would

4:29

talk about this there hasn't

4:31

been that much concentration in the last couple

4:34

of years and now we see

4:36

the market is doing quite well in the

4:38

US and it's doing okay in other places

4:40

as well and

4:42

say the S&P 500 year-to-date

4:45

almost 20% gain so

4:47

it's really a great story if you

4:49

first look at it and

4:51

then it turns out almost all

4:53

of it is driven by six

4:55

seven stocks and we

4:58

haven't really seen these levels

5:00

of concentration since

5:02

the internet boom of 2020 right is

5:04

this time very

5:07

different should I not be worried why is

5:09

it happening what's your take on

5:11

all of this yeah it is

5:13

just completely fascinating just let's

5:16

get some facts on the table the companies

5:18

of course are Apple and Alphabet and Microsoft

5:20

and Nvidia and Amazon and Tesla and Meta

5:22

they're referred to as the Magnificent Seven and

5:25

at this point those seven companies account for 30% of

5:27

all of the market

5:30

value of the S&P 500 and that

5:33

is just stunning now unsurprisingly of course

5:35

the top seven companies at any time

5:37

account for a very large share but

5:39

it's typically more like 1617 it's now

5:41

almost double that yeah and for the

5:43

course of the year they're up 70%

5:46

while the market as you put it with up a little less

5:49

than 20% so in fact if you strip

5:51

them out the market is kind of flat

5:54

it's flat yeah nothing is happening nothing is

5:56

happening right and so how do you make

5:58

sense of that and I think I think

6:00

there are a couple of different potential explanations, and

6:02

we should just think about which one we like

6:04

the best. Okay. So the

6:06

first is, it's a little bit of a herd mentality.

6:09

It's a little bit of a flight to

6:11

safety during a time of economic uncertainty that

6:13

everybody wants to go to these relatively

6:16

safe assets. And the funny part, Felix,

6:18

is usually those safe assets are things

6:20

like government bonds. One

6:22

explanation is that it turns out those

6:24

safe assets are now Apple

6:27

and Amazon and Microsoft. And

6:29

maybe what we're seeing is

6:32

those companies have actually become vehicles

6:35

for safety. And that

6:37

is one way to try to understand that.

6:39

I'll give you a couple more. The

6:42

second way to think about it is either

6:44

they are leading or

6:46

lagging. And by that,

6:48

I mean this disjunction will get resolved.

6:52

And the question is whether those Magnafson 7 are

6:54

ahead of the pack or behind the pack. We

6:57

could see all those underperformers catch up.

7:00

The market performance would go from being quite narrow

7:02

to being quite broad. Alternatively,

7:04

it's the Magnafson 7 that's

7:06

the aberrational group. And

7:09

it's the rest of the market that is actually telling

7:11

you what is really going on in the economy. And

7:14

as a consequence, they're kind of lagging. And so

7:16

what's going to happen over time is it'll just

7:19

deflate. You mentioned the dot-com

7:21

bust as one example. There's an even

7:23

earlier, I think, more resonant

7:25

parallel, which is what was called the Nifty Fifty.

7:28

So in the early 1970s,

7:30

there were these 50 big blue

7:32

chip companies that similarly just

7:35

attracted massive amounts of value

7:37

and then everything else underperformed.

7:40

In that case, it became a situation

7:42

where that Nifty Fifty really presaged the

7:44

decline of the market. Basically

7:46

everything started to go down. So

7:48

that's, I think, one way to think about it. I'd

7:50

love to hear what you make of all this. So

7:53

one other theory that I find

7:55

interesting to think about is these

7:58

are the same companies. that we

8:01

sold off about a year ago. And

8:03

so if you look at changes over time, if

8:06

we sold off a set of companies last

8:08

year, even if it's

8:10

mostly a return to the mean valuation

8:12

that is maybe not quite as terrible

8:15

as we anticipated a year ago, given

8:17

the size of these companies, that should mean you

8:19

are a really important driver of stock market performance.

8:22

And then, of course, this is also

8:24

coupled with the entire hype

8:27

around AI. In

8:29

particular, the tech portion of the

8:31

Magnificent Seven, they're all in one

8:34

way or another involved with AI.

8:36

And so one view is it's

8:39

really a combination of having sold off these

8:41

companies not so long ago. And

8:43

now the realization that maybe AI

8:46

is most lucrative, is most helpful,

8:48

is most interesting for the large

8:50

tech companies, as opposed to many

8:52

other players. And that creates this

8:55

rally, that creates this concentration.

8:58

And then a final theory

9:00

is these really

9:02

big companies, they have found

9:05

ways to really entrench themselves.

