Man, sometimes it feels like the world is just
moving way too fast. Yeah. And it's almost impossible
to keep up with what's really important, you
know, without getting totally overwhelmed with
all the noise. Absolutely. That's why we're taking
a deep dive today. That's right. Into some really
key materials that we've gathered. Legal stuff,
some really interesting economic analysis from
the team over at KKR. And then also a briefing
document that kind of ties it all together. Yeah.
hopefully we can get a better sense of what's
actually going on. Exactly. We're going beyond
just like the headlines and the surface level
stuff. We're really gonna dig deep into some
of the big changes that we've seen lately in
the legal world, the economy, education, all
kind of as of late March 2025. And the goal is
really to connect the dots between these things
that might seem totally separate at first glance
and try to pull out the insights that are gonna
matter most for you guys. for you to really understand
what's happening right now and get ready for
some surprises along the way. OK, I love surprises.
Some little ha -ha moments. Some ha -ha moments,
OK? We should have a sound effect for that. Yeah,
we should. All right. Yeah, we'll get to those.
OK, let's unpack all of this. OK. Starting, I
guess, with the legal front, where things have
gotten pretty spicy recently, one case that really
stood out to me involves the Trump administration
and Judge James Bosberg. All right. And it's
about information related to flights to Venezuela.
And it seems like things have gotten really kind
of aggressive. Yeah, the thing that's so fascinating
here is just how openly the administration has
been defying a court order. Yeah. It's not even
just like, oh, they're slow rolling the information.
You know, they're like taking their time. The
language in their legal filings has been so...
so insulting towards the judge. Give me an example.
Like one of the things they said was it was a
Paclunian dispute over the micromanagement of
immaterial fact -finding. Wow. They accused the
judge of engaging in like unnecessary judicial
phishing expeditions. Okay, so really, really
disrespectful. It's wild. This is not the kind
of language you usually see in these documents.
Okay, so I'm guessing Judge Boesberg didn't just
let that go, right? What was his reaction? No,
not at all. He shot back pretty directly. Basically
said, the information you provided is woefully
insufficient and set a very hard deadline for
them to give him what he wants. Okay, so real
showdown brewing there. Yeah, absolutely. So
what are the consequences if they don't actually
meet those deadlines? Now, I know it can be tough
to hold a a former president directly in contempt,
what about his legal team, the people around
him? So this brings up the question of where
does the court's power actually reach? And like
you said, holding a former president in contempt
has its own complexities, which we don't need
to get into all of that. But their lawyers, the
people working for them, they are definitely
within the court's reach. Like retired federal
judge Shira Scheinlein has said, if they fail
to comply with these orders, if they provide
false information, they could be hit with criminal
contempt charges. Now whether that actually happens
is another question. Given who's running the
Justice Department right now, AG Pem Bondi, it
seems pretty unlikely. Okay, so criminal contempt's
maybe a long shot. What other options does Judge
Bosberg have then? Civil contempt is definitely
on the table. And that can get pretty serious.
That could mean jail time, which would definitely
get their attention. It could mean hefty fines
that could add up really quickly. And probably
the most like, professionally damaging thing
would be a referral to the bar for disciplinary
action. Right. So they could potentially lose
their law licenses. Oh, wow. And this is important.
Even a presidential pardon wouldn't protect them
from that. So a pardon wouldn't cover that? No,
a pardon wouldn't cover the loss of their bar
card. OK. So that's a pretty powerful tool. Wow.
I mean, it's kind of wild to see lawyers taking
these risks. Yeah, it's a big gamble for sure.
Yeah, it really shows you how high the stakes
are. Absolutely. On a kind of related note, Chief
Justice John Roberts actually made a really unusual
public statement recently that I thought was
pretty interesting. What's fascinating about
this is that Roberts almost never weighs in publicly
like this. Right. And he did it in response to
some Republicans calling for Boasberg to be impeached.
OK. So, you know, he put out this very short
two sentence statement and he said, for more
than two centuries, it has been established that
impeachment is not not an appropriate response
to disagreement concerning a judicial decision.
The normal appellate review process exists for
that purpose. That's a pretty clear message.
