July 29, 2025 - Bannon's War Room
47:42
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| Speaker | Time | Text |
|---|---|---|
| This is the primal scream of a dying regime. | ||
| Pray for our enemies, because we're going to medieval on these people. | ||
| Here's not got a free shot at all these networks lying about the people. | ||
| The people have had a belly full of it. | ||
| I know you don't like hearing that. | ||
| I know you try to do everything in the world to stop that, but you're not going to stop it. | ||
| It's going to happen. | ||
| And where do people like that go to share the big lie? | ||
| MAGA Media. | ||
| I wish in my soul, I wish that any of these people had a conscience. | ||
| Ask yourself, what is my task and what is my purpose? | ||
| If that answer is to save my country, this country will be saved. | ||
|
unidentified
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Waru, here's your host, Stephen K. Baff. | |
| Tuesday, 29 July in the year of our Lord 2025. | ||
| So here's what we're going to do. | ||
| I've had such overwhelming demand for the Judy Shelton interview to be played during the week in one of the evenings. | ||
| We're going to do this. | ||
| I'm going to break it down. | ||
| So what I'm going to do, I'm going to do interstitial programming. | ||
| We're going to play some of the interview, and I'm going to come back and try to contextualize it since it happened on Saturday. | ||
| Although she talked about kind of eternal truths about all this. | ||
| Also, we have in here, if you remember, much to her surprise, I think Pleasant's surprise, we also found the clip from John Adams. | ||
| And if you haven't seen John Adams, the series of HBO, I strongly recommend you to get a DVD, if you don't have a DVD player, but order it, get it up digitally online, and watch it with the family. | ||
| It's quite frankly a masterpiece. | ||
| And of course it's written with a certain slant on it, as everything is, but it's really a masterpiece. | ||
| And we play a great segment of that in the Next Block with Jefferson and Hamilton kind of going at it on the fight that still continues today. | ||
| I want to thank our team at Birch Gold. | ||
| Of course, Philip Patrick and the team. | ||
| We think it's very important now more than ever that you understand currency, that you understand America's role as the prime reserve currency. | ||
| I'm very proud over the last couple of years in being, I think the last four years or longer, of being with, associated with Birch Gold, where we've done this series called The End of the Dollar Empire. | ||
| You heard Judy, and a lot of people are so blown away by Judy. | ||
| And when I tell them, hey, go get the end of the dollar empire, that's kind of a primer in what she's talking about. | ||
| And she speaks with so clearly, her thinking's so clear, the way she articulates this, the ideas are so clear, I think that's why she kind of stands out in today's about commentators and observers and people that do analytics. | ||
| It's one of the reasons President Trump picked her in the first term. | ||
| And of course, she was defeated in the United States Senate of Mitchell McConnell. | ||
| I don't think she would be defeated today. | ||
| I'm a huge advocate of Judy getting involved in all this. | ||
| Make sure you go to birchgold.com, promo code abandon. | ||
| You get the end of the dollar empire. | ||
| We've got seven free installments for you. | ||
| We're working on installment number eight, and we're also working on installment number nine. | ||
| We think so much came out of Rio, particularly on the de-dollarization effort that you need to understand. | ||
| Remember, I keep saying this over and over again. | ||
| It's not the daily price of gold. | ||
| Of course, it's had a historic run up in the last year. | ||
| If you've been with us for four years, and you've gotten involved early on, you understand a real run it's had. | ||
| And in fact, before the stock market started breaking these all-time records here recently, historically through the 21st century, I think it's got the best returns. | ||
| Anyway, we're going to go back. | ||
| This is the interview I just did on Saturday with Judy Shelton. | ||
| Let's go ahead and hit the opening button. | ||
| Judy, you know, the president, we've got some clips we want to show you a little later, but the president went to the Federal Reserve on the same day Scott Besson, the Secretary of Treasury, saying, hey, look, this is just not about a new chairman. | ||
| We need a fundamental review, strategic review of exactly what we're doing here as a central bank. | ||
| What's their mandate? | ||
| What's the plan? | ||
| Are they helping us or hurting us? | ||
| I think you've been, and I would say the most prominent of the critics of the Federal Reserve. | ||
| Can you walk us through your thoughts about what Scott Besson, with the Secretary of Treasury, is saying? | ||
| Because the media, as they always do, they've got to focus on palace intrigue. | ||
| So it's this person, that person. | ||
| But you've argued for a while we have a much deeper and systemic problem with our central bank. | ||
| Ma'am, the floor is yours. | ||
| Your observations about where we stand with this central bank right now. | ||
| Well, first, Steve, let me just say how honored I am that you invited me. | ||
| I'm so glad to be with you this morning. | ||
| As far as the Federal Reserve, boy, do I welcome this. | ||
| They really needed a come-up. | ||