9:08

It's safety, but it's not safety

9:10

because they have amazing

9:12

performance, because they're doing really

9:14

wonderful things. It's because they

9:16

have pretty solid performance, because

9:19

in many ways they have

9:21

managed to wipe out competition.

9:24

And that, of course, would then be a

9:26

concern for the longer term performance of many

9:29

other companies, that would at one and the

9:31

same time explain why you

9:33

have some companies that are doing so

9:35

well, and then many, many other companies

9:37

that don't seem to perform quite as

9:39

well. Yeah. I

9:41

like both of those explanations, and I'll try to

9:43

give you a third explanation. So I love your

9:46

product market explanation, which is that latter one. They

9:48

are just succeeding remarkably well. They are more and

9:50

more dominant in product markets, for maybe good reasons,

9:52

maybe bad reasons, maybe good reasons, whatever. And

9:55

that dominance should be manifested in really, really high

9:57

values. I think that's a totally reasonable way to

9:59

think about it. about the world. I

10:01

also like your first explanation, which is there's

10:04

this technology which is going

10:06

to be transformative. Many

10:08

people think it will be completely transformative, and

10:10

the benefits to scale will be really, really

10:12

large. And I have kind of signed up

10:15

to that idea. Oh, really? Not all of

10:17

those companies. We've talked previously a little bit

10:19

about Google, will they benefit or not, versus

10:21

people like Microsoft. I think it plays out

10:24

differently across those different companies. But I do

10:26

think AI is going to lend itself to

10:28

scale. And so that could be

10:31

interesting. I want to give you one

10:33

other further explanation, which is a weird

10:35

explanation, which is it's tempting

10:37

to focus on the seven. But

10:40

maybe the lesson is in the 493. Maybe

10:44

it's just really, really hard to beat

10:46

your cost of capital. Maybe

10:48

interest rates have gone up, and

10:50

maybe it's just extremely competitive, and

10:54

everyone else is

10:56

treading water. So one

10:58

way to understand this is not just

11:00

that, oh, these seven companies are exceptional.

11:03

But maybe the world, after

11:05

15 years of low rates,

11:07

and maybe a little bit of an

11:10

easier way to compete, is getting

11:12

very tough. Well, that would be manifest

11:14

in the 493, really

11:16

struggling. And then if you really want

11:18

to go down this path, you can

11:20

ask yourself, well, if you really believe

11:22

in the productivity revolution that AI might

11:24

bring in the next 20 years, then

11:28

maybe all the rents from

11:30

that productivity revolution will go to those seven.

11:33

And no one else will get

11:35

that productivity revolution. And the productivity

11:38

revolution will be so great, and

11:41

so concentrated, because it'll happen

11:44

throughout the economy, but all

11:46

the profits from it will

11:48

accrue to NVIDIA, for

11:50

example. And maybe that's what's

11:53

going to happen. What do you make of that?

11:56

I like this idea of thinking about what's going

11:58

on with the 493. What

12:01

I love about the way you put it

12:03

is the key question is really if in

12:06

fact there's big productivity gains and

12:08

there's big profitability, where

12:11

will these profits flow? And

12:14

one story is they flow to big

12:16

tech. I think

12:18

it's equally reasonable that it'll

12:21

make people more productive. If

12:24

people are more productive, we'll probably share

12:26

some of that in the form of

12:28

higher wages because we attract good people

12:30

who are then really great at using

12:32

these new tech products. That

12:35

may be a big part of it

12:38

will not really lead to increased

12:40

margins because in competition

12:42

with one another, everybody has

12:44

similar tools, everybody has similar

12:47

technology and raising prices

12:49

and raising margins will be really

12:51

hard. That's a good

12:53

story in the sense that productivity and the

12:55

gains from productivity get distributed a little bit

12:58

more widely. The kind of story I

13:00

told is one way to understand the

13:02

last maybe 15, 20 years. There's a

13:04

lot of gains from productivity but going in some sense

13:06

to very few companies. And so I

13:09

like your story. My only concern about it is on

13:12

a valuation basis, the top

13:14

seven would be viewed as expensive by

13:17

some traditional metrics of price earnings ratios.

