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I think this was the most enlightening pre-record conversation I've had.

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We should record that shit for your premium people, right?

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We should have.

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We should have.

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You know, I do that when I'm with Tom Longo.

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We hit the tape before we hit the tape.

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I hit the tape on my phone.

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I go, let's go.

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Argue about something like music or some uber shit, you know.

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Tom is one of my favorite crazy uncles, recurring crazy uncles on this show.

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He's totally.

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He's totally, yeah.

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Yeah, we definitely we definitely riff off of each other from different angles.

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I look at it from finances and I try to explain the world.

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He tries to explain the world from ideology.

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And together, it's like we're both right or we're both just lying to each other.

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Who knows? All right. So I'm with you.

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Do you do you pick up what he's putting down in terms that England still controls the world?

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The crown still controls the world?

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he needs a focal point

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and that focal point

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this is not going to be a negative statement

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he seems to focus on a focal point

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and then he sees the tentacles coming out

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I don't see the focal point

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it may not be the king of England

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or the crown

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two years ago it was Davos and WEF

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and the Biden Junta

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that was his expression

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and now he's gravitated towards the crown

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I'm like you know what

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I mean, when you look at things through the lens that I study and analyze things, which is like him, and that is all you do is you find out who benefits and who suffers.

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And you just keep eliminating people until you find out the one guy who's there.

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And I don't know that it's the crown per se, but there's definitely a – one thing that he said that's really true is that Europe in general is a plantation.

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Long time ago, he was talking about it this way.

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Europe's a plantation.

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They've, you know, feudalism.

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And the people that are in power want to stay in power.

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And the Europeans are still colonizing.

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They're trying to protect their colonies.

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And I guess if you want to put a focal point on it, you can call it the crown.

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You can call it the people that operate the crown.

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I think I know from a friend of mine who's a banking executive here that there's an ideological

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split, and it's everywhere.

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And the ideological split is the European old money.

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I mean, they don't have anything there.

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I mean, I'm not anti-Europe like he is.

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But, you know, they're doubling down on, let's say, ideology or wokeness.

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And Germany's got no manufacturing anymore.

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No, no.

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I agree with him.

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It's probably not that.

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In six months, you and I will talk about this again.

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And he will say, well, I know who's pulling the strings of the crown now.

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He just keeps going up the ladder, right?

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He was like, I hate Biden because of this.

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And I'm like, yeah, you're right.

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He goes, and then I will look at Europe and England in terms of trade.

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I'll say, well, this is what's going on here.

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That doesn't make sense.

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Italy's getting screwed, yada, yada, yada.

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And then I'll say, well, that's because the ideology is driving all the policy.

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I would say the ideology influences policy because I still believe that people can at least be semi-rational.

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He – he's kind of dragging me that way, but he's like, no, no.

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Ideology determines everything with these people, and it's sad and pathetic, but it's true.

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I'm looking at things differently now.

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For example, domestically, Kamala Harris, right?

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I don't care about the politics.

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I'm not a political person.

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Well, I identify her as what you would call a third generation feminist.

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So there's real feminists, then there's their children, and then there's the third generation.

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Why are you a feminist?

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Because my mom was.

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Kamala's third generation.

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I'm like, well, where did she get this training?

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And I found that yesterday.

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Kamala Harris, I'm listening to like the Dick Kennedys, which is like, they have a so-called...

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Are you familiar with the band?

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Yep.

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So California Ubrows, right?

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It's about Jerry Brown, you know, the hippie who wanted to run for president when Reagan won.

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And I'm reading the lyrics.

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I'm like, yes, it's pretty funny.

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It's really cool.

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And then, you know, where's Jerry Brown now?

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Boom.

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I did one of those things on ChatGPT.

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And Kamala Harris's name came up in his bio.

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She was attorney general for California for seven years on their head.

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And I'm like, oh, that's where you got it.

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And they just got off the deep end of those people.

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anyway all right cool um so i agree with tom on a lot of things and when i disagree i let him know

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and it's usually minor stuff uh or when i don't agree or disagree i just sit back and just watch

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him froth and we have fun he brings on to kind of give him a sounding board to do his thing yeah

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it's uh great we we typically we for some reason we always record on the late friday afternoon

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whenever we do record.

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And that's like him after a week of screaming at people

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and dissecting things.

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And I don't know if I get him at his most tired point

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or when he's distilled his thoughts most clearly,

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but they're always incredible conversations.

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If they're not distilled clearly,

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I see the picture of the guy from

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It's Always Sunny in Philadelphia with the map.

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I'm like, whoa.

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I'll say, okay, time out.

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Could you pause this?

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What the fuck are you talking about?

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Tom Peppers.

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And then other times I'm like, that sounds stupid, but it's not wrong.

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That sounds, it's not wrong.

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Oh shit, he might be right.

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And I just, I just walk away going, all right, I guess I have to look at it that way now.

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Yeah, I will say he definitely dragged me towards his viewpoint in terms of this, for lack of a better term, inter-cabal squabble, like changing the reference rate.

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Inter-cabal squabble.

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Yeah, that's right.

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That's what it is.

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Inter-cabal.

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That's a good phrase.

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You should get a .com on that or something like .io.

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Inter-cabal squabble.

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The only thing that I've identified that I think that, and I'm saying it to you and I'll say it to him, but I haven't said it to him yet, but I'm saying it to you.

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He has become so patriotic.

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I'm very patriotic.

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But he has become so patriotic that everything Trump does is viewed as good for us.

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And I have said that as well, meaning Trump's an accelerationist.

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Whether he's good or bad, I don't care.

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We're going to get to where we have to get faster because of him.

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but I don't think he's the 3D chess people that some person that people do.

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I think he's a people pleaser. He just wants to be liked.

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Oh yeah. He's a, would you say people pleaser? Yeah.

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That's right. He's got a personality disorder and that's,

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and I'm not saying that lightly. He's got,

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he's a narcissistic personality disorder.

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I studied him when I was in New York city for years as,

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as one of the things to look at and yeah.

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And it becomes a people pleaser.

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He's constantly pulling.

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And thank God, because he doesn't get married to an idea and he can change gears if he's wrong.

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On the other hand, it really kind of makes it look like he's out of his mind.

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Yeah.

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Yeah.

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I was watching Scott Adams.

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He did his daily show yesterday.

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And he was highlighting like the Hamas Israel deal that was signed.

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Who knows if it will stick?

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But nobody thought he could do that.

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Right.

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I think he's catering to the people-pleasing nature of like –

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Oh, you're right.

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And that's something that Tom actually pointed out.

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He goes – like, this is me and you versus Tom and his part, conversation.

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Tom, do you know what Trump does on Thursday?

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He dumps some ideas to get them distracted.

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He does something else on Monday.

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It's brilliant.

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And I'll say, Tom, he tries stuff.

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If it doesn't work, he moves on to something else because he wants to keep the press on him in positive light.

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He's like, oh, no, he's got a plan.

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But no, he doesn't, Tom.

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So anyway, the point is the result is the same, but I agree with you.

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That's true, right?

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People pleaser.

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Right now, he's not like the economy.

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He's talking about – the funny thing is because he's screwing up on – let's say he's being perceived as screwing up on – I mean, look, he's not making – he's not getting more popular, right?

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He's losing popularity.

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So what's he doing?

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And he goes, well, where can I pivot to next?

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Oh, shit.

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Let me work.

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He's working on things all the time.

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And, you know, and if Gaza works, his popularity goes up.

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I mean, look, after the midterms, he's done in terms of influence.

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And so he kind of recognizes that.

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Yeah.

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No, I mean, last point on this, but like he did have MSNBC, ABC, CBS, sort of giving him

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flowers and obama while not explicitly mentioning him in the tweet did say that was a good thing

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that this peace deal is coming so it seems like he is dragging people in his erection but one thing

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that trump is famous for is being a big fan of gold uh this is your expertise and why i wanted

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to bring you on obviously is gold i think it's still trading over four thousand dollars right now

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Wow. Silver screaming.

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I told you

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we've had two people on.

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I'm short silver right now. I'm a fucking idiot.

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Don't

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record that. Turn that mic off.

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Let me see what I see here.

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Yeah, Trump and gold. That's your Scott

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Bessette thing. And that's where Bitcoin

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comes in.

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You don't announce you're going to create an

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SPR for Bitcoin. You just buy.

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Gold's 4019. Jesus

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Christ.

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What?

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whenever I see gold up $40,

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I go,

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all right,

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what did Trump do today?

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You know,

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like the Gaza deal just blow up or something.

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Yeah.

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He called out China.

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He said,

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China's not,

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uh,

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not over the table.

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China's not cooperating with the rare earth metals deal that they want to do.

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Right.

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That's right.

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He said,

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right.

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Stocks are down.

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Gold is up.

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What's the dollar doing in dollars down?

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00:09:59,840 --> 00:10:00,280
Yeah.

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00:10:00,660 --> 00:10:00,820
Oh,

219
00:10:00,920 --> 00:10:03,680
but the market's acting recessionary.

220
00:10:03,680 --> 00:10:08,340
I think I just saw something come across the tape

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That he's threatening to do more tariffs

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Yeah, Trump threatens China tariffs

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There you go

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Doesn't take much to get gold going right now

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And by the way, with the context of Bitcoin

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I do want to say something to your audience about that

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Because having lived through the repression of gold price

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All your people are smart enough to know how it's happening

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But I just want to confirm it and give them details of how it's being done

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because they're keeping the lid on it to accumulate it.

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That's what they're doing.

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They're trying to wash people out.

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That's what they're doing.

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And I'm not even paranoid.

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Anyway, all right, I'm ready for you.

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All right, we'll get to that later.

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Let's focus on gold first.

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Like I was saying, I've had two people on the last three months

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caught my eye, actually probably the last two months,

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caught my eye two months ago,

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the chart of the Shanghai warrants going up.

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We'll cover that.

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00:11:03,100 --> 00:11:05,540
parabolically. What is happening there?

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00:11:06,320 --> 00:11:07,180
I'm sorry, what?

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What is happening there?

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00:11:09,140 --> 00:11:10,060
Are we starting now?

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Yeah.

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00:11:11,240 --> 00:11:11,500
Okay.

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We've been recording for 11 minutes.

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Oh, nice. Cool.

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00:11:15,700 --> 00:11:19,360
All right. So, okay.

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Shanghai warrants.

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All right. So the fact is, and I know you know this and your people know this as well,

254
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but the fact of the matter is Shanghai has been adding warrants, which are claims on gold,

255
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in the exchange. Now, generally speaking, the Shanghai warrant float is, I'm going to make a

256
00:11:38,440 --> 00:11:41,300
number up, but it's going to be giving an idea of the scale. If you have the chart for your people,

257
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that'll help them as well. About four, like four on a scale of one to 104, you know, 4,000 warrants

258
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or 400 warrants, but it's a small number and it's very regular. And it goes like this. If you're

259
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looking at a chart, if you have chartists out there, it'll go sideways. And what that is,

260
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is that those warrants in general are tied to people arbitraging the physical to the futures

261
00:12:05,900 --> 00:12:11,420
in China. That's all it is, right? There's not a lot going on there. But a couple months ago,

262
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it starts to ramp. And there you go. That's it. Yeah, it starts to ramp. So

263
00:12:16,880 --> 00:12:27,940
it starts to ramp before 2025. It starts to ramp, frankly, when Trump started doing the tariff thing.

264
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And it's getting aggressive now.

265
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Now, I've been watching this for a couple months with interest, but no conclusion.

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And just to stay with the facts of that for a second there, what they're doing is they're

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locking up gold.

268
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That gold is being locked up.

269
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And China has been importing gold hand over fist.

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And they advertise that now because they're broadcasting to their BRICS partners.

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They're junior partners that say, we've got the gold.

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We've got the gold.

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We're telling you we've got the asset that allows us to get off of treasuries, which

274
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allows us to get off of dollars.

275
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And they're doing that.

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But what are they using the gold for is really what I think there's probably only three people

277
00:13:16,620 --> 00:13:19,240
who have a clue, at least publicly, that are talking about it.

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One of them, I hope, is me.

279
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Another is Eric Young.

280
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He and I are friends.

281
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We've come to the same conclusion from different points of view.

282
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And there's someone else out there I'm not going to mention because I don't know.

283
00:13:28,600 --> 00:13:31,920
So, but here's the situation.

284
00:13:34,180 --> 00:13:40,780
And it has to do with gold and the yuan, the Chinese currency, and it has to do with trust.

285
00:13:42,360 --> 00:13:50,580
So, in the West, we recently changed gold to a tier one asset per Basel III.

286
00:13:51,200 --> 00:13:53,840
And that means, right, so everyone knows that terminology here.

287
00:13:53,900 --> 00:13:54,220
All right, good.

288
00:13:54,220 --> 00:14:03,100
So we changed it to tier one, Basel III, and we did that because what it does is it allows the piggy bank of your gold to be recognized on your balance sheet.

289
00:14:03,900 --> 00:14:10,240
So my balance sheet now recognizes the asset at its full value.

290
00:14:10,340 --> 00:14:11,240
It used to be tier three.

291
00:14:11,700 --> 00:14:14,000
Tier three, only 50% of its value is recognized.

292
00:14:14,200 --> 00:14:16,340
So if I needed 100%, you sold it.

293
00:14:17,220 --> 00:14:19,580
The structure was made for you to sell gold.

294
00:14:20,040 --> 00:14:21,000
They make it tier one.

295
00:14:21,120 --> 00:14:22,420
You don't have to liquidate it.

296
00:14:22,420 --> 00:14:26,180
So you hold it and you get the full benefit on your balance sheet. And when you do that,

297
00:14:26,740 --> 00:14:30,360
if you're, let's say you're a central bank, I don't know if it applies to central banks yet,

298
00:14:30,820 --> 00:14:35,220
but it offsets your losses. You have a bigger piggyback. You have a bigger savings account,

299
00:14:35,280 --> 00:14:41,660
but you can't touch it. You can't monetize it. You can't loan it. You can't leverage it. It's just

300
00:14:41,660 --> 00:14:47,040
a pet rock, which is what they want. Because if you let the pet rock out,

301
00:14:47,040 --> 00:14:56,220
it becomes a potential replacement for the dollar and for treasuries. So that's Basel,

302
00:14:56,220 --> 00:15:11,433
that Basel III in tier one The next level above this is where China comes in the next level above Basel III in Tier 1 is what called HQLA That a high liquid asset If they not familiar with that I explain it very quickly

303
00:15:11,553 --> 00:15:22,952
HQLA means not only is it Tier 1, but it's so liquid and so robust and so continuous that we trust it to be used as collateral in financing.

304
00:15:25,013 --> 00:15:27,692
HQLA, so essentially, what is HQLA?

305
00:15:27,692 --> 00:15:34,712
Treasuries, the biggest bond market in the world, right? And the argument was made in Europe

306
00:15:34,712 --> 00:15:41,712
that gold is not HQLA for various reasons. And, you know, depending on how you slice and dice the

307
00:15:41,712 --> 00:15:46,393
technicals of it, maybe it's not. But if you slice and dice the technicals another way, it is. The

308
00:15:46,393 --> 00:15:53,592
World Gold Council put out a report. And I read that report. And that report said, gold is not HQLA.

309
00:15:53,592 --> 00:15:54,673
And I went, oh, shit.

310
00:15:55,072 --> 00:15:56,332
So it's just a pet rock still.

311
00:15:56,473 --> 00:15:57,413
It's just all a pet rock.

312
00:15:57,853 --> 00:15:58,753
And I moved on.

313
00:15:59,273 --> 00:16:01,173
And then I went back to this chart that you showed.

314
00:16:01,393 --> 00:16:03,793
And I went, what the hell are they doing with that?

315
00:16:05,212 --> 00:16:08,013
And then I talked to a couple of friends and I said, oh, shit.

316
00:16:10,452 --> 00:16:14,992
And I did, then I did some, what I did then was I did some, I did deep dive research on

317
00:16:14,992 --> 00:16:17,613
the BRICS behavior at their summit this year in May.

318
00:16:19,133 --> 00:16:22,712
And that summit, which did not get a lot of press this year, there wasn't a lot of hype.

319
00:16:22,712 --> 00:16:29,013
for various reasons, but I wrote five articles on it. And one of the articles was I identified

320
00:16:29,013 --> 00:16:33,793
from piecing together articles everywhere, I'm talking to two sources of mainland China,

321
00:16:33,872 --> 00:16:42,113
from talking to someone in Hong Kong, that China, to assuage fears of the other BRICS people,

322
00:16:43,332 --> 00:16:50,173
had said, look, we want you to use the yuan for currency. And let's say you're a Saudi Arabian.

323
00:16:50,173 --> 00:16:51,092
You're like, OK, I'll use it.

324
00:16:51,492 --> 00:16:51,913
I'll use it.

325
00:16:52,113 --> 00:16:53,572
But you know what?

326
00:16:54,192 --> 00:16:57,013
I may not trust the US, but the US dollar is better than the yuan.

327
00:16:57,553 --> 00:16:58,753
What are you backing it with?

328
00:16:58,973 --> 00:17:00,332
Well, we're backing it with our economy.

329
00:17:01,293 --> 00:17:02,813
We're not going to back it with gold.

330
00:17:03,393 --> 00:17:04,412
But I'll tell you what we will do.

331
00:17:04,453 --> 00:17:05,713
We'll do something the US doesn't do.

332
00:17:06,273 --> 00:17:09,352
We'll let you convert it into gold freely.

333
00:17:09,953 --> 00:17:10,672
No problem.

334
00:17:12,092 --> 00:17:16,592
And the Saudi Arabians said, everyone, just for instance, they said, that's great.

335
00:17:16,693 --> 00:17:17,553
Where will the gold stay?

336
00:17:17,753 --> 00:17:18,932
This is like five years ago.

337
00:17:18,932 --> 00:17:19,973
Where will the gold stay?

338
00:17:20,172 --> 00:17:26,273
well, it'll stay in China. They're like, nah, that's not going to work. We just ended this

339
00:17:26,273 --> 00:17:30,973
problem with the US. Everyone's pulled their gold back. And so China comes up with a plan.

340
00:17:31,873 --> 00:17:35,493
And the SGE, which is the Shanghai Gold Exchange, that's their physical exchange,

341
00:17:35,953 --> 00:17:44,393
they create an international division, SGEI. And the SGEI starts partnering with vaults in

342
00:17:44,393 --> 00:17:52,453
various BRICS countries, and they create a network. So I'm Saudi Arabia. I give them my oil.

343
00:17:53,092 --> 00:17:58,793
They give me yuan. And I say, you know what? I want to convert this into gold. Will you make me

344
00:17:58,793 --> 00:18:04,273
a market? And they do, China. And the yuan gets converted to gold. Where's the gold go?