| For too long, the Fed has been accumulating power and prominence in financial markets. | ||
| It's entirely too political itself. | ||
| And I think that the chair, Jerome Powell, was setting himself up as some kind of an emperor who was going to sit in judgment. | ||
| And yes, an elected president could come in and put forward their supply-side program of lower taxes and less regulation and smarter trade policy and better energy policy. | ||
| And the Fed would just sit there in judgment and decide if it would allow those things. | ||
| And it really came to a head when Chair Powell made that speech at the Economic Club in Chicago. | ||
| And I think he bought the farm when he did that. | ||
| Because finally, the disconnect between the world of central banking and all the Americans who voted for President Trump and want those policy changes, who want an economy that's growing, who want an emphasis on the private sector, the real economy, they just said, no, wait a minute, he's talking about tariff-caused inflation as if that's a done deal. | ||
| And it's time to call the Fed out. | ||
| It can no longer just say, oh, then you're threatening the sanctity of central bank independence or markets might get royal. | ||
| I'm telling you, we're going to See the central bankers double down. | ||
| Because when Chair Powell goes to Europe and he gets toasted by Christine Lagarde, the head of the European Central Bank, and he gets a standing ovation as she says, Oh, yes, we all hope to be as brave as he is in resisting. | ||
| I presume she means being fired. | ||
| I mean, no one got fired when we hit 9% inflation, the highest in 40 years. | ||
| And yet the Fed talks about transparency and accountability, but it's kind of cheap grace because in the end, the Fed just keeps perpetuating its own power. | ||
| It has wrong models, wrong mechanisms. | ||
| It needs an entirely new construct. | ||
| I welcome when Treasury Secretary Scott Benson said we need fundamental reform. | ||
| It matters a lot more than whether the Fed reduces 25 basis points in July versus September. | ||
| And even the building renovation project, that's just the thread that we can now pull to unravel all of the problems of the Fed running at an operating loss since September 2022, over $900 billion in unrealized capital losses on its own portfolio. | ||
| And for me, the worst, the Fed paying interest on reserve balances, which means it doesn't engage in open market operations to set monetary policy. | ||
| It dictates the interest rate. | ||
| In a free market economy, it fixes the interest rate, the price of loanable capital, and it does it by paying banks not to make loans and not to put their money in Treasury securities, which would bring down those rates, which do affect the real economy. | ||
| So I'm happy. | ||
| I'll be meeting with Republican senators next week at their steering committee meeting. | ||
| You have a number of senators who are finally willing to exercise, I think, their constitutionally mandated oversight responsibility. | ||
| Section 1, Article 8. | ||
| They're supposed to regulate the money. | ||
|
unidentified
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Okay. | |
| Welcome back. | ||
| She's pretty extraordinary, isn't she? | ||
| I think the reason we got such a tremendous feedback from the Saturday interview was the fact that people hadn't heard her voice. | ||
| She's been on the boardroom before, but particularly today and particularly what we were talking about last week, this is the Fed. | ||
| This was going over to the Federal Reserve itself. | ||
| It's only the third time in the history of this country that a sitting president has ever been to the Federal Reserve. | ||
| It said FDR was one with the Eccles building, was inaugurated, opened up. | ||
| He went some magnificent space, classic space, Beau Arts. | ||
| And then I think Jerry Ford had a buddy that was a governor. | ||
| He went over for lunch or something. | ||
| But President Trump went over, and that was an inspection tour. | ||
| It was quite extraordinary. | ||
| What you're going to see next, and this gets to the issue that we have before us today. | ||
| HBO, the John Adams film, multi-by, I think it was 10 hours or something, had an Englishman, Steve Delane, that played Jefferson. | ||
| And really, I think he steals the movie, but you have, this is the very first cabinet meeting, and you've got with General Washington an interesting John Adams as his VP, and John Adams didn't sit in the cabinet meeting. | ||
| There were some money reasons for that. | ||
| Number one, they didn't really know what a vice president was. | ||
| Number two, President Washington wasn't that close to John Adams. | ||
| And John Adams is a little bit of an instigator. | ||
| Although here he tries to be a peacemaker. | ||
| And he knew he had enough to handle because he had selected both Hamilton to be his Minister of Finance or Secretary of the Treasury and Jefferson to be Secretary of State. | ||
| Jefferson had been in revolutionary France and had just come back for the first cabinet meeting. | ||
| And they went at it right off the bat. | ||
| And what is about? | ||
| This is about this central tension that's still in the country today between being a manu. | ||
| And Hamilton, these guys saw the fact that the United States could be a continental empire and a massive manufacturing superpower. | ||
| Remember, this is in, what, 1792? | ||
| You know, this is the 18th century. | ||
| This is the genius of Hamilton in his vision looking downrange. | ||
