The feud between President Trump and Fed Chair Powell is really a fool's errand. Neither can possibly know what interest rates should be, simply because interest rates are derived in the marketplace. Price fixing, by either the Fed or the President, always ends us creating economic malaise. The Fed should not exist because there's no way to properly fix prices, and counterfeiting is unconstitutional and immoral. The current posturing between fails to get us closer to ending this anti-American institution.
Hello, everybody, and thank you for tuning in to 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.
Guess what?
We're going to talk about finances, and maybe we'll hit around it.
We're going to talk about the Fed and some of the nonsense going on there.
Many, many people, pundits now, are talking about, you know, what this means.
And, of course, I've spent a year or two talking about what it means when you have a central bank, what it means when you don't have a definable, you know, unit of account for the world, and you end up with a mess.
That's what we have.
So it's a big, big issue.
But gold always is a big issue.
And at times of this, when there's economic turmoil and there's too much spending, and everybody explains what they can do and will do and what will happen.
And it's interesting that the fears were actually started back when they created the Fed, and certainly when they took away the gold ownership of the American citizen.
So the predictions were there, but they were correct, but there was no way to know how long the people would put up with the nonsense.
Instead of, you know, the handwriting being on the wall and the people giving up on the whole system, what they did, they, you know, the people doctored it up, and we had so much wealth, and we still do, a lot of wealth and a currency that is still kinkpin, but quickly, more quickly than ever, diminishing as the most important currency of the world.
So we have this going on, and this is one of the reasons we talk a lot about gold and the history of gold, and also the reason we work in partnership with Birch Gold Company, because they talk about what individuals can do.
And one of the biggest challenges is if you do come around to the subject of believing that holding hard currency, the metals, the precious metals, that is not all that easy.
I remember when I first discovered what was going on, gold was not even legal.
And then if you wanted to put it in your IRA account, that wasn't legal.
But things, you know, have changed.
And we think of all the terrible consequences going on.
But there was also, you know, the time when we couldn't even own gold.
Now we can own gold.
And there's a vehicle now where you can actually put your bullion into an IRA account and satisfy the Feds, at least for now.
So if you're interested in something like that, you can get some more information from Birch Gold and show how the funding one might have in regular stocks and other investments and convert it and put it over into a gold IRA.
If you want that information, you can look at the screen and see that if you text Ron 989898, that will connect you to Birch and they will send you material further explaining this brief explanation I gave.
And that is something that is worthwhile doing.
They don't charge you for this, but it might enlighten you as far as how it's done.
So once again, if you are interested in that, text Ron 989898.
And Chris, I think we'll go on now and talk about a subject we just got done talking about and something I've talked about.
Matter of fact, interest in the monetary system really came to light.
I came across Austrian economics in the 1960s, and there were many people then that were identified as Austrian economists, sound money people, and they were predicting back in the 60s that the Bretton Woods Agreement, which was artificial and fake fiat money and that it wouldn't last.
But we were pretending that we could honor the dollar forever and always reimburse foreigners, but not Americans, with gold if they had Federal Reserve notes.
But everybody that had any sense in the 60s knew it wouldn't last.
And lo and behold, there was a day, August 15th, 1978, where the big collision occurred.
The government, our government, had to declare bankruptcy.
Oh, we've been lying about it all the time.
We don't have that much gold.
We just printed the money.
And a lot of suckers took it.
And now the foreigners held it, especially de Gaulle.
He was annoyed by this.
And he says, I'm turning in my Federal Reserve notes, and I want my gold back.
And that was the breakdown at Bretton Woods.
And that was the day that I decided that the monetary issue was big stuff.
And even today, with the events that we're witnessing today, with all the confusion, the spending, and all the argument, it's an issue that more and more people every day that were considered conventional finance people are very concerned and very worried, and they ought to be, because things are way out of control.
For instance, when Bernanke had to deal with a crisis back a few years ago with a recession, depression, he had to issue $3 trillion of extra credit.
People say, $3 trillion, extra credit.
And then under Powell, that was close to what Trump was already in.
The economy was weak again.
So they issued an additional $5 trillion.
New Money, New Problems00:15:18
Guess what?
The anticipation now, it may be right, it may be wrong, it may be a lot more, but it's estimating it could be $10 trillion of new money put into circulation to bail out the potential bankruptcies and the shortage of credit.