Yeah. No ambiguity there. No. He's defending
the courts. And this isn't the first time he's
done that, right? Not at all. He's been pretty
consistent in defending the independence of the
judiciary. Even going back to when Trump was
president, like in 2018, he issued a similar
warning. OK. So he clearly sees these attacks
on judges as a threat to the whole system. Yeah,
and it makes it even more interesting that Judge
Boesberg, I mean, he's kind of a weird target
for this kind of attack, isn't he? Totally. If
you look at his background, he's not some partisan
hack. Right. He was appointed by both Bush and
Obama. OK. Even Roberts has a lot of respect
for him. He's appointed him to a bunch of important
roles, like being the chief judge of the FISA
court. And get this, he was actually college
roommates with Brett Kavanaugh. Wow, okay. So
this is not some radical figure. He's a really
lousy target for the administration to go after.
It's almost like they only really care about
decisions that come straight from the Supreme
Court. Right, like that's the only court that
matters to them. probably because they think
they have that 6 -3 majority locked in. But they
might be miscalculating here, because if this
Boasberg case actually makes it to the Supreme
Court, there are at least a couple of those conservative
justices who have shown that they're not afraid
to go against the administration. Interesting.
So it might not be the slam dunk they're hoping
for. All right, well, let's shift gears a little
bit, but stay on the legal thing. There's this
whole situation with the Pol Weiss law firm.
Yeah. That honestly sounds like something out
of a movie. It's pretty wild. It's like a political
thriller or something. It really is. The administration
is basically targeting this law firm. Right.
Because one of their former partners, Mark Pomerantz,
was involved in some investigations related to
President Trump. Yeah, he was part of those investigations.
So what did they do? Like, how did they target
the firm? So they issued an executive order that
basically stripped the firm of its security clearances.
Wow. And that makes it incredibly difficult for
them to work on any federal cases or even interact
with federal government employees. So they're
basically shut out. Yeah, they're pretty much
frozen out. And it seems like this is about more
than just punishing this one firm. Oh, absolutely.
It sends a really chilling message to any organization
that might even think about investigating the
administration. Right, don't even think about
it. Or opposing them in any way. It's a huge
power play. So how did Paul Weiss respond to
this? Pretty intense pressure. Well, they basically
caved. OK. You know, they were facing huge pressure,
reportedly losing clients. Right. And they ended
up making a bunch of concessions. Like what?
So they formally apologized for Pomerance's wrongdoing.
Wow. They agreed to scrap their DEI efforts,
their diversity, equity, and inclusion programs.
And they promised to do $40 million worth of
pro bono legal work for the government. Oh, wow.
And I remember it was specifically pro bono work
related to combating anti -Semitism and assisting
veterans. But there's some real skepticism about
whether that anti -Semitism claim was genuine.
Oh, yeah, totally. I mean, if you look at the
administration's own history, there are connections
to some pretty questionable figures. The idea
that this was really about fighting anti -Semitism
just doesn't hold water. It seems much more like
they forced this concession out of the firm.
It's a pretty messed up situation. Yeah, one
of our sources said, the whole thing stinks to
high heaven. I can see why they would say that.
You know, it's setting a dangerous precedent.
Right. Can you hold a law firm responsible for
what a former partner does? Right. And can the
president really use executive power to extract
these kinds of concessions? Yeah, it's pretty
worried. It is. But the thing is, even if some
of those provisions are legally dubious, challenging
them in court takes a a lot of time and money,
and that's probably what the administration's
counting on. Wear them down. Exactly. And it
sounds like Paul Weiss might not be the only
firm facing this kind of pressure. Unfortunately,
no. There are rumors that other firms are in
the administration's sights. Hm. That's not a
good trend. No, not at all. It's pretty concerning
for the legal profession as a whole. Yeah. OK.
Well, on a slightly lighter note, there's this
Schadenfreude story this week that I just had
to share. Oh, yeah. This is a good one. It's
just too perfect. It really is. So this Minnesota
state senator, Justin Eichhorn, he actually introduced
a bill to try to classify what he called Trump
derangement syndrome as a mental illness. You
can't make this stuff up. I know, right? Too
good. And he defined it as, like, an acute onset
of paranoia in reaction to the policies and presidencies
of President Donald J. Trump. Wow. So anyone
who disagrees with Trump is basically mentally
ill? That's the gist of it, yeah. OK. But. Here's
the best part. What happened? So shortly after
introducing this bill, Senator Eichhorn, who
is a married father of four. Oh, wow. He gets
caught up in this whole, like, online solicitation
thing. Oh, no. But he's messaging someone he
thinks is a 17 -year -old girl. Oh, dear. Sending
messages like, chance you are still available
tonight. And what's a guy got to do to get with
the hottest girl online tonight? Oh, my. Of course,
it turns out it's an undercover police detective.