| This is why if you read the report on manufacturers, I say it's right up there with the Declaration of Independence as a sophisticated look of how you develop a nation. | ||
| You know, Jefferson's was about the freedom of man and liberty and really a declaration of war, most of a declaration of war against the British crown. | ||
| The reports on manufacture came out later, was about how you actually take a country that's really just agriculture and some trading and some ports and turn it into an industrial superpower. | ||
| That's the vision Alexander Hamilton had and the practicality put it through. | ||
| But they were at each other's throats, and what did it get about? | ||
| It got about debt, deficits, currency. | ||
| You remember these topics from today? | ||
| It's from the beginning of the country, and you see the two sides of how they played it out. | ||
| And Judy Shelton has a magnificent analysis. | ||
| In fact, she had just talked about that right as we were coming into the break. | ||
| My crack team were able to pull this, and of course she was delighted. | ||
| And so you get to see this issue at the very start of the revolution. | ||
| I really want to thank once again Birch Gold. | ||
| And this is why we make the end of the dollar empire. | ||
| It's now taught in college courses because, as these professors are saying, in finance, it gives accessibility to their students. | ||
| It's written like a textbook, much more accessible, why we want to take a middle class and a working class audience, and it kind of explains how the system works, particularly capital markets, the economy, and the interactions between and currency and why being the prime reserve currency has been so important for America's rise. | ||
| But it comes with a number of responsibilities and obligations. | ||
| Right now, we're in the middle of a huge fight where you have the BRICS nations led by Russia and China that are trying to get off. | ||
| They think that the dollar, we've weaponized the dollar and it's used against them. | ||
| Also, they got an issue with, hey, they're running such huge debts that they're devaluing their dollar all the time. | ||
| We don't want to take payment in fiat currencies. | ||
| It's going to be depreciated over time. | ||
| This is why gold more than ever. | ||
| This is why these central banks are buying gold at record rates. | ||
| You have to understand all this. | ||
| One to understand politics today, but also to understand your community, your family's finances, and your personal. | ||
| Remember, we never talk about the price of gold and getting the price of gold, though. | ||
| It's had a tremendous run-up because it's not about the price of gold. | ||
| It's about learning about it. | ||
| How about it? | ||
| Birchgold.com slash bannon. | ||
| Ended the dollar empire. | ||
| Here we go with the second block. | ||
| Judy Shelton, Thomas Jefferson, and Alexander Hamilton. | ||
|
unidentified
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Let's try in Philadelphia. | |
| Much change, Mr. Jefferson. | ||
| More change than I could have imagined, Mr. Hamilton. | ||
| Not the city itself. | ||
| All cities swallow everything in their way. | ||
| That's no surprise to me. | ||
| That's why I abhor them. | ||
| But I have been, as you know, in revolutionary France, where the streets are filled with the songs of liberty and brotherhood and the overthrow of ancient tyrannies of Europe. | ||
| And to return from there to this, our cradle of revolution and find the dinner table chatter is all of money and banks and authority is an unwelcome surprise. | ||
| Unwelcome, perhaps, but necessary. | ||
| I must admit, Mr. Holmes, I am a little uncertain as to the purpose of the Treasury Department. | ||
| No doubt its function will reveal itself to me in good time. | ||
| The future prosperity of this nation rests chiefly in trade. | ||
| Trade depends, among other things, on the willingness of other nations to lend us money. | ||
| And how would you propose to establish international credit? | ||
| Our first step would be to incur a national debt. | ||
| The greater the debt, the greater the credit. | ||
| To that end, I have recommended to the President that Congress adopt all the debts incurred by the individual states during the war through a national bank. | ||
| The idea being that if the states owe Congress money, then other nations will feel more inclined to lend it to us. | ||
| If the states are indebted to a central authority, it increases the power of the central government. | ||
| You have it exactly. | ||
| The greater the government's responsibility, the greater its authority. | ||
| The moneyed interest in this country is all in the north. | ||
| So the wealth and power would inevitably be concentrated there in the federal government. | ||
| To the expense of the south. | ||
| If that is the case, it is unavoidable if the union is to be preserved. | ||
| I fear our revolution will have been in vain if a Virginia farmer is to be held in hawk to a New York stock jobber, who in turn is in hawk to a London banker. | ||
| The opportunities for avarice and corruption would certainly prove irresistible. | ||
| Well, there you have it, as I have heard said. | ||
| Men were angels, and no government would be necessary. | ||
| Right there, you see, and that is from the classic John Adams on HBO, and I strongly recommend if you have not watched that and watched it with the family, you do it right there at the very beginning of the country. | ||
