Pivot · May 10, 2022

Market Madness, The Latest on Roe, and Guest Kirsten Grind

Automatic transcript of the end of the episode, from 50:38. Speakers are labeled by software and may contain errors. Highlighted passages are Scott’s predictions.

Guest · 50:38 Addict. So one of the things that we really tried to get to the bottom of is the role of his family there, which I think had been sort of embellished along the way. Kara Swisher · 50:47 Yeah. Meaning embellished that they tried to help him or embellished that they Guest · 50:51 That that his brother was, like, out to get him. I mean, I don't think his brother was, like, quote, unquote, out to get him. Right? I think his brother was, like, a lot of people around him dealing with a mentally ill addict. Kara Swisher · 51:04 With enormous money and enormously... I agree with you on the... On your question, Scott. It made me think about it. He was, compared to a lot of these people, quite earnest. You know what I mean? Like, it wasn't all bullshit with this guy. He really was seek... He was a seeker. And so may... That's why it was tragic is because so many of the others are so malevolent, and he just wasn't. He just wasn't. He was a sweet man. He was a sweet man. Guest · 51:29 And, you know, it's funny because a lot of my work, I'm dealing with people who I don't find that nice and sweet, and it took me a while. I I really spent a lot of time asking people, is this... Was this for real? Like, was this workplace culture for real? Was this happiness mantra for real? And I I actually think it really was for a lot of years, which is quite an accomplishment. Kara Swisher · 51:52 He did. Was also weird at the time. It was weird at the time. Trust... I spent a lot of time at Zappos, and it was weird. It was odd. Guest · 51:59 I bet. Kara Swisher · 51:59 And I was I was the malevolent person there. I remember, you're so unhappy, Cara. I'm like, no. No. I don't have to say I'm happy. Guest · 52:06 I'm just realistic. Well, you you had this really interesting interview. I don't know if you remember with him where you... Someone in the audience asked him, I'm really shy. I don't know what to do if I'm speaking, you know, publicly. What should I do, Tony? What's your advice? And Tony doesn't answer for a long time, and then he says, drink alcohol. And I was like, now there there is maybe a warning sign that you could have overlooked. Right? I mean, what advice is that? Like, drink? Kara Swisher · 52:38 Yeah. He was fine for a while, and then it it escalated. I saw him play poker a whole bunch of times, and he had a a special liquor he drank and a lot of it. Like, a lot of it became Guest · 52:48 The Fernat. Kara Swisher · 52:49 Yes. That's right. Yes. That's right. He had someone pour it for him. It was very odd. Anyway, separately, talking about other stories, you're the lead reporter at the Wall Street Journal's Activision Blizzard investigation into sexual harassment and the role of Bobby Kodak, and you reported on Sheryl Sandberg's pressuring the Daily Mail to drop reporting on Kotick's misconduct. Will anything come of the investigation Meta is supposedly doing in that situation? Eventually, by the way, this will... Microsoft will take over this company, and presumably, all of the issues will be... Microsoft has its own history of sexual harassment problems, but they do know how to deal with it. So can you... Where is it right now? Where... Especially around Meta? Guest · 53:24 In terms of Meta, that's a good question. I mean, we we sort of have our eye on what's going on there. They were kind of narrowly looking at how Cheryl handled this whole situation with the Daily Mail. Kara Swisher · 53:37 And this is the issue of her using Facebook resources to do so. She has her own PR people from what I recall. I haven't talked to her in years. But... Guest · 53:45 Yeah. Exactly. It's whether she used Facebook resources specifically in her outreach to the Daily Mail kind of on behalf of Bobby Kotick and his restraining order allegations exactly. But we... It's it's unclear what... I don't know what's gonna happen next there. I think that just came out recently, so we're still looking Kara Swisher · 54:06 into it. Right. That's so odd. She has her own people. Because I thought that was... That that would be a real mistake on her part. Go ahead, Scott Galloway · 54:13 that this is anything... I'm cynical. My assumption is that friends and... Friends are always trying to help powerful people, other powerful friends, and and that this is not unusual. This comes across especially cynic... Especially cynical for someone who's tried to position themselves as a champion for for women. But it it it... Did anything really unusual happen here? Guest · 54:34 That's that's right. That's exactly right. We all kind of just viewed it as an interesting view, albeit a detailed one, into people potentially abusing their positions of power. Right? And I completely agree with you. I don't have, like, the evidence, but I'm quite sure this happens all Kara Swisher · 54:53 the time. Everyone's gotten a call from Cheryl. Let's just say. Right. They've gotten, hey, girl. No. No. Scott Galloway · 55:01 Congratulations. I'm gonna give you the other side of this story here. I mean, I... You can just see how Kara Swisher · 55:06 What happens to the acquisition, though? What what... It's it's going... But I've talked to Microsoft people recently about this, and they feel like they're just sort of moving through it, just, like, trying to get everything done. Guest · 55:17 It's interesting. It's sort of like... I get asked that almost every day by an editor what's happening with the acquisition. But it's just, you know, the problems