Tariffs are very risky business. They're like playing with fire. We run into the same unsolvable problem that we have with The Fed. They don't know what interest rates should be. It's all arbitrary. In the same way, the president doesn't know what the price of cars, or lumber, or any other product should be. While the president is not literally price-fixing like the Fed, he is arbitrarily interfering with market prices and trade. Our inescapable problem in America is the overwhelming size of government, spending, debt and empire. All of these variables are still going in the wrong direction.
Hello, everybody, and thank you for tuning into the Liberty Report.
With us today, we have Chris Rossini, our co-host.
Chris, welcome to the program.
Happy Friday, Dr. Paul.
Great to be with you.
Very good.
This is an interesting day.
At least there's some things out there that are exciting the markets.
You know, I think when I first looked at the TV this morning to see the first price of gold, because it was a future price, it just happened.
It turned out it was like $40 going up.
And even though there's nothing that I didn't expect, but when I see it, I'm still shocked, you know, because when we started watching gold prices, gold was, you know, theoretically $35, but then it would go up to $38, $39, a dollar here and a dollar there.
But now it could go up $50 in a day, and it's not that big a deal.
I think it is a big deal, but people sort of blink and they go along with it.
You know, but today, one of the reasons why gold jumped up, there was a report on the Federal Reserve's favorite price control gadget information.
That's the core PC expenditures.
It's a different way of using the CPI.
And they use this, and it was up a little more than they thought, which means inflation is still there.
And that leads to trouble.
And this is one of the reasons things pop up like this, although the theory and the philosophy of inflation and the future of the dollar was well known probably years and years, decades ago.
I became aware of it by reading Austrian economics in the 1960s.
And there were a group of popular editorialists and journalists that would talk about what was coming, the breakdowns of the Bretton Woods and gold soaring and all these things.
So it's been around, but it's still something that people have to deal with.
But I don't think the understanding of how serious it is is yet known.
But it certainly is because everybody is going to suffer from it.
BRICS is busy thinking, what are they going to do to replace the dollar?
Nobody knows exactly what will happen there, but there are things that are coming along.
But one thing that we have done here at the Liberty Report is we have partnered with Birch Goldroop because they knew about this a long time ago.
And they were one of the first ones to start one of these groups to get a gold IRA.
A regular IRA, you can't put gold in there.
You can't put physical gold in it.
But the adaptation, which makes me a little bit nervous, to tell you the truth, is when the government made it available, it was a place to put physical gold.
And what Birch has is they have a description and they educate people on exactly how that works, be able to take stock and bonds or whatever you have and you shift it over without paying taxes or penalties on it.
So it's information that's worthwhile.
And that's why we talk about gold because we believe in it.
But we also put a pitch in for Birch Goldrew.
And if you look at the screen, you can see how you can get it.
You can call Ron at 98989A and they'll send you some free materials on this whole thing about trying to get metals into an IRA, which gets around the fact that the regular IRA doesn't permit you to do that.
So, anyway, that's worth looking into.
If you do that, they'll send the information.
They don't charge you for this information.
But, Chris, we will talk about gold, I'm sure, today, somewhere along the way, because our subject is really having to do with tariffs.
And the big discussion ever since Trump's in office is, don't tariffs raise prices?
And is that inflationary?
You know, technically, it's not inflationary.
It'll cause prices to go up, but a lot of things cause prices to go up.
You know, hurricanes can make prices go up, but that's not inflation.
That's price adjustments for certain changes that are occurring in the marketplace.
So, this is something that we have to be aware of.
And the people really are concerned about what's happening because I think it's really a major event in the last year or two of the shift from the average, very numerous number of economists who, even if they weren't bragging about it, they didn't support tariffs.
It was a popular position to hold.
But all of a sudden, you know, because the people voted for Trump and on the surface, it sounds like this tariff business sounds good.
Keep out the competition.
We're not doing well in our automobiles or whatever you want.
Let's keep out the competition.