| That is, ladies and gentlemen, the very first cabinet meeting of General Washington, President Washington, his very first cabinet meeting with Jefferson newly returned from France and Alexander Hamilton. | ||
| And what is the argument at the very first cabinet meeting, the very first topic? | ||
| Money, debt, central banking, all of it. | ||
| Judy Shelton, so the beginning of our republic, ma'am, this has been a central issue. | ||
| It's not taught, right? | ||
| They don't want you to know about this, but this went all the way through Andrew Jackson, all the way through, in fact, the great 1836 to, I think, 1911, 1913, is one of the greatest periods of growth in world history. | ||
| We did it without a central bank. | ||
| Your assessment of this, ma'am. | ||
| Steve, that conversation you just aired is so riveting. | ||
| And it shows that from the beginning, there was this slippery slope between wanting to preserve the founding principles of a nation that believed it was capable of self-government and that it would achieve this by empowering individuals economically. | ||
| They would have freedom to plan their own lives. | ||
| They were deemed capable. | ||
| In the Constitution, in Article I, Section 8, when Congress was granted the authority to regulate the money, it's in the same sentence as the one that gives Congress the power to establish the official standard of weights and measures, because money was meant to be a measure, an honest measure. | ||
| And so this tension between Alexander Hamilton, who wanted to convince President Washington that the United States needed to be a big player and issue debt and gain credit and become part of that international system for purposes of trade, | ||
| there are some valid arguments there, and taking on the debt of the individual colonies, which were now newly independent states, but beneath the protection of the United States of America as a nation on its own. | ||
| Jefferson had written notes on the establishment of a money unit for the United States. | ||
| And what Jefferson had emphasized is money, we have to have money that people can take straight up. | ||
| And it shouldn't be a sophisticated thing. | ||
| It should make sense to the people who carry out their everyday transactions. | ||
| He said it should be easy to understand. | ||
| It should be familiar, and it should give confidence. | ||
| And it will help unite these earlier colonies into their own country. | ||
| So Jefferson was highly suspicious of central banks because he thought, if you approve that and you issue debt, and you're putting that burden, adding that to the yoke on members of the public, how are you so different from these other tyrannies dominated by a king. | ||
| And both gentlemen, both of these great men in U.S. history, wrote lengthy essays to try to convince Washington. | ||
| Washington was very reluctant to agree to establish a bank. | ||
| But in the end, I think for these pragmatic purposes of gaining entry into what was then the international trading system and being seen as a legitimate authority and a new nation, he acquiesced. | ||
| But as you say, later in the 1800s, when we issued greenbacks and during the Civil War, and the idea was the government would just have these IOUs with no connection to gold reserves or backing of any kind, but they had to be accepted as legal tender, that prevailed during the war. | ||
| And right after the war, the very man who had approved that as a Treasury official became the head of the Supreme Court, and he said that what he had done was unconstitutional. | ||
| He ruled that that was a violation of really these same founding principles that are in the Constitution. | ||
| So this tension goes on, and I'm so pleased. | ||
| It was so gratifying to see President Trump looking very natural in a hard hat for construction, really confronting, and I think bringing down to size, this chairman of the Fed. | ||
| And the message there for me was that when you have a change of leadership, I think he's hitting on all cylinders remarkably in all these foreign policy areas, on the border. | ||
| He's doing so much, challenging a corrupt DOJ. | ||
| But on this big question, what is the appropriate role of a central bank in a free market economy? | ||
| And you hear all the invocation of the dual mandate, but really that's the way the Fed protects itself. | ||
| I would put the next Fed chairman should be someone who puts the Constitution ahead of the Federal Reserve Reform Act of 1977. | ||
| And I might also point out that the Humphrey Hawkins Act of 1978, contrary to what people say about establishing central bank independence, says in it several times what we need, and I'm quoting, this is legislative language, is improved coordination among the President, the Congress, and the Board of Governors of the Federal Reserve. | ||
| And it was meant to help use an all-of-government approach to achieve national economic priorities, one of which was a better trade balance. | ||
| So I just think the Fed has gone off the rails and kind of believes its own press clippings when, in fact, it is not serving the public and it is not carrying out the function. | ||
| I mean, even the dual mandate, stable prices. | ||
| That was meant to mean zero inflation. | ||
| Again, read the legislation, zero inflation. | ||
| The Fed in 1996, when Alan Greenspan was the chair, discussed what it meant to deliver stable prices. | ||
| And Greenspan thought it meant zero inflation. | ||
| What else could it mean? | ||
| But he was talked out of that by Janet Yellen, who was on the Federal Open Market Committee at the Federal Reserve. | ||
