| Time | Text |
|---|---|
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Dollar Devaluation's Impact
00:03:29
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| So do you foresee a devastating inflation? | |
| Well, I think we already saw it. | |
| I think we saw it in the 21st century. | |
| When the year 2000 dawned, a dollar bought 1 260th of an ounce of gold. | |
| And let's never forget that even though we left the gold standard in 1971, it never stopped existing as a measure, as a market signal of government's mismanagement of money. | |
| And so $266 in the year 2000, roughly. | |
| By the time George W. Bush left office in 2009, gold was up to roughly $1,000. | |
| During President Obama's presidency, the price of gold rose all the way to $1,900. | |
| Now it's at $1,700. | |
| That's a fairly substantial devaluation of the dollar. | |
| We didn't register and quote inflation in CPI because they've stripped out most of the market goods that Signal the inflation the most. | |
| If they'd measured it the way they did in the 1970s, we would have registered a major inflation in the 21st century. | |
| Are Republicans fighting this? | |
| Not enough. | |
| Republicans buy into it too. | |
| I don't want to be the bearer of bad news, but it's stuff you already know. | |
| Let's never forget that Donald Trump routinely said that other countries were beating us because their currencies were cheaper than ours. | |
| Nothing could be further from the truth. | |
| Implicit there is that Mexico is rich and has gotten rich by devaluing the peso. | |
| That so is Argentina by devaluing their peso. | |
| No, rich countries protect the value of their money simply because in protecting the value of their money, they're protecting the wealth of their citizenry. | |
| The worth of their work. | |
| They're also protecting the investors who commit capital to new ideas. | |
| When you devalue money, what you're saying to the investors who drive all economic growth is that if you commit capital to a new idea and you actually get a return, you succeed, you create a new Google or a Microsoft or an Amazon, any money you get back will come back and devalue dollars. | |
| So currency devaluation is anti-progress. | |
| It's a tax on growth, yet it's hard to find a politician who understands this nowadays. | |
| Well, it seems it's hard to find a businessman who understands this. | |
| Every big business sides with the left. | |
| Yep, yes, certainly some do. | |
| Certainly some make that statement as a way of just making nice with the other side. | |
| But I think businessmen, in a sense, broadly understand it. | |
| Phil Knight of Nike, in his wonderful book Shoe Dog, made the point that when the U.S. left the stability of the dollar as 1 35th of an ounce of gold in the 1970s, suddenly his ability to run Nike became extraordinarily difficult because he was importing most of his shoes from Japan. | |
| And so these floating exchange rates that no one had ever seen before. | |
| It made the ability to do business a much more difficult concept because it rewrote contracts overnight. | |
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When Politicians Panic
00:00:24
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| It's the robbing of people who want certainty. | |
| Yeah, Nike. | |
| And then look at what it ended up doing. | |
| Well, listen, you wrote a very important book. | |
| When Politicians Panic, folks, is up at the DennisPrager.com. | |
| John, I look forward to talking to you again. | |
| Dennis, thank you so much for having me on. | |
| I appreciate it. | |