13:20

And in fact, the overall market by

13:22

some traditional metrics of price earning ratios

13:24

is relatively expensive in the sense of

13:26

just what it looks like relative to,

13:28

for example, long-term interest rates. Which

13:31

means, of course, that the 493 can

13:34

be understood to be either extremely

13:36

cheap or just

13:38

dead in the water. I think we spent a lot of

13:40

time thinking about the seven but the 493 is what's interesting

13:42

to me because your story is, well, the

13:44

493 will get better. The

13:47

alternative view is the 493

13:49

are just going to grind it out for the

13:51

next decade in a world where yes. The

13:54

Fed does engineer the soft landing but it's kind

13:56

of like a low growth world and

13:58

we're just grinding out. for 10 years. That's

14:01

consistent with the 493 being valued the

14:03

way they are. And then the

14:05

top seven, you have to kind of rationalize as being some

14:08

kind of productivity boon. So

14:10

let me ask you, if you

14:12

think about the implications for investors of

14:14

all the stories we just told and

14:17

all the ideas about why we might

14:19

see what is happening in the market

14:21

at this moment in time. One

14:24

story that you hear is it makes

14:26

stock picking really difficult

14:30

because all the index money

14:32

is obviously bet on the

14:34

magnificent seven and the

14:37

likelihood that you will dramatically underperform

14:39

if you pick anything other than

14:41

the big seven is now really

14:43

great. And so that makes it

14:46

really hard. That's probably

14:48

not bode well for the efficiency

14:50

with which we allocate capital. If

14:53

in fact many of the opportunities that

14:56

will arise maybe in the wake

14:58

of AI lie not only with the big

15:01

seven but elsewhere in the economy. What

15:03

are the implications for investors? How do you think about

15:05

that? So I'm going to give you

15:07

a super boring answer, which is I don't think

15:09

you want to chase it nor do you want

15:11

to fight it. Chasing it

15:13

would mean, man, I'm going to pile in behind the

15:16

big seven because obviously they're the winners of the world.

15:18

And fighting it would mean I'm going to buy

15:20

a bunch of value indices because I think that

15:23

it's all wrong. I think the same advice that

15:25

always holds, holds today, which is

15:28

if you are a typical retail investor and

15:30

you have good asset allocations that are like

15:32

pretty reasonable for your exposure to markets, you

15:34

should be thankful that the year was as

15:36

good as it was and you should kind

15:38

of stay with it and you shouldn't pull it out and you shouldn't

15:41

put new money in. You should kind of do what you've been doing.

15:44

And I think the mistake that investors

15:46

make, for example, when COVID

15:48

happened, when the market tanked was

15:51

to react to that by taking out all

15:53

their money. And in fact, over the

15:55

last 12 months, a lot of inflows have

15:57

been negative. Retail investors have been pulling money

15:59

out. of the market. Now maybe

16:01

that was good, maybe it wasn't, but you

16:03

don't really want to be thinking too hard

16:05

about this. I think as an economic phenomenon,

16:08

it's super interesting. In terms of

16:10

whether you should alter your portfolio, unless you're

16:12

doing it 24-7, I'm a

16:14

little bit skeptical. So then

16:16

what does it mean for managers of

16:18

active funds? It means life is so

16:20

hard, Felix. And by the way, that's

16:23

part of what goes on here. In

16:25

these moments, when performance is

16:27

so concentrated, you're coming up to December 31st

16:29

and you're asking yourself, I want to look

16:31

like somebody who participated in that. And my

16:34

holdings get published and then there's

16:36

this year-end effort to mimic the

16:38

strategies that have been working. So

16:42

active investors who are tracking indices, which is

16:44

most of the mutual fund industry, it is

16:46

hard and life is hard. And you end

16:48

up mimicking things that you don't even really

16:50

believe in because you have to at these

16:52

moments. And then if you

16:55

have more latitude, which is possible at

16:57

places like long-short hedge funds, then

16:59

you have to really take some serious bets.

17:02

Now, they have been crowding into this trade

17:04

massively. And then finally, if you're that

17:06

last part of the market, which is the really

17:09

quantitative hedge funds, you're doing something similar. You're looking

17:11

at all these signals and you're

17:13

saying, hey, the thing that's

17:15

working is the big seven. So let's

17:17

file into the big seven. And

17:19

those reflexes are what is

17:21

worrisome, honestly, Felix. The reflexes that are

17:24

internal to financial markets, which is people

17:26

reading signals that tell you just

17:29

to keep buying. That's right. Active fund managers who are

17:31

trying to track an index and who have nothing to

17:33

do, but I've got to buy that stuff because I

17:35

got to look like I bought it. Those

17:37

are the internal dynamics of financial markets.