| And she thought, let's have perpetual low inflation, basically, because through Keynesian principles, that's how you fool wage earners. | ||
| If the economy takes a downturn, and let's say normally that meant companies did 1% less business and you would maybe cut wages 1%. | ||
| She said, oh, no, no. | ||
| If you have inflation at, say, 2% or 3%, you can actually give them a raise, and they won't realize that in real terms, they've lost purchasing power. | ||
| And that has been the Fed's policy to deliberately debase the dollar. | ||
| Even at 2% a year, they would pat themselves on the back to get down to 2%. | ||
| But think of that, over a decade, losing 20% of your purchasing power. | ||
| I just think I'm amazed the American people have put up with it, and I'm delighted that I think we're now starting to confront the Fed about these long-standing policies that have not served the aims or been consistent with the principles of America. | ||
| Isn't she amazing? | ||
| I mean, absolutely amazing. | ||
| And I really want to thank her. | ||
| We're going to have her on a lot more. | ||
| Often, remember, you know, Navarro and Russ Vogt and Scott Besson, just really so proud of who's come on the show and how they've taken to the audience and the audience has taken to them. | ||
| Of course, guys like Mike Benz, Philip Patrick from Birch Gold. | ||
| I always want to thank the Birch Gold team. | ||
| It makes all this possible. | ||
| And of course, you guys have jumped into the Birch Gold situation and have told us time and again, we want to learn more. | ||
| We want to know more. | ||
| That's the whole purpose of this. | ||
| That's the whole purpose of the show. | ||
| Jim Richards, he came on as a contributor a couple years ago. | ||
| Strategic Intelligence actually set up a webpage. | ||
| What we try to do is give you access to information that you can't get anywhere else. | ||
| You go to RichardsWarroom.com. | ||
| Strategic Intelligence is the newsletter. | ||
| The reason I love it, this audience of working class and middle class folks, you get access to something that the C-suites, that's a fancy Harvard Business School term for the guys that are chairman of the boards or the CEOs or people running these organizations. | ||
| You get the same access to information that you get. | ||
| Make sure you go to RickardsWarroom.com today to get strategic intelligence. | ||
| And Jim kicks in a book, Money GPT, about currency and artificial intelligence. | ||
| I came to Jim's writings over a decade ago, I think 15 years ago, with his currency wars. | ||
| It's pretty amazing. | ||
| And we're so proud to have Jim on. | ||
| He was on this morning. | ||
| Of course, walked through everything on geopolitics, intelligence, national security, and capital markets and economics as President Trump runs the table on these trade deals. | ||
| Now it's time to get, you know, maybe go do an audit of Fort Knox. | ||
| I'm all in for that. | ||
| You like that idea? | ||
| I think Jim Rickards likes it. | ||
| Keeps talking about it. | ||
| Got to get Scott Besson. | ||
| Let's just go, maybe not have an audit. | ||
| Let's just go and take a clipboard and make sure we just check. | ||
| Got all the gold there. | ||
| We're going to continue on. | ||
| We're going to take a short commercial break. | ||
| Johnny Connell, take us out. | ||
| We're going to come back and continue on with Judy Shelton. | ||
| Make sure you take your phone out. | ||
| Bannon, text Bannon at 989898. | ||
| Get the ultimate guide. | ||
| This guide is free for investing in gold and precious metals in the age of Trump. | ||
| Now more than ever. | ||
| We're teaching you how to fish. | ||
| We ain't giving you a fish. | ||
| Here in the war room. | ||
| Short commercial break. | ||
| Johnny Kahn takes us out. | ||
|
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| It is now time to really go through the Federal Reserve and take it apart and look at it and find out what its strategy is, what's actually happening, what are the control mechanisms. | ||
| And I think we've got to get back to the very basics, what its purpose is and do we need it. | ||
| Judy mentioned just in passing a $900 billion loss, unrealized loss on their balance sheet right now, almost a trillion dollars. | ||
| Judy, we just had the AI action plan. | ||
| We've got artificial intelligence. | ||
| We just beat back a central bank digital currency. | ||
| This audience with MTG and a handful of others made sure that we had an independent vote passed so we wouldn't go to a central bank digital currency because they were about to pass that up on Capitol Hill. | ||
| So we're on the eve of a revolution that will be the greatest industrial revolution, at least to date, with artificial intelligence and the convergence of quantum computing and regenerative robotics and artificial general intelligence. | ||
| Chris for all that, the singularity is within sight, right? | ||
| As we said when I was in federal prison, you can see the door. | ||
| Why is Judy Shelton then, why are you not just a complete throwback to Jefferson and Hamilton and horse and buggy? | ||
| You continue to hammer the Fed and the Space Accord. | ||
| You talk about gold, gold bonds. | ||
| You want an audit. | ||
| Don't you come from the horse and buggy era in that really it's passed you by what they're talking about today with the digitization of money and artificial intelligence and all that. | ||