But that is not the competition is beating us at something that should give us the incentive to do a better job on the products, getting the prices down.
But this is something now, though, that people are arguing about and worried about.
The debate is going on and on.
And I would say the excitement now in the metals markets and the inflation rate right now has to do with inflation that's there because I look at the debt for the inflation.
Because when the debt gets too high, the government has nothing else they can do than monetize it, print money to do it.
But that's one part of it.
But also, raising prices in the midst of inflation is a big, big problem.
And I think there was one report where Trump recognized this and he says, oh, yeah, it might raise the prices here.
But he suggested regulating prices, telling people what to do and what they can charge.
That's not what we should be talking about.
Not if you're interested in the free marketplaces and sound money.
So, Chris, I'm sure you've thought a little bit about this.
And what do you have to say this morning?
That's right, Dr. Paul.
And I want to start by, you know, Trump is not an economic fool.
The guy's a billionaire, successful businessman.
So our criticism applies not necessarily to the person versus the policy.
So this applies to any human being that tries to do this.
And like you said, Dr. Paul, it's also arbitrary to me.
You know, some nations are going to have exemptions from tariffs.
You'd be nice to us.
Others will not.
Anybody that buys from Venezuela will get another 25%.
He's telling automakers, don't raise prices.
This is like central planning.
This is like what the problem we have with the Fed.
They don't know what interest rates should be, and it's all arbitrary.
And is this the type of economy that we want?
We don't live in a kingdom where this is Trump's realm.
He's going to pass it off into his family.
We live in our democracy.
So, in a very short time, a Democrat could be in there who does not understand economics like Trump does.
Are they going to do the same?
Are they going to go line by line?
Let's see.
Lumber?
Yeah, let's put 25% on that.
Computer chips.
Do Republicans use computer chips?
Let's put 100% tariffs on computer chips.
Is that the world that we want to bring in the future at some point?
This is like Soviet stuff, where politicians arbitrarily mess with prices.
The problem in our country that cannot be escaped is the overwhelming size of our government.
Now, we have Elon Musk and Doge that are dealing with that.
They're probably the best part of the Trump administration.
But then you have Trump himself and the Republicans, and it seems like they don't, you know, they have no interest.
They want to keep the biggest drain on our country, the military empire, going and think that they're going to make America great again.
So we'll go over that again, but this is a big problem so far.
You know, whether it's just the plain old-fashioned inflation where we take debt and print money, distorting interest rates for the businessman to make decisions and people who save money, everybody gets mixed up because you don't have an honest opinion about what rates should be.
But the other problem is that the way it's being handled now, that if there is resistance, public resistance or the resistance against the country or an entity that's going to be suffering from the change in policy on tariffs, then all of a sudden, oh, okay, let's switch it.
The uncertainty, you know, I think of the business man, I said, you know, if I have, if I have to look at my products, if I were to import them, they're going to go up 5% next year, and that's the answer.
He could start planning.
Still difficult, but he'd do it.
But what if it was said, well, we're going to put 10% on, 20% on, but then there's a lot of feedback and say, hey, I guess we better change that.
And then the market has gone down.
And then they remove some of the tariffs.
The markets go way, way up because they remove some of the penalties in there.
So that is, you know, very disruptive to the marketplace.
But people have to realize that tariffs are taxes.
And no matter what we're told from our government, that we won't have to pay the taxes.
Matter of fact, the president actually recognizes, yeah, there could be some prices going up there, but we could take care of that.
We'll punish people for buying these goods and we'll put price control and other things, intervention.
So this really raises the maze of the subject about interventionism and how foolish it is.
Because intervention, if you have no intervention, that's laissez-faire and we sort of lead that direction.
Or if you have total control, you have the worst type of Marxist system where they control every social and economic event going on.
And that's the worst kind of control.
But everybody else, which is 90-some percent, especially people in this country, are for intervention.
Oh, intervention, good invention.
So you argue, what's good invention, bad invention?
How do you have that?