345
00:18:04,273 --> 00:18:23,733
It goes into their vault. So in a sense, in a crypto way, they've decentralized the or in non-crypto, you'd say they diversify the geographic risk of ownership of the physical metal, but they're still accounting for it.

346
00:18:23,733 --> 00:18:27,432
in a, you know, it's like old school blockchain.

347
00:18:27,693 --> 00:18:29,432
It's like, you know, red flimstone chain.

348
00:18:29,873 --> 00:18:36,053
But, and so that made the Saudis

349
00:18:36,053 --> 00:18:37,293
and the other countries in the BRICS

350
00:18:37,293 --> 00:18:39,513
more comfortable holding yuan.

351
00:18:40,112 --> 00:18:41,633
I could convert it to gold.

352
00:18:42,412 --> 00:18:44,273
I could have, I could see the gold.

353
00:18:44,373 --> 00:18:45,793
I don't have to worry about it going anywhere.

354
00:18:46,013 --> 00:18:46,953
I don't have to worry about it.

355
00:18:47,233 --> 00:18:48,513
You know, I don't have to worry about an accountant

356
00:18:48,513 --> 00:18:50,932
going in and auditing them, you know, to an extent.

357
00:18:50,932 --> 00:18:54,033
and they gradually got more comfortable with it.

358
00:18:54,053 --> 00:18:56,373
At the same time, they got less comfortable with the U.S. Treasuries.

359
00:18:58,513 --> 00:19:04,953
And so at the BRICS summit, the Chinese had homework,

360
00:19:05,033 --> 00:19:07,053
and their homework was to internationalize the yuan

361
00:19:07,053 --> 00:19:08,672
and to internationalize gold ownership.

362
00:19:09,373 --> 00:19:10,453
And this is what they announced.

363
00:19:10,453 --> 00:19:14,313
Hong Kong, Singapore, the Golden Card,

364
00:19:14,393 --> 00:19:15,973
or I'm not sure if I named that or they named that,

365
00:19:16,013 --> 00:19:19,133
but there's like a Golden Card or Singapore, Macau,

366
00:19:19,133 --> 00:19:25,213
all along this area, the Shanghai Cooperative Organization.

367
00:19:27,252 --> 00:19:29,432
And they're saying all these vaults are now connected,

368
00:19:29,672 --> 00:19:32,393
which means you could arbitrage back and forth,

369
00:19:32,453 --> 00:19:36,513
which means every country can have their gold close enough to see, to visit.

370
00:19:37,273 --> 00:19:38,453
And I went, this is great.

371
00:19:38,572 --> 00:19:39,373
I see what they're doing.

372
00:19:39,553 --> 00:19:41,432
They're making sure people are trustworthy in gold.

373
00:19:41,493 --> 00:19:43,513
And I said, well, what are they doing about the volatility in gold?

374
00:19:44,373 --> 00:19:44,773
Right?

375
00:19:45,493 --> 00:19:47,572
Well, because the U.S. can spoof it lower.

376
00:19:47,973 --> 00:19:49,013
Anyone can spoof it lower.

377
00:19:49,133 --> 00:19:50,473
It's not that deep.

378
00:19:51,053 --> 00:19:52,693
Well, it turns out they solved that too.

379
00:19:52,793 --> 00:19:54,293
I don't know if it's going to work, but they solved that.

380
00:19:54,352 --> 00:19:58,953
Their solve was the gold will be carried on everyone's balance sheet according to a moving

381
00:19:58,953 --> 00:20:01,233
average, not according to the price at the end of the day.

382
00:20:02,013 --> 00:20:03,633
So 200-day moving average.

383
00:20:04,153 --> 00:20:08,793
And let's face it, over the long run, gold holds value because it's gold, right?

384
00:20:08,893 --> 00:20:15,793
I mean, there's no synthetic gold yet, at least not in large size yet.

385
00:20:15,793 --> 00:20:20,013
Okay, so they create the network of vaults.

386
00:20:20,133 --> 00:20:22,473
And I go, all right, this is for the BRICS Summit.

387
00:20:22,912 --> 00:20:25,553
They address the concept of price volatility.

388
00:20:25,752 --> 00:20:27,612
I go, all right, that's good.

389
00:20:29,873 --> 00:20:35,133
And then I read something, I wrote on it, and I went, oh, shit, this is what they're going to do next.

390
00:20:35,752 --> 00:20:36,793
And this is what they're going to do.

391
00:20:38,473 --> 00:20:43,332
They announced that they're going to be partnering with vaults in countries that need to build infrastructure.

392
00:20:43,332 --> 00:20:45,653
So you're thinking about the African BRICS countries.

393
00:20:45,793 --> 00:20:52,493
right? Why? Well, I'm a country in Africa, Ghana, and I've got a shit ton of gold.

394
00:20:53,612 --> 00:20:57,773
And it's just sitting there. And if I want to use it, I have to give it to the IMF,

395
00:20:57,793 --> 00:21:00,993
and they give me treasuries, and I borrow money, and I build a road, right?

396
00:21:01,653 --> 00:21:08,953
But I want to do business with China. China is building roads and airports and cutting deals

397
00:21:08,953 --> 00:21:14,733
because they're just colonizing economically. We know that. China says, you can use your gold.

398
00:21:15,793 --> 00:21:20,412
So I'm an African country that needs an airport built to simplify it.

399
00:21:20,693 --> 00:21:21,513
And I've got gold.

400
00:21:21,653 --> 00:21:29,213
I put it in the vault, which is in the system of the Shanghai Exchange setup.

401
00:21:29,533 --> 00:21:37,293
And then China loans me the money on the gold directly, not through treasuries, not through

402
00:21:37,293 --> 00:21:38,393
some swap deal.

403
00:21:38,953 --> 00:21:40,033
The gold is there.

404
00:21:40,473 --> 00:21:41,612
China trusts them.

405
00:21:41,612 --> 00:21:45,873
and then I take the yuan and I go back to China and I say, build me an airport.

406
00:21:46,653 --> 00:21:50,832
And so what they've done is they created project financing. Now, I had gotten that far with this.

407
00:21:51,412 --> 00:21:55,313
I'm like, okay, this is really good. They're unlocking the buying potential of gold. You

408
00:21:55,313 --> 00:22:00,233
own stocks, I own stocks. Can you borrow money against it and do stuff? Yeah. And if you use

409
00:22:00,233 --> 00:22:04,852
your leverage smartly, you're fine. I went, all right. So they're going to unlock gold and that

410
00:22:04,852 --> 00:22:12,592
makes it high quality collateral asset. I went high quality collateral asset, HQCA.

411
00:22:13,233 --> 00:22:19,432
And then I read this report, high quality liquid asset. Oh, shit. And then I went back to my bond

412
00:22:19,432 --> 00:22:23,672
days and I went, what is an HQLA used for? Now I'll use a word that everyone knows, repo.

413
00:22:24,533 --> 00:22:30,873
If you want to get something done in the world, you pledge your treasuries into repo, which is

414
00:22:30,873 --> 00:22:34,612
theoretically you're selling them and you buy them back as collateral and they give you money.

415
00:22:34,612 --> 00:22:36,273
That's what the repo market is.

416
00:22:36,633 --> 00:22:38,553
I have an asset that's high-quality asset.

417
00:22:38,653 --> 00:22:39,133
It's a treasury.

418
00:22:39,572 --> 00:22:40,453
Here, loan me the money.

419
00:22:40,493 --> 00:22:42,352
I'm going to build the road, and I'll pay you back on the back end.

420
00:22:42,713 --> 00:22:45,393
I mean, that's what we do with treasuries.

421
00:22:46,013 --> 00:22:55,813
And the HQLA pool is, I think it's more, but I'm going to throw you a lower number, $17 trillion, $20 trillion.

422
00:22:56,813 --> 00:23:03,172
And of that pool, depending on how you measure, between 50% and 70% is US treasuries.

423
00:23:03,172 --> 00:23:05,112
and none of it is gold.

424
00:23:06,273 --> 00:23:08,233
It's treasuries or sovereign bonds

425
00:23:08,233 --> 00:23:10,153
that we deem are high quality enough.

426
00:23:11,193 --> 00:23:13,352
Chinese bonds aren't high quality enough.

427
00:23:13,993 --> 00:23:15,633
The BRICs won't even buy the Chinese bonds.

428
00:23:15,773 --> 00:23:17,013
But anyway, I'm going to pause for a second here

429
00:23:17,013 --> 00:23:18,213
because I'm talking a lot.

430
00:23:18,293 --> 00:23:19,193
Is there anything you wanted to,

431
00:23:19,373 --> 00:23:20,393
you know, I don't want to,

432
00:23:21,172 --> 00:23:21,773
should I just keep going?

433
00:23:21,773 --> 00:23:23,752
Yeah, because this is,

434
00:23:24,332 --> 00:23:27,893
we've been covering this,

435
00:23:28,172 --> 00:23:29,293
not this specifically,

436
00:23:29,473 --> 00:23:31,572
but this idea of this diversification

437
00:23:31,572 --> 00:23:32,953
away from the dollar treasury

438
00:23:32,953 --> 00:23:38,053
system and one of the mechanics that's one thing i've been saying for years as a bitcoiner it's

439
00:23:38,053 --> 00:23:41,733
like all these countries should just skip to bitcoin instead of some bricks back currency

440
00:23:41,733 --> 00:23:44,752
because they're not going to be able to trust each other which is like what you're getting into now

441
00:23:44,752 --> 00:23:49,393
like who wants to buy chinese bonds who wants to buy russian bonds who wants to buy saudi bonds

442
00:23:49,393 --> 00:23:55,932
they're working around it right they're working around it and i think china's end game to that

443
00:23:55,932 --> 00:24:00,873
point is eventually they'll get everyone to buy chinese bonds whether it be whether it be stable

444
00:24:00,873 --> 00:24:04,773
coin Chinese bonds. But that's the point is they want everyone to own Chinese bonds. But

445
00:24:04,773 --> 00:24:10,252
they're just replicating what the US did probably a little bit better, using it in a more

446
00:24:10,252 --> 00:24:18,233
decentralized way. Yeah, but I agree. That's what they're doing. So here I'm going high quality

447
00:24:18,233 --> 00:24:22,752
collateral asset. I went, oh, yeah. And I went, oh, shit, now you're competing. Gold's going to

448
00:24:22,752 --> 00:24:27,293
compete with treasuries. Then I went back to my European analysis and I went, wait a minute,

449
00:24:27,293 --> 00:24:33,973
but it's not hqla so it can't be repo then i call the friend of mine on the mainland i go

450
00:24:33,973 --> 00:24:40,592
are you guys going to use this as a repo asset so you can allot the financing of that poor country

451
00:24:40,592 --> 00:24:45,533
in africa that wants to do this or wants to do that or so saudi arabians can load money to the

452
00:24:45,533 --> 00:24:50,213
country in africa in gold you know using gold as collateral because they have a ton of money

453
00:24:50,213 --> 00:24:56,352
and uh he basically said yeah i said well how do you do that this is where i was a little bit

454
00:24:56,352 --> 00:25:01,693
not wonkish enough. He goes, well, you get it. You turn it into a high quality liquid asset.

455
00:25:01,693 --> 00:25:08,112
We designate it for our half of the world as HQLA. And then we put it into repo.

456
00:25:08,673 --> 00:25:14,612
And then I went, oh, I went back to the chart. And then I talked to a friend of mine, Eric,

457
00:25:15,572 --> 00:25:25,773
Eric Young, and he's popular on Twitter, King Kong. And I went, Eric, HQLA, you need to be to

458
00:25:25,773 --> 00:25:32,112
become a repo. And I think they're doing that for all this mine stuff and this project stuff. I go,

459
00:25:33,112 --> 00:25:40,352
where's the goal? He went, that's what the warrants are for. They're locking the goal down.

460
00:25:40,592 --> 00:25:47,572
And at some point, again, this is theory. We're not sure yet. It's conjecture. At some point,

461
00:25:47,773 --> 00:25:52,953
we believe they're either, reasonably speaking, they're either testing the system out. They've

462
00:25:52,953 --> 00:25:57,112
tested things before and I've seen them tested. They're either testing the system out, stress

463
00:25:57,112 --> 00:26:03,813
testing it for wards or whatever, or they're accumulating it to put it in the Hong Kong vault,

464
00:26:03,913 --> 00:26:09,612
which just opened. You put that in the Hong Kong vault and what do you have? Hong Kong is the

465
00:26:09,612 --> 00:26:16,072
buffer zone between China and the rest of the world. And you have your Switzerland for gold.

466
00:26:16,072 --> 00:26:23,913
and that's where your first repose will be, he and I concluded separately, coming from different

467
00:26:23,913 --> 00:26:31,693
points of view. So China is going to, I believe, has a very good chance or intensive, they have to,

468
00:26:32,092 --> 00:26:37,513
otherwise the gold just is still a pet rock. They need to unlock its leverage and buying power

469
00:26:37,513 --> 00:26:41,233
now that everyone trusts it, now that everyone's in the process of trusting yuan,

470
00:26:41,233 --> 00:26:43,273
in the process over there.

471
00:26:43,752 --> 00:26:46,713
They want to say, okay, now you can borrow your wine against your gold,

472
00:26:46,873 --> 00:26:49,153
and you can see the gold, and you can build an airport.

473
00:26:49,592 --> 00:26:51,213
And it's like, great, let's do it.

474
00:26:51,592 --> 00:26:54,932
And they drop the Neokinesian concepts, and they do this,

475
00:26:54,973 --> 00:26:58,072
which is a hard money concept, and they're going to start doing it.

476
00:26:58,153 --> 00:26:59,273
That's what I think is going to happen.

477
00:26:59,273 --> 00:27:04,112
And I wrote almost like a short academic-style paper on it,

478
00:27:05,013 --> 00:27:06,553
a St. Joe's Prep-style paper, right?

479
00:27:06,553 --> 00:27:10,953
and I had to drop that in

480
00:27:10,953 --> 00:27:12,673
since we figured that out

481
00:27:12,673 --> 00:27:16,713
like it's the Jesuits

482
00:27:16,713 --> 00:27:18,133
so

483
00:27:18,133 --> 00:27:22,873
I look at all that and I go

484
00:27:22,873 --> 00:27:24,813
why the hell else would the warrants be going up

485
00:27:24,813 --> 00:27:26,352
a lot of people are saying oh they're doing this

486
00:27:26,352 --> 00:27:27,752
they want to do the 3D testing

487
00:27:27,752 --> 00:27:31,153
no the warrants are rarely used because they're about arbitrage

488
00:27:31,153 --> 00:27:33,313
they're just like SHFE

489
00:27:33,313 --> 00:27:34,612
which is the futures exchange

490
00:27:34,612 --> 00:27:36,373
kind of like COMEX versus LBMA

491
00:27:36,932 --> 00:27:37,893
Go back to London, go back to London.

492
00:27:37,932 --> 00:27:38,793
It's going back and forth.

493
00:27:39,092 --> 00:27:41,432
But then it just starts ballooning and it's not going anywhere.

494
00:27:42,213 --> 00:27:44,932
I mean, ultimately, it just makes the price go up.

495
00:27:44,973 --> 00:27:47,653
But I think they're getting ready to do that.

496
00:27:48,693 --> 00:27:52,813
Now, I want to add one anecdotal piece.

497
00:27:54,553 --> 00:27:58,313
It started happening before the end of the year, right, in that chart you have.

498
00:27:59,313 --> 00:28:01,752
And it's since ramped up even more.

499
00:28:02,653 --> 00:28:04,173
What else happened at the end of the year?

500
00:28:04,832 --> 00:28:06,453
The U.S. started repatriating gold.

501
00:28:08,092 --> 00:28:10,313
U.S. started repatriating silver to the counter, right?

502
00:28:10,533 --> 00:28:10,673
Okay.

503
00:28:10,973 --> 00:28:12,193
U.S. started repatriating gold.

504
00:28:12,352 --> 00:28:15,112
Now, did we buy the gold or were we just bringing gold back that was ours?

505
00:28:15,592 --> 00:28:16,092
I don't know.

506
00:28:16,233 --> 00:28:17,932
I mean, I actually do know, but it's not important.

507
00:28:18,332 --> 00:28:23,633
What's important is that the U.S. is now emptying London of its gold.

508
00:28:24,492 --> 00:28:25,413
Again, it's collateral.

509
00:28:25,592 --> 00:28:28,873
You have to, like Zoltan and Pozar, it's a crisis of collateral.

510
00:28:29,013 --> 00:28:30,513
You need to have the collateral there.

511
00:28:30,572 --> 00:28:32,352
You need to say, this is my gold.

512
00:28:32,352 --> 00:28:34,313
If you're going to borrow it, it needs to be there.

513
00:28:34,492 --> 00:28:35,992
If you're going to borrow against it, it needs to be there.

514
00:28:36,453 --> 00:28:38,373
So the U.S. starts calling the gold back.

515
00:28:39,193 --> 00:28:45,213
And I also noticed that when the U.S. is calling the gold back, gold's not being bought by China.

516
00:28:45,373 --> 00:28:46,173
I have a chart.

517
00:28:46,653 --> 00:28:48,313
When the U.S. buys, China doesn't.

518
00:28:48,553 --> 00:28:49,893
When China buys, the U.S. doesn't.

519
00:28:50,053 --> 00:28:52,112
So there's your – what's the word you use?

520
00:28:52,193 --> 00:28:52,533
Cabal?

521
00:28:53,173 --> 00:28:54,273
Inter-cabal squabble.

522
00:28:54,693 --> 00:28:55,752
Inter-cabal squabble.

523
00:28:55,793 --> 00:28:56,713
That's exactly it.

524
00:28:56,953 --> 00:28:58,133
It's the war of the roses.

525
00:28:58,393 --> 00:29:00,153
But it's a divorce.

526
00:29:00,733 --> 00:29:02,193
But again, I'll give you that chart.

527
00:29:02,193 --> 00:29:09,193
it's visually interesting. But I talked to someone in the political side, and I think he's well

528
00:29:09,193 --> 00:29:15,352
connected. But what he said to me is, that makes sense. I said, why do we start bringing gold back?

529
00:29:15,393 --> 00:29:19,332
And my theory was we started bringing gold back because we figured out we needed it for something.

530
00:29:19,673 --> 00:29:25,332
I didn't know what for, right? If you talk to one person, it's, we're going to have gold bonds.