Because as a system like this goes, more and more is necessary to pretend they're recovering from the recession rather than fixing it up and deciding, why are we printing all this money?
They just say, well, we'll print it, and the people will keep taking it.
Yeah, sure.
But I think what we're doing is we're witnessing, Chris, the beginning of the end of this system in a much more concerted effort.
And a lot more people involved.
The bubble is bigger than ever.
And I want to talk a little bit today about, you know, this boiling down to an argument between Powell and Trump and say, who knows what the interest rate should be?
As if they only knew this, they could solve all their problems.
Chris, I think there's more to it than that.
What do you have to say about that?
Yeah, the feud between Trump and Powell is really, it's like, you know, Republicans and Democrats fighting over, you know, should taxes be 70% or 69%.
It's really insignificant.
Neither Trump nor Powell know what interest rates should be.
Interest rates naturally occur in the marketplace between a lender and a borrower who wants to borrow money and a lender who has money to lend.
We do this with everything.
We do this at the supermarket.
The supermarket has products to sell.
We go in, we look at the price, the products, and we say yes or no, yes or no, over and over and over.
And that's how prices are arrived.
And the supermarket, if they see something is priced too high, they'll lower the price.
And then perhaps people will say yes and they will buy it.
And prices are arrived in the moment between those two.
We do this with stocks and houses and everything.
This is very easy to understand.
It's not an outsider like the president or the Fed chair who says this is the price.
And they're not even involved in the transaction.
They're just decreeing this is what the interest rate should be.
And the only one that benefits is themselves, not anybody else.
So they do it for whatever reasons they have.
And it's not necessarily about money.
Oh, they want to make themselves rich.
The Fed can finance wars.
They can finance social insanity.
You know, all that insanity we went through for the past whatever amount of years?
That was funded by zero interest rates.
So they fund craziness throughout society, wars.
They could break politicians in half by raising rates, crashing the economy, and the politician takes the blame.
So this is a very bad institution that is ruling over our country.
They're more powerful than the president.
So it's not about Trump saying interest rates should be lower and Fed saying we're not lowering.
The Fed itself has to go.
You know, I'm glad you start off with the general concern about prices because that is the consequence.
That's what the people see.
But then they come up with the different reasons for this rather than saying going back to the Fed and dealing with monetizing deficits that the politicians and the people want.
But we should talk more often and refer to interest rates as a price.
It's a price to borrow the money.
It's called interest rates.
And I think it's the most important price there is if you want to have an organized economy, because that tells you what the value of the currency is.
So that to me is so important.
So I think this debate is huge.
Everybody knows it's important because it was reported Trump, oh, Trump, I think, appointed Powell.
And then a couple weeks ago, he says he has to go.
And the markets go shooting down.
And then the next week he says, well, I'm reconsidering.
Maybe it doesn't have to be right away.
And, you know, it's so arbitrary.
But it'd be much easier for us to decide.
Chris, we just wouldn't have somebody running the Federal Reserve System because it's so abusive.
And this is price fixing.
And I consider this debate that's gone going, you know, on again, off again.
Is he going to be fired?
What will happen?
I think that issue is one of the biggest debates and the most important debate around.
You say, oh, no, it's war.
It's war in Yemen and it's Ukraine and spending here and welfarism and all this.
They're all important.
But in a way, I see that all as being secondary.
Because if you didn't have, this debate here involves all of that because the issue of money, the value of the money, the stability of the money and the currency is so important.
And so to me, this debate going on, and I coined this debate between Trump and Powell as a fool's errand.
I mean, I don't know whether they must know how foolish what they're doing.
But in the meantime, because, well, they kept it together ever since the Fed's been involved.
We were warned at the end.
We were warned during the Depression when we weren't allowed on gold.
And things go by, and we always patch it up, just add more and more on.
And so they talk themselves into it, even though I think they have to have concern about it.
Because what I think is this debate, and it's epismized, not that who's going to win this debate.
Is Trump going to fire Powell and get away with it?
Or is Powell going to resign?
Or will he just finish out his term?
But the issue itself, the important point I want to make is there's not going to be a winner.
And Chris Already's pointed this out.
They don't know what the interest rates are going to be.
So how can one of them win it with the argument?
