Armchair Expert with Dax Shepard

Andrew Ross Sorkin (on stock market crashes)

November 19, 2025

Key Takeaways Copied to clipboard!

  • Andrew Ross Sorkin's early career was marked by an aggressive pursuit of journalism, culminating in an unofficial internship at *The New York Times* after starting his own high school advertising-supported magazine. 
  • The cultural shift that made debt acceptable to the general public, starting with consumer goods like cars (pioneered by General Motors), eventually extended to stock market speculation, a dynamic Sorkin sees paralleled in modern crypto markets. 
  • Despite the popular perception of widespread financial suicides following the 1929 crash, official statistics suggest fewer suicides occurred in 1929 than in 1928, though the event deeply scarred a generation against stock ownership. 
  • The Federal Reserve in 1929 was hesitant to take substantive action to curb the crash due to fears of political backlash and losing funding, contrasting with Ben Bernanke's decisive actions in 2008. 
  • The public response to the 1929 crash involved a high degree of personal responsibility, with many blaming themselves, which differs from the tendency to blame external factors seen after the 2008 crisis. 
  • Current trends, such as the passage of the 'Genius Act' allowing less transparent private market assets into retirement funds and proposals to reduce quarterly earnings disclosures, mirror the deregulation and lack of transparency that preceded the 1929 crash. 
  • Victories achieved as the underdog feel significantly better than those achieved when expected to win, as illustrated by a discussion comparing baseball playoff wins. 
  • The conversation briefly shifts to an intense discussion about a specific World Series Game 7 moment involving a pitcher and a Canadian batter, highlighting the host's emotional investment in winning. 
  • The hosts discuss the captivating and raw honesty of Shia LaBeouf's interview on John Bernthal's podcast, noting LaBeouf's public ownership of his past abusive behavior. 
  • The host expresses cognitive dissonance over misremembering when he watched the movie *Too Big to Fail*, leading to a brief, agitated debate about the difficulty of UCLA versus UGA degrees. 

Segments

Guest Introduction and Praise
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(00:00:13)
  • Key Takeaway: Andrew Ross Sorkin is introduced as the author of 1929: The Inside Story of the Greatest Crash in Wall Street History and co-creator of Billions.
  • Summary: Andrew Ross Sorkin is an award-winning journalist for the New York Times and co-anchor of CNBC’s Squawk Box. He previously wrote the popular book Too Big to Fail, which was adapted into an HBO show. His new book focuses on the 1929 stock market crash, suggesting most people only know the surface details of the event.
Early Life Anecdotes
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(00:01:35)
  • Key Takeaway: Dax Shepard recalls winning a cherry seed spitting contest in Traverse City, Michigan, during seventh grade.
  • Summary: The hosts briefly discuss podcast merchandise featuring cherries, which prompts Dax Shepard to recall winning a cherry seed spitting contest in Traverse City, Michigan, during seventh grade. This memory was significant enough that he appeared on the news at the time.
Coloboma and Childhood Insults
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(00:04:26)
  • Key Takeaway: Andrew Ross Sorkin has a coloboma in his eye, a feature that some people notice immediately while others miss it for decades.
  • Summary: Dax Shepard noticed Sorkin’s coloboma, an eye feature that sometimes leads strangers to express concern about his vision. Sorkin shared a story about a substitute teacher who sent him to the nurse after he joked about his eye, and recalled a third-grade classmate telling him God drew him wrong.
Sorkin/Sorkin Confusion and The Newsroom
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(00:08:43)
  • Key Takeaway: Andrew Ross Sorkin is constantly asked if he is related to Aaron Sorkin, a confusion compounded by the fact that both are from Scarsdale, New York.
  • Summary: Andrew Ross Sorkin confirmed that the two most frequent questions he fields concern his eye and his relation to Aaron Sorkin. He served as a consultant for Aaron Sorkin on the third season of The Newsroom during the storyline involving the ACN merger.
High School NYT Internship
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(00:13:17)
  • Key Takeaway: Sorkin secured an unofficial internship at The New York Times during high school by persistently contacting the advertising columnist, Stuart Elliott.