531
00:29:25,432 --> 00:29:28,653
We're going to have a gold standard. Talk to all the bums, right? No, we're not going to have gold

532
00:29:28,653 --> 00:29:32,453
bonds. That's my opinion. I'd like it to happen. Judy Shelton, I respect her, and I think she's

533
00:29:32,453 --> 00:29:37,173
right. At one time, I agree with her, but I think gold bonds would undermine the regular treasury

534
00:29:37,173 --> 00:29:42,293
market. Oh, I'll get the gold bond. Why would we sell people bonds with gold and we could just

535
00:29:42,293 --> 00:29:47,473
sell them paper? The second one is gold standard. No, we can't go back to gold standard. It's the

536
00:29:47,473 --> 00:29:56,053
end of the world if we do that. You can't do it, in my opinion. A use for gold. Well, yeah,

537
00:29:56,053 --> 00:29:59,913
the commercial banks can start throwing it to blockchain and stable coins and

538
00:29:59,913 --> 00:30:00,153
they say,

539
00:30:00,153 --> 00:30:01,773
create a new ETF type of product,

540
00:30:01,852 --> 00:30:12,685
the new product Like all right that good But there was more bought that should have been bought or more delivered Some of it was going on to Comex some of it wasn It was going to the Treasury

541
00:30:14,005 --> 00:30:16,585
And so I talked to my friend.

542
00:30:16,705 --> 00:30:18,425
I said, do you think that's related?

543
00:30:18,505 --> 00:30:19,185
He goes, oh, yeah.

544
00:30:19,685 --> 00:30:23,625
He goes, I think the US finally paid attention

545
00:30:23,625 --> 00:30:26,025
to what they were doing and said,

546
00:30:26,585 --> 00:30:27,965
well, if they're getting theirs

547
00:30:27,965 --> 00:30:33,065
and there's a chance that gold becomes a competitor to the US.

548
00:30:33,245 --> 00:30:36,685
If I want to finance a project in Africa, I may need gold too.

549
00:30:37,085 --> 00:30:38,265
So let's get our gold back.

550
00:30:38,785 --> 00:30:40,345
And so we ramped the gold back.

551
00:30:40,405 --> 00:30:42,065
You saw Trump flip-flop.

552
00:30:42,745 --> 00:30:44,345
We're going to tariff gold and silver.

553
00:30:44,505 --> 00:30:47,565
We're not going to – those are just – sorry, like him or don't,

554
00:30:47,665 --> 00:30:48,905
those are idiotic things to do.

555
00:30:49,165 --> 00:30:53,565
But they work because when he does them, the market tells him

556
00:30:53,565 --> 00:30:54,625
if he's right or wrong immediately.

557
00:30:54,625 --> 00:30:57,445
You know, he's instant feedback.

558
00:30:57,965 --> 00:31:10,925
Well, that's what I was going to ask, because when it comes to repatriation of gold at the end, gold at the end of last year, like one of the main narratives is like people are flooding it into U.S. vaults because of the pending tariffs.

559
00:31:11,305 --> 00:31:14,105
So were tariffs just used as a mechanism to flood it back?

560
00:31:14,165 --> 00:31:16,405
Or was it just some narrative control?

561
00:31:16,505 --> 00:31:16,685
Yeah.

562
00:31:17,165 --> 00:31:17,505
Excuse.

563
00:31:18,185 --> 00:31:20,725
I mean, I knew.

564
00:31:20,925 --> 00:31:22,545
Let's just start with the tariffs on gold.

565
00:31:22,545 --> 00:31:24,165
Silver's a different story, but tariffs on gold.

566
00:31:24,545 --> 00:31:26,805
You cannot tariff gold.

567
00:31:26,805 --> 00:31:34,365
because gold is the intent bitcoin's going to be as well but gold is the intentional unintentional

568
00:31:34,365 --> 00:31:42,265
loophole to avoid sanctions everyone does it so this is gold well is it money no it's gold it's

569
00:31:42,265 --> 00:31:48,845
a good i'm buying a good from you right it's a good it's it's it's barter you're giving me a jet

570
00:31:48,845 --> 00:31:54,125
and i'm giving you gold it's barter and so that avoids the monetary that avoids the sanctions

571
00:31:54,125 --> 00:32:00,525
but because gold is used for nothing and it's a brick it's gold so it's money it may as well be

572
00:32:00,525 --> 00:32:05,685
money it's not good for anything else and so that's a loophole that exists in the world

573
00:32:05,685 --> 00:32:10,065
russia uses it we use it i'll give you an example as a martin arms for an example

574
00:32:10,065 --> 00:32:19,825
when japan looks at the u.s and says it's not hypothetical it is in the 90s when japan has it

575
00:32:19,825 --> 00:32:23,285
you know there's supposed to be like a trade relationship you have to buy this much from us

576
00:32:23,285 --> 00:32:24,245
We have to buy that much from you.

577
00:32:24,305 --> 00:32:26,545
Well, what Japan does is Japan used to go like this.

578
00:32:26,565 --> 00:32:30,085
All right, we're not buying enough stuff from the US.

579
00:32:30,205 --> 00:32:30,825
What are we going to buy?

580
00:32:30,965 --> 00:32:31,325
Cars?

581
00:32:31,725 --> 00:32:31,945
No.

582
00:32:33,345 --> 00:32:34,365
Let's buy some gold.

583
00:32:35,005 --> 00:32:36,285
You buy American gold.

584
00:32:36,665 --> 00:32:38,205
It's a money laundering operation.

585
00:32:38,905 --> 00:32:40,525
You know, you buy American gold.

586
00:32:41,465 --> 00:32:42,425
You take it.

587
00:32:42,705 --> 00:32:43,945
It counts as an import.

588
00:32:44,185 --> 00:32:45,865
It counts against your trade deficit.

589
00:32:46,065 --> 00:32:49,085
And then you take the gold and you put it back in London and you get out of it.

590
00:32:49,165 --> 00:32:50,225
It's a laundromat.

591
00:32:50,625 --> 00:32:52,065
So gold is used that way.

592
00:32:52,065 --> 00:32:58,525
Gold is used to satisfy the legal fine print on trade deficits.

593
00:32:59,545 --> 00:33:02,865
And that's where that went.

594
00:33:03,205 --> 00:33:06,465
So they're not going to tax or tariff gold.

595
00:33:07,165 --> 00:33:13,805
To put it simply, one of the words that I use a lot is mercantilist, but I don't want it to be like a catchphrase.

596
00:33:13,805 --> 00:33:24,485
But the bottom line is if you look at the concept of mercantilism, you tax imports of what you make, and you don't tax imports of what you need.

597
00:33:25,305 --> 00:33:26,725
And we need gold.

598
00:33:26,845 --> 00:33:27,605
We need silver.

599
00:33:27,745 --> 00:33:28,465
We need lithium.

600
00:33:28,905 --> 00:33:31,145
You don't threaten the tariff of lithium.

601
00:33:31,425 --> 00:33:36,345
And so gold is that loophole item that allows us to circumvent tariffs.

602
00:33:36,945 --> 00:33:41,425
And we don't close it because it's kind of like an honor among thieves.

603
00:33:41,605 --> 00:33:42,185
We all do it.

604
00:33:42,185 --> 00:33:47,805
So the tariffs being a reason to bring gold to them, that's complete horseshit.

605
00:33:48,345 --> 00:33:49,705
It was complete horseshit then.

606
00:33:49,865 --> 00:33:50,665
I saw it then.

607
00:33:51,025 --> 00:33:52,265
And it's complete horseshit now.

608
00:33:52,405 --> 00:33:57,225
In fact, like a month or two ago, didn't Trump do that?

609
00:33:57,445 --> 00:33:59,725
Trump said we might tax the gold and gold went crazy.

610
00:34:00,025 --> 00:34:01,445
I mean, I know he did that, right?

611
00:34:01,845 --> 00:34:03,865
He said, we're going to tax bullion.

612
00:34:03,965 --> 00:34:06,085
And the bullion banks were like, whoa, you can't do that.

613
00:34:06,485 --> 00:34:11,265
Because all they do is take gold, put it in a safe, short it against it, take the money

614
00:34:11,265 --> 00:34:14,765
and go out and buy Aussie bonds or something and buy, you know, NVIDIA.

615
00:34:15,325 --> 00:34:17,425
So he changed that right away.

616
00:34:17,445 --> 00:34:18,365
That was rule 282.

617
00:34:19,025 --> 00:34:20,205
Changed that right away for gold.

618
00:34:20,405 --> 00:34:24,065
And there will be no tariffs on monetary gold.

619
00:34:24,485 --> 00:34:26,945
Your gold chain, they might tariff that.

620
00:34:27,305 --> 00:34:29,465
But once it's melted down, they can't tariff it anymore.

621
00:34:29,745 --> 00:34:30,325
And that's it.

622
00:34:30,585 --> 00:34:32,185
So gold will not be tariffed.

623
00:34:32,265 --> 00:34:33,865
Gold's money for them anyway.

624
00:34:34,405 --> 00:34:34,565
Yeah.

625
00:34:34,905 --> 00:34:37,925
I mean, in tying this all together too, I mean, before we hit record,

626
00:34:37,925 --> 00:34:42,925
So we got to touch on the Russian war because that really ties into this, too.

627
00:34:43,005 --> 00:34:45,645
Is that the catalyst for this big movement?

628
00:34:46,285 --> 00:34:49,885
And sort of we've been prepping for this for over three years.

629
00:34:49,885 --> 00:34:56,305
But that was really the Treasury freezing in 22 was the last straw.

630
00:34:57,145 --> 00:34:58,265
It was. It was. It was.

631
00:34:58,365 --> 00:35:05,485
And last straw is a good way to look at it because because our biggest trade partner, China, raised concerns with us after the financial crisis.

632
00:35:05,485 --> 00:35:08,545
They're like, okay, we own a lot of treasuries

633
00:35:08,545 --> 00:35:09,745
And you're printing all this money

634
00:35:09,745 --> 00:35:13,525
And they were convinced that everything would be alright

635
00:35:13,525 --> 00:35:17,105
And during that time, around 2014

636
00:35:17,105 --> 00:35:18,605
With the whole Ukrainian thing

637
00:35:18,605 --> 00:35:20,365
Because this is the geopolitics of it, right?

638
00:35:21,025 --> 00:35:22,245
Russia said, you know what?

639
00:35:22,985 --> 00:35:24,085
The US is meddling

640
00:35:24,085 --> 00:35:26,325
We don't want to deal with this anymore

641
00:35:26,325 --> 00:35:27,165
We don't want our treasuries

642
00:35:27,165 --> 00:35:28,645
And they started de-dollarizing

643
00:35:28,645 --> 00:35:29,685
And they tried to bring

644
00:35:29,685 --> 00:35:32,025
This is from someone who was involved in the conversations

645
00:35:32,025 --> 00:35:39,545
that they Russia approached China and said and said we're de-dollarizing are you going to be

646
00:35:39,545 --> 00:35:43,645
dollarized and China's like no way you out of your mind we can't do that we're not going to do that

647
00:35:43,645 --> 00:35:49,665
we we're still too tied closely together and then so China little by little is selling treasuries

648
00:35:49,665 --> 00:35:54,225
but nothing crazy and but they're buying gold and it's not public they're not really saying we're

649
00:35:54,225 --> 00:35:58,265
buying gold they're just buying it and then they get into the World Trade Organization a little

650
00:35:58,265 --> 00:36:06,245
more time goes by in 2022, the US sanctions and Europe sanctions them for invading Ukraine.

651
00:36:06,245 --> 00:36:10,745
Now, for anyone who's not familiar, and I know that you are, just briefly,

652
00:36:12,605 --> 00:36:18,305
Russia had most countries that use dollars, and every country does use dollars,

653
00:36:19,065 --> 00:36:27,125
has dollars in this global network called SWIFT. And SWIFT is essentially a big network of ATMs.

654
00:36:27,125 --> 00:36:32,045
and that money's in there and your assets are there and it's basically all treasuries and you

655
00:36:32,045 --> 00:36:38,005
borrow against the treasuries and you do what you have to do. Throughout most, I'm not a historian,

656
00:36:38,605 --> 00:36:44,785
throughout most wars, nobody seizes anybody's money. They don't do that. So Russia invades

657
00:36:44,785 --> 00:36:52,965
Ukraine and the U.S. and Europe just decide to freeze all their assets, essentially confiscating

658
00:36:52,965 --> 00:37:00,085
their assets. Now, right or wrong, justified or not, every other country out there that has money

659
00:37:00,085 --> 00:37:06,385
in it says on the BRICS side, it's like, you know what? These guys have been keeping the price of

660
00:37:06,385 --> 00:37:10,585
gold down. They've been keeping the price of oil down. We can't make any money. We live off

661
00:37:10,585 --> 00:37:16,805
natural resources. We're poor. And they just took all the wealth from Russia on nuclear power.

662
00:37:17,565 --> 00:37:22,185
They can do that to us anytime they want. And they started knocking on China's door and saying,

663
00:37:22,185 --> 00:37:27,585
okay, we're ready. Let's do it. And it started to accelerate. And China started buying gold very

664
00:37:27,585 --> 00:37:36,185
publicly to show them they meant business. And in 2022, the rest of the world outside the G7 said

665
00:37:36,185 --> 00:37:43,165
the only reason to own treasuries was because of the guarantee that the US would never

666
00:37:43,165 --> 00:37:48,165
take it from them as a counterparty. And that made it more beneficial than gold with the interest

667
00:37:48,165 --> 00:37:55,165
trades. And after this, that's no longer worth it. How can we work another type of collateral

668
00:37:55,165 --> 00:38:03,325
like treasuries into our system to substitute for treasuries? And everyone's awareness had

669
00:38:03,325 --> 00:38:07,885
been raised up because of crypto and Bitcoin. And all of a sudden, we also have the inflation in the

670
00:38:07,885 --> 00:38:14,665
US. People become aware of it and trying to start selling bonds and buying gold. And they all start

671
00:38:14,665 --> 00:38:20,945
doing it. Even just to bring it to present day, the last time Brazil bought gold was in 2021.

672
00:38:22,525 --> 00:38:31,805
And now Brazil just bought, I forget how much, 15 and a half tons this month. They haven't bought

673
00:38:31,805 --> 00:38:40,025
gold in four years. And so now they're buying. So countries are de-dollarizing even more.

674
00:38:40,485 --> 00:38:43,865
Even the countries that are our friends are repatriating their gold from us.

675
00:38:44,045 --> 00:38:46,205
Serbia, whether they're friends or not, it's hard to say.

676
00:38:46,465 --> 00:38:48,465
But yeah, that's a great chart.

677
00:38:48,625 --> 00:38:49,285
That's a great chart.

678
00:38:50,285 --> 00:38:50,345
Yeah.

679
00:38:50,765 --> 00:38:56,165
I pulled this up because the inflection of 22, particularly on the gold part of the chart

680
00:38:56,165 --> 00:38:56,685
is pronounced.

681
00:38:57,045 --> 00:38:57,625
So we'll see.

682
00:38:58,365 --> 00:39:01,385
Is that share reserves?

683
00:39:01,485 --> 00:39:03,965
Yeah, that's actually an important point.

684
00:39:04,965 --> 00:39:06,545
So a lot of people will look at that.

685
00:39:06,625 --> 00:39:07,465
So that's what's that showing.

686
00:39:07,465 --> 00:39:16,365
Gold is in the process of eclipsing US Treasuries as a share of the Central Bank reserves, right?

687
00:39:16,665 --> 00:39:16,865
OK.

688
00:39:17,765 --> 00:39:19,465
I have something to add to that.

689
00:39:19,605 --> 00:39:20,485
It's not me.

690
00:39:21,205 --> 00:39:24,765
Bank of America did a study about six months ago.

691
00:39:25,965 --> 00:39:28,705
And what they were trying to figure out, at least publicly, they probably already knew.

692
00:39:29,425 --> 00:39:34,065
If central banks are buying gold, the word they use is diversify out of the dollar,

693
00:39:34,605 --> 00:39:39,585
how much gold should they buy to have an optimal diversification of their portfolio?

694
00:39:40,365 --> 00:39:46,785
Bank of America did the analysis, and they said it's not efficient frontier, but it's similar to it.

695
00:39:46,785 --> 00:39:58,085
They said the optimal amount of their reserves in gold for all the central banks that report to the IMF is 30%.

696
00:39:58,705 --> 00:40:01,265
and it's currently at 20%.

697
00:40:01,265 --> 00:40:04,945
So as a percentage, you should have 30% gold,

698
00:40:05,225 --> 00:40:08,065
maybe $50, and 20% other currencies.

699
00:40:08,745 --> 00:40:11,145
And so they optimize, and they're basically doing a trade way.

700
00:40:11,245 --> 00:40:13,305
How much trade do I do that I need gold for?

701
00:40:13,745 --> 00:40:14,685
That's going to go up.

702
00:40:16,045 --> 00:40:18,265
And I had that report, and I broke it down.

703
00:40:18,325 --> 00:40:19,465
I shared it with subscribers.

704
00:40:20,825 --> 00:40:22,725
Then you go into chat to EPT, and you say,

705
00:40:22,725 --> 00:40:24,125
how much money is that?

706
00:40:24,125 --> 00:40:28,685
and it was like $1.9 trillion in gold.

707
00:40:29,005 --> 00:40:30,045
Now, are they going to buy it overnight?

708
00:40:30,185 --> 00:40:31,285
No, they're going to buy it over time.

709
00:40:32,165 --> 00:40:34,745
And then Goldman Sachs comes out with a report that says,

710
00:40:34,905 --> 00:40:37,385
we're not going to say what we think the optimal amount is,

711
00:40:37,385 --> 00:40:39,205
what we think they're going to be buying from three to five years.

712
00:40:39,305 --> 00:40:42,165
And I went, okay, they're going to buy $2 trillion worth of gold

713
00:40:42,165 --> 00:40:43,145
over three to five years.

714
00:40:43,225 --> 00:40:44,225
What does that do to the market?

715
00:40:44,865 --> 00:40:47,185
It drives the price to potentially $10,000.

716
00:40:47,965 --> 00:40:49,905
It just does if they do it,

717
00:40:49,905 --> 00:40:51,605
depending on how patient they are.

718
00:40:51,605 --> 00:41:02,225
And every time, to your point before we started, every time Trump says, I'm not putting up with China, what does gold do?

719
00:41:02,985 --> 00:41:06,785
It rallies because a central bank somewhere says, oh, shit, let's buy a little bit more.

720
00:41:07,525 --> 00:41:09,765
So, yeah, I mean, that's it.

721
00:41:09,865 --> 00:41:17,225
The dollarization started with the Russian war, and it accelerated something that was already on the table to happen.

722
00:41:17,405 --> 00:41:18,925
And it's not going to go away.

723
00:41:18,925 --> 00:41:20,905
We're talking about a decade of this probably.

724
00:41:21,605 --> 00:41:50,945
Yeah. And two things I wonder. First, like bringing it back to geopolitics with a U.S. perspective, like did Trump and Bessent more specifically come in understanding this dynamic at play and really try to reorient things with this incoming administration rather quickly to sort of combat or rearrange their side of the chessboard to be in a better position?