| And everything we talk about is really about this barbaric metal that really harkens back to the dark ages of mankind, ma'am? | ||
| I think that talking about the role of gold in anchoring an international level monetary playing field is a very forward-looking, even sophisticated approach. | ||
| I might note that Secretary McBeson said that he was probably best labeled a gold bug during his currency trading days. | ||
| And it's funny. | ||
| I was preparing and looking at some notes. | ||
| I actually have an email from Alan Greenspan. | ||
| This was from July 2019. | ||
| I had a great collegial relationship with him since 1990. | ||
| He'd read my book on the coming Soviet crash, and he had just come back from the Soviet Union, and he wanted me to come to DC to talk about it. | ||
| So then I met pretty regularly with him. | ||
| But when I was a new, newly named nominee for the Federal Reserve Board by President Trump, there was just a brutal column about me in the Washington Post. | ||
| So I sent it to Alan. | ||
| I emailed it. | ||
| And I started out by saying, I'm noting a certain almost hysterical antagonism toward the gold standard these days. | ||
| And then said, sound familiar? | ||
| That was the opening sentence of the paper that Alan Greenspan wrote called Gold and Economic Freedom. | ||
| A radical paper. | ||
| And he wrote that for Ayn Rand's compendium, Capitalism, the Unknown Ideal. | ||
| And he emailed right back, dear Judy, interesting times. | ||
| If gold is such a worthless metal, then why does the U.S. government and all other major governments hold so much of it in storage? | ||
| Unquote. | ||
| Best Allen. | ||
| So I've also known Paul Volcker since 1994, right up until he passed away. | ||
| We would always be together at the International Monetary Conference chaired by Robert Mundel, and I co-chaired it the last few years of Mundel's life. | ||
| He was the Nobel economics laureate, who was really the intellectual godfather under President Reagan for supply-side economics. | ||
| And he believed a stable dollar was just vital to assuring prosperity. | ||
| You needed the proper foundation for market forces to work, for supply and demand to deliver optimal economic performance because the money itself conveyed accurate price signals and it functioned as a store of value. | ||
| So I've grown a very thick skin and people who criticize gold are not the ones in the arena. | ||
| Paul Volcker always talked about the role of gold as the anchor for the Bretton Woods system. | ||
| He wrote in his book, Changing Fortunes, he always thought it was embarrassing that the U.S. walked away from the gold convertibility obligation, and he was sure we were going to just restore the system but at a higher valuation for gold. | ||
| So, when I see people who have been in the arena and served for many, many years as the head of the most important central bank in the world, like Greenspan, like Volcker, and then to have such a good relationship with Mundell, who his supply-side approach is now being replicated and I think improved and made substantially stronger due to the bold leadership of President Trump. | ||
| I can laugh off people who think it's a better system to listen to the nuanced statement of 12 officials on the voting committee that defines, that dictates the rate of interest, and they meet eight times a year to decide the cost of loanable capital. | ||
| I mean, that's barbaric. | ||
| To me, that violates the norms of democratic governance. | ||
| So I would rather have, I think I would go with the thinking not just of central banks, which have been buying up gold like crazy, but all the people buying it at Costco. | ||
| I trust that aggregate wisdom much more than the rather insulated world of central bankers who think they can control the money supply. | ||
| You brought up all of this, these evolving electronic payment platforms. | ||
| How can you control the money supply with stable coins coming on? | ||
| There's unlimited potential for stable coins to serve as money. | ||
| You have the explosion of private credit. | ||
| The whole rationale for a Federal Reserve system was to prevent banking panics. | ||
| Well, now more than 50% of the loans to small and medium-sized businesses are coming from non-bank institutions, private credit. | ||
| How is the Fed examining that? | ||
| There's a regulatory arbitrage going on where the big banks just play footsie with the Fed. | ||
| They collect hefty interest rates for letting their money sit in cash balances at the Federal Reserve. | ||
| And then on the side, and we just heard Jamie Dimon talking about this, he says, I think it's dangerous as can be, but we want in on it. | ||
| So JPMorgan is now saying, we're going to get into this private credit business big time. | ||
| Those loans are not under the immediate regulatory oversight of the Federal Reserve. | ||
| And another very interesting movement, the growing number of states, including Florida and Texas, in the last two months have signed legislation to allow citizens to use gold and silver through debit cards and mobile applications as legal tender for everyday transactions. | ||
| And it was no mistake. | ||
| I mean, Greg Abbott, the governor of Texas, when he signed the legislation less than a month ago, he said this is to restore constitutional money. | ||
| And when Governor DeSantis signed it for Florida just a month before that, he said this is to restore economic freedom. | ||
| So you have an alternative to a dollar that is being deliberately debased. | ||
| I think this should be sending a signal to Washington. | ||