Classic. So he shows up for the meeting with
with like $129 in a condom. Oh no. And he gets
busted. Wow. Arrested for soliciting a minor.
So what happened to him? Well, he immediately
resigned from the state Senate. OK. And reportedly,
his wife is planning to file for divorce. Talk
about a fall from grace. Yeah, it's pretty, pretty
wild. That's comma for you. Yeah, I guess so.
All right. Well, let's move on to the economy.
Yeah, let's talk money, money, money, money.
So we've got this analysis from KKR about the
March 2025 FOMC meeting. That's the Federal Open
Market Committee. Right, the Fed. Yeah, the Fed.
And it seems like they're painting a pretty complicated
picture. Yeah, things are definitely getting
interesting. So what did the Fed actually do
at this meeting? Okay, so the big decision was
they kept interest rates unchanged, which everyone
was expecting, but they did announce a pretty
big slowdown in the pace of quantitative tightening.
Okay, and for our listeners who might not be
total economics nerds, can you explain what quantitative
tightening actually is? Sure, so basically it's
like the opposite of quantitative easing, which
is what the Fed did during those crisis periods.
They pumped a ton of money into the economy.
Quantitative tightening is when they start pulling
their money back out. OK, so they're slowing
down that process. Right. They reduced it from
$25 billion per month down to just $5 billion
per month starting in April. And that's a bigger
and earlier reduction than a lot of people, including
KKR, were expecting. Interesting. So what about
the Fed's overall assessment of the economy?
It sounds like they've changed their tune a bit.
Yeah, they've definitely adjusted their forecasts.
So they put out these projections. It's called
the dot clot, which basically shows where each
Fed official thinks the economy's headed. Right.
And they've downgraded their expectations for
economic growth in both 2025 and 2026. So they're
expecting slower growth. Right, slower growth.
But at the same time, they've actually raised
their inflation forecasts for those same years.
So slower growth and higher inflation. That's
the picture they're painting. But they're still
predicting two interest rate cuts in both of
those years. Yeah, that's the thing. It seems
a little contradictory. It does, right? And that's
exactly what KKR pointed out in their analysis.
They think this shows that the Fed is more worried
about growth slowing down too much than they
are about inflation getting out of control. Interesting.
And this fits with their bigger regime change
thesis. Which is? Basically, they think the fundamental
drivers of the economy are shifting and that
we're going to need lower interest rates in the
long run. Okay, so it sounds like those trade
disputes and the tariffs are playing a big role
in this economic picture. Oh, for sure. Yeah.
Powell himself, the Fed chair, you know, he acknowledged
that people are really worried about the economy,
especially because of the ongoing trade war.
Right. And he even used the word transitory.
Okay. When he was talking about inflation caused
by tariffs. Now that word transitory, that's
a bit loaded, isn't it? It is, especially for
the Fed. After all that inflation we saw back
in 2021 to 2023. Yeah, they kept saying it was
transitory back then. Exactly, not really. So
KKR thinks that Powell, using that word now,
means the Fed is pretty confident they can handle
whatever inflation comes from these tariffs.
OK, so they think they've got it under control.
That's what it seems like. And KKR has some specific
projections about how those tariffs are going
to hit US growth, right? They do. They're forecasting
a drag of about 0 .8 percentage points, or 80
% basis points if you're into the financial jargon
on US economic growth this year. And they say
that's directly because of those tariffs. And
how high do they think those tariffs are going
to get? They're expecting them to average around
11%. OK, that's significant. Yeah, it's a pretty
big hit. And they also say April 2 is a key date
to watch. OK, why is that? Because that's when
the administration might announce even more tariffs.
So things could actually get worse. Potentially,
yeah. But here's the interesting thing. KKR also
suggests that these same policies might actually
create opportunities in other parts of the world.