725
00:41:50,945 --> 00:41:52,505
or were they caught off foot?

726
00:41:53,125 --> 00:41:56,465
And then two, with the gold price running like it is,

727
00:41:56,825 --> 00:41:59,285
Bitcoin was at an all-time high last week.

728
00:41:59,665 --> 00:42:03,305
Do animal spirits get engaged?

729
00:42:03,305 --> 00:42:07,525
Is there like a FOMO trade where a number of countries

730
00:42:07,525 --> 00:42:09,725
or individuals, institutions, whatever it may be,

731
00:42:10,225 --> 00:42:14,785
realize they're offside, underexposed, and rush in?

732
00:42:17,085 --> 00:42:18,145
To Bitcoin?

733
00:42:19,345 --> 00:42:20,305
Gold, Bitcoin.

734
00:42:20,305 --> 00:42:23,145
I know this. Oh, yeah. I think part of this debasement trade.

735
00:42:23,265 --> 00:42:26,325
OK, so so the first the first what was the first question again?

736
00:42:26,345 --> 00:42:29,785
Because that was interesting. That was an interesting political side where.

737
00:42:29,905 --> 00:42:36,865
Right, right. Yeah. Or the percent, because obviously you had that famous percent interview at the Manhattan Institute,

738
00:42:36,865 --> 00:42:41,165
where he's talking about the global monetary reordering that he wants to be a part of.

739
00:42:42,765 --> 00:42:46,525
Like in my mind, it's like, OK, he seems to know that something's going on.

740
00:42:46,525 --> 00:42:47,745
He wants to be in that position.

741
00:42:49,125 --> 00:42:57,585
But you look at the volatility of Trump's positioning, throwing things out there, backing away, pivoting somewhere else.

742
00:42:57,765 --> 00:42:59,085
Like, do they actually know what's happening?

743
00:42:59,345 --> 00:43:00,185
Are they flat footed?

744
00:43:01,205 --> 00:43:09,725
Yeah, I think we'd have to have like a, you know, sit down and have a beer or pizza or something and say, all right, what are they doing in the room together?

745
00:43:09,725 --> 00:43:15,045
And, you know, some people are like, you know, it's a master plan.

746
00:43:15,045 --> 00:43:16,685
And some people are like, he doesn't know what he's doing.

747
00:43:16,845 --> 00:43:21,245
And I personally think from the study that I've done of him over the years in the 90s

748
00:43:21,245 --> 00:43:28,305
and always when I was in New York on Wall Street, I personally think that Trump will

749
00:43:28,305 --> 00:43:34,125
find someone that he likes to listen to, that he will, who knows how to not be alpha, but

750
00:43:34,125 --> 00:43:35,185
be like a consigliere.

751
00:43:35,745 --> 00:43:37,185
And this time it's Besant.

752
00:43:37,585 --> 00:43:40,165
And I think Besant said, this is where we're going.

753
00:43:40,305 --> 00:43:41,385
This is where they're going.

754
00:43:41,805 --> 00:43:42,705
We want to get there.

755
00:43:42,765 --> 00:43:44,405
Let's take care of this or that first.

756
00:43:45,045 --> 00:43:49,385
And so eventually, Trump's like, I want to make America great again.

757
00:43:49,705 --> 00:43:51,345
I understand that we need to do manufacturing.

758
00:43:51,465 --> 00:43:52,005
I'm going to do that.

759
00:43:52,505 --> 00:43:54,585
Tell me the plumbing of this.

760
00:43:55,545 --> 00:43:56,805
And so Bessette does that.

761
00:43:57,425 --> 00:44:04,265
And he basically says, eventually, we're going to have to have more gold.

762
00:44:04,365 --> 00:44:05,345
We're going to have to have something.

763
00:44:05,625 --> 00:44:07,245
We're going to have to solidify the dollar.

764
00:44:07,385 --> 00:44:08,965
It's all about the debt that we have.

765
00:44:09,385 --> 00:44:10,845
We're going to have to monetize the debt.

766
00:44:10,845 --> 00:44:17,405
And this is where I think it's a combination of prepared and flat-footed.

767
00:44:17,805 --> 00:44:19,045
This is where I come down.

768
00:44:19,085 --> 00:44:20,705
It sounds like a compromise, but it's really not.

769
00:44:22,025 --> 00:44:25,525
Prepared in the sense that I think there are smart people like Scott percent who know what's

770
00:44:25,525 --> 00:44:27,825
going on and know the end game, right?

771
00:44:28,245 --> 00:44:32,325
Flat-footed in the sense that because we are the global reserve currency and because we've

772
00:44:32,325 --> 00:44:37,825
been able to screw up for decades and get away with it, that incumbency, you're the

773
00:44:37,825 --> 00:44:39,305
champ, you always get the extra vote.

774
00:44:39,305 --> 00:44:51,825
So I think that has made us complacent. And so even someone as sharp as Scott Bessett, I would think he's I think he's sharp, might say, yeah, this is going to be a problem, but we can come back to that. We can always buy time later on.

775
00:44:51,825 --> 00:45:00,985
And the reason I'm not just making that up is because I had a conversation with the CEO of Scottsdale Mint.

776
00:45:01,285 --> 00:45:04,805
And so he's very heavily involved in the industrial side of metals, copper and silver.

777
00:45:05,485 --> 00:45:18,617
And we were talking back and forth And we were talking like you and I are talking now And it like you know what Why do we not care about copper For example China has been taking scrap

778
00:45:18,617 --> 00:45:22,837
copper out of the US for years. And we both concluded we don't care about it because we

779
00:45:22,837 --> 00:45:28,018
have copper or because we've just got bigger fish to fry right now. Right? Same thing with silver.

780
00:45:28,018 --> 00:45:34,317
China has been going into Latin America and buying silver in raw form before it gets to the exchange

781
00:45:34,317 --> 00:45:36,137
so the supply never hits.

782
00:45:36,617 --> 00:45:38,238
So it's like pre-mining silver.

783
00:45:39,198 --> 00:45:41,177
And he's like, yeah, they're doing that.

784
00:45:41,258 --> 00:45:42,857
I go, it's called silver concentrate.

785
00:45:43,097 --> 00:45:44,577
I go, why do we not care?

786
00:45:45,198 --> 00:45:47,137
We're like, well, because silver really isn't that important.

787
00:45:47,477 --> 00:45:48,597
It's important to us.

788
00:45:48,738 --> 00:45:49,657
We're in a little bit of a bubble.

789
00:45:51,857 --> 00:45:54,258
So Josh said, he goes, but copper is important.

790
00:45:54,657 --> 00:45:56,278
Everyone's talking about copper, right?

791
00:45:56,278 --> 00:45:58,957
Even if the price isn't doing the crazy stuff.

792
00:45:58,957 --> 00:46:06,077
and sure enough he comes back from an event right a month before they list silver as a critical

793
00:46:06,077 --> 00:46:13,557
mineral and he says for some reason the federal government has mobilized to protect our copper

794
00:46:13,557 --> 00:46:18,637
supply now is what he shared with me what i can share that he told me we have a big processing

795
00:46:18,637 --> 00:46:23,778
plant for scrap in atlanta i forget the name he goes they're locking it down they're not letting

796
00:46:23,778 --> 00:46:28,038
any silver any he's talking about copper not letting any copper leave anymore they're making

797
00:46:28,038 --> 00:46:31,617
sure all the roads lead to this plant. They're centralizing. That's what the government's doing,

798
00:46:31,617 --> 00:46:36,957
they centralize. He goes, we're serious about copper now. And then the tariffs came out.

799
00:46:37,538 --> 00:46:46,398
I went, oh. So to my point, as half-cocked as it is, I think we are smart enough to know what's

800
00:46:46,398 --> 00:46:50,617
going on. I think we do know what's going on. And we think we have all the time in the world.

801
00:46:50,617 --> 00:46:55,597
and somebody sounds an alarm and they go, let's lock that plant down.

802
00:46:55,698 --> 00:47:01,057
So I think when that happened, you also saw a start of repatriating gold and silver.

803
00:47:01,518 --> 00:47:04,698
And therefore, I believe that we're playing catch up,

804
00:47:05,018 --> 00:47:08,337
but we always can play catch up because of our positioning.

805
00:47:08,597 --> 00:47:09,218
Does that make sense?

806
00:47:09,698 --> 00:47:09,817
Yeah.

807
00:47:10,337 --> 00:47:14,837
No, as it pertains to copper, it makes a ton of sense

808
00:47:14,837 --> 00:47:19,137
considering the sort of expansion of the energy grid that's necessary.

809
00:47:19,137 --> 00:47:19,577
Yeah.

810
00:47:19,577 --> 00:47:33,238
It has been deemed necessary. I think it's critically necessary, but mothers may have another opinion, but it seems abundantly clear that even before the AI boom, the data center boom, it was clear to me.

811
00:47:33,317 --> 00:47:42,297
I've been talking about it since 2018. It was very anti-ESG. Energy is good. Cheap abundant energy equates to human flourishing.

812
00:47:42,297 --> 00:47:45,357
like we should be expanding our grids, our grids are unstable.

813
00:47:45,637 --> 00:47:49,918
And I think luckily for us, this administration recognizes that now

814
00:47:49,918 --> 00:47:55,538
and has made it a point to really lean into the energy sector specifically.

815
00:47:56,018 --> 00:47:57,377
And copper is a huge part of that.

816
00:47:57,457 --> 00:47:59,918
You need copper throughout that whole supply chain.

817
00:48:01,218 --> 00:48:01,918
That's right.

818
00:48:02,058 --> 00:48:09,657
You know, the copper story is interesting because in there you could see how Trump screwed up,

819
00:48:10,457 --> 00:48:11,837
but reaffirmed it.

820
00:48:12,297 --> 00:48:16,117
he initially said about right where,

821
00:48:16,278 --> 00:48:16,817
right when he,

822
00:48:17,198 --> 00:48:18,738
remember how copper had that spike.

823
00:48:19,137 --> 00:48:23,998
He made an announcement that we're going to tariff all copper imports.

824
00:48:25,137 --> 00:48:26,558
And I immediately called Joshua.

825
00:48:26,677 --> 00:48:26,738
I go,

826
00:48:26,977 --> 00:48:27,137
why,

827
00:48:27,258 --> 00:48:28,657
how would we tariff copper imports?

828
00:48:29,218 --> 00:48:29,837
He goes,

829
00:48:29,977 --> 00:48:30,157
well,

830
00:48:30,177 --> 00:48:33,177
we don't really need to buy copper because we have our own raw copper.

831
00:48:33,877 --> 00:48:37,198
What we don't have is we don't have a fabrication facilities.

832
00:48:37,258 --> 00:48:38,238
We don't have the manufacturing.

833
00:48:38,377 --> 00:48:38,538
I went,

834
00:48:38,637 --> 00:48:38,778
okay,

835
00:48:38,857 --> 00:48:38,998
fine.

836
00:48:39,258 --> 00:48:39,457
I go,

837
00:48:39,778 --> 00:48:41,097
but it still doesn't make sense.

838
00:48:41,097 --> 00:48:48,058
And sure enough, a couple of days later, he said, you know, this is this is it's probably didn't hit the press this way.

839
00:48:48,117 --> 00:48:53,058
But this is the fact. We tariffed finished goods in copper.

840
00:48:53,258 --> 00:48:58,218
So you and I, we go buy a copper weather vane over in, you know, Africa.

841
00:48:58,357 --> 00:49:02,198
We bring it back. It gets tariffed. Right. But then they made a carve out.

842
00:49:02,558 --> 00:49:08,998
And this is to your point about energy. The carve out was semi finished copper goods.

843
00:49:08,998 --> 00:49:16,617
we're not going to tire. And so a semi-finished copper good is an electric cathode. Because we

844
00:49:16,617 --> 00:49:22,518
don't make them and we need them, to your point about energy. So we were like, nope, you can't

845
00:49:22,518 --> 00:49:26,218
bring that weather vane in here. You can't bring in that copper kettle here. Cathodes, oh yeah,

846
00:49:26,278 --> 00:49:32,117
you can bring them all in. We want them all. And so copper is that important. And I think

847
00:49:32,117 --> 00:49:37,877
it's become obvious that we need it.

848
00:49:38,438 --> 00:49:42,238
So that's like the point of the spear. Whatever copper does, other things will do.

849
00:49:43,137 --> 00:49:44,278
And I agree with you.

850
00:49:45,538 --> 00:49:50,357
Yeah. It's very interesting times. Are you optimistic about our ability

851
00:49:50,357 --> 00:49:54,357
to navigate this reshuffling of the board politically on the monetary

852
00:49:54,357 --> 00:49:54,718
side?

853
00:49:54,718 --> 00:50:07,238
I'm violently neutral. Meaning I will wake up and say, yes, this can happen. And then I'll wake up

854
00:50:07,238 --> 00:50:11,617
and say, this doesn't make sense. And right now I'm one that this doesn't make sense side. So

855
00:50:11,617 --> 00:50:18,038
the yes, this can happen side goes like this. It's pretty simple. It goes, all right, we need time.

856
00:50:18,457 --> 00:50:22,477
We're going to have 5% inflation for the next five years, give or take. I'm just making a number up.

857
00:50:22,477 --> 00:50:25,398
that inflation is going to be used to retool the economy

858
00:50:25,398 --> 00:50:26,317
we'll build manufacturing

859
00:50:26,317 --> 00:50:31,758
and then we'll export our deficit by buying things

860
00:50:31,758 --> 00:50:33,418
because we can't get anyone to finance our deficit

861
00:50:33,418 --> 00:50:34,137
we have to sell things

862
00:50:34,137 --> 00:50:34,837
I'm with you

863
00:50:34,837 --> 00:50:35,977
this is best said

864
00:50:35,977 --> 00:50:36,857
we need cheap energy

865
00:50:36,857 --> 00:50:37,918
we need a weak dollar

866
00:50:37,918 --> 00:50:39,018
and we need to build stuff

867
00:50:39,018 --> 00:50:40,077
I'm like we can do that

868
00:50:40,077 --> 00:50:41,357
that's me right

869
00:50:41,357 --> 00:50:41,677
that's me

870
00:50:41,677 --> 00:50:43,698
and I see the energy getting cheaper

871
00:50:43,698 --> 00:50:45,877
I know Trump's cutting deals with Saudis

872
00:50:45,877 --> 00:50:46,457
he's saying look

873
00:50:46,457 --> 00:50:47,738
keep pumping the oil

874
00:50:47,738 --> 00:50:49,738
you know at the right level

875
00:50:49,738 --> 00:50:51,817
I'll keep the shale people out of your

876
00:50:51,817 --> 00:50:57,498
noses. I'll take care of Canada's, you know, sans oil. We'll keep that out of the market.

877
00:50:57,977 --> 00:51:00,998
And you can just get all the market share at the lower price. And you and Russia,

878
00:51:01,218 --> 00:51:06,938
we will be happy. All right. So because we can do more, to your point, we can do more with cheap

879
00:51:06,938 --> 00:51:11,698
energy than most anyone else can. If you're a patriot and you believe in the American spirit,

880
00:51:12,337 --> 00:51:12,857
That's right.

881
00:51:13,657 --> 00:51:17,418
And then the data centers.

882
00:51:18,317 --> 00:51:23,218
And then I see the data centers and I go, all right, we need to build data centers.

883
00:51:23,677 --> 00:51:24,617
We need to build data centers.

884
00:51:27,258 --> 00:51:34,018
And I go, well, aren't we just building data centers?

885
00:51:34,177 --> 00:51:35,477
Where's the demand coming from?

886
00:51:35,998 --> 00:51:40,018
And I'm not even getting into the fact that the energy grid's not going to be able to handle it,

887
00:51:40,018 --> 00:51:45,198
all the stuff that I think that you're focusing on. I'm not even getting into that. I go, well,

888
00:51:45,817 --> 00:51:48,857
wait a minute. Didn't we just alienate everyone in the world? They're not going to buy our

889
00:51:48,857 --> 00:51:54,518
treasuries. They don't want to use gold. Every good that's made these days is a commodity.

890
00:51:55,457 --> 00:52:01,957
What are we going to sell them? Like Uber Eats? Our delivery system is the premium?

891
00:52:01,957 --> 00:52:04,938
and so I get depressed

892
00:52:04,938 --> 00:52:05,938
and then

893
00:52:05,938 --> 00:52:08,617
of course it's Zero Hedge right

894
00:52:08,617 --> 00:52:11,117
Zero Hedge posts something

895
00:52:11,117 --> 00:52:11,617
and it shows

896
00:52:11,617 --> 00:52:14,817
in posting something like this every other day

897
00:52:14,817 --> 00:52:15,617
for about a month

898
00:52:15,617 --> 00:52:18,998
but the thing they post when they talk about fundamentals

899
00:52:18,998 --> 00:52:20,817
they're right and they say okay

900
00:52:20,817 --> 00:52:22,778
this ties it with

901
00:52:22,778 --> 00:52:24,877
Nvidia ties it with you know everyone's talking

902
00:52:24,877 --> 00:52:26,018
about the circle jerk now

903
00:52:26,018 --> 00:52:28,778
that's been going around for years but now they're

904
00:52:28,778 --> 00:52:29,637
talking about it

905
00:52:29,637 --> 00:52:47,038
So my concern is, based on my pessimistic side and based on the data that Zero Hedge is showing, is that companies are now extrapolating out, we're not going to do 2027 earnings.

906
00:52:47,137 --> 00:52:48,797
We're going to do 2035 earnings.

907
00:52:49,117 --> 00:52:54,297
And you're seeing these lines for data centers going out, projecting forever.

908
00:52:54,297 --> 00:52:57,637
and I go, and this is me positively going,

909
00:52:58,238 --> 00:53:00,058
that's crazy, but maybe it can happen.

910
00:53:00,877 --> 00:53:04,218
And then I read a line that makes me think,

911
00:53:04,957 --> 00:53:07,278
it's not going to happen.

912
00:53:07,477 --> 00:53:08,938
And the line is, and the line is,

913
00:53:09,058 --> 00:53:10,758
this is why I'm worried about 10% inflation.

914
00:53:11,377 --> 00:53:12,738
And the line is, I'm not a doomer.

915
00:53:12,738 --> 00:53:15,918
The line is, everything's coming along.

916
00:53:16,558 --> 00:53:18,218
We're creating an asset bubble

917
00:53:18,218 --> 00:53:21,957
by spending money to build data centers

918
00:53:21,957 --> 00:53:24,038
and our stocks are getting driven up.

919
00:53:24,297 --> 00:53:27,297
because of the projected future potential earnings.

920
00:53:27,457 --> 00:53:28,258
And that's fine.

921
00:53:28,998 --> 00:53:31,357
And we can do that in a world where everyone's on our side,

922
00:53:31,457 --> 00:53:31,977
but they're not.

