LIVESTREAM: A Former Fed Economist Reveals What's Really Happening, with Karsten Jeske (“Big ERN”)
#643: Picture this: you're at the Federal Reserve years ago. The chairman literally hangs up a conference call, waits 30 minutes, then calls back — suddenly everyone agrees on the rate decision.
That's the kind of insider story Karsten Jeske (“Big ERN”) shares when he joins us to break down what's happening with the economy right now.
Karsten worked at the Federal Reserve Bank of Atlanta for eight years, then spent a decade on Wall Street at Bank of New York Mellon.
Today he runs the popular Early Retirement Now website, where he applies his economist background to help people understand money and markets.
You'll hear Karsten explain why the Fed is about to start cutting interest rates. The futures markets are pricing in a 90 percent chance of a quarter-point cut, with more cuts likely through the end of the year.
But why? After all, inflation just ticked up in the latest CPI report, yet the Fed is still planning to lower rates.
We dive into how this affects real people. If you're thinking about buying or selling a house, Karsten suggests acting sooner rather than later.
He explains the "buy the rumor, sell the news" principle – the bond market may have already priced in the good news about rate cuts, so waiting might not help you.
The conversation covers some surprising economics too. Did you know that high interest rates can actually cause housing inflation?
When mortgage rates are expensive, fewer people build new homes, which drives up prices. It's the opposite of what most people think happens.
Karsten walks through the recent jobs report revisions that caught everyone off guard. The government had to subtract nearly a million jobs from their previous estimates. He explains how this happens – it's not that officials are making up numbers, but tracking new businesses is genuinely hard to do in real time.
You'll also learn about two Fed tools most people haven't heard of: the dot plot and R-star. The dot plot shows where Fed officials think interest rates should go over time. R-star represents the theoretical perfect interest rate when the economy has no problems — currently around 3 percent.
The interview wraps up with Carsten's take on Fed culture. The consensus-building era under Greenspan is giving way to more dissenting votes, which actually makes the central bank more like it was decades ago under Paul Volcker.
Enjoy!
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(0:00) Podcast introduction and guest background
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1:03:19
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1:03:19
BONUS: Stagflation, Stocks & Social Security - What’s Next for Your Money? with Rob Berger
EXCLUSIVE: Is your money safe in today’s economy? In this bonus interview, Paula Pant sits down with financial expert Rob Berger to unpack the latest on inflation, interest rates, market valuations, and the future of Social Security.
Together, Paula and Rob dive into the tough questions:
Is the American Dream dead for Gen Z?
Will there be another market crash?
How should you invest when stocks feel overpriced?
Can you still retire comfortably if Social Security gets cut?
Rob also shares his insights on asset allocation, diversification, and long-term investing strategies — advice that matters whether you’re in your 20s saving for a first home or in your 60s planning for retirement.
Don’t miss this conversation between Paula Pant and Rob Berger — a deep dive into money, markets, and the decisions that shape your financial future.
Timestamps:
(04:19) CPI Numbers, Mortgage Rates, and Market Outlook
(05:05) Inflation, Jobs & the Fed’s Dilemma
(05:46) Stagflation Concerns
(06:38) Interest Rate Predictions
(07:29) Stock Market Valuations & The Magnificent Seven
(09:46) Diversification & Index Fund Concerns
(10:53) Rules of Thumb for Asset Allocation
(12:07) Bonds: TIPS vs. Nominal Treasuries
(13:04) The Future of Social Security
(14:41) Retirement Planning for Ages 55–60
(16:59) Should You Invest More Aggressively Near Retirement?
(18:52) Gen Z, Millennials & the American Dream
(21:08) Action Plan for a 25-Year-Old Buyer
(22:45) Predictions for 2026 (and Why Predictions Fail)
(25:12) Closing Thoughts & Where to Find Rob Berger
Resources mentioned:
The Rob Berger Show on YouTube
Free Asset Location Cheat-Sheet
For more information, visit the show notes at https://affordanything.com/robbergerhttps://affordanything.com/robberger
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The Case for Investing in Individual Stocks, with Co-Founder of the Motley Fool, David Gardner
#642: Curious about how individual stock picking could sharpen your investing skills—even if you’re an avid index fund investor?