continue to strangely keep piling up on the Activision side. So they have this SEC investigation that is very much still underway. Kara Swisher · 55:35 Explain that. This is David Geffen and Barry Dillard. Correct? Guest · 55:38 No. That's actually a separate one. So this this first one is actually about how CEO Bobby Kotick and the board handled these sexual harassment claims over the years. Then the Barry Diller one is separate. That's a DOJ investigation into potential insider trading. And we recently reported that Activision and Bobby Kotick has been pulled into that one as well. So they... And that's, of course, separate from the Sheryl Sandberg thing. There's a whole separate issue going on with the state investigation into Activision. So, you know, these problems, they're still ongoing, but Microsoft is buying them. So I I would be shocked if anything derailed that acquisition, to be honest. Kara Swisher · 56:26 Still undergoing federal government, Guest · 56:28 looking Yeah. It's it's going... Undergoing the FTC review. It should close next year. Really, this is just... To be honest, like, it doesn't look good reputationally for Bobby Kotick or those Activision board members, but will it derail the actual deal? I think it would have to be pretty big. Kara Swisher · 56:47 It's a good outcome for them, and for micro... It's important for Microsoft, which is interesting. In any case, everybody should read this book. Kirsten Grind is... Works at the Wall Street Journal. She's a coauthor, and your coauthor's name is, who is that? Guest · 57:00 Katherine Sayer, and she covers gambling in Las Vegas for us here Kara Swisher · 57:04 at The It's called Happy at Any Cost. And I know, Scott, I get your point, Scott, but it's a really... This guy was unusual, and and it was really tragic. So everybody should read it. It's a really interesting book. You you captured him rather well, I thought, of someone who knew... Spent a lot of time with him. Thank you so much. Thank you so much, Kirsten. Scott Galloway · 57:22 Nice to meet you, Kirsten. Thanks for your good work. Guest · 57:24 Thank you. Very nice to meet you guys. Kara Swisher · 57:26 Alright, Scott. That was a great question, Scott. I hadn't really thought of it that way because I knew him so well. But one more quick break. We'll be back for predictions. [Ad break] — Predictions segment begins — Kara Swisher · 59:12 Okay, Scott. Let's hear some predictions from me. You've made several in the show already, and and let's think... Let me make a happy prediction because life feels a little down right now. Scott Galloway · 59:20 You're talking to the wrong Kara Swisher · 59:22 guy. I thought so. Scott Galloway · 59:25 You're talking to a guy who woke up on Sunday and thought, you know, is it a bad sign we're not gonna have a great Mother's Day when I'm in a gas station thinking, do they have Mother's Day cards? Know you're just in for a rough day when you're Kara Swisher · 59:37 didn't get mine from you yet, Scott Galloway · 59:38 but I'm waiting Kara Swisher · 59:39 up. Okay, you got me the Scott Galloway · 59:40 green Oh, you juice, so you're get 78. You're literally, I mean, you got enough. That's like, that's... Anyways, you're gonna be... If you move to Japan, you're gonna be the wealthiest woman in the world. Aren't they all supposed to support you when you get older? Anyway, Kara Swisher · 59:52 I Let think that was supposed to me just say, all I did was kid stuff all day. So it was mother works day. Scott Galloway · 59:57 My prediction is not good. You can see you can see how you fall into this trap of playing up or down stories because of personal relationships. Like, I just find it fascinating that all of these libertarians who are investing in or taking over Twitter are so critical of Twitter, but Jack's okay. Jack's one of us. Yeah. It's like, no. Kara Swisher · 1:00:20 Agreed. Come on. Agreed. Scott Galloway · 1:00:22 If if you're looking for a culprit here, this thing was a fucking disaster under... And you Kara Swisher · 1:00:27 can Under Jack. Scott Galloway · 1:00:28 Under Jack. And you can Kara Swisher · 1:00:30 Yep. Scott Galloway · 1:00:30 You can blame the board, but, fine. He was the CEO or the co co co CEO. But Yep. I I I know this kid in the buy now, pay later sector, and he's just the most likable, decent, earnest kid, and he's Mhmm. And I'm... I find that when I write about buy now, pay later, I find myself being reserved. And here's here's the prediction of what I actually think. This thing is a fucking shit show. Buy now, pay later is the equivalent of the subprime crisis brewing for millennials and Gen z. And in California, 9 out of $10 of all consumer loans issued in 2020 were buy now, pay later loans. Gen z consumers have spent 925% more through point of sale services than in January 2020 because they walk up, inner free people going to Coachella, and they say, are you sure you only wanna buy a $40 outfit? You can buy a $400 outfit, and there's no credit check right now. And like all of these things, there's mendacious societal impact. 