923
00:53:32,758 --> 00:53:35,477
So are you telling me this is like the Tyler thing,

924
00:53:35,857 --> 00:53:37,817
the zero action, the line's going up like that.

925
00:53:37,957 --> 00:53:39,457
Are you telling me we're not going to have a recession

926
00:53:39,457 --> 00:53:40,837
for the next 15 years?

927
00:53:41,317 --> 00:53:42,317
Because that's what you're projecting.

928
00:53:43,177 --> 00:53:45,578
And I went, oh shit, we're going to have a recession.

929
00:53:45,918 --> 00:53:46,998
We have to have a recession.

930
00:53:47,877 --> 00:53:49,637
Because the rest of the world

931
00:53:49,637 --> 00:53:52,398
is going to have a recession at some point.

932
00:53:52,398 --> 00:53:53,977
And it's going to affect us.

933
00:53:54,297 --> 00:53:56,357
And we can't raise rates.

934
00:53:56,797 --> 00:53:57,998
We're going to lower rates.

935
00:53:58,438 --> 00:54:01,998
So my conclusion is we're not going to – I mean, this is like today.

936
00:54:02,078 --> 00:54:02,597
Call me tomorrow.

937
00:54:02,698 --> 00:54:03,777
Maybe I'll be in a good mood, right?

938
00:54:04,238 --> 00:54:05,617
We're not going to get there.

939
00:54:06,377 --> 00:54:12,657
Even if Trump executed everything perfectly, there's no successor to Trump who's going to be like him.

940
00:54:12,657 --> 00:54:14,657
There's no – I don't know.

941
00:54:14,698 --> 00:54:17,918
Maybe J.D. Vance is.

942
00:54:17,977 --> 00:54:18,377
I don't know.

943
00:54:18,377 --> 00:54:25,918
But the bureaucratic deep state is still entrenched like a tick at a deer.

944
00:54:26,018 --> 00:54:27,038
They're not going to go anywhere.

945
00:54:27,558 --> 00:54:28,718
They're going to wait it out.

946
00:54:29,218 --> 00:54:40,157
And I think the first recession we get, because we're running a 1970s-style bubble, first recession we get, we can't afford to cut.

947
00:54:40,797 --> 00:54:44,438
We're going to have to – we can't afford to raise.

948
00:54:44,877 --> 00:54:45,877
We're going to have to cut.

949
00:54:46,477 --> 00:54:48,238
We're cutting in a bubble right now.

950
00:54:48,377 --> 00:54:53,097
We're cutting in an economic borderline boom right now, depending on how you look at it.

951
00:54:54,938 --> 00:54:59,718
And the last time we did that materially was in 1973, 1974.

952
00:55:00,238 --> 00:55:03,137
The US was on this mind.

953
00:55:03,218 --> 00:55:04,038
This is where we are now.

954
00:55:04,377 --> 00:55:07,938
1973, 1974, the US was monetizing its debt.

955
00:55:08,177 --> 00:55:09,857
We're doing that again right now, by the way.

956
00:55:09,977 --> 00:55:12,137
We're not doing that at the Fed, but we're monetizing our debt.

957
00:55:12,597 --> 00:55:13,797
It's really ugly what we're doing.

958
00:55:14,477 --> 00:55:15,258
Another conversation.

959
00:55:15,258 --> 00:55:20,777
But in the 70s, we were paying for all the Vietnam veterans coming home.

960
00:55:20,918 --> 00:55:25,277
We were trying to fend off communism, civil rights, a lot of social safety net and welfare

961
00:55:25,277 --> 00:55:26,657
money is being spent, spent, spent.

962
00:55:26,817 --> 00:55:27,977
We're financing Vietnam.

963
00:55:28,277 --> 00:55:29,637
We're still paying for Korea.

964
00:55:30,198 --> 00:55:34,957
And so we're cutting rates in the 70s, 72, 73, 74.

965
00:55:35,418 --> 00:55:39,698
And 73 and 74, the stock market does very poorly.

966
00:55:39,758 --> 00:55:41,258
But the gold market is at the highs.

967
00:55:41,578 --> 00:55:42,938
But then they cut rates.

968
00:55:42,938 --> 00:55:50,718
in 75 and 76 the stock market explodes everything is great again 76 is the bicentennial i was like

969
00:55:50,718 --> 00:55:56,857
you know eight years old and uh every there was everyone was so happy the bicentennial everyone

970
00:55:56,857 --> 00:56:06,938
wasn't yet and then 77 all goes in the shitter they stopped lowering rates to paint the turd

971
00:56:06,938 --> 00:56:15,078
as the expression goes. Inflation came back, and between 77 and 79, 77 and 80, it was nothing but

972
00:56:15,078 --> 00:56:21,518
inflation. So that's where we are now. Either we're in 1974, and we're cutting rates to get

973
00:56:21,518 --> 00:56:30,297
the economy going, or if Trump doesn't succeed, it's 1977, and we're going to have asset commodity

974
00:56:30,297 --> 00:56:36,518
prices high, and data centers that no one's using. They'll become skateboard parks. So right now,

975
00:56:36,518 --> 00:56:38,657
pretty pessimistic.

976
00:56:38,738 --> 00:56:40,177
But thank you for letting me go off on that.

977
00:56:42,418 --> 00:56:42,817
It's

978
00:56:42,817 --> 00:56:44,317
important because, I mean,

979
00:56:45,058 --> 00:56:46,777
one thing I'd bring up is like, have we been

980
00:56:46,777 --> 00:56:48,518
in a recession in real terms

981
00:56:48,518 --> 00:56:50,438
for a while? Because if you look at inflation data,

982
00:56:50,558 --> 00:56:52,198
you're using CPI. It's not tracking

983
00:56:52,198 --> 00:56:53,877
real inflation.

984
00:56:54,617 --> 00:56:54,718
Right.

985
00:56:56,398 --> 00:56:57,018
And then

986
00:56:57,018 --> 00:57:00,297
how bad does it get?

987
00:57:00,398 --> 00:57:02,597
I posted yesterday a passage from

988
00:57:02,597 --> 00:57:04,238
When Money Dies and the

989
00:57:04,238 --> 00:57:05,977
corollaries to

990
00:57:05,977 --> 00:57:07,957
why more Republic vibes

991
00:57:07,957 --> 00:57:10,137
are very high right now.

992
00:57:11,518 --> 00:57:12,038
Behaviorally,

993
00:57:12,137 --> 00:57:14,058
they are very high. Behaviorally,

994
00:57:14,137 --> 00:57:14,337
sure.

995
00:57:16,218 --> 00:57:17,817
Everybody's on Robinhood.

996
00:57:18,277 --> 00:57:20,078
Every Zoomer thinks they're the best stock,

997
00:57:20,177 --> 00:57:21,918
but not every Zoomer. It's definitely

998
00:57:21,918 --> 00:57:23,657
a growing trend of Zoomer

999
00:57:23,657 --> 00:57:26,137
stock traders giving advice.

1000
00:57:26,238 --> 00:57:27,977
We saw that with Wall Street Bets, obviously.

1001
00:57:28,498 --> 00:57:28,738
Yeah.

1002
00:57:28,738 --> 00:57:30,977
But back then, we tolerated

1003
00:57:30,977 --> 00:57:32,857
because it was stimulus. There's no stimulus now.

1004
00:57:32,938 --> 00:57:33,857
They're still doing it.

1005
00:57:34,238 --> 00:57:34,558
No.

1006
00:57:34,797 --> 00:57:39,597
And to your point about the debt and the rates,

1007
00:57:39,597 --> 00:57:44,018
I worry like lowering rates right now.

1008
00:57:44,157 --> 00:57:46,177
We just cut 25 bps.

1009
00:57:46,357 --> 00:57:47,698
The 10-year is still above 4.

1010
00:57:48,198 --> 00:57:52,777
And I think that's one thing people had collective amnesia

1011
00:57:52,777 --> 00:57:55,477
after the initial rate cuts from last year.

1012
00:57:55,718 --> 00:57:56,218
Right.

1013
00:57:56,377 --> 00:57:58,998
Where they just assume like, oh, the Fed funds rate goes down

1014
00:57:58,998 --> 00:58:00,317
and bond yields will follow.

1015
00:58:00,317 --> 00:58:04,317
That doesn't seem to be really materializing at all.

1016
00:58:05,698 --> 00:58:06,457
That's right.

1017
00:58:08,277 --> 00:58:10,337
I'd like to speak to that for a second, if you don't mind.

1018
00:58:12,498 --> 00:58:21,218
During the QE era, we all got addicted to Fed lowers rates, bond yields drop, and therefore we have to buy stocks because nothing gives us any interest anymore.

1019
00:58:21,398 --> 00:58:25,058
Money market rates down, bond yields down, just help buy stocks, right?

1020
00:58:25,558 --> 00:58:28,877
But we're not in the QE era anymore, at least not from the Fed side.

1021
00:58:28,877 --> 00:58:34,857
And so when you're not in the QE era, you're what I call the anti-Goldilocks era.

1022
00:58:35,198 --> 00:58:39,038
So the Goldilocks era was QE from the 90s.

1023
00:58:39,258 --> 00:58:40,538
Well, QE started in the O's.

1024
00:58:40,637 --> 00:58:48,977
But from the 90s through the mid-O's, we had deflationary tailwinds, disinflationary tailwinds pushing us up.

1025
00:58:49,657 --> 00:58:50,498
Goods were getting cheaper.

1026
00:58:50,637 --> 00:58:51,957
Technology was being implemented.

1027
00:58:52,198 --> 00:58:57,698
Everything at Walmart was the prices are dropping at Walmart every day, like low prices every day.

1028
00:58:57,698 --> 00:58:58,758
You don't hear that anymore.

1029
00:58:58,877 --> 00:59:06,238
Because now we've gone from disinflationary tailwinds from technology from developing supply chains to inflationary headwinds.

1030
00:59:07,097 --> 00:59:22,498
And when you have inflationary headwinds, meaning other people are buying commodities that we need or restricting our access to them, like oil in the 70s, when you have that happen, you have inflationary headwinds hitting the economy.

1031
00:59:22,498 --> 00:59:34,558
And with inflationary headwinds, you can't lower rates without causing a bubble.

1032
00:59:35,238 --> 00:59:36,817
Actually, I just lost my train of thought on that.

1033
00:59:38,117 --> 00:59:42,038
The Fed can't, oh, the deficit and the debt.

1034
00:59:42,457 --> 00:59:44,438
Yeah, oh, this is a bond market, right?

1035
00:59:44,578 --> 00:59:48,078
When you have an anti-Goldilocks situation and you have the inflationary headwinds,

1036
00:59:48,078 --> 00:59:56,078
When you lower the Fed funds rate, the bond market vigilantes, and they're back, they say,

1037
00:59:56,078 --> 00:59:59,317
wait a minute, you're not done fighting inflation.

1038
00:59:59,317 --> 01:00:03,018
If you're lowering rates too soon, we're going to make the inflation come out the other end.

1039
01:00:03,018 --> 01:00:04,578
And so that's really what's happening though.

1040
01:00:04,578 --> 01:00:06,457
You're going about 4%.

1041
01:00:06,457 --> 01:00:09,498
There's two ways to, again, another Zoltan Pozar statement.

1042
01:00:09,498 --> 01:00:12,498
There are two ways to fight inflation at the monetary level.

1043
01:00:12,498 --> 01:00:13,538
One is by raising inflation.

1044
01:00:13,584 --> 01:00:19,204
using short-term rates, which we've stopped doing. And two is by letting long-term rates rise.

1045
01:00:20,104 --> 01:00:26,144
So like you said, Powell cut September 17th last year, and the bond market dumped yields,

1046
01:00:26,524 --> 01:00:34,364
climbed. The bond market did a seesaw. The bond market did that. That's yields. Drop, raise. I'm

1047
01:00:34,364 --> 01:00:40,984
like, that's bad. That means that inflation is not out of the market yet. And sure enough,

1048
01:00:40,984 --> 01:00:45,904
he cut again and the bond market didn't do it as badly but the bond market's not happy

1049
01:00:45,904 --> 01:00:50,224
and that's the rest of the world going oh look another reason to not own american bonds

1050
01:00:50,224 --> 01:00:55,224
and they're selling them and i think if he cuts again we're going to have one of these it's kind

1051
01:00:55,224 --> 01:01:01,324
of like a mini version of what went on in the uk uh people start selling dollars bonds and stocks

1052
01:01:01,324 --> 01:01:06,484
and taking their money back it's that's the real risk if you want to watch anything as a reason to

1053
01:01:06,484 --> 01:01:10,344
buy gold or as a reason to buy, you know, a crypto or Bitcoin.

1054
01:01:11,124 --> 01:01:16,204
If you want to if you want to watch anything, you want to watch how the market reacts to

1055
01:01:16,204 --> 01:01:17,024
when the Fed cuts.

1056
01:01:17,384 --> 01:01:19,884
And it has not been approving of the Fed cuts.

1057
01:01:20,264 --> 01:01:24,344
I don't think like I don't think he's going to I think I think it'll be a mistake if he

1058
01:01:24,344 --> 01:01:24,724
cuts again.

1059
01:01:24,964 --> 01:01:25,264
I do.

1060
01:01:28,024 --> 01:01:31,744
But does he have the political will to not cut?

1061
01:01:31,984 --> 01:01:32,924
That's the question, right?

1062
01:01:33,104 --> 01:01:34,484
Is that's where you have Trump coming in?

1063
01:01:34,484 --> 01:01:37,044
as well as being a bull in a china shop.

1064
01:01:37,424 --> 01:01:38,604
But he's a short timer, too.

1065
01:01:38,664 --> 01:01:40,524
Maybe he can hide and wait it out for six months.

1066
01:01:41,284 --> 01:01:41,524
Yeah.

1067
01:01:42,024 --> 01:01:42,264
Right?

1068
01:01:42,264 --> 01:01:43,884
I mean, what is it?

1069
01:01:43,904 --> 01:01:46,264
He cuts 25 basis points recently, right?

1070
01:01:46,404 --> 01:01:48,244
He talks extremely dovish.

1071
01:01:48,444 --> 01:01:51,684
And then like two weeks later, you know, gold rallies $100.

1072
01:01:52,004 --> 01:01:53,004
I'm like, oh, this is bad.

1073
01:01:53,084 --> 01:01:54,044
Like, he's going to cut again.

1074
01:01:55,064 --> 01:01:56,064
And stocks are up.

1075
01:01:56,164 --> 01:01:57,344
And stocks start to tail off.

1076
01:01:57,664 --> 01:02:01,444
Then he starts talking, oh, well, I was just readjusting the rates.

1077
01:02:01,564 --> 01:02:03,624
He's doing that whole Fed speak thing.

1078
01:02:03,624 --> 01:02:07,984
And I go, you're cutting into a boom.

1079
01:02:08,184 --> 01:02:09,224
Like we're creating a boom.

1080
01:02:09,424 --> 01:02:20,304
And, you know, related to what we're trying to do here is China, every step of the way now, saying things like, oh, you're spending $500 billion on Stargate?

1081
01:02:20,424 --> 01:02:21,324
Oh, we did it for $5 billion.

1082
01:02:21,624 --> 01:02:23,304
Now, whether they're lying or not, it's not the point.

1083
01:02:23,704 --> 01:02:27,524
The point is they're putting propaganda out saying that we're paying too much.

1084
01:02:28,564 --> 01:02:30,364
They're saying our assets are overvalued.

1085
01:02:30,764 --> 01:02:32,284
And that's petrifying to me.

1086
01:02:32,284 --> 01:02:33,304
They never did that before.

1087
01:02:33,624 --> 01:02:36,424
I think the bond market is telling us we should not be lowering rates.

1088
01:02:36,844 --> 01:02:37,124
I agree.

1089
01:02:37,824 --> 01:02:38,004
Yeah.

1090
01:02:38,424 --> 01:02:43,264
Well, staying on this topic of government debt and inflation before we hit record.

1091
01:02:43,864 --> 01:02:44,144
Right.

1092
01:02:44,884 --> 01:02:46,424
Inflation is not geopolitical.

1093
01:02:46,424 --> 01:02:51,144
There are these inflationary headwinds across the world for different purposes.

1094
01:02:51,324 --> 01:02:56,824
You said here in the U.S., manufacturing, Japan, defense, Europe, defense, and social safety nets, China.

1095
01:02:57,504 --> 01:02:57,644
Right.

1096
01:02:57,704 --> 01:02:58,584
Social safety nets.

1097
01:02:58,584 --> 01:03:04,144
So the inflation trade is not isolated to the United States.

1098
01:03:05,484 --> 01:03:06,064
No, it's not.

1099
01:03:06,384 --> 01:03:08,724
It's and it's actually.

1100
01:03:12,084 --> 01:03:17,084
Like, we're we're the last we're probably going to be the last to really debase or cut.

1101
01:03:17,424 --> 01:03:19,084
But yeah, you're right.

1102
01:03:19,124 --> 01:03:20,204
It's not isolated to the United States.

1103
01:03:20,284 --> 01:03:24,904
And if you go around the world, Trump's policies, which would have happened anyway.

1104
01:03:25,524 --> 01:03:25,764
Right.

1105
01:03:25,764 --> 01:03:27,504
Start under by we pulled out of Afghanistan.

1106
01:03:27,504 --> 01:03:34,684
If you look at Pax Americana of us being a cop on every corner of the world, we can't pay for that anymore.

1107
01:03:34,784 --> 01:03:35,984
And some places don't even want us.

1108
01:03:36,144 --> 01:03:40,264
So we're kind of like the tide of American military is receding.

1109
01:03:40,404 --> 01:03:41,344
We're retrenching.

1110
01:03:41,544 --> 01:03:43,804
Call it Monroe Doctrine.

1111
01:03:44,584 --> 01:03:46,004
Call it whatever you want to call it.

1112
01:03:46,024 --> 01:03:47,364
Call it America first.

1113
01:03:48,264 --> 01:03:49,364
Whatever the reasons are.

1114
01:03:49,724 --> 01:03:52,884
So we pull out of Afghanistan, butchered by Biden.

1115
01:03:52,884 --> 01:04:16,604
And then war starts. Gaza war starts. Ukraine war starts. And I see us not doing what we normally do, meaning in Gaza, we really let the Israelis off the leash. And I know it's another whole can of worms to talk about. But we really just said, you know what, we'll let them fight it out and make it a hockey fight.