Oh, no, we think the overnight rate should be 2% tonight.
Oh, no, it needs to be 3%.
And they don't know that, and that's what they're arguing with.
And then they have all the inputs by the business people and the banks and what those spenders are going to do.
And they've kicked it aside.
The most important information, and that is the interest rates.
And because if interest rates tend to be low in a free market and a sound money system, they say, oh, okay, there's currency available.
We could get loans easier.
It'll do something to the economy.
So there's a very important signal we get from the interest rate.
But once it's a fool's errand and nobody pays any, they pretend they don't pay attention to it, just will delay the inevitable.
And I think, Chris, what we're witnessing now is many people every day are added to that list are looking at this inevitability of a major crisis with our currency.
That's right, Dr. Paul.
And yeah, you mentioned the firing.
I mean, who cares?
Are we going to replace Powell with somebody else that doesn't know what interest rates should be?
It's like, you know, replace Marco Rubio with John Bolton.
Stop wasting our time.
You know, it's the policy itself, not the people.
And the Fed should not exist, as we keep mentioning.
But since it does, I mean, which one would I prefer in this feud?
I would go with Powell because he is not lowering rates.
And Trump wants more inflation of all things.
I mean, is that what we need?
The rates are still low.
They're not even high.
They're high relative to zero, but not high in general.
They would be much higher if there were no Fed.
But Trump, he's always been a big spender, big debt.
Remember the CARES Act?
That was the record amount of money printing by the Fed.
I mean, he called Massey the first time, a third-rate politician, for opposing the inflation.
Biden, of course, made the inflation worse.
And now Trump wants even more inflation because that's what lowering rates artificially will produce.
More money printing.
Is that what we want?
Higher prices?
That's not what I want.
My supermarket bill has not gone down.
I know Trump is saying, oh, inflation is down and prices are down.
But Biden said the same thing.
So they're always going to say it.
But you lower rates, and that means people are going to, oh, look, rates are low.
Let's go borrow more money.
A society that is just drowning in debt needs more debt, more inflation.
So in this case, even though the Fed shouldn't exist, Powell is right in my eyes.
I think Trump wanting more inflation would just harm us even further.
You know, you point out that it's sort of weird that they're arguing for low rates and that Trump is arguing about it.
And the economy is perking along.
You know, superficially, up until a few weeks ago, the markets were great.
The stock market was up, and it seemed like everybody was happy, and they had all kinds of favorable statistics.
And, you know, when they started talking about lowering interest rates, my thoughts were, you know what?
They're not coming clean.
They have some statistics that they're not revealing.
And, of course, there's no reason why anybody should say that any reports we get from the government, whether it has to do with foreign policy or financial things, how can we say, oh, whoa, that's a real number.
Because they're going to fib a little bit.
They're going to distort.
And sometimes they flat out lie about what's happening.
So when they said, we want to lower interest rates, characteristically, we're under the conditions of a deep depression, and that's the solution or inflation.
We have to deal with the interest rate.
So I thought that was a bad sign.
Now, I think it's right now, and Chris points this out, this is a personality fight right now going on.
And of course, it's not to argue that Powell is a non-inflationist.
He's just a smoother one.
And he's doing it.
And sometimes they can inflate and provide all credit.
Now, when they bill out these companies, when Bernanke and others came up with trillions and trillions of dollars of credit, nobody knows exactly who benefited from that credit.
And so that was one of the reasons I thought, well, if people only knew about what goes on with the Fed and what they're dealing with, these bubbles would cease to exist.
And that's why I simply little request, why don't we have an audit of it?
And find out what's going on.
And that is one issue that is very supported bipartisan-wise.
Both sides say, well, how can they argue against transparency and having an audit made?
We don't know what exactly is going on.
But the opposition to this, I've heard it from the very beginning that the Fed is meant to be independent.
And I thought, well, I had some friends and good conservatives that didn't know much about monetary policy.
They say, Ron, you don't want the Congress setting interest rates.
And they thought that if there wasn't a Federal Reserve Board, it would be the Congress.
And technically, you might argue that's closer to the Constitution, but bad economic policy.
But the Constitution said they should have only gold and silver as money.
So the personalities make a big difference.
And the ones with the most beneficial personality usually wins the day.