28% of black and Hispanic Americans signed up for at least one point of sale loan in January 2022 compared with 14% of white Americans. And a lot of people on both sides will say, it's not fair of you to infantilize certain segments. But the reality is young men and women of color are getting into more and more debt because of BNPL. And I find this is going to be very scary. And then you have forty three percent of Gen Z users have missed at least one BNPL payment. And then we have consumer debt levels for March 2022 climb by $53,000,000,000 an annual increase of 14% seasonally adjusted, which I think is the largest increase on record. Yes. Revolve Kara Swisher · 1:02:12 Not a surprise post pandemic, though, but go ahead. Scott Galloway · 1:02:15 And revolving credit, which includes credit cards, surged by 22%. So... And then you have... There's the younger cohort, which is really getting whacked by inflation cause their wages have gone up and the media goes crazy. But the cost of their core goods, services gone up, their purchasing power has gone down. So you have this perfect storm of bad things. And then you have some moral hazard, and that is we gave away too much money, and people will always think that that's going to last forever. And two, people get angry at me for this. I think this indecision around student loan forgiveness is really bad because young people haven't had to pay their student loans for the last couple of years, and they're under the false notion and maybe it's not false, that it's all gonna be wiped out, which I think is a really bad thing. So you have this perfect storm of a debt crisis looming for young people. Kara Swisher · 1:03:03 And then I won't have to deal with that. By the way, you're gonna have to deal with that, kids. Scott Galloway · 1:03:06 Called debt. Kara Swisher · 1:03:07 It's not passing. Guest · 1:03:08 It's called Kara Swisher · 1:03:08 debt for Scott Galloway · 1:03:09 a reason. Kara Swisher · 1:03:09 It may be wrong way to do it. It may... Maybe we should reform our educational system, but you're gonna have to pay Scott Galloway · 1:03:14 them. Well, here's the thing. Here's the solution. I'm trying to be more thoughtful about offering a solution. Okay. There was an interesting tweet, and it said, should we be teaching calculus to eleventh graders when they don't have basic financial literacy? And I think that if there was one piece of the curriculum I would wanna see changed in high schools and even in junior high schools, we have to give young men and women some basic training in financial literacy. What is debt? What are interest rates? What are the stock and bond market movements? What does it mean for you? Living below your means, diversifying. Kara Swisher · 1:03:47 I would agree. I I oddly enough, I just spent a lot of time with one of my sons talking about this, like, going through everything, explaining, you know, he lost his bank card. I know. And I use this as an opportunity to discuss everything, and it was really helpful. And I was like, don't they teach you this in school? And of course, they didn't teach me in school. You just learn it. But you're right. A 100%. That's a great idea. Scott Galloway · 1:04:07 So I I think my prediction is you're gonna hear a lot more about buy now, pay later credit in this credit bubble that is a function of a lot of things, including moral hazard of this holding out this notion that if you take out if you're a student and you're about to sign up to take $100,000 out so you can go to get some Joey Bag of Donuts degree, are you more or less inclined to take out that debt if all debt gets wiped away right now? Why not? It might get wiped away again. So we are... We have a debt crisis brewing that's enormous in size. That's my prediction. Kara Swisher · 1:04:42 Big one. Alright. The Pied Piper is coming for you. Okay, Scott. That's the depressing frigging show. I'm making a prediction. I'm going to see Top Gun early because I'm interviewing You Scott Galloway · 1:04:51 are Top Gun. Kara Swisher · 1:04:51 One of the producers. Scott Galloway · 1:04:52 You are. Kara Swisher · 1:04:53 Top Gun two. Scott Galloway · 1:04:54 Nice. Kara Swisher · 1:04:54 It's gonna be happy. Everything is gonna be good. There's a lot of playing bass... Volleyball on a beach with with oiled men. It's gonna be fantastic. That's all I have to say. That is my happy place. Anyway, we'll be back on Friday for more. Please read us out. — Predictions segment ends — Scott Galloway · 1:05:08 Today's show is produced by Lara Nayman, Evan Engel, and Taylor Griffin. Ernie Interdott engineered this episode. Thanks also to Drew Burrows and Mille Silverio. Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to Pivot from New York Magazine and Vox Media. We'll be back later this week for another breakdown of all things tech and business. You looking to feel more upbeat? Two words. First, oiled. Second, men. Kara Swisher · 1:05:30 Also, you, Drew.

Didn’t happen

Resolved May 10, 2023 · 12 months after it aired

Pivot #301 · Aired May 10, 2022

Buy-now-pay-later lending will cause a debt crisis for millennials and Gen Z comparable in severity to the subprime mortgage crisis.

Buy Now, Pay Later: Recent Developments and Implicationsrichmondfed.org

4 more sources

How we graded it

Counts as true if: Widespread reporting or data showing a BNPL-driven debt crisis (rising defaults, delinquencies, regulatory action) among millennials and Gen Z comparable to the subprime mortgage crisis narrative.

By the stated resolution window (May 2023) and through 2026, BNPL default and charge-off rates have stayed in the low single digits (CFPB: 2.63% in 2022, 1.83% in 2023), far below the systemic failure rates of the 2007-2008 subprime mortgage crisis that triggered bank collapses like Lehman Brothers. Industry analysts and Fed researchers explicitly rejected the 'subprime 2.0' framing, and regulators actually loosened BNPL oversight rather than cracking down on a crisis, with the CFPB withdrawing its 2024 interpretive rule in 2025. While rising delinquencies among younger borrowers is a real, documented trend, no credible data source or regulator found a debt crisis comparable in severity to the subprime mortgage crisis.

Researched and graded by AI on Oct 13, 2026

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