1116
01:04:16,604 --> 01:04:21,904
and then we go into Jim Edgewood and then we say, what's Trump say? We're not going to spend

1117
01:04:21,904 --> 01:04:29,324
money on NATO anymore. And the math is very simple. Speaking as a Tom Luongo person,

1118
01:04:30,344 --> 01:04:38,044
but from my expertise or lack of a better word, one of the things that Europe is very proud of

1119
01:04:38,044 --> 01:04:44,964
is over the last 50 years, they're proud of their social safety net. They're proud of their

1120
01:04:44,964 --> 01:04:52,624
welfare state. They're proud of free college. They're proud of no homelessness. And to Trump's

1121
01:04:52,624 --> 01:05:01,884
point, that's because they have a defense budget of zero or 1%. And we have a defense budget of 5%,

1122
01:05:01,884 --> 01:05:08,844
probably more. And so we have been, since communism, even, you know, we have been the,

1123
01:05:08,844 --> 01:05:16,944
it's like a few good men like the you would eat me on that wall type of thing you know and we have

1124
01:05:16,944 --> 01:05:22,284
been there saying okay you can you can we're subsidizing their welfare state and so Trump

1125
01:05:22,284 --> 01:05:27,204
says we want to spend less and now you do the math and they're like everyone's going from maybe

1126
01:05:27,204 --> 01:05:33,184
it's one to three percent of GDP now it's five to six percent so call it five call it two to five

1127
01:05:33,824 --> 01:05:34,944
That's a lot of money.

1128
01:05:35,764 --> 01:05:41,664
And you're doing it right after you just let millions of people in your country to be attached to your social safety net.

1129
01:05:41,724 --> 01:05:42,904
What do you think you're driving down labor?

1130
01:05:43,004 --> 01:05:43,964
You're not driving down labor.

1131
01:05:44,264 --> 01:05:45,284
You're driving down welfare.

1132
01:05:46,524 --> 01:05:48,844
So Europe's got to spend more money.

1133
01:05:49,764 --> 01:05:51,624
They can't even spend on their manufacturing.

1134
01:05:51,824 --> 01:05:52,944
Germany's done.

1135
01:05:53,364 --> 01:05:57,624
Italy's probably going to be the next leading country in Europe, if you can call it that.

1136
01:05:57,624 --> 01:06:05,684
then you go over to japan and we're they're like hey listen taiwan like like we don't have a good

1137
01:06:05,684 --> 01:06:10,984
history with china we don't want to have that blow up on our face well and u.s say well we're

1138
01:06:10,984 --> 01:06:16,024
we said we're pulling out there's a there's a pact like a pack like asiana i forget what it's called

1139
01:06:16,024 --> 01:06:22,024
but japan's ramping up their their military spending all the things that we didn't want

1140
01:06:22,024 --> 01:06:25,944
europe to do because we're worried about the nazis coming back or about imperial japan coming back

1141
01:06:25,944 --> 01:06:28,424
Well, now we have to let them do it, right?

1142
01:06:28,584 --> 01:06:30,604
So Japan's spending on that, right?

1143
01:06:30,644 --> 01:06:35,184
And everyone's got big debt for buying flat screen TVs with money they didn't have, right?

1144
01:06:35,184 --> 01:06:36,504
So Japan's spending on military.

1145
01:06:36,964 --> 01:06:39,164
Europe's spending on military and a safety net.

1146
01:06:39,164 --> 01:06:42,824
In the US, we're not spending, I mean, we are, but we're not spending on military.

1147
01:06:43,084 --> 01:06:44,724
We're not spending on a safety net.

1148
01:06:44,824 --> 01:06:45,684
Well, we are a little bit.

1149
01:06:46,124 --> 01:06:49,724
We're spending to become a producer of goods again to compete with China.

1150
01:06:50,524 --> 01:06:53,484
So we're spending, Europe's spending, everyone's spending.

1151
01:06:53,604 --> 01:06:55,824
It's a race to the bottom one way or another.

1152
01:06:55,944 --> 01:07:04,224
And China, which has had to spend to begin with to get their economy out of their own kind of like recession.

1153
01:07:05,164 --> 01:07:08,804
And this isn't me talking, but I've read the work.

1154
01:07:09,104 --> 01:07:09,844
I forget his name.

1155
01:07:09,964 --> 01:07:12,124
Eric Green, I think, T.S.

1156
01:07:12,204 --> 01:07:12,964
Lombard analyst.

1157
01:07:13,384 --> 01:07:15,984
I had a conversation with him about a report that he put out.

1158
01:07:16,364 --> 01:07:19,104
And I'm like, completely naive American, right?

1159
01:07:19,184 --> 01:07:21,784
I'm like, they're communists, even though they're not communists.

1160
01:07:22,184 --> 01:07:22,764
They're communists.

1161
01:07:22,864 --> 01:07:24,624
What do you mean they don't spend enough money helping people?

1162
01:07:24,744 --> 01:07:25,564
He goes, oh, no.

1163
01:07:25,564 --> 01:07:46,764
Oh, no, no. When they went capitalist, they went full capitalist. They're like, you live in the country. We're not giving you a dime. You better move to the city and get a job. That was part of their urbanization plan, I guess. So what does that mean? He goes, well, it's not working anymore. People aren't moving anymore. And there's a higher level of poverty, right?

1164
01:07:46,764 --> 01:07:54,384
There's also they have like 50% college graduates or students or young men are unemployed.

1165
01:07:54,704 --> 01:07:56,404
It's bigger than ours for sure.

1166
01:07:57,084 --> 01:07:58,364
And I said, so what does that mean?

1167
01:07:58,404 --> 01:08:06,264
He goes, well, he goes, they're actually working up the plans to add welfare for the rural areas.

1168
01:08:06,704 --> 01:08:08,744
He goes, they're going to be spending a lot.

1169
01:08:08,844 --> 01:08:10,064
They're creating a welfare program.

1170
01:08:10,164 --> 01:08:12,324
They have no social safety net.

1171
01:08:12,904 --> 01:08:15,244
And so I went, so China's going to spend on social safety net?

1172
01:08:15,244 --> 01:08:15,604
He goes, yeah.

1173
01:08:15,704 --> 01:08:18,464
I go, so now every country is spending for different reasons.

1174
01:08:19,064 --> 01:08:21,044
And every country is going to monetize their debt.

1175
01:08:21,144 --> 01:08:23,404
And it's a race to the bottom.

1176
01:08:23,504 --> 01:08:24,664
It's like Santa Claus.

1177
01:08:25,444 --> 01:08:27,524
You know, you've got a 16-year-old kid.

1178
01:08:28,484 --> 01:08:29,664
He knows there's no Santa Claus.

1179
01:08:29,784 --> 01:08:30,864
You know there's no Santa Claus.

1180
01:08:30,964 --> 01:08:32,944
But as long as you don't acknowledge, you keep giving him gifts.

1181
01:08:33,544 --> 01:08:34,824
And that's where we are right now.

1182
01:08:34,824 --> 01:08:41,204
I happen to know, now that I've studied it, that we're monetizing our debt already,

1183
01:08:41,284 --> 01:08:44,104
which means we can't pay off our debt, so we're printing money.

1184
01:08:44,564 --> 01:08:45,144
We're printing.

1185
01:08:45,244 --> 01:08:46,984
not at the Fed level, at the Treasury level.

1186
01:08:47,404 --> 01:08:51,224
And in doing that, we're weakening the dollar intentionally.

1187
01:08:51,604 --> 01:08:52,424
So that's it.

1188
01:08:52,524 --> 01:08:53,704
Yeah, everyone's spending.

1189
01:08:54,124 --> 01:08:54,744
Everyone's spending.

1190
01:08:55,144 --> 01:08:56,824
No one can be austere yet.

1191
01:08:57,204 --> 01:08:59,924
That comes after the crash, possibly.

1192
01:09:00,844 --> 01:09:01,044
That's it.

1193
01:09:02,944 --> 01:09:05,184
When do you think the crash will be, if there is one?

1194
01:09:06,044 --> 01:09:07,124
Yeah, I get it.

1195
01:09:07,144 --> 01:09:07,484
Stuff like that.

1196
01:09:07,484 --> 01:09:09,444
I don't know.

1197
01:09:09,604 --> 01:09:13,464
I'm very, I see the fork in the road.

1198
01:09:13,464 --> 01:09:16,604
and it's like I don't know when it will be

1199
01:09:16,604 --> 01:09:18,804
but I'll know what will cause it

1200
01:09:18,804 --> 01:09:19,744
so it'll be

1201
01:09:19,744 --> 01:09:21,964
it'll be

1202
01:09:21,964 --> 01:09:24,244
you'll see

1203
01:09:24,244 --> 01:09:26,784
information like let's look at the

1204
01:09:26,784 --> 01:09:28,904
current events right you'll see information accumulating

1205
01:09:28,904 --> 01:09:30,524
that oh people are

1206
01:09:30,524 --> 01:09:32,664
Goldman Sachs which has been

1207
01:09:32,664 --> 01:09:34,984
AI stocks all the way is now saying

1208
01:09:34,984 --> 01:09:36,744
circle jerk you know

1209
01:09:36,744 --> 01:09:38,944
client finance and everyone

1210
01:09:38,944 --> 01:09:40,604
say oh it's just like 2000 I'll say well

1211
01:09:40,604 --> 01:09:42,784
it's not yet because people still believe

1212
01:09:42,784 --> 01:09:48,464
I'll start to say crash if I see a day where stocks are down and gold is up.

1213
01:09:48,464 --> 01:09:54,904
Not because gold's better, but because people are going to put their money into gold because

1214
01:09:54,904 --> 01:10:07,367
stocks are down They not going to buy more stocks So when I see things like that I be concerned I tell you what the warning shot across the bow was that I looking for to happen again to make me think there be a crash

1215
01:10:07,367 --> 01:10:22,367
The warning shot across the bow was, I think it was, I don't know, in April or May when Europe, to defend itself, said the U.S. is no longer American exceptionalism.

1216
01:10:22,367 --> 01:10:30,526
exceptionalism, the US is weak. And therefore, because of its debt, we're going to sell our

1217
01:10:30,526 --> 01:10:34,666
stocks. And instead of putting it in bonds, we're going to repatriate our currency. And that's where

1218
01:10:34,666 --> 01:10:41,346
your crash comes from. So for example, Japan is a huge investor overseas, huge. And they've got

1219
01:10:41,346 --> 01:10:46,086
problems now. They've always had problems. But the solution to their problems now is to repatriate

1220
01:10:46,086 --> 01:10:51,466
currency. It's to sell your investments in Europe and bring your money back for yourself. That's

1221
01:10:51,466 --> 01:10:55,266
what they need to do to shore up the currency. Imagine if they did that with U.S. Treasury. I

1222
01:10:55,266 --> 01:11:00,947
think they're the largest holder, maybe number two. But they financed the world. So as countries,

1223
01:11:01,386 --> 01:11:05,867
I'm Europe. I need to rebuild my infrastructure. You can't use dollars to build a road.

1224
01:11:06,367 --> 01:11:13,226
You need euros. And so it's sell my U.S. stocks. Don't put it in bonds this time. Don't put it in

1225
01:11:13,226 --> 01:11:19,006
dollars. Put it in euros. Bring it home. And so when the dollar, gold, so when the dollar,

1226
01:11:19,006 --> 01:11:22,407
bonds and stocks drop at the same time, I get petrified.

1227
01:11:23,146 --> 01:11:26,907
And we had, I think, a shot across the bow in, I think it was April or May.

1228
01:11:27,526 --> 01:11:31,426
And when I see that happen, I pay attention. So when that happens, then I'll say,

1229
01:11:32,106 --> 01:11:36,186
Marty, we should get short. And of course, we get our asses handed to us, but we get how it works.

1230
01:11:36,407 --> 01:11:37,306
Yeah, that's it.

1231
01:11:38,287 --> 01:11:42,827
No, it is. In the last six months, I've

1232
01:11:42,827 --> 01:11:48,146
described the period that we're living in as equally exhilarating and unnerving

1233
01:11:48,146 --> 01:11:50,486
because it's just impossible to tell.

1234
01:11:51,046 --> 01:11:51,466
Yeah, yeah.

1235
01:11:51,666 --> 01:11:52,526
What's the expression?

1236
01:11:54,926 --> 01:11:58,646
The guy with one foot in a bucket of coal,

1237
01:11:58,766 --> 01:12:00,046
the other foot in a bucket of ice,

1238
01:12:00,166 --> 01:12:00,986
and you say, how are you doing?

1239
01:12:01,046 --> 01:12:02,207
He says, on average, I'm okay.

1240
01:12:03,327 --> 01:12:04,186
That's where we are.

1241
01:12:04,327 --> 01:12:05,066
That's where I feel like.

1242
01:12:05,747 --> 01:12:05,886
Yeah.

1243
01:12:06,886 --> 01:12:10,287
And so let's talk about Bitcoin.

1244
01:12:10,287 --> 01:12:12,046
I mean, you talked about it earlier,

1245
01:12:12,407 --> 01:12:14,407
about a lot of the moves that have been made

1246
01:12:14,407 --> 01:12:16,346
in the last couple of years with the ETFs,

1247
01:12:16,346 --> 01:12:22,546
I think the options on the ETFs, futures going 24-7 soon, I believe, if not already.

1248
01:12:23,806 --> 01:12:32,306
You think these markets and particularly the derivatives are being used to hold the price down so the government can accumulate?

1249
01:12:32,886 --> 01:12:33,226
Yeah, I do.

1250
01:12:33,287 --> 01:12:36,207
And I'm not a paranoid to fill out where I'm a person who never believed that.

1251
01:12:36,287 --> 01:12:37,627
But I understand how it works now.

1252
01:12:40,586 --> 01:12:44,827
There's only two things a nation does that it doesn't let its people do.

1253
01:12:44,827 --> 01:12:51,766
One, kill you. You can't kill yourself. They can put you to death. And two, make money.

1254
01:12:53,526 --> 01:13:01,186
Nations, anyone who's a hardcore, I'm not a hardcore Bitcoin person, but a nation needs to have sovereign money.

1255
01:13:01,327 --> 01:13:04,506
That's sovereign wealth. And that's very like the charterless concept.

1256
01:13:04,707 --> 01:13:08,447
You print the money, you give it to them, you take it back at tax, you create that circle, right?

1257
01:13:08,947 --> 01:13:11,327
And then you skim off the top and you run it.

1258
01:13:11,327 --> 01:13:18,066
Bitcoin was becoming a threat, whether it's made by someone or not, I don't care.

1259
01:13:18,486 --> 01:13:20,546
It has a life of its own now.

1260
01:13:20,766 --> 01:13:23,566
It is a Trojan horse in many ways.

1261
01:13:24,367 --> 01:13:32,926
And what the US does, not all governments, what the US does is it will,

1262
01:13:32,926 --> 01:13:39,947
if it catches it early enough, it'll kill it, the threat to the dollar.

1263
01:13:39,947 --> 01:13:46,066
If it doesn't catch it early enough, it'll just use rhetoric and propaganda and fun it.

1264
01:13:47,867 --> 01:13:51,226
And if it survives that, then it won't actively attack it.

1265
01:13:51,287 --> 01:13:54,947
Maybe like a CIA assassin goes out to kill Bitcoin.

1266
01:13:55,166 --> 01:13:57,386
I mean, you get my point, like a regime change.

1267
01:13:58,166 --> 01:14:02,766
And then if it can't do that, and this is where the US is really smart, it co-ops.

1268
01:14:02,766 --> 01:14:15,586
So when you create the ETFs, I think I know that people do not value the liquidity network that the US has big enough.

1269
01:14:16,146 --> 01:14:18,086
And so I'm going to exaggerate, but I'll make a point.

1270
01:14:18,907 --> 01:14:22,226
70% of all the Bitcoin transactions were outside of the US.

1271
01:14:22,606 --> 01:14:24,186
The liquidity was not in the US.

1272
01:14:24,827 --> 01:14:28,086
You create, finally, the spot Bitcoin ETF.

1273
01:14:28,086 --> 01:14:34,086
and without doing anything intentional, without funding it, without manipulating it,

1274
01:14:34,486 --> 01:14:42,226
you make the liquidity pool the US. And so the US may not own the Bitcoin, but the US

1275
01:14:42,226 --> 01:14:49,747
controls the Bitcoin. You raise margins, you change T2, all these things, and you create,

1276
01:14:50,247 --> 01:14:55,486
you control the liquidity pool. So if you can't kill it, you demonize it. If you can't demonize

1277
01:14:55,486 --> 01:15:00,827
or vice versa. You co-opt it. So what the US does is it takes everything it cannot control.

1278
01:15:01,367 --> 01:15:06,666
You can write a paper on this. Everything it cannot control, that's an outside force,

1279
01:15:06,787 --> 01:15:11,146
and it co-ops it. And that's what it did with Bitcoin. Now, I'm not even into the manipulation

1280
01:15:11,146 --> 01:15:19,066
part. In 1974, there's a WikiLeaks email out there that essentially says what I'm about to say.

1281
01:15:19,066 --> 01:15:25,726
in 1974 after the u.s went off the gold standard and the price of gold started to move higher

1282
01:15:25,726 --> 01:15:34,966
the u.s and the uk london were trying to keep the price of gold down why because they were cheating

1283
01:15:34,966 --> 01:15:40,226
they were printing more dollars than they had of the gold and they had this thing called the london

1284
01:15:40,226 --> 01:15:46,787
gold pool scheme etc etc but then they came up with an idea simple idea and it's in the email

1285
01:15:46,787 --> 01:15:50,146
We're going to create a futures exchange for gold.

1286
01:15:50,506 --> 01:15:50,787
Why?

1287
01:15:51,306 --> 01:15:53,526
Because if you get, it's in the email.

1288
01:15:53,907 --> 01:16:01,046
If you can create a futures exchange, then you can reduce the demand for physical.

1289
01:16:02,046 --> 01:16:07,486
Because over time, people will take convenience over authenticity, right?

1290
01:16:07,846 --> 01:16:08,747
I'll take the knockoff.

1291
01:16:09,846 --> 01:16:13,827
And when you get them with electronic bank accounts, it grows more and more.

1292
01:16:13,827 --> 01:16:16,566
And a generation goes by and your grandparents are dead.

1293
01:16:16,787 --> 01:16:18,546
And they're like, I don't need it all.

1294
01:16:18,606 --> 01:16:20,566
Just it's the next best thing that's gold.

1295
01:16:20,986 --> 01:16:21,766
And you do that.

1296
01:16:21,986 --> 01:16:26,586
And over time, you set up the market structure because you don't want gold to go up.

1297
01:16:27,086 --> 01:16:29,127
You make it a tier three asset.

1298
01:16:29,407 --> 01:16:30,947
You make the margins higher.

1299
01:16:30,947 --> 01:16:33,947
And then you have these banks called bullion banks.

1300
01:16:34,287 --> 01:16:36,947
Those are the custodians of Bitcoin now.

1301
01:16:37,546 --> 01:16:44,386
The bullion banks say, all right, the government wants gold to go down.

1302
01:16:45,127 --> 01:16:46,747
They're happy when it goes down.