How do you subsidize this company?
And on and on.
But once the principle of interventionism is supported, you know, it grows by leaps and bounds.
And it never goes away.
So it gets worse.
And we're at a point now where interventionism mixed up with the dependency of the manipulation of the money supply in order to take care of the deficit.
So, excuse me, that is why we are at a crisis point.
I think also the recognition that we are bankrupt and also the recognition that more people are buying gold.
Yes, Dr. Paul.
As I mentioned, I think the best part of the Trump administration is Doge and Elon.
And when it comes to spending debt, you know, Trump and the Republicans not seeing it.
And it appears based on foreign policy that they want to keep this big empire that is the biggest drain on our country.
You can't run from that.
I mean, has foreign aid been canceled?
Trump talks about being us being ripped off.
Why Central Bank Cryptocurrencies Matter00:04:57
Is there any bigger ripoff than just sending money to foreign countries?
No, it hasn't been canceled.
Are troops coming home?
No.
Bases closed?
No.
Wars?
He's out there bombing Yemen.
What are you doing?
We don't have time for this kind of stuff if we're going to fix this place.
You know, and he, the worst part, he was on with Pim Poole when he was campaigning, bashing Biden for bombing Yemen.
And he's in there bombing Yemen.
I mean, this is all bad stuff.
And, you know, despite the good stuff that Doge is doing.
But I did notice something, and it was kind of predictable.
Doge is focusing on, and I'm not blaming Elon for this.
He has to do what he has to do.
He's focusing on the Democrats stuff, USAID, Department of Education, NPR, PBS.
This is all leftist stuff.
And we said at the very beginning that we'll know that Doge has done a good job for the American people when both parties are upset and can't stand Doge.
And that is just not the case.
They're just focusing on the leftist stuff, which means the right wants to keep the empire.
And there is no way you're not making America great again.
America was great before we started invading the world.
It's what invading the world is what has bankrupted us.
And unless that is addressed and it is not being addressed, we're in big trouble in the future.
You know, there's under the conditions that we have, a lot of people talk about cryptocurrencies and why it would be important from an argument that we would agree with why the central bank shouldn't be devising a cryptocurrency to more or less be prepared for the alternatives of the dollar.
So that's floating around.
But just recently, Cruz, Senator Cruz introduced a bill that would prohibit it.
They would prohibit the central bank's digital currency.
And it's a shame you have to have a specific bill like that.
Why don't you just have the Constitution or honesty?
You wouldn't have all this nonsense.
You wouldn't have a central bank and whatnot.
But they don't want that competition and they see that.
At the same time, they're writing a prohibition about an official digital currency.
They're doing everything possible.
Trump brags about it, making a digital currency, the Bitcoin, you know, the official reserve currency.
In a way, it's a shifting, literally shifting gold, revalue into gold, and use the profits that they make to buy Bitcoin.
Now, it may on paper look great, and they have all kinds of promises, but in one hand, they said no, no Federal Reserve, no Federal Reserve, Bitcoin, you know, new currency, if they do that, but if you also at the same time say, well, I think what we need,
we need to fill the central bank up with digital currency, maybe crypto, maybe Bitcoin or whatever.
For some reason, that seems contradictory to me.
And I've been looking at currencies for a long time, and I get a lot of support from the people who like to see the competition with the dollar because I have recited the fact that I think the dollar is in bad shape.
We should have alternatives, but I want the alternative being the free market, no prohibitions, no taxes on it, and no regulations on it.
And the people do that.
There's history that shows that the privacy, the private system can't handle its own currency.
It's not likely to happen soon, but we can't say that all of a sudden we can have this happen and with regulations, we can have one currency graduate and one we have to set aside without dealing with the morality of spending money we don't have and taxing people through the inflation tax because that's immoral,
it's counterfeit, and it's evil, and it's the source of so much of our problem.
Because without this counterfeiting system that people accept, unfortunately, over the many decades, because everybody thinks they can get part of that, you can't even mention the fact that maybe social welfare could be handled in the marketplace.