  • Summary: Sorkin started selling advertising for his high school paper because he avoided the required reporting class, leading him to start his own magazine, The Sports Page Magazine. He religiously read the advertising column by Stuart Elliott, and after persistent contact, Elliott arranged for him to intern secretly because the Times was a union shop that disallowed unpaid interns.
First Published Article Triumph
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(00:17:07)
  • Key Takeaway: Sorkin’s first published article in The New York Times was about the sound modems made, and its subsequent inclusion in the internal ‘Greenies’ memo for best articles led to the paper discovering he was a high school student.
  • Summary: After explaining the function of modems to a colleague, Sorkin wrote an article that was edited by Stuart Elliott and published without a byline. The article was later highlighted in the Times’ internal ‘Greenies’ memo, prompting editors to find the anonymous author, which resulted in him staying for the rest of the summer.
Shift to Finance Focus
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(00:18:42)
  • Key Takeaway: Sorkin became fascinated with business and finance because following the money explains politics, sports, and history, viewing money as the fundamental incentive driving human behavior.
  • Summary: By his junior year of college, Sorkin shifted focus to mergers and acquisitions because he believed that examining financial incentives explained nearly every aspect of the world. He enjoyed ‘chasing interesting’ during the late 1990s merger boom, which involved complex intersections of business, politics, and policy.
Journalistic Trading Restrictions
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(00:20:31)
  • Key Takeaway: Both The New York Times and CNBC enforce strict rules prohibiting journalists from owning individual stocks to avoid conflicts of interest when breaking market-moving news.
  • Summary: Sorkin confirmed that the rule at his employers is zero individual stock ownership, though mutual funds and indexes are permitted. This restriction is necessary because his reporting can cause stock prices to move dramatically, creating potential conflicts of interest for him and his family.
AI Impact on White Collar Work
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(00:23:59)
  • Key Takeaway: AI, specifically ChatGPT, is poised to eliminate white-collar work first, as demonstrated when Sorkin used it to successfully redline a contract and draft a cover letter, saving significant legal fees.
  • Summary: Sorkin shared an experience where ChatGPT analyzed a contract, pointed out flaws he noticed, and suggested others, then drafted a professional counter-letter, all in 45 minutes. He advises using paid ChatGPT with the prompt: ‘Only bring me back verifiable facts with links,’ to mitigate its tendency to fabricate information.
Origin of the 1929 Book Idea
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(00:29:09)
  • Key Takeaway: The idea for the book 1929: The Inside Story of the Greatest Crash in Wall Street History arose because Sorkin repeatedly could not answer audience questions comparing the 2008 crisis to the 1929 crash.
  • Summary: After writing Too Big to Fail about the 2008 crisis, Sorkin realized his knowledge of the 1929 crash was limited to broad strokes. His desire to write a character-driven narrative about the period was solidified after discovering previously unseen archival material from Thomas Lamont’s meetings with Roosevelt at Harvard.
Debt Acceptance and Market Flooding
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(00:39:30)
  • Key Takeaway: The structural foundation for the 1929 boom was laid when companies like General Motors normalized consumer debt for purchases, which was later mirrored by banks loaning money for stock purchases.
  • Summary: Prior to 1919, taking on debt was considered a moral sin in America, but General Motors successfully encouraged borrowing to buy cars. This precedent was followed by figures like Charlie Mitchell, who enabled people to borrow money to buy stock, leading to massive market inflation through leveraged buying.
Stock Pools and Market Manipulation
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(00:46:31)
  • Key Takeaway: In the late 1920s, wealthy individuals legally engaged in ‘stock pools’—a pump-and-dump scheme where they coordinated to artificially inflate stock prices before pulling the rug, a practice Sorkin compares to modern meme stock activity.
  • Summary: Stock pools were an open, legal form of market manipulation where wealthy investors would coordinate to drive a stock’s price up before selling out, hoping the public could jump on and off the ’train’ before the collapse. Jesse Livermore, the book’s Cassandra figure, made $100 million by short-selling the market, but ultimately lost it all and committed suicide in 1940.