17:39

And those perversities are the

17:41

worrying part. Yeah. It's different than our previous conversation

17:44

where we're talking about like fundamentals. That's right. But

17:46

there is a whole internal world that

17:48

I think can make this reverse rather

17:50

quickly as well. And this

17:52

is consistent with some research that

17:54

we have. If people look at

17:56

the efficiency with which capital gets

17:58

deployed in economies. and how

18:01

that's related to concentration. One

18:03

of the things that you see is

18:05

that often following periods of high concentration,

18:08

capital is misallocated in significant

18:10

ways. And the

18:12

misallocation essentially reflects

18:14

the dilemma that you just talked about. I

18:17

might be an active investor. My incentives are

18:19

supposed to be to unearth some piece of

18:22

information that no one else has. So

18:24

I can bet confidently on a company

18:27

whose performance no one else anticipates.

18:30

In the current situation, my incentives to

18:32

do this are super, super weak. And

18:35

so over time, safe concentration were

18:38

to be maintained at these high levels over

18:40

long periods of time. One worry

18:42

is that the incentives that

18:44

are so important for capital allocation

18:46

that we have a group of

18:48

people who are constantly thinking about,

18:51

what could I do that the crowd doesn't see?

18:54

That might be one of the victims of increasing

18:56

levels of concentration over a long period of

18:59

time. I've been toying with this metaphor, Felix,

19:01

and I'm curious what you make of it. One

19:03

way to understand financial markets is

19:06

as a mirror. And

19:08

the other way to understand financial markets is as

19:10

a lamp. So a mirror

19:14

is something that just reflects what is going

19:16

on in the underlying economy. Our first part

19:18

of the conversation was financial markets

19:20

are a mirror. There are things going on, and

19:23

then you're seeing it manifest. And that's what's fun

19:25

about financial markets. You can look at them to

19:27

understand the real economy. But the

19:29

alternative is it's a lamp. It's

19:32

actually projecting something onto the real

19:34

economy, and it's influencing the real

19:36

economy. And it's changing the real

19:38

economy because of all these decisions. And

19:41

the reason I like that metaphor is because most

19:44

of the time we think about it as a mirror. Look

19:46

at what's happening in the world, and if you want

19:48

to understand it, look at financial markets as sending you signals about that.

19:51

Sometimes these internal dynamics crowd

19:53

out the mirror, and then it's just

19:56

projecting itself on the actual real economy

19:58

and influencing the real economy. So

20:00

that's I think what we're gonna find out

20:02

in the next 12 months whether this concentration

20:04

is a manifestation of something real or A

20:07

reflection of some of these internal dynamics.

20:10

Yeah, we'll come back and see given

20:12

all the narcissism in today's world I'm

20:15

generally not so fond of mirrors

20:19

But in this case, I think I'm going to

20:21

make an exception. There you go You

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21:27

Don't miss out on this limited time offer Uncommon

21:30

Goods we're all out of the

21:32

ordinary So

21:40

we hear life on campus Conversations

21:43

on campus what's on

21:45

your mind? Well, I think two things First

21:48

I think campus life was a little bit different

21:50

this last semester. I felt it and I think

21:52

everybody felt it that of

21:54

course has to do with global events, but

21:56

campuses are also communities and the

21:59

global events the

24:00

year or so has shown that that's

24:02

not really true. There is a whole

24:04

set of conversations that are incredibly difficult

24:07

for us to have, where

24:09

it feels antagonistic,

24:11

where it feels there's very

24:13

limited ability to listen

24:16

to people who have a different view. And

24:18

one of the biggest questions I

24:21

have, where I'm not so sure why

24:24

this really is, is what

24:26

has happened that makes

24:28

these conversations much more difficult?

24:30

What are the underlying changes,

24:33

perhaps from generation to generation,

24:35

perhaps as a result

24:37

of changes in technology, perhaps as a

24:39

result of how we interact with one

24:41

another? What is it

24:44

that makes conversations so hard?

24:47

I see it so often now that when

24:49

I speak to people about a whole range

24:51

of issues that they say, look, in

24:53

that particular respect, the best thing I can

24:55

possibly do is I say nothing. Anything

24:58

that I can say will only

25:00

come at a cost that I don't want to

25:03

bear. And so being silent on

25:05

a whole host of issues is

25:07

how I respond to the current climate.

25:09

And that, of course, is terrible. Right.

25:11

Absolutely. And so let me give you

25:14

a couple of hypotheses, and I'm curious

25:16

which you might like. So

25:18

one is that campuses are

25:20

just like the rest of our world. It's

25:22

just become more polarized. And

25:24

it shouldn't be surprising that we should see

25:26

this on campuses. I've always thought

25:28

one of the amazing things about campuses are they're

25:31

open. Obviously, students

25:33

are selected, but they're open and they're

25:35

part of a community. They're like hospitals.