| And I think it is. | ||
| And I think our members of Congress are picking up on it. | ||
| That the spell has been broken. | ||
| When the Fed allowed inflation to get to the point that it did, when the Fed's model predicted doom and gloom, and that didn't happen, when people started to realize that the way you fight inflation is by increasing output, increasing supply, not by trying to suppress demand and curtail growth. | ||
| What the Fed does, when government is overspending and engaged in classic stimulus deficit spending, and then the Fed becomes a disciplinarian and says, well, we'll run up interest rates to prevent inflation, all they're doing is empowering government at the expense of the private sector because government has to pay whatever the interest rate is decreed through treasury auctions. | ||
| But for entrepreneurs, for small business people who really need access to capital, when you set artificially high interest rates, which is what the Fed means when it says yes, it's restrictive, they mean it's restricting the amount of real growth that it is permitting because these people are now having to go elsewhere. | ||
| And because high cost of capital is a real barrier to people in the real economy, that's why it makes no sense to have fiscal policy working at odds with monetary policy to the benefit of empowering big government. | ||
| Are the BRICS totally wrong? | ||
| I mean, geopolitically, it's becoming anti-Western, but when they talk about the deterioration of the dollar and they're looking to do bilateral agreements that are backed in gold and they're talking about some sort of gold backed currency, they deem their central banks to go buy gold at record rates. | ||
| They understand something about the deterioration of the dollar, correct? | ||
| They have their reasons. | ||
| Of course, we don't want that to happen. | ||
| I like that President Trump put it out there that don't do that. | ||
| It's hard for them because we have the deepest financial markets. | ||
| We have a lot going for us. | ||
| The U.S. has a legacy of having been the anchor country for the Bretton Woods system, which not only delivered productive growth all over the world, and you had fixed exchange rates, which meant trade was carried out on the basis of a unified money system, just like we had when Adam Smith wrote The Wealth of Nations. | ||
| You can't talk about comparative advantage if currency manipulation is obscuring the price signals and slanting to the advantage of countries that depreciate their currencies. | ||
| So the BRICS countries, they want to avoid sanctions. | ||
| They understand that the U.S. dollar is subject to What we're calling the inability, the fiscal insustainability of our path, which we keep saying we're going to deal with in the long run. | ||
| Well, I'm waiting for day one of the long run and trying to get down to a balanced budget. | ||
| You need sound finances to go with sound money. | ||
| But this is why I say the United States could just leap ahead, and it would be fairly simple if you had your Treasury Secretary. | ||
| And I say, I think Scott Bessant would be amenable to this because he is a student of monetary history, even a professor of monetary history. | ||
| The Treasury Secretary. | ||
| Hey, we've got to go to a break. | ||
| I want to give the punchline on the other side. | ||
| Judy Shelton's with us, the author of Good is Gold. | ||
| It's now out. | ||
| You can get it at Amazon. | ||
| We're going to get all her coordinates here in a second. | ||
| Judy, go ahead and finish what you were saying about Scott Bessant. | ||
| I think as Treasury Secretary, he could authorize, with President Trump's approval, I believe he would love the idea, he could authorize the issuance next year on July 4th, 2026, of a 50-year Treasury bond convertible into gold at maturity at the option of the bond holder. | ||
| I think this would be something like a TIPS bond, Treasury inflation-protected security. | ||
| It can just be an offering put out there for investors. | ||
| I think the demand would be phenomenal. | ||
| I think this might involve verifying a walkthrough Fort Knox. | ||
| I think the gold is there, but let's make sure there are no encumbrances. | ||
| The 261 million ounces the U.S. owns, we carry it at a book value of $11 billion. | ||
| It's worth closer to $1 trillion. | ||
| You could take a windfall profit if you collateralize that gold, our family jewels. | ||
| We're in a family emergency. | ||
| You pledge those as specific collateral for these bonds. | ||
| And I think that starts to establish the Lodestar. | ||
| And what I think that we need to do, and what I would say to the Treasury Secretary and to members of Congress, particularly the Senate, who are looking at the Fed, the Fed is potentially facing an existential crisis when you have people like the constitutionalist Senator Mike Lee calling for end the Fed and Senator Rand Paul calling for an audit of the Fed. | ||
| I think the next Fed chair should be concentrating on eliminating the Fed's mechanism of paying interest on reserve balances. | ||
| It's paying 4.4% on $3.4 trillion sitting in cash. | ||
| 40% of the hundreds of billions it's paying is going to foreign-owned banks. | ||
| I think that's outrageous. | ||
| And the Fed should instead go back to the Paul Boecker way of open market operations, which means it should be shrinking its portfolio and selling off some of its own treasuries. | ||