The Federal Reserve’s Inaction
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(00:48:58)
  • Key Takeaway: The Federal Reserve, a relatively new institution established in 1913, largely sat on its hands during the lead-up to the crash due to fears of political backlash and losing funding.
  • Summary: The Fed debated whether to raise or lower interest rates to curb speculation but remained paralyzed by political concerns. They feared being hauled before Congress or losing their independence if they took substantive action against the speculative frenzy.
Fed Inaction During 1929 Crash
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(00:48:43)
  • Key Takeaway: The nascent Federal Reserve in 1913 was politically timid, choosing to ‘sit on their hands’ rather than flood the system with money, fearing Congressional reprisal.
  • Summary: The Federal Reserve, established in 1913, was an institution worried about politics and thus largely inactive during the 1929 crash, debating interest rate adjustments without substantive action. They feared losing funding if they made politically unpopular decisions, unlike Ben Bernanke who later bailed out the system in 2008. The political fallout from the 2008 bailouts, however, shows the enduring unpopularity of such measures.
Personal Blame vs. Blaming Others
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(01:10:00)
  • Key Takeaway: Following the 1929 crash, individuals like Groucho Marx accepted personal responsibility for their investment mistakes, a trait less common today where blame is often externalized.
  • Summary: Groucho Marx, after losing money on RCA stock, blamed himself for believing his broker, illustrating a past tendency toward personal accountability. This contrasts with the current environment where people tend to blame external forces for financial setbacks. Debates about capitalism versus socialism did not significantly emerge until the mid-to-late 1930s.
Hoover’s Policy Mistakes and Bank Holiday
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(01:11:10)
  • Key Takeaway: President Hoover made critical errors by raising taxes during economic faltering and implementing tariffs in 1930, which led to a 60% drop in global trade within a year.
  • Summary: Hoover incorrectly believed the economy and the market were separate, attempting to ‘jawbone’ the situation psychologically, similar to recent administrations. He also insisted on implementing tariffs despite warnings from economists and CEOs, fulfilling a campaign pledge. Hoover’s attempt to institute a bank holiday before Roosevelt’s inauguration was blocked by political ego, leading Roosevelt to implement it immediately after taking office.
Societal Fallout and Banker Accountability
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(01:12:10)
  • Key Takeaway: The 1929 crash resulted in 25% unemployment by 1934, leading to the first significant political blame directed at bankers, exemplified by Charles Mitchell’s arrest for tax evasion.
  • Summary: Unemployment peaked at 25% in 1932 (or 1934 according to one speaker), dwarfing the 11% peak after 2008, and leading to widespread societal impact. Bankers faced political blame for the first time, resulting in Charles Mitchell’s arrest for tax evasion, not directly for the banking crisis. Mitchell was acquitted, and the subsequent legal change made his stock-loss tax maneuver illegal.
Current Regulatory Guardrails and Risks
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(01:13:35)
  • Key Takeaway: The removal of post-1929 regulatory guardrails, such as the SEC and Bank Act, in the name of democratizing finance, particularly through the ‘Genius Act’ for crypto trading, poses a risk.
  • Summary: Post-1929 reforms like the SEC and the Bank Act were designed to make the system safer, but current trends are removing these guardrails under the guise of democratization. The ‘Genius Act’ allows less transparent private equity and venture capital to be traded in retirement accounts without standard public disclosures. Furthermore, Donald Trump’s proposal to reduce public company earnings disclosures from quarterly to semi-annually reduces transparency.
Speculation as Twin of Innovation
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(01:15:32)
  • Key Takeaway: While speculation is often viewed negatively, it is the necessary twin of innovation, funding breakthroughs like Tesla and current AI development, presenting a difficult balance to control.
  • Summary: The economy requires a degree of speculation to fuel major innovations, making it the necessary counterpart to innovation. The challenge lies in controlling this powerful force to have enough risk-taking without excessive, destabilizing speculation. Nearly all modern assets trace their funding back to this speculative stock market system.
Gamification and Media Trust
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(01:16:47)
  • Key Takeaway: The current culture’s obsession with gamification, including betting on news and personal events, coupled with media polarization, erodes trust in institutions, favoring individual voices.