25:37

People can walk around them. People can

25:39

express views. It's actually a remarkably open

25:41

part. And there are very few, if

25:43

any, organizations in the world that are

25:45

open in that way. So unsurprisingly, when

25:47

the world moves in a direction, which

25:50

is towards more conflicted views, you're

25:53

going to see them on campuses. The

25:55

second theory is, no, there's something

25:58

specific going on in our world. academia.

26:01

And so here's the second explanation, which

26:03

is, you know, at a first approximation,

26:05

we have academics and academic communities that

26:07

are left of center. I think

26:10

that's a fair and easy thing to characterize it

26:12

as. And so that drift

26:15

has accelerated, perhaps, so

26:17

goes the theory, and

26:19

the disjunction between that way of

26:22

thinking about the world and

26:24

the way that much of the rest of the world thinks about

26:26

the world has grown bigger. And so

26:28

academic centers then become somehow disconnected

26:30

and lose their legitimacy. And then

26:32

they become, look at what has

26:35

happened on campuses, because they're so

26:37

out of the mainstream. And

26:39

then the third possibility is a generational problem, which

26:42

is the generation that is now

26:44

coming through the university system is

26:46

somehow different. They're somehow

26:48

brittle. They have not

26:51

been able to deal with different points

26:54

of view for various reasons. Call

26:57

it COVID, call it technology, call

26:59

it helicopter parenting, broad cultural

27:02

stereotypes that get used here.

27:04

And then that generation is

27:06

so brittle that they can't

27:08

handle the conversations. I

27:11

don't know, do any of those theories resonate with you? Or

27:13

do you have a different theory? Your

27:16

second theory makes sense in the sense

27:18

that the rest of society might look

27:20

to campuses and might feel that, oh

27:23

my God, this on-campus conversation feels very

27:25

different from how we think about issues

27:27

and how we talk about issues. So

27:29

that might explain why the conversation between

27:32

the campus and the rest of the

27:34

world has gotten more fraught,

27:36

more difficult, more controversial. I

27:39

don't think it does a great job

27:42

explaining why the conversation on campus has

27:44

become more difficult. And when

27:47

I think about what

27:49

has changed, that

27:51

these conversations feel more difficult. I

27:54

have two ideas and they both might

27:56

be completely wrong. I don't really know,

27:58

but yeah. two conjectures.

28:01

One is the role

28:03

of identity in

28:05

conversations and in politics

28:07

and in attitudes towards

28:10

issues has grown much

28:12

larger. And one

28:15

peculiar aspect of identities is that

28:17

they're not really negotiable. When

28:20

someone says, you just don't know what

28:22

it's like to be a black gay

28:24

person. Yeah, that's exactly right.

28:26

I cannot possibly know what that is

28:28

like. And as a

28:31

result, any conversation that says you should

28:33

do this or you should think about

28:35

it in a particular way, you

28:37

have no idea what it's

28:39

like to be a Christian conservative with

28:42

a sense that my way of

28:44

life is going out of style

28:46

or threatened. And that's exactly right.

28:49

I have no idea what that is like. That

28:51

makes it really, really hard to

28:54

have these conversations because in

28:56

the end, we're hostage to nothing

28:59

that you can possibly say has really

29:01

any bearing on how I think about

29:03

the world, what I think is right,

29:05

what I think is wrong, because

29:08

my identity is non-negotiable. It's not something

29:10

that we can talk about. I think

29:12

that's part of it. And then the

29:14

second trend and it's sort of related

29:17

to that is I think we

29:20

have come to think of

29:22

language much more

29:25

as a weapon than was

29:27

traditionally the case. So the

29:30

violence that can be inherent in

29:32

language and the damage that can

29:35

be done in language. I think

29:37

traditional attitudes, we had some

29:39

limits to what you can say and what

29:41

you cannot say, but we try to push

29:43

these limits as much as possible. And

29:46

now I think in particular on

29:48

campuses, there is much more

29:51

of a view that language

29:53

can violate someone else's right, can

29:55

really hurt people. There's a lot

29:58

of harm in how we. talk

30:00

about things and what we say. And

30:02

what's interesting to me about that is

30:05

the yardstick. When do

30:07

I know that what I say is harmful to

30:09

you? That is just your

30:11

feeling. There's no objective standard. You tell me

30:14

when it's harmful and I just have to

30:16

accept it. And that's another version

30:19

of this earlier problem that that line,

30:21

what can be said and what cannot

30:23

be said, is really not negotiable because

30:25

the moment I talk to you and

30:28

you're somehow different, you own that line

30:30

and you tell me where it is

30:32

and as a result I have to

30:34

stay away from that line. We can't

30:37

really have a dialogue. I think both

30:39

of these points are deep and true.