And Chris, you mentioned Yemen.
Maybe the problems over there in Yemen could be solved without us bombing them on a nightly fashion.
End of an Era00:05:34
You know, it's just so bad.
But I think it comes from nobody, most people don't start with a basic principle of non-intervention, falling the Constitution, no lie, cheating, and stealing, and that sort of thing.
They just start off and then they're in the business of manipulating.
That's why interventionism, per se, which is very generalized, means that you can do whatever you want if you can get enough people to support you.
You know, so you bring together all the special interest groups and they start intervening in the market, and we end up with $36, $37 trillion debt.
It's still climbing.
And really, even with the good things going on now with Goach, we really haven't accomplished that in the budget.
They've delayed the major votes to the end of summer, I think, to deal with cutting the spending, actually.
Chris?
Very good, Dr. Paul.
I will conclude with my thoughts.
Yeah, tariffs are not the answer.
In fact, it's like playing with fire.
We're giving all this authority to the president to mess with prices all over the economy.
That can't go well because it's far too complex, the economy, way too complex for anybody to go.
This raise prices here, lower prices here.
Don't you dare buy from them.
I mean, this is an impossible task that is unsustainable.
And again, what happens when a Democrat gets in?
The problem we have is the expansion of the state.
It is a Republican and Democrat party problem, both of them, not just one.
And here we've had people like us, like Dr. Paul, especially, decade after decade, stop expanding the state.
Getting rid of it is going to be extremely hard.
And nobody listened.
And here we are with a government that is so massive that the philosophy is not that it's there to serve us.
It's that we exist for it.
It's a false god, a idol, a golden calf, and it has worshipers.
Look at just the stuff that Elon's doing.
There's violence against Teslas.
I mean, these people worship the state.
So we're in a tough, tough bind because then you have the leftists that don't want it to go away, their false god.
And then you have the right that don't want the empire to go away.
So we are in a tough bind with all of these people on both sides addicted to the government.
The best we can do is put out the ideas on what should be done, you know, but nobody wants to hear what should be done.
They want what they want for their own side to win against the other guy, and we're all losing.
You know, so we'll just keep plugging away here on the Liberty Report.
You know, the conditions we're talking about aren't new to us.
They've been around for a long, long time.
And they finally end.
All the reserve currencies end eventually, and ours looks like it's winding down.
But getting rid of the reserve currency is done for a market reason.
Because politically, you wouldn't be allowed to do it.
Because when you live beyond one's means and use an artificial currency and you don't have a definition of the currency itself, the unit of account, you end up with a lot of malinvestment.
People say, oh, you want to save a lot of money.
I'm going to go buy a house, you know.
And before you knew it, you have a housing bubble or whatever you have.
That's the creation of bubbles.
So they do this, and then there has to be a correction.
But there's also the malinvestment, but there's also the evil that most people recognize, and that is prices go up.
And so I've been told by constituents, what you need to do is send us more money because our prices are too high.
Instead of understanding the issue, we've been printing too much money.
That is the reason that we have to do something about it.
But I think the whole thing will collapse because it will collapse because the debt and the malinvestment has to be liquidated to get a fresh start.
Does that mean that I am an absolute defeatist and negative?
No.
My point is it's not that complicated.
All we have to do is live within our needs, look at the Constitution, do it from a moral basis.
And yes, there will be a bankruptcy.
There will be a liquidation.
It's happened many, many times.
But as long as you keep printing the money and regulating it and compensating for one mistake with more mistakes, like I think we're drifting into, it just prolongs and makes the bubbles bigger.
I don't think there's any sign that our financial bubble is shrinking.
Do you think with all this talk we hear about cutting spending that all of a sudden we're going to have a balanced budget this year?
Well, my prediction is it's not going to happen.
And yet the market says it better happen someday or we'll take care of it.
So the market is speaking loud and clear.
I want to thank everybody for tuning in today to the Liberty Report.