  • Summary: The proliferation of betting on non-sporting events (like elections or celebrity relationships) and the gamification of everything is seen as a negative cultural shift driven by social media. This environment contributes to the perception that media brands (like The New York Times) are overly politicized, leading the public to trust individuals more than established institutions.
Artistic Expression in Personal Turmoil
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(01:18:39)
  • Key Takeaway: Publicly airing intimate relationship pain through art, such as Lily Allen’s album detailing her separation from David Harbour, is ethically permissible as art but may negatively impact the artist’s perceived rationality.
  • Summary: While artists are entitled to process pain through their work, publicizing intimate details of a relationship’s failure, especially through explicit lyrics, is a knee-jerk public reaction. The speaker suggests that such actions often fail to achieve the desired outcome of hurting the ex-partner and instead result in the artist being perceived as irrational. The speaker ultimately supports it as art, acknowledging that many people find comfort in feeling seen by such disclosures.
Creatine Benefits and Physical Traits
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(01:33:07)
  • Key Takeaway: Creatine supplements offer benefits for muscle energy and cognitive function in older adults, though caution is advised for those with diabetes, bipolar disorder, or during pregnancy.
  • Summary: Creatine helps skeletal muscles by creating a steady energy supply, aiding exercise and recovery, and studies suggest it may improve short-term memory and reasoning in people over 60. It is advised against for individuals with diabetes, kidney or liver disease, and those with bipolar disorder due to mania risk. The discussion briefly pivots to physical traits, noting the rarity of coloboma (0.01%) and heterochromia (less than 1%).
Champion Mindset and Victory Feelings
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(01:39:25)
  • Key Takeaway: Victories achieved as the underdog provide a superior feeling compared to victories achieved when already favored (Goliath).
  • Summary: The feeling derived from winning is directly proportional to the perceived underdog status of the victor. Winning as David against Goliath feels significantly better than winning when already positioned as Goliath. This competitive dynamic applies to sports and reflects a preference for overcoming significant odds.
World Series Anecdotes and Aggression
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(01:41:11)
  • Key Takeaway: The host enjoyed the emotional intensity of the LA Dodgers winning the World Series, including aggressive on-field confrontations.
  • Summary: The host recounted watching the World Series victory with friends, noting one friend nearly left when the team was losing, underscoring the emotional investment. A specific incident involved a Dodgers pitcher hitting a Canadian batter, leading to an audible expletive and a bench-clearing confrontation in the fourth inning. The host admitted prioritizing winning over aversion to aggression in that context.
Shia LaBeouf’s Candid Interview
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(01:46:40)
  • Key Takeaway: Shia LaBeouf demonstrated an exceptional level of public ownership and introspection regarding his history as a domestic abuser in an interview with John Bernthal.
  • Summary: The discussion referenced John Bernthal’s podcast episode featuring Shia LaBeouf, which has garnered significant attention. LaBeouf reportedly owns his past actions, including hitting women, with a level of honesty that shocked the speaker. The host noted that LaBeouf expressed a commitment to apologizing for the rest of his life for the harm he caused.
Audience Projection on New Content
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(01:49:57)
  • Key Takeaway: Audience reactions to sensitive content, such as clips from the new project Bethstead, reveal more about the audience’s internal narratives than the content itself.
  • Summary: Feedback on clips from the new project Bethstead shows listeners projecting their own biases onto benign statements. For example, a comment about writing on a daughter’s mind triggered responses about boys, demonstrating how pre-existing narratives influence interpretation. Specific reactions to content often reveal more about the individual listener than the material presented.
Memory Error and College Majors
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(01:52:01)
  • Key Takeaway: The host experienced a significant memory error regarding watching the movie Too Big to Fail during college, leading to agitation over factual inaccuracy.
  • Summary: The host realized he incorrectly remembered watching Too Big to Fail while in college, despite living in Los Angeles at the time. This error caused mental distress because the memory felt vivid, suggesting the viewing likely occurred during a holiday visit home. The segment concluded with lighthearted jabs about the relative difficulty of graduating from UGA versus UCLA.