30:42

In my mind, they speak a little

30:44

bit to what might be different now

30:46

and that becomes, I think, a little

30:49

bit of a generational story. And

30:51

the difficult thing about both of them, Felix, is they're

30:54

in some ways quite legitimate. When

30:56

somebody says you don't know what it's like

30:58

to be a Christian conservative on campus or

31:01

you don't know what it's like, that is

31:03

true. It's true, yes. It's exactly right. That

31:05

role of identity is important and was probably

31:07

underappreciated historically. And it is important

31:09

to acknowledge that those differences exist. But

31:12

your point is that it's becoming the end

31:14

of the conversation because then there is

31:16

no further thing to say because there

31:19

is no scope for communication and learning.

31:22

And that seems very problematic. So we should

31:24

be able to preserve the benefits of

31:26

an appreciation of identity without giving

31:28

it so much power that

31:30

it includes what is the commonality. In

31:33

a way, what draws together campuses and

31:36

what draws together humanity is commonality. We're

31:38

human beings, we have common sympathies and

31:40

common feelings and common emotions. And

31:42

so we should be able to navigate that path. And

31:45

then your second point is related, which is language is

31:47

now viewed as harmful in certain ways. And

31:49

again, there's some truth in that. It's totally right. Everything

31:52

is very hurtful to me. And

31:54

we probably historically underappreciated

31:57

that. And we didn't give it

31:59

the credence it deserved. But yet now it has come

32:01

to dominate. I think it

32:04

is often then extrapolated to this generation

32:06

that is so preoccupied with identity and

32:08

so preoccupied with language. The

32:10

disjunction for me is, I don't know

32:13

if that's really true. My view of

32:15

the world is a little bit

32:17

different, which is there are small

32:19

fractions of people who are

32:22

very preoccupied with these questions.

32:25

And then there is like this massive middle, which

32:28

is actually not as interested

32:30

in that. But yet they find

32:32

themselves captive to it. And so I

32:35

guess what I'm wondering about, Felix, is these

32:37

ideas of what is happening and why people

32:39

have become brittle on campuses. Part

32:41

of what you're suggesting is that people are

32:44

behaving differently. There's a different

32:46

explanation, which is actually

32:48

there's a vast group that's yearning

32:51

for conversation and for challenge. Yet

32:54

there's relatively small groups who

32:57

are preventing that from happening. Do

32:59

you view this as a generalized phenomenon? Or

33:02

do you view this as a phenomenon that

33:04

is occurring on the margins? But what is

33:07

happening on the margins is very corrosive

33:09

to the whole community. My

33:12

instinct is that it's a

33:14

little bit more something that's happening on

33:17

the margin, because I interact with students

33:19

who want to have conversations. So when

33:21

you talk with them one-on-one, they're desperate

33:23

for challenging conversations. I want

33:26

to go back to an earlier point that you made, these

33:28

historical injustices. That

33:31

we didn't pay much attention to language,

33:33

that we didn't pay sufficient attention to

33:35

identity. That's completely

33:37

right. And I think that

33:39

creates the legitimacy for

33:42

holding back, respecting

33:44

other identities as non-negotiable.

33:47

I share your observation that there is

33:50

appetite for challenging and

33:53

different conversations, but

33:55

they take place within groups

33:57

that are very similar to begin with.

34:00

with. When I think about

34:02

my conversations with students about what is

34:04

happening in the Middle East, the

34:06

most open-minded, interesting,

34:09

fascinating conversations that

34:11

I had are

34:14

with students who are in no way

34:16

tied to the region because

34:18

they grew up in very

34:20

different circumstances. They're not Jewish,

34:23

they're not Muslim. No

34:25

aspect of their identity has a

34:27

direct bearing on the conflict. And

34:30

then we can have these conversations and

34:32

we can think about, oh my God,

34:34

how on earth can we get out

34:37

of this spiral of violence? What

34:40

are creative ideas? And

34:42

I completely agree with you that

34:44

people want to have these conversations, but they're

34:47

conditioned by we don't

34:49

have to think much about how identity

34:52

informs our views of what is happening.

34:54

And we don't have to worry much

34:56

about anything that I will say will

34:58

harm you in a really deep way.

35:01

And I think both of these things can be

35:04

true at one and at the same time. So

35:06

when you are in a group where you

35:08

know everybody is very conservative, it's

35:10

perfectly okay to then debate what's

35:12

the limits to a particular conservative

35:14

position. If you're in a group

35:16

where everyone's a liberal, we can

35:18

have conversations about how far should

35:20

you go with any of the

35:23

liberal policies. But the

35:25

most interesting conversations we can't

35:27

really have, because

35:30

the moment it becomes really contentious,

35:32

because the conversations

35:34

play across identities and across

35:37

understandings of what language is harmful

35:39

and what language is not harmful,

35:41

those conversations, they die and I

35:43

think they have gone away.