1303
01:16:46,787 --> 01:16:53,947
they're lending us money at zero, we'll rehypothecate. And so rehypothecation,

1304
01:16:54,086 --> 01:17:02,127
which was invented for gold bulls, not for bears, is used by bears to sell five, 10 times as much

1305
01:17:02,127 --> 01:17:08,006
gold as out there. And the reason it works, Marty, the reason it works is because the US liquidity

1306
01:17:08,006 --> 01:17:16,627
pool is so big that the trading, you look at the US price, you trade on the US hours. You don't

1307
01:17:16,627 --> 01:17:21,826
trade in the off hours, we become the market. And in becoming the market,

1308
01:17:25,826 --> 01:17:31,207
and the futures price becomes more important than the spot price, the derivative price becomes more

1309
01:17:31,207 --> 01:17:35,846
important than the spot price, then you can influence the market lower by just selling paper.

1310
01:17:36,826 --> 01:17:41,846
You don't need the gold. You don't need the gold. Just need the paper. And that goes on for years.

1311
01:17:41,947 --> 01:17:45,466
And then they come up with other schemes. And I don't mean, these are just traders who want to

1312
01:17:45,466 --> 01:17:49,627
make money. I would have done it if I was in that seat. It's like, wait a minute. You want it to go

1313
01:17:49,627 --> 01:17:55,127
down? Fine. I would approach the Fed in 1993, just like the boy in Bankston had said, you guys have

1314
01:17:55,127 --> 01:17:59,346
gold sitting in Fort Knox doing nothing? Give it to us. We'll give you 50 basis points for it. We'll

1315
01:17:59,346 --> 01:18:03,426
take the money. We'll take the gold. We'll short it. We'll take the money and we'll go buy something

1316
01:18:03,426 --> 01:18:10,526
else. Greenspan was like, great idea. It happened. Great idea. Clinton, who was the president at the

1317
01:18:10,526 --> 01:18:14,666
time, was like, great idea. It'll keep the bond players from freaking out because bond players

1318
01:18:14,666 --> 01:18:21,867
would buy gold as a substancy. And so they did it successfully for 30 years. And a generation goes

1319
01:18:21,867 --> 01:18:27,806
by like an elephant tied to a stake with a thread. He doesn't know he can pull the stake out of the

1320
01:18:27,806 --> 01:18:34,266
ground. And it goes on and on. And that's why Bitcoin is gold 2.0. They're doing the same thing.

1321
01:18:34,766 --> 01:18:38,707
Are they doing it to buy it? Yeah, they're doing it to buy it. Are they doing it to make it the

1322
01:18:38,707 --> 01:18:43,926
dollar? No, they're not going to do that. Then you lose sovereign money. And little by little,

1323
01:18:43,926 --> 01:18:48,326
there's no liquidity in the world anywhere for Bitcoin except here now. I mean, you know,

1324
01:18:48,326 --> 01:18:52,286
and other nations like China, although they should have it, and they probably do have it,

1325
01:18:52,666 --> 01:18:58,447
they've shied away from it because the US has a monopoly on it now. And so the rehypothecation

1326
01:18:58,447 --> 01:19:05,886
has gone from bullion banks selling futures and taking the money and borrowing to custodian banks

1327
01:19:05,886 --> 01:19:11,986
like JP Morgan or BlackRock or however they do it, go, I have your Bitcoin, I'll give it to you

1328
01:19:11,986 --> 01:19:17,947
five days, you basically take five orders for Bitcoin and you sell. It's rehypothecation all

1329
01:19:17,947 --> 01:19:24,867
over again. So every time someone buys a Bitcoin at the BlackRock level, they're slamming a future.

1330
01:19:25,786 --> 01:19:30,186
And you know why that works? It works for the same reason JP Morgan makes money when silver goes up.

1331
01:19:30,826 --> 01:19:34,967
JP Morgan has all the silver in the world, hypothetically, in their vault. They have

1332
01:19:34,967 --> 01:19:39,506
the Hunt Brothers silver. It's been passed down to them. But they're not long silver.

1333
01:19:39,506 --> 01:19:42,026
there's short futures against it.

1334
01:19:42,526 --> 01:19:43,707
And if the shit hits the Fed,

1335
01:19:44,707 --> 01:19:59,069
they just won honor the contract Isn that what Bitcoin places are doing That what they did We don have the Bitcoin so we not going to honor the contract So it happening all over again And they got Bitcoin

1336
01:19:59,069 --> 01:20:02,889
under control, and it'll go up in price, but there's no one who's going to challenge the US

1337
01:20:02,889 --> 01:20:08,909
on it right now, at least not yet. So I hope that makes sense. Yeah, I will say anecdotal observation.

1338
01:20:08,909 --> 01:20:12,849
and I didn't really think about this

1339
01:20:12,849 --> 01:20:16,229
until you started walking through that explanation

1340
01:20:16,229 --> 01:20:19,209
is probably been a few years,

1341
01:20:19,409 --> 01:20:22,109
but there was a point I've been in Bitcoin for 12 years

1342
01:20:22,109 --> 01:20:23,349
and it was like a meme

1343
01:20:23,349 --> 01:20:25,889
and something that you came to expect

1344
01:20:25,889 --> 01:20:27,969
is that when Asia woke up, the price would move.

1345
01:20:29,309 --> 01:20:29,409
Yeah.

1346
01:20:29,409 --> 01:20:32,089
In my early days creating it, I was like, oh, Asia's up.

1347
01:20:32,729 --> 01:20:32,889
Yeah.

1348
01:20:33,649 --> 01:20:35,309
And that doesn't happen anymore.

1349
01:20:36,229 --> 01:20:36,709
Right.

1350
01:20:36,709 --> 01:20:41,829
It's not as prominent as a meme as it was five, seven, 10 years ago.

1351
01:20:41,829 --> 01:20:46,789
I used to trade the Japanese US hours for gold.

1352
01:20:47,589 --> 01:20:48,789
And I used to trade the ARB.

1353
01:20:49,849 --> 01:20:53,909
And it was a very, very low profit margin, high transaction thing.

1354
01:20:54,009 --> 01:20:56,149
You know, it did OK.

1355
01:20:57,329 --> 01:21:02,229
But during that time frame, when China was stimulating, when China was stimulating, all

1356
01:21:02,229 --> 01:21:06,689
the base metals would go off, iron, copper, aluminum, and then eventually silver and gold.

1357
01:21:06,709 --> 01:21:10,849
would go up. And I would be able to like kind of front run it, right? So when China said,

1358
01:21:10,929 --> 01:21:16,329
we're going to print money, and then Bitcoin comes on the scene, it's like iron, Bitcoin,

1359
01:21:16,689 --> 01:21:20,209
aluminum. I'm like, why is Bitcoin going up? I called a buddy of mine, he goes, well, that's

1360
01:21:20,209 --> 01:21:23,789
because every time they print money, the banks want to make sure they don't have too many yuan

1361
01:21:23,789 --> 01:21:30,689
in their pocket, so they buy something that can go up. So Bitcoin was a, what do you call it,

1362
01:21:30,689 --> 01:21:35,569
like a safety valve for these guys. And they're not doing it anymore. I mean,

1363
01:21:36,709 --> 01:21:54,169
Yeah. Well, to your point, not even pushback, but just a different perspective in terms of the ability to combat this manipulation, which I think whether you call them, I think you can define anything as manipulation.

1364
01:21:54,169 --> 01:22:01,989
buyer sellers exist right right uh it's just the market dynamics the way they exist with

1365
01:22:01,989 --> 01:22:08,509
the large custodians like blackrock which really they're custodying with coinbase and

1366
01:22:08,509 --> 01:22:15,229
you layer on futures and options on top of that you can easily manipulate the price using those

1367
01:22:15,229 --> 01:22:21,509
tools but i think where bitcoin has the opportunity i think this week we have a great example of

1368
01:22:21,509 --> 01:22:29,389
how to combat it is it's so much easier to take delivery and actually use it and custody it and

1369
01:22:29,389 --> 01:22:35,129
i think if we see more things like square announced this week where they're enabling

1370
01:22:35,129 --> 01:22:41,949
four million merchants to shuffle to immediately sweep a percentage of their their cash flows in

1371
01:22:41,949 --> 01:22:50,969
the bitcoin that they can then draw from uh their square terminals or business portals um that's

1372
01:22:50,969 --> 01:22:57,589
what needs to happen if you want to combat this manipulation so that's why here at this show and

1373
01:22:57,589 --> 01:23:02,489
i advise anybody getting into bitcoin i think etfs are good if you want exposure you don't have

1374
01:23:02,489 --> 01:23:07,329
self-custody and you don't need to use the bitcoin right but highly encourage people to

1375
01:23:07,329 --> 01:23:13,289
take bitcoin in self-custody get it off the exchange yeah to prevent this manipulation

1376
01:23:13,289 --> 01:23:20,949
so you're talking about jack when you say square right yeah okay he has been on a on

1377
01:23:20,949 --> 01:23:27,289
a thread for about maybe three to six months.

1378
01:23:28,069 --> 01:23:30,809
It's not enough that it's a store of value. It has to be a currency.

1379
01:23:31,269 --> 01:23:33,829
Am I paraphrasing that right? Yes.

1380
01:23:35,909 --> 01:23:37,789
He's so right, Marty.

1381
01:23:38,889 --> 01:23:42,829
Meaning, what I just said to you about how the U.S.

1382
01:23:43,269 --> 01:23:47,169
co-ops something, what they do is they rim-fence the liquidity

1383
01:23:47,169 --> 01:23:50,009
so the liquidity is all there and they don't let it out.

1384
01:23:50,009 --> 01:23:54,929
And so you take, I mean, look, Bitcoin's about network, right?

1385
01:23:55,029 --> 01:23:57,789
You take the network and you make it a walled garden.

1386
01:23:58,889 --> 01:24:04,109
And if it's not a currency, if it's not out there, it doesn't build its network.

1387
01:24:04,289 --> 01:24:07,369
And if it doesn't build its network, it becomes an asset.

1388
01:24:07,589 --> 01:24:10,609
It becomes the pet rock.

1389
01:24:11,689 --> 01:24:12,489
That's what it does.

1390
01:24:12,569 --> 01:24:16,409
I'm not saying gold was ever something you couldn't do that, but you could do it with

1391
01:24:16,409 --> 01:24:17,389
silver at one time.

1392
01:24:17,389 --> 01:24:28,569
But you take this thing that is indestructible, right, unless there's no energy for like, you know, no power for like 50 years.

1393
01:24:28,809 --> 01:24:30,109
That's indestructible.

1394
01:24:30,329 --> 01:24:31,889
That's as easy to use.

1395
01:24:31,969 --> 01:24:33,789
You know, you talk about whether it's fast enough or not.

1396
01:24:33,829 --> 01:24:34,329
I don't care.

1397
01:24:34,649 --> 01:24:38,909
The point is if it doesn't proliferate, it doesn't get used.

1398
01:24:39,169 --> 01:24:42,569
It gets used as a store of value, but it doesn't get used.

1399
01:24:42,569 --> 01:24:46,769
The analogy that I've used with my people is the Joe DiMaggio baseball card.

1400
01:24:47,389 --> 01:24:52,289
OK, so the Joe DiMaggio baseball card, let's say there's only 10 of them in the world.

1401
01:24:53,089 --> 01:24:56,869
Right. And there's only 10 in the world and nobody cares about it.

1402
01:24:57,369 --> 01:25:02,569
Well, it's a store of value, but you can't do anything with it because it's locked into the SEC.

1403
01:25:03,229 --> 01:25:08,309
They they they securitized money. They made money, a piece of art.

1404
01:25:08,449 --> 01:25:11,769
They made money, an asset. They made it a humble.

1405
01:25:11,929 --> 01:25:14,829
I don't know if anyone's old enough in your group. You know what a humble is?

1406
01:25:14,829 --> 01:25:19,849
You know those little stupid glass figurines that your grandparents have in a China cabinet?

1407
01:25:20,289 --> 01:25:21,909
Well, they all have serial numbers on the bottom.

1408
01:25:22,189 --> 01:25:23,089
They're all one of a kind.

1409
01:25:23,509 --> 01:25:25,469
They're all special, and they're all worth money.

1410
01:25:27,069 --> 01:25:29,309
And if you have to sell them, you'll get some decent money for them.

1411
01:25:29,669 --> 01:25:31,489
But you can't go around with a humble.

1412
01:25:31,929 --> 01:25:33,249
They stay in the China closet.

1413
01:25:33,649 --> 01:25:39,329
The ETF is a China closet for Bitcoin, and it's going to go there, and it's going to fall out of existence.

1414
01:25:39,509 --> 01:25:41,289
It's like the landline.

1415
01:25:41,389 --> 01:25:42,629
The first landline was built.

1416
01:25:42,689 --> 01:25:43,249
Who needed it?

1417
01:25:43,249 --> 01:25:53,849
But when the network gets built, the last person in the world who doesn't have access to a phone would pay a million dollars to use it because he wants to be connected.

1418
01:25:54,529 --> 01:25:56,149
The first person wouldn't pay anything.

1419
01:25:56,369 --> 01:26:01,789
And I think Bitcoin, you know, if you want to make the case that the government's involved, it's like, you know what?

1420
01:26:02,309 --> 01:26:02,869
How about this?

1421
01:26:02,929 --> 01:26:07,489
The government's involved in Ethereum because they want to make sure that Bitcoin doesn't proliferate.

1422
01:26:07,569 --> 01:26:11,409
I mean, I'm just taking the side of a maxi in that point of view.

1423
01:26:11,949 --> 01:26:15,449
No, the idea is to own it, lock it down.

1424
01:26:15,669 --> 01:26:20,749
The idea is to, instead of, and I know the Maxis are like, oh, but it's a Trojan horse.

1425
01:26:20,849 --> 01:26:21,109
You know what?

1426
01:26:21,969 --> 01:26:23,289
Maybe it's a Trojan horse.

1427
01:26:23,969 --> 01:26:26,069
But it's going to take 100 years for that Trojan horse.

1428
01:26:26,189 --> 01:26:29,809
The state's not going to let it survive until the state itself is dead.

1429
01:26:30,229 --> 01:26:31,489
The state does two things.

1430
01:26:31,549 --> 01:26:33,429
It kills people and it prints money.

1431
01:26:33,829 --> 01:26:35,949
And it will not give up either of those two things.

1432
01:26:37,589 --> 01:26:40,549
And if it does give up either of those two things, that's because it's not a state anymore.

1433
01:26:41,409 --> 01:26:41,889
Yeah.

1434
01:26:42,869 --> 01:26:43,549
That's interesting.

1435
01:26:44,189 --> 01:26:45,289
Focusing on Dorsey,

1436
01:26:45,649 --> 01:26:50,449
when you think of the prominent billionaire CEOs

1437
01:26:50,449 --> 01:26:53,629
or executives pushing Bitcoin,

1438
01:26:53,789 --> 01:26:54,869
I think you have him,

1439
01:26:55,109 --> 01:26:56,709
and then Saylor, juxtapose Saylor,

1440
01:26:56,849 --> 01:26:57,669
it's digital capital.

1441
01:26:57,809 --> 01:26:58,689
Why would you ever sell it?

1442
01:26:58,749 --> 01:26:59,569
And you have Dorsey who's like,

1443
01:26:59,629 --> 01:27:02,449
no, this is cypherpunk digital cash

1444
01:27:02,449 --> 01:27:04,689
that we need to be pushing in the economy.

1445
01:27:04,909 --> 01:27:06,589
I respect the hell.

1446
01:27:07,429 --> 01:27:08,989
I'm friends with both of them,

1447
01:27:08,989 --> 01:27:15,209
And I agree more with Jack in the sense that like this is supposed to be used as money.

1448
01:27:15,209 --> 01:27:16,169
It was in the white paper.

1449
01:27:16,269 --> 01:27:22,009
I'm not getting full Roger Moore here, but I think it is a better money at the end of the day.

1450
01:27:22,009 --> 01:27:31,449
And this whole focus on treasury companies and using it as digital capital is catering to those like to co-opt it.

1451
01:27:31,689 --> 01:27:33,409
And it's like, no, we shouldn't.

1452
01:27:33,409 --> 01:27:38,629
Look, Steller, who is brilliant in his own right, he knows what he's doing.

1453
01:27:38,989 --> 01:27:45,209
He knows that the path is, I want the price to go up. And if I have to work with the government,

1454
01:27:45,289 --> 01:27:50,689
I'll do that, provided I play well in the sandbox. Whereas Jack, in my opinion,

1455
01:27:50,849 --> 01:27:56,229
it's probably pretty obvious, he's an idealist. And so he wants to, he's not an anarchist person,

1456
01:27:56,289 --> 01:28:04,109
maybe he is, I don't know. But he wants a more fair distribution based on merit and not based

1457
01:28:04,109 --> 01:28:10,249
on incumbency. And so, you know, these are the, this is the bucket of calls and the hot and the

1458
01:28:10,249 --> 01:28:15,169
ice, right? It's true. I mean, that really is true. And I think at the end of the day,

1459
01:28:15,629 --> 01:28:19,769
at the end of the day, I've seen what they did with gold for 30 years.

1460
01:28:21,229 --> 01:28:26,269
Can they do that with Bitcoin? I think they can. At least I think they can, unfortunately,

1461
01:28:26,269 --> 01:28:32,849
it's because maybe you can't destroy it, but our liquidity pool is so big and so important,

1462
01:28:32,849 --> 01:28:34,049
even if it is on the way down,

1463
01:28:34,569 --> 01:28:38,989
that all you have to do is critically limit the on-ramps and off-ramps

1464
01:28:38,989 --> 01:28:41,429
or structures that you're controlling them,

1465
01:28:41,889 --> 01:28:43,489
and then half the world is going to be like,

1466
01:28:43,569 --> 01:28:44,829
nah, I'm not going to use it.

1467
01:28:44,989 --> 01:28:47,569
I mean, I'm an optimist, but I'm also a realist.

1468
01:28:48,069 --> 01:28:48,169
Yeah.

1469
01:28:49,469 --> 01:28:52,029
But would you agree with what I said earlier in terms that

1470
01:28:52,029 --> 01:28:59,389
the ability to combat net suppression is much easier with Bitcoin

1471
01:28:59,389 --> 01:29:00,849
due to the fact that it's digital?

1472
01:29:01,729 --> 01:29:02,729
Oh, yeah, absolutely, absolutely.

1473
01:29:02,849 --> 01:29:08,169
You know, I think this is like a monetary philosophy point here.

1474
01:29:08,629 --> 01:29:13,509
I think the main difference in terms of gold and Bitcoin, I mean, there's many differences,

1475
01:29:13,629 --> 01:29:18,289
but the main difference is that people look at gold as a store of value that's money because

1476
01:29:18,289 --> 01:29:18,949
it's a thing.

