27. Are Tariffs About to Disappear? The Economic Signals to Watch

Hunter Craig sits down with Professor Edwin T. Burton of the University of Virginia to break down the most pressing economic issues of the moment: the Federal Reserve’s upcoming meeting, the meaning behind falling short-term rates and stubborn long-term rates, the fragility of today’s housing market, and whether the U.S. has already slipped into a debt spiral.

Professor Burton also uncovers what’s really happening with global currency dynamics, the potential end of the current tariff regime, and the likely trajectory of inflation in 2026. The episode closes with a frank look at artificial intelligence — what AI is genuinely good at, what’s overpromised, and whether the massive capital pouring into AI represents a bubble.

If you’re trying to understand inflation, interest rates, tariffs, national debt, or how AI fits into the bigger economic picture, this episode offers rare clarity.

Episode Breakdown

The Fed’s Next Move

• Why falling two-month Treasury yields reveal the Fed’s likely rate decision
• How recent money-supply actions signal a shift in policy
• Why mortgage rates remain elevated despite easing in short-term yields

Housing Market Pressures

• Why supply remains artificially constrained
• When homeowners may begin listing again
• Expectation for national home-price behavior over the next few years

The U.S. Debt Spiral

• Why both spending and taxation have reached political limits
• How U.S. debt compares to historical sustainability thresholds
• Why entitlement structures create long-term structural pressure

Global Currency and Trade Dynamics

• The declining share of global payments conducted in dollars
• How tariffs have strained relationships with European and Asian partners
• Why political and legal pressures may force a shift in U.S. tariff policy

Artificial Intelligence: Hype and Reality

• What AI is truly good at — and where its abilities plateau
• Why AI won’t replace scientific intuition or discovery
• How overinvestment could trigger the next tech-sector correction
• Whether the S&P 500 would look dramatically different without AI enthusiasm

Investor Takeaways

• Why staying in broad index funds remains a sound long-run strategy
• What rising consumer weakness means for the next two years
• How to think about volatility ahead

Professor Edwin T. Burton has been a cornerstone of the University of Virginia’s Department of Economics since 1988, where he has taught more third- and fourth-year students than anyone in the department’s history. A graduate of Rice University and Northwestern University, he brings both academic rigor and real-world fluency to the study of financial markets, behavioral finance, and monetary policy.

Widely known for making complex economic ideas accessible, Professor Burton’s classes at UVA have launched generations of students into careers in finance, analytics, and policy. His dedication to mentorship runs so deep that the department’s undergraduate career office was renamed the Edwin T. Burton Economics Career Office in his honor — a testament to the impact he’s had on thousands of young economists.

Beyond the classroom, Professor Burton is a sought-after commentator on issues like inflation, tariffs, and global debt dynamics, helping audiences understand how large-scale economic forces shape everyday financial realities. His mix of clarity, candor, and grounded insight makes him a trusted guide through the noise of economic news — and an ideal guest for conversations that ask what today’s headlines really mean for investors.

 

Disclaimer

The information provided on this podcast is for educational and informational purposes only. It is not intended as financial advice and should not be relied upon as such. All opinions expressed by the hosts, guests, or participants are solely their own and do not reflect the views of any companies or organizations they may be affiliated with. We recommend that you consult with a qualified financial professional before making any financial decisions. Remember, investing and financial decisions carry risks, and it is important to do your own research.