35:46

I don't know. I'm a little

35:48

more hopeful, Felix, because if we go down that

35:50

path, it'll lead to sorting.

35:53

Just like we've had geographic sorting, we'll have

35:55

sorting at the company level, it'll happen at

35:57

the university level, it'll happen at the campus

35:59

level, it'll happen. in every way. And

36:02

universities really suffer when there is extreme

36:04

sorting, because we believe in the diversity

36:06

of ideas and we believe in debate

36:08

and we believe in all these things.

36:11

So if we end up in a very

36:14

sorted world, then we all

36:16

lose. Because in some sense, the one

36:18

place in the world where we should

36:20

be able to be together with conflicting

36:22

views is in the campus. That is

36:24

the goal. And so we

36:27

have got to figure this out. I

36:29

guess I'm still hopeful because I see

36:31

lots of people who want to have

36:33

conversations, but who are just scared out

36:35

of their mind. We've got to get

36:37

an equilibrium where we give everybody

36:40

enough confidence to feel like

36:42

we can be sensitive to differences, we

36:44

can be sensitive to identity, we can be sensitive

36:46

to the role of language, but

36:49

it cannot stop us from talking. And a

36:51

lot of that has to do with, in my mind,

36:53

forgiveness. We have to be more forgiving. Forgiving

36:56

of mistakes people make when they talk,

36:59

and forgiving of ignorance of

37:01

your particular background and what it

37:03

means. A lot of

37:05

things in the world get better if you're

37:07

forgiving, as opposed to being very demanding on

37:09

each other. So maybe that's a little bit

37:11

of the answer as well. I don't know. Let

37:13

me share another reason why I think

37:16

we can be hopeful. The

37:18

hope is perhaps that over

37:20

time we get

37:23

better at recognizing that every person has lots

37:25

and lots of different identities. And

37:28

some of these we have to

37:30

be very mindful and very careful, and

37:32

many other identities. We

37:34

can talk about basically everything. If

37:37

that's the evolution of how

37:40

we incorporate concern for

37:42

identity and concern for harmful language

37:44

into the conversations that we have

37:46

and don't have or have and

37:48

can't have, I'm much

37:51

more optimistic that we can actually talk

37:53

about most of the things most of

37:55

the time. But it

37:57

would be a recognition that every

37:59

every one person is not just

38:02

this one thing. Your

38:04

religion doesn't define you, your political

38:06

attitude doesn't define you, your gender

38:09

identity doesn't define you. It's

38:12

this wild mix and combinations of all

38:15

of these things that you are. And

38:18

that, I think, enables conversations in

38:20

a way that maybe we sometimes

38:22

don't recognize because we have picked

38:25

a very select few dimensions

38:27

along which we define identity

38:30

and along which we define what's

38:32

okay to say and what's not okay to

38:34

say. Yeah, not to tie to

38:37

need a bow on it. Maybe

38:39

the pendulum swung towards this emphasis

38:41

on identities and maybe it was

38:43

very helpful. We had

38:45

to go through a period where what had

38:47

been taboo to talk about and what had

38:49

been not discussed enough had to be at

38:51

the forefront. And it needed its time

38:53

in the forefront. And that was

38:56

very important and really wonderful. And

38:58

then the question is, can you get it to swing

39:00

back? Can you get it to be what you've just

39:02

described? And a greater appreciation

39:04

for commonality as opposed to difference. And

39:07

I think we have to see how

39:09

that happens. I remain very optimistic

39:11

because I think if anywhere can

39:13

figure it out, it is on university campuses and in some

39:15

sense we have to because

39:17

our imperative is so tied up in the

39:20

idea of functioning in this way.

39:23

But it is hard not to feel like it is a

39:25

perilous moment at the same time, given everything that's going on.