| And I think as banks got off of that approach of just passively collecting money from the Fed, they would put that money into the treasury instruments and bring down those interest rates, which really would matter to the real economy. | ||
| And then my third piece of advice is have Treasury work with the Fed to issue that 50-year bond, because if you compare the rate of return on a bond that's convertible into gold, a dollar, denominated in dollars as good as gold, | ||
| and compare what the U.S. has to pay for that interest rate relative to fiat money, which denominates normal Treasury securities, that could come to serve not just as an information tool to the Fed about the aggregate expectations of the future purchasing power of the dollar relative to gold, which is a good surrogate for commodities and the real economy. | ||
| It could become a price rule in the future. | ||
| Instead of just having wholly discretionary authority of the 12 people who decide the rate of capital, maybe if there's a huge discrepancy, a big gap in the interest return on dollar-denominated instruments where it's as good as gold compared to fiat money, that would be a signal that the Fed had to take certain actions. | ||
| The people who worry most about Federal Reserve independence are the ones most resistant to any kind of a rule. | ||
| And I think that's very telling. | ||
| So those would be my recommendations. | ||
| Judy, where do people get your rings? | ||
| Where do they get the new book, Good as Gold, and where they get all your writings, social media, all of it, ma'am? | ||
| Well, thanks for asking. | ||
| Amazon, Good as Gold, how to unleash the power of sound money. | ||
| And it details my approach, which is that we know central planning doesn't work. | ||
| So why do we have that at our central bank? | ||
| And then it gets into the very specifics of the proposal I just outlined. | ||
| And you can follow me on X at Judy Schell. | ||
| Judy, thank you for taking an hour on Saturday morning in July, in late July, to inform our audience. | ||
| I'm telling you, people loved it. | ||
| And we'll make sure we get you back on here and talk about all these developments as we push forward for a restructuring of the Federal Reserve, ma'am. | ||
| It was to be with you, Steve. | ||
| Thank you for inviting me. | ||
| Thank you, ma'am. | ||
| Wow. | ||
| This is what they don't want working class people in the middle class to understand. | ||
| They don't want you to understand really money, currency, the way the system works. | ||
| If you're going to make changes to the system, you have to understand the system and how it works so then you can take it apart. | ||
| President Trump, and this is why this huge fight you've had for years and years and years to return President Trump to the Oval Office is so important because you bring in people like Russ Vogt. | ||
| You bring in people like Dr. Peter Navarre. | ||
| You bring in people like Scott Besant, right? | ||
| These people that are taking a fundamental and serious look at the system and how to either take it apart and rebuild it so it maximizes freedom for the American people and the benefit of American citizens. | ||
| And what Judy said right there, we'll get more into that in the days and weeks ahead about paying interest on these bank reserves, particularly 50% of it going to foreign banks. | ||
| The rot inside the system is amazing, but the resistance to change, and this is one of the things that's so we have to stick the landing on what Tulsi Gabbard has put before us. | ||
| We're going to get more into that in the second hour, which is so vitally, vitally important. | ||
| Do you agree with me that maybe, I don't know, let's put her on the shortlist for Federal Reserve Chair. | ||
| I'm serious about this. | ||
| She's a rock star. | ||
| And she speaks truth, and she speaks truth to power. | ||
| And you heard about her book, Good as Gold. | ||
| I want to thank the Birch Gold team. | ||
| Like I said, now maybe more than ever, you want to find out about this. | ||
| Birchgold.com slash Bannon, the end of the dollar empire. | ||
| We're not certainly rooting for the end of the empire. | ||
| We're warning people that if you continue on this path, the bricks and, I mean, we were the called shot that said the bricks are going to stand up eventually. | ||
| We said this years ago. | ||
| Why are they doing that? | ||
| Because we're devaluing the dollar all the time. | ||
| President Trump, he ain't having it. | ||
| He said, hey, point blank, you join the BRICS, you're going to pay 10% premium on your tariffs. | ||
| And he already put a 50% on Brazil. | ||
| And I believe in that. | ||
| You got 30% for Bolsonaro and 20% for leading the BRICS effort. | ||
| Anyway, birchgold.com slash bannon into the dollar empire. | ||
| Go check it out today. | ||
| Philip Patrick, of course, in the team. | ||
| No better, I think it's no better time to have the right stuff, the magnificent, off a classic book by Tom Wolfe, who was born and raised in the same neighborhood I was in Richmond, Virginia. | ||
| One of the great authors. | ||
| Remember all the great books he wrote? | ||
| Tom Wolfe, the great novelist. | ||
| Philip Kaufman's the director of a classic. | ||
| And Conte is the composer of this magnificent score. | ||
| This weekend, maybe you'll watch The Right Stuff with the Kids. | ||
| We're back at 10 a.m. Eastern Daylight Time tomorrow morning. | ||
| It's going to be on fire. | ||
| The President of the United States is back in town. | ||
| We'll be back with him in the war room. |
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