1477
01:29:18,949 --> 01:29:23,729
And if you really understand Bitcoin, I'm not saying that I do, but I understand monetary

1478
01:29:23,729 --> 01:29:24,149
theory.

1479
01:29:24,329 --> 01:29:31,609
If you understand money from a chartless theory, then you understand that money should be nothing.

1480
01:29:31,609 --> 01:29:44,332
It basically just an accounting ledger And gold is nothing It just that there is an obsession with it because it I guess it like a Marxist comment

1481
01:29:44,511 --> 01:29:46,811
Capitalism itself makes it that.

1482
01:29:46,811 --> 01:29:48,611
But what's his name?

1483
01:29:48,871 --> 01:29:50,492
Richard – was it Richard Spencer?

1484
01:29:51,752 --> 01:29:52,912
The guy who was on Tucker Carlson.

1485
01:29:53,092 --> 01:29:53,572
Richard Warner.

1486
01:29:54,371 --> 01:29:55,172
Richard Warner, right?

1487
01:29:55,551 --> 01:29:58,492
Richard Spencer is a completely different tip.

1488
01:29:58,511 --> 01:29:59,912
He's probably like a rock and roll guy, right?

1489
01:29:59,992 --> 01:30:00,871
Like an old singer or something.

1490
01:30:01,032 --> 01:30:03,172
He's like a white nationalist out of –

1491
01:30:03,172 --> 01:30:03,832
Oh, is he really?

1492
01:30:04,032 --> 01:30:06,032
He was some deep state

1493
01:30:06,032 --> 01:30:08,231
PSYOP white nationalist here in the US.

1494
01:30:08,672 --> 01:30:10,092
Listen, I'm not Elon Musk, all right?

1495
01:30:11,631 --> 01:30:12,412
I'm just kidding.

1496
01:30:12,572 --> 01:30:13,952
I'm just kidding, Elon. Don't ban me.

1497
01:30:14,731 --> 01:30:15,712
Yeah, so Richard Werner

1498
01:30:15,712 --> 01:30:17,871
talks about QE,

1499
01:30:18,072 --> 01:30:20,151
talks about all these other things, and one of the

1500
01:30:20,151 --> 01:30:22,072
things he said is that banks at the commercial

1501
01:30:22,072 --> 01:30:22,971
level can create money.

1502
01:30:23,771 --> 01:30:26,032
And I digged

1503
01:30:26,032 --> 01:30:27,992
into some things after that. And what I digged

1504
01:30:27,992 --> 01:30:30,111
into was there's a paper by the Bank of

1505
01:30:30,111 --> 01:30:32,072
England out there. And the Bank of England

1506
01:30:32,072 --> 01:30:32,871
was written in

1507
01:30:32,871 --> 01:30:35,752
I don't know, 2014, I think maybe.

1508
01:30:35,952 --> 01:30:39,712
And that paper, the Bank of England said, yes, because Werner was right.

1509
01:30:40,271 --> 01:30:41,771
Yes, it was at Spencer again.

1510
01:30:42,371 --> 01:30:46,191
Yes, money is created from nothing.

1511
01:30:46,332 --> 01:30:47,771
And we don't want you to know that.

1512
01:30:48,051 --> 01:30:50,271
It's not just created from nothing from central banks.

1513
01:30:50,511 --> 01:30:52,752
It's created from nothing at the commercial bank level.

1514
01:30:53,172 --> 01:30:56,532
And what they have is they have essentially what's called the chartless asset.

1515
01:30:57,151 --> 01:31:01,832
The chartless of that, there was a big fight between the Keynesians and these other guys,

1516
01:31:01,832 --> 01:31:05,032
maybe German guys, I don't know. But the Toronto Stat set was like, no, no,

1517
01:31:05,572 --> 01:31:14,431
money is just a ledger account of you owe me a favor. And so basically, it's kind of like,

1518
01:31:14,511 --> 01:31:19,351
it dovetails into MMT as well. And then the other side, the Keynesian side, not Neo Keynesian,

1519
01:31:19,412 --> 01:31:26,572
was like, well, money needs to be tethered to something real so that we can make sure we don't

1520
01:31:26,572 --> 01:31:33,651
overprint or debase. And so the Keynesian side won, which became Neo-Keynesian, but the chartless

1521
01:31:33,651 --> 01:31:39,011
side is what Werner's talking about. And you know what? That's what Bitcoin is. That's really what

1522
01:31:39,011 --> 01:31:44,931
it is. It's like Bitcoin is like, you know what? Let's take the Bitcoin ledger of nano,

1523
01:31:45,711 --> 01:31:51,832
and let's put it in a gold casing like an iPhone, and let's put it in an ETF, and let's make everyone

1524
01:31:51,832 --> 01:31:53,891
worship it. Let's make it shiny.

1525
01:31:54,111 --> 01:31:56,111
No, no, it's a workhorse.

1526
01:31:56,231 --> 01:31:58,032
Get it out there because that's what

1527
01:31:58,032 --> 01:31:59,891
money is. Money is a workhorse. Now, I'm not

1528
01:31:59,891 --> 01:32:02,032
a proponent of MFT, but I

1529
01:32:02,032 --> 01:32:02,771
am saying that

1530
01:32:02,771 --> 01:32:05,711
there are aspects of Bitcoin that make it

1531
01:32:05,711 --> 01:32:07,471
that make it.

1532
01:32:07,811 --> 01:32:09,971
I'm a gold book. There are aspects of Bitcoin

1533
01:32:09,971 --> 01:32:11,511
that when the world is ready for,

1534
01:32:12,651 --> 01:32:14,051
it will, whether

1535
01:32:14,051 --> 01:32:15,431
it's Bitcoin or a successor,

1536
01:32:15,952 --> 01:32:17,412
when the world is ready for it,

1537
01:32:17,931 --> 01:32:19,092
it'll be ready for it.

1538
01:32:19,092 --> 01:32:23,811
It's, you know, you can't get away from the physicality of it all yet.

1539
01:32:24,311 --> 01:32:24,471
Yeah.

1540
01:32:27,551 --> 01:32:34,211
Obviously, I'm full on in it, been in it for 12 years, completely incorporated into my business.

1541
01:32:34,471 --> 01:32:43,051
But we have, like, I think it's going to be ultimately successful just because particularly for cross-border payments.

1542
01:32:43,051 --> 01:32:49,032
Like, I have some contractors that work outside the United States and they demand to get paid in Bitcoin.

1543
01:32:49,092 --> 01:32:50,651
And like it was unprompted.

1544
01:32:50,992 --> 01:32:52,711
I think they know.

1545
01:32:53,971 --> 01:33:05,051
We're a company focused on Bitcoin specifically, but I was surprised a couple of months ago, this new contractor started and he was like, all right, send me the invoice.

1546
01:33:05,291 --> 01:33:07,452
I was thinking it was going to be an international wire transfer.

1547
01:33:07,572 --> 01:33:08,492
It was a Bitcoin invoice.

1548
01:33:08,592 --> 01:33:09,231
I was like, yeah, sweet.

1549
01:33:09,592 --> 01:33:15,711
I think, you know, we were talking about this before as well.

1550
01:33:15,711 --> 01:33:23,032
I think Bitcoin's going to find a niche that can't be crushed, cross-border.

1551
01:33:23,231 --> 01:33:24,631
Europe is scared to death of it, right?

1552
01:33:26,311 --> 01:33:30,151
Black market, I'm not trying to demonize, but you know, things that you got to get around

1553
01:33:30,151 --> 01:33:31,711
stuff like you use with gold.

1554
01:33:32,231 --> 01:33:33,992
And I think it's going to thrive in that niche.

1555
01:33:34,551 --> 01:33:39,172
And then there'll be an opportunity, like a calamitous event or a nation.

1556
01:33:39,391 --> 01:33:43,151
And it'll become the surrogate currency.

1557
01:33:43,151 --> 01:33:45,252
And then it'll never go.

1558
01:33:45,252 --> 01:33:46,471
There's your Trojan horse.

1559
01:33:47,791 --> 01:33:52,231
Assuming that you can't kill it, if you can't kill this, it will survive.

1560
01:33:52,651 --> 01:33:56,231
And it will survive, in a good way, a virus.

1561
01:33:56,352 --> 01:33:57,291
It won't go away.

1562
01:33:57,771 --> 01:33:58,492
It'll be there.

1563
01:33:59,011 --> 01:34:06,011
And then a good product that's indestructible, all it needs is time and an opportunity.

1564
01:34:06,711 --> 01:34:07,992
And something will happen.

1565
01:34:07,992 --> 01:34:13,391
And they'll go from your contractors to a small country going, you know what?

1566
01:34:13,391 --> 01:34:20,131
Oh, Jesus, we train with our partners across the border here all the time, and they're sanctioned, and I'm sanctioned.

1567
01:34:20,412 --> 01:34:25,691
Let's create a zone between my country and your country or the border, and let's just use Bitcoin.

1568
01:34:26,271 --> 01:34:26,912
Just do that.

1569
01:34:27,011 --> 01:34:29,592
And then after a while, it organically spreads.

1570
01:34:31,011 --> 01:34:32,011
That's the home run.

1571
01:34:32,072 --> 01:34:33,191
The home run is time.

1572
01:34:34,072 --> 01:34:36,392
And time usually means one or two generations.

1573
01:34:36,691 --> 01:34:38,931
I have to be dead, and you have to be old.

1574
01:34:41,451 --> 01:34:42,332
I think.

1575
01:34:43,392 --> 01:34:48,872
uh many bitcoiners myself included recognize that as well it's a it's a multi-generation

1576
01:34:48,872 --> 01:34:56,151
thing and that's it's a funny when i hear people deride and besmirch bitcoins like oh it's not used

1577
01:34:56,151 --> 01:35:01,752
as day-to-day currency where can i spend it's like what other monetary asset uh has launched

1578
01:35:01,752 --> 01:35:08,931
and been completely ubiquitous within 17 years like it's not survived yeah i mean just that's

1579
01:35:08,931 --> 01:35:10,492
That's the whole point of a network.

1580
01:35:10,832 --> 01:35:13,951
If you can create a network, even if it's not being used,

1581
01:35:14,011 --> 01:35:15,632
even if it's not being used but it exists,

1582
01:35:16,092 --> 01:35:17,271
all it needs is an opportunity.

1583
01:35:18,691 --> 01:35:23,731
Using gold, for example, Shanghai has had gold for 15 years,

1584
01:35:24,072 --> 01:35:26,231
and it survived.

1585
01:35:26,572 --> 01:35:29,651
And then it's all an opportunity, and boom, it took market share.

1586
01:35:30,051 --> 01:35:32,532
This is what it's all about, surviving and taking market share.

1587
01:35:33,132 --> 01:35:35,791
And Bitcoin is a survivor, and that's why it eventually wins.

1588
01:35:36,412 --> 01:35:36,431
Yeah.

1589
01:35:36,431 --> 01:35:41,651
I think the other thing we have in the Bitcoin or camp in our favor is we're very good at memeing.

1590
01:35:42,011 --> 01:35:44,451
We're very good at getting messages.

1591
01:35:44,971 --> 01:35:51,231
Would you admit, would the gold bugs admit, that we've helped the sound money cause materially in the last 15 years?

1592
01:35:51,231 --> 01:35:51,872
Oh, yeah, yeah, yeah.

1593
01:35:51,971 --> 01:35:57,492
I mean, look, I tried to reach out to you early on, not you specifically, but your group.

1594
01:35:57,632 --> 01:36:00,372
And I was like, listen, would you stop shitting on gold?

1595
01:36:00,912 --> 01:36:02,072
It's the same thing.

1596
01:36:02,072 --> 01:36:03,791
I mean, yours might be gold 2.0.

1597
01:36:03,791 --> 01:36:07,151
I would like create memes of like the old guy memes, right?

1598
01:36:07,912 --> 01:36:10,592
Black and white cookie, you know, a Seinfeld joke,

1599
01:36:10,752 --> 01:36:11,892
look to the cookie type of shit.

1600
01:36:12,332 --> 01:36:13,532
Shut up, you old man.

1601
01:36:13,711 --> 01:36:15,691
And then, and this is where I started to hate sell

1602
01:36:15,691 --> 01:36:18,431
because I knew that that fucker, excuse my French,

1603
01:36:18,511 --> 01:36:23,271
was just trying to say, hey, go because he just wanted it to go up.

1604
01:36:23,651 --> 01:36:25,451
And he was going after the demographic.

1605
01:36:26,492 --> 01:36:31,731
It was a smart move, but he was like, people like I'm Gen X, right?

1606
01:36:31,731 --> 01:36:34,671
So Gen X up to boomers are like Bitcoin.

1607
01:36:34,832 --> 01:36:35,211
No way.

1608
01:36:35,252 --> 01:36:36,451
I'm just lucky, you know.

1609
01:36:37,931 --> 01:36:43,191
But yeah, it's like it's like we're just like it's it's new tech.

1610
01:36:43,252 --> 01:36:44,112
We're not familiar with it.

1611
01:36:44,151 --> 01:36:44,492
Give us it.

1612
01:36:44,511 --> 01:36:45,112
Give us a break.

1613
01:36:45,332 --> 01:36:48,211
You know, I've been very consistent throughout the years on this show.

1614
01:36:48,271 --> 01:36:49,191
I love our gold bugs.

1615
01:36:49,191 --> 01:36:51,372
We're ideologically and philosophically aligned.

1616
01:36:51,551 --> 01:36:52,711
We need to work together.

1617
01:36:52,912 --> 01:36:53,171
Right.

1618
01:36:53,352 --> 01:36:54,231
Well, I mean, that's it.

1619
01:36:54,252 --> 01:36:58,451
You know, it's like the speaking of memes, it's like the what is it?

1620
01:36:58,471 --> 01:37:00,231
The Splinter and Ninja Turtles meme.

1621
01:37:00,231 --> 01:37:04,791
you know we raised you and now you're and then you're going to use your ear it's usually ron paul

1622
01:37:04,791 --> 01:37:09,191
a lot it's like yeah yeah exactly it's a ron paul beat it's exactly ron paul that's exactly it yeah

1623
01:37:09,191 --> 01:37:14,852
yeah yeah since this has been uh it's been great thank you for doing this i can't believe it's

1624
01:37:14,852 --> 01:37:22,592
this long i appreciate you having me i appreciate you having me on uh uh this is fun i know that i

1625
01:37:22,592 --> 01:37:28,811
i know you by reputation i know you from we're mutuals on uh on x but uh yeah this was fun um

1626
01:37:28,811 --> 01:37:35,412
very pleasantly uh surprised that wasn't negative but i'm pleasantly surprised i hope you are as

1627
01:37:35,412 --> 01:37:39,612
well yeah the fact that we went to the same high school if you're ever back uh in philly let me

1628
01:37:39,612 --> 01:37:44,451
know we'll have to get a beer and a pizza somewhere yeah yeah have you have you have you uh

1629
01:37:44,451 --> 01:37:48,252
have you been to the at the jay zoo in a while have you been to the prep in a while

1630
01:37:48,252 --> 01:37:54,592
not uh not in a few years i need to get fabulous it looks fabulous unbelievable what they've done

1631
01:37:54,592 --> 01:37:55,112
Unbelievable.

1632
01:37:55,392 --> 01:37:55,551
Anyway.

1633
01:37:56,612 --> 01:37:57,032
All right.

1634
01:37:57,271 --> 01:37:57,671
Memories.

1635
01:37:58,451 --> 01:37:58,632
Yeah.

1636
01:37:59,171 --> 01:38:01,051
Well, hopefully this is the first of many.

1637
01:38:01,612 --> 01:38:04,892
I'm sure there'll be plenty to talk about as things evolve moving forward.

1638
01:38:06,231 --> 01:38:06,992
Yeah, absolutely.

1639
01:38:07,252 --> 01:38:07,532
Absolutely.

1640
01:38:08,051 --> 01:38:09,051
Thank you for having me on, Marty.

1641
01:38:09,372 --> 01:38:13,051
And oh, if I just want to just drop.

1642
01:38:13,451 --> 01:38:13,892
Is that OK?

1643
01:38:14,271 --> 01:38:14,572
Yeah.

1644
01:38:14,951 --> 01:38:15,151
Yeah.

1645
01:38:15,451 --> 01:38:24,051
So I have a newsletter on Substack and it's VBL Gold Fix, Victor Boy Larry Gold Fix at Substack.com.

1646
01:38:24,051 --> 01:38:31,852
And it is, as you would guess, it's predominantly monetary, and it's predominantly gold and silver because, well, that's what's been moving lately.

1647
01:38:32,372 --> 01:38:39,791
But when those markets are not at the front of everyone's mind, I'll talk about geopolitics, which I do all the time.

1648
01:38:40,572 --> 01:38:45,791
Look, if you understand gold, you understand geopolitics, you understand inflation, and you understand economies.

1649
01:38:45,852 --> 01:38:49,231
And my background is in the bond market and fundamental analysis.

1650
01:38:49,231 --> 01:38:52,731
And so, therefore, I will talk about Bitcoin.

1651
01:38:52,731 --> 01:38:54,572
But I do get some good research on Bitcoin as well.

1652
01:38:54,971 --> 01:38:55,872
And I cover it.

1653
01:38:55,912 --> 01:38:56,451
I cover it as well.

1654
01:38:56,532 --> 01:38:57,731
But that's not a sales pitch.

1655
01:38:57,791 --> 01:39:01,311
I guess what I'm saying is I'm a gold guy who hedges his gold with Bitcoin.

1656
01:39:01,731 --> 01:39:02,791
Not a Bitcoin guy.

1657
01:39:03,151 --> 01:39:04,311
So that's it.

1658
01:39:04,551 --> 01:39:05,992
You can find me on Twitter as well.

1659
01:39:06,051 --> 01:39:06,872
Just VBL Ghost.

1660
01:39:07,412 --> 01:39:09,572
Like I said, we love our gold bugs here at TFTC.

1661
01:39:09,572 --> 01:39:13,872
So thank you for adding to the list of gold bugs that have come on the show.

1662
01:39:14,492 --> 01:39:15,971
And we'll link to all that in the show notes.

1663
01:39:16,032 --> 01:39:16,711
So you guys are interested.

1664
01:39:17,092 --> 01:39:17,912
Check out the show notes.

1665
01:39:18,211 --> 01:39:19,432
You can check out Substack.

1666
01:39:19,572 --> 01:39:22,112
And great follow on X as well.

1667
01:39:23,651 --> 01:39:24,092
Thanks, buddy.

1668
01:39:24,572 --> 01:39:25,011
Thank you.

1669
01:39:25,231 --> 01:39:26,032
That's all we got today, freaks.

1670
01:39:26,112 --> 01:39:26,572
Peace and love.

1671
01:39:26,892 --> 01:39:27,072
Okay.