Right. It's kind of a weird silver lining. So
they're talking about a structural opportunity
emerging outside of the U .S. OK. And that's
because of those U .S. tariffs and because Europe
and China are responding differently. So how
are they responding differently? Well, they're
both putting in place new fiscal stimulus measures
while the U .S. is basically tightening its economic
policy. So it's kind of like they're going in
in opposite directions. Exactly. And KKR also
expects the US dollar to keep weakening. OK,
interesting. So what's the big economic indicator
that KKR is watching right now? What are they
really focused on? Productivity. They're specifically
looking at the data for the first quarter of
this year, which comes out in late April. And
they think if productivity takes a hit, that's
going to put a lot of pressure on the Fed to
cut interest rates. And it could also be bad
news for the stock market. OK, so productivity
is the key thing to watch. That's the one. All
right, well, let's move on from money to education.
OK. And it sounds like the Trump administration
is being super aggressive here. Yeah, they're
really shaking things up. Really trying to reshape
the whole higher education system. Yeah, they're
coming at it from all angles. So let's start
with those defunding efforts. OK. You've seen
some pretty huge numbers being thrown around.
Oh, yeah, some really big cuts. Like, what are
some examples? Well, Columbia University reportedly
had about 400 million in federal grants and contracts
canceled. And the administration said it was
because they weren't doing enough to fight anti
-Semitism on campus. And then you've got the
University of Pennsylvania. They lost $175 million,
supposedly because of their policies on transgender
athletes. OK, so those are two pretty big examples.
Yeah, those are just the tip of the iceberg,
though. Really? Yeah, there are a bunch of other
universities under investigation right now. Oh,
wow. For similar stuff, you know, not dealing
with anti -Semitism or having controversial diversity
programs and affirmative action policies. OK,
and what about that USAID stuff? Oh, yeah, the
United States Agency for International Right,
USA. So they've basically been gutted. OK. And
that's reportedly cost Johns Hopkins University
something like $800 million. Wow. In existing
contracts, which has led to a ton of layoffs.
Oh, wow. It's been a big blow. OK, so legally
speaking, these defunding moves seem pretty shaky,
right? Yeah, a lot of legal experts are saying
that they're saying it could be a breach of contract
by the government. OK. And that they're not following
the proper procedures for cutting off funding.
Right, because normally there's a whole process.
for that exactly the argument is that the president
can't just unilaterally cancel these agreements
right just because he doesn't like what a university
is doing so it's not as simple as him just saying
I don't like you no more money right it's not
that easy okay Donna Lieberman from the NYCLU,
the New York Civil Liberties Union, she called
it an unconstitutional attempt to censor speech.
Wow. But even if the universities have a strong
legal case, going up against the federal government
in court is a long and expensive battle. Right.
And who knows what kind of judge you're going
to get. Exactly. You could end up with a Trump
appointee. So that's a big risk for these universities.
Yeah. It's a tough spot for them. It really is.
And we've seen some really different responses
from different universities. Columbia and Georgetown
come to mind? Yeah, those are two good examples.
So how did they handle this pressure? Well, Columbia
basically surrendered. People have called it
utterly humiliating. They agreed to all sorts
of demands. Like what? Give me some specifics.
Well, they're going to discipline students who
were involved in those pro -Palestinian protests.
They're adopting a very specific definition of
anti -Semitism, which could be seen as pretty
limiting. They're overhauling their admissions
policies. They're basically putting their Middle
East studies departments under academic receivership.
So they're losing control of those departments.
Pretty much, yeah. Wow. They're increasing the
presence of police on campus, giving them more
authority. And they're even banning masks on
campus, unless you have ID. Wow. That's a lot
of concessions. It's a pretty comprehensive surrender.
OK, so what about Georgetown? What do they do?
Well, Georgetown Law, under Dean William Tremer,
they put up a much stronger They were facing
pressure from the acting U .S. attorney to get
rid of their DEI initiatives, their diversity,
equity, and inclusion programs. And Trier basically
said, no way. Okay, so how did he justify that?
What were his arguments? So he really emphasized
the idea of academic freedom. saying that the
government can't tell universities what to teach,
and he cited the First Amendment. Okay, so free
speech arguments. Exactly. He also pointed out
how ironic it was. that a Catholic official was
threatening Georgetown. Right, because Georgetown
is a Jesuit institution. Exactly. You know, their
whole identity is built on this idea of open
dialogue and intellectual inquiry. And he also
demanded guarantees that Georgetown faculty and
staff wouldn't be discriminated against in hiring.