39:28

And to bring it home, part

39:30

of what I love about doing

39:32

this podcast across all the different guests

39:34

that we have, all the different people

39:36

we talk to is every

39:39

time before we record, I

39:41

have a sense of, oh

39:43

my God, I get to talk to

39:45

really smart and thoughtful people. And

39:48

everything else doesn't really matter. I

39:51

get to talk to someone who

39:53

is thoughtful and smart and eloquent

39:56

in defending a particular view of

39:59

the world. And you learn

40:01

the time. So if that's the

40:03

general direction long term, I think we might

40:05

be in good shape. So is that how

40:07

you feel when you talk to me or

40:09

is that how you feel when you talk

40:12

to anybody? No, actually you should be completely

40:14

honest. And

40:25

we have recommendations, of course. So

40:28

now that teaching is over, I'm remembering

40:30

some of the books that I've read in

40:33

the summer that were really fantastic. So

40:35

there is an on-fiction book called

40:37

The Best Minds by Jonathan Rosen,

40:40

which is a memoir which

40:42

I usually don't typically like. It

40:44

is the story of a gentleman named Michael Lauder,

40:46

who is Jonathan Rosen's friend, who we grew up

40:49

with, who has this remarkable

40:51

career as a young person and

40:53

is diagnosed with schizophrenia, and

40:55

then goes to a law school, goes to

40:58

work at Bain, and then comes

41:00

undone by schizophrenia and

41:02

ends up committing a horrible crime. And

41:05

so it is just so

41:08

well written and such a thoughtful meditation

41:10

on mental illness and the way we think about mental illness.

41:12

And previously I've recommended

41:15

Strangers to Ourselves by Rachel Aviv

41:17

and The Mind Fixers, which is

41:19

about psychopharmacology. And I think

41:22

this one is kind of nice because it's a

41:24

memoir and it has

41:26

a different kind of tone to

41:28

it, and it's written just so

41:30

beautifully. So The Best Minds by

41:32

Jonathan Rosen. It sounds wonderful, really

41:35

great. Is it science-based? It

41:37

does have science in the background. It even has the

41:39

healthcare system in the background, obviously. We

41:41

see how he navigates the healthcare system.

41:45

You don't want to read it to learn about schizophrenia,

41:47

but you want to read it just as a story

41:49

of mental illness and about that

41:51

fine line. And we all know people who

41:54

are on that line between genius and madness,

41:57

and it's so compelling and so...

42:00

Trenchant. You can't help but think this could happen

42:02

to any of us and it's very complex when

42:04

it does. Well, okay. What a recommendation. And what

42:06

do you have Felix? I'm in

42:08

a role. I recommend a

42:10

cop show, mostly thinking of you,

42:13

of course, and this week, again,

42:15

another cop show. Oh, my dreamy

42:17

outcome. Have you

42:19

seen Three Pines? I think

42:22

I've heard of it. I have not seen

42:24

it. It's really remarkable. Maybe

42:26

the most fascinating thing is

42:29

it takes place in French-speaking

42:31

Canada. Yeah. And the

42:34

context is Canada's treatment

42:38

of Indigenous people, Indigenous women

42:40

in particular. Uh-huh. So the

42:43

little town is close to

42:45

a school, a

42:47

home that mistreated

42:49

Indigenous children for a very

42:51

long time. There are

42:53

people living in the village who

42:55

went to that school and have

42:57

complicated memories about what happened. And

43:01

it's just a spectacular

43:03

way to show the

43:05

historical significance of those

43:08

relationships. You know

43:10

how sometimes you can feel you're

43:12

misusing that context to do something

43:14

bigger? Yeah. It never feels like

43:16

that. It feels very genuine. That's

43:18

great. The filmmaker is someone who's

43:20

a member of the Kainai First

43:23

Nation tribe, a person called Tailfeather.

43:25

And perhaps the

43:27

involvement of someone who's really close

43:29

to the phenomenon helped to

43:32

make it real authentic and to make

43:34

it feel like we're not just misusing

43:36

the context, but the combination as a

43:38

result is really powerful. So it's

43:40

a mini-series, eight episodes. Crimes are typically solved

43:43

across two episodes, which is also interesting. And

43:45

then there's a bigger story in the background.

43:47

That is fantastic. It's really super interesting to

43:49

watch. And it stars one of my favorite

43:52

actors, which is Alfred Molina. He's amazing. Oh,

43:54

yes. He's really amazing. And I'm just looking

43:56

at it here. By the way, I feel

43:58

compelled because I feel... like I'm losing my

44:01

status as the cop show guy. I'm

44:03

just going to mention Annika with Nicola Walker,

44:05

which is also fantastic. Anyway, I just feel

44:07

like I have to do that because I

44:10

feel now some competition with you on

44:12

the cop show. Now you've come through

44:14

with two very strong ones, Felix. I'll

44:16

retreat to my territory of making music

44:19

suggestions next week. No, well, I was

44:21

actually going to recommend a Turkish polka,

44:23

but maybe that's fine. And

44:26

this is it for tonight. Thank you

44:28

for listening. This was After Hours from

44:30

the Ted Audio Collective.