Paula sits down with David Gardner, co-founder of The Motley Fool and author of Rule Breaker Investing, to delve into the world of contrarian stock strategies and the mindset behind picking standout companies.
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic
advertising run times. The provided timestamps are approximate and may
be several minutes off due to changing ad lengths.
(0:00) Sports team investing analogy
(4:20) Individual stocks vs index funds
(7:12) Values-based investing approach
(13:16) Starbucks pick criteria
(13:28) Six rule breaker traits
(20:41) Why overvalued works
(26:44) Market timing philosophy
(32:20) Traditional metrics miss key factors
(39:18) When to sell stocks
(45:26) Winners vs losers math
(48:32) Portfolio allocation rules
(55:10) Sleep number concept
(1:00:00) Adding to winners strategy
(1:05:16) Evaluating unfamiliar companies
(1:09:15) Dot-com bubble lessons
(1:16:24) AI investing parallels
(1:20:18) Sports betting critique
Resource:
David Gardner's book: Rule Breaker Investing: How to Pick the Best Stocks of the Future and Build Lasting Wealth
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Q&A: ChatGPT Built Her $1.2M Portfolio … But Should You Trust It?
#641: Cristina has a $1.2 million portfolio and hopes to make work optional within the next decade. Is she invested in the right way? Or should she change up her asset allocation?
Anonymous and her husband plan to retire in 5 years. They have 10 rental properties and a $2.75 million portfolio. They dream of slow travel, generosity, and family time. How should they structure their assets to support the lifestyle they want?
Paula (the caller) and her husband are planning for three kids, private school, and possibly college down the road. Should they front-load a 529 plan with a large lump sum, or take a different approach?
Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.
Enjoy!
P.S. Got a question? Leave it here.
Resources mentioned in the show:
Interview with Frank Vasquez
Risk Parity Cheat Sheet
Caller Christina's original call on https://affordanything.com/episode463
Afford Anything Episode 618 https://affordanything.com/episode618
Risk Parity Portfolio Blueprint https://affordanything.com/riskparity
Joe's episode SB 1698 https://www.stackingbenjamins.com/create-your-retirement-spending-plan-1698/
Run The Line half marathon with Joe: https://runsignup.com/Race/TX/Texarkana/RuntheLineHalfMarathonTXAR
SavingForCollege.com
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(01:42) Christina
(16:42) Anonymous
(33:40) Paula the Caller
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57:44
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First Friday: Jerome Powell's Remarks at Jackson Hole
#640: The jobs report came out this morning and it was a painful one.
The US added only 22,000 new jobs in August, according to the latest BLS report.
And unemployment ticked up to 4.3%.
What does this mean?
Find out in today's First Friday episode!
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(01:48) ADP vs BLS Jobs Data
(04:33) Mortgage Rates & Their Impact on Homebuyers and Sellers
(11:30) Fed Chair Jerome Powell’s Remarks
(12:54) The Fed’s Dual Mandate Explained
(15:58) The Fed’s Changing Approach to Unemployment
(18:13) Implications: Rate Cuts on the Table
For more information, visit the show notes at https://affordanything.com/episode640
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You can afford anything, but not everything. We make daily decisions about how to spend money, time, energy, focus and attention – and ultimately, our life.
How do we make smarter decisions? How do we think from first principles?
On the surface, Afford Anything seems like a podcast about money and investing.
But under the hood, this is a show about how to think critically, recognize our behavioral blind spots, and make smarter choices. We’re into the psychology of money, and we love metacognition: thinking about how to think.
In some episodes, we interview world-class experts: professors, researchers, scientists, authors. In other episodes, we answer your questions, talking through decision-making frameworks and mental models.
Want to learn more? Download our free book, Escape, at http://affordanything.com/escape. Hosted by Paula Pant.
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