So it was a really strong defense of the university's
autonomy. So they stood their ground? They did.
Okay, so in addition to the defunding stuff,
there are also reports that the administration
is targeting foreign -born students and faculty.
Yeah, that's a really worrying trend. Yeah, it
seems like it could have some pretty big long
-term consequences. Oh, absolutely. For universities.
Yeah, it could really hurt their ability to attract
global talent. Right. We've seen multiple cases
of foreign students and faculty at places like
Columbia, Brown, Georgetown being detained or
even deported. Wow. And the administration's
rhetoric is really disturbing. Give me an example.
They're using terms like terrorists, gang members,
invaders. Wow. Okay. It's very dehumanizing.
Yeah, that's pretty extreme. It is. And it's
creating this climate of fear. Right. On campuses,
some universities in California are even holding
training sessions to teach students and faculty
what to do if ICE agents show up. Oh, wow. So
they're preparing for that. Yeah, it's getting
pretty serious. It's a pretty sad state of affairs.
It is. Okay. So on top of all that, there's this
report that the administration is actually trying
to dismantle of the Department of Education.
I know, it's crazy, right? It's a huge move.
It is. So how would they even go about doing
that? Well, Trump apparently signed an executive
order. OK. Telling the Secretary of Education
to start shutting the department down. OK. And
giving control of education back to the states.
Right. Now, to actually abolish a federal agency,
you need Congress to sign off on it. OK. But
the administration's plan seems to be to just
make the department non -functional. OK, so starved
of resources. Exactly. Through executive actions
and budget cuts. And what kind of impact could
that have? Well, it could really change the way
education is run in this country. Right. Less
federal oversight, less federal funding. Yeah,
it's a big shift. It is. But it could also backfire
politically. OK. You know, it could be a big
issue for Democrats in the next election. Right.
They could use it against the administration.
Exactly. Now, the administration often tries
to justify these actions, especially the ones
targeting universities, by saying it's all about
fighting anti -Semitism. Right. That's their
go -to line. But it doesn't seem like that's
the whole story, does it? No, it feels pretty
disingenuous. Yeah. I mean, there's been a lot
of criticism of that claim. Oh, yeah. One of
our sources put it perfectly. They quoted Gary
Cooper and said, it's so phony. Nobody believes
it. I mean, that's pretty blunt. Yeah, but it's
true. OK, so if it's not really about anti -Semitism,
what is it actually about then? Well, it seems
like it's part of these broader culture wars.
OK. You know, there's a deep resentment of universities
within the Republican Party. They see them as
these bastions of liberalism. And there's also
resentment from voters who didn't go to college.
Right. They feel like these universities are
out of touch. Yeah. And then you've got the fact
that universities teach critical thinking. They
expose students to different perspectives. And
that often clashes with the MAGA worldview. Yeah,
so they're seen as a threat. Exactly. One commentator
said, it's not really fighting anti -Semitism
V1 .0. It's more like culture wars, V by 4553
by 96. So it's just the latest iteration? Yeah,
it's the same old fight, just a new battleground.
And there could even be national security implications
here, right? Oh yeah, potentially big ones. Like
what? Well, if you weaken American universities,
you're basically shooting yourself in the foot.
You're making it harder to educate the best and
brightest, to do cutting -edge research, and
that could ultimately make the U .S. less competitive
globally. Especially against countries like China.
Exactly. They're the ones who stand to benefit.
Okay, so amidst all this pretty heavy stuff.
Yeah. There was one little story of Froudenfreude
that I wanted to share. Oh yeah, the fish doorbell.
Yes, tell me about this. This is such a cool
story. Okay. So in Utrecht, in the Netherlands,
they had this problem with fish. Okay. They couldn't
get through this lock on the canal. Right. During
their spawning season. So they could reproduce.
Exactly. Okay, so what did they do? I'm guessing
they didn't just like ignore the problem? No,
they came up with this brilliant solution. They
set up a website with a live underwater webcam.
So you can see the fish? Yeah, you can see the
fish swimming around. And then there's this button
that anyone in the world can click to let the
lock keeper know that there are fish waiting
to go through. So basically a doorbell for fish.
Exactly, a fish doorbell. That's awesome. It's
so cool and it's been super successful. Really?
Yeah, millions of people have used it.