But the one thing that I've taught myself to try to remember is that when they say independence, Because there's a touch of reasoning in there because you don't want 435 people sitting.
I say, yeah, but when they use that word, what they want is secrecy.
Independence means that's the excuse for nobody to know what's going on.
And they call that independence so that the Federal Reserve Board can do their work and not be badgered by the different factions and politicians.
Trump broke the rules more than anybody else in this issue.
And that is, he wanted it out in the open.
He wasn't going to put up with this.
He wasn't going to allow the Fed to be independent.
And in some ways, that independence on Trump arguing that case, you know, argues the case we should have more openness of the Fed.
But those are technical arguments that we don't even need to pay attention to because they don't make any sense.
Because what we want is to rein in the Fed and not have a Fed so that we don't have to worry about whether it's more transparency, more independence, or they want to just flat out have secrecy and not let us know exactly who's ripping us off when the bailouts come or when they have ordinary monetary policy because there's always someone who benefits more than the other.
The people who benefit the most are the ones who get to hold the new money first.
And that's usually the banks and the big corporations.
They get the money first.
And by the time it circulates after a couple years, it loses its value.
Prices go up, and it's a tax.
They're taxing the money.
The money's worthless, so that's a tax.
Guess what?
The middle class and the poor suffer the most.
And they all say, well, we need to spend this money because we're going to provide welfare for the poor.
And they do.
They get the crumbs.
And big business, big banks, and military-industrial complex, all the special witnesses, they get the gravy.
Blame Game Politics00:03:20
And that's why not only is this system unworkable, it's immoral, unconstitutional, and it just doesn't work.
Chris.
Excellent, Dr. Paul.
I will finish up with my closing thoughts.
Yeah, Trump wanting interest rates lower is really parfur the course for him because spending and debt are sadly increasing under this second Trump presidency.
Doge is fading away.
I read that Elon is leaving for Tesla, who blames him after, you know, he probably hit a brick wall.
They're attacking Tesla cars.
We were right about Republicans.
They lined up these politicians behind Doge because they knew it would not be a threat to them.
And it has ended up not being a threat to them.
And I don't blame Elon.
I'm sure he would cut across the board if he could based on what I know about him.
But Republicans are now back up to their big spending ways, as always.
So it's a shame because the spending and debt is our problem.
The empire is our problem.
Elon sounded the best during the campaign.
I remember watching his speeches.
And my brother was watching him with me.
He goes, you know, notice that Trump doesn't sound like Elon.
Elon sounds great.
And my brother was right because Trump is a big government, big spending, big debt guy.
That's how he was in his first administration.
That's how he is now.
That's not to say he hasn't done good things.
He's done good things on the border, the Department of Education.
This isn't the whole thing that we're putting down, but the spending, the debt, troops aren't coming home.
Wars aren't ending.
This is the problem in our country.
And we're going to have to wait, it looks like, for someone else to come along and address this.
We were hoping that it would be this time.
But as of now, it's not shaping up that way at all.
You know, this debate about going on between Trump and Powell, some people have postulated the switcheroo that Trump is.
He said, oh, maybe we don't have to fire him.
Not now, anyway.
And, you know, there's, I'm always suspicious, maybe more than I need to be, but maybe there's collusion.
There could be collusion, survival, survival of the politicians and even the ones who seem to be on the outside.
But there may be a strategy here for Trump.
And some have suggested, yeah, you know, Trump probably knows something about cycles, the business cycle, and there will be one.
And his idea that we're not going to wait until it's bad and then lower interest rates.
I want those interest rates low because I know it's coming.
So he might say, besides to himself, of course, and this is a weird speculation, yeah, when it comes, I think maybe we should just have Powell exactly where he is and let him run the show, and all the blame can be put on Powell.
Well, that may be, and it may be what will happen, and maybe Powell's digging a hole for himself by wanting to stay.
Encouraging Less Government Spending00:02:51
Because if conditions get anywhere as bad as there are some predictions, somebody's going to do some blaming.
But unfortunately for us, the blame generally doesn't, it isn't put on the central bank.
And that, of course, is part of our effort, is to spread the blame around to those who are guilty.
It's the monetary system.
And there are many guilty parties there.
And it wouldn't be that hard to fix.
And that is the spending should be reduced.
And what guidelines would you use about the monetary system and spending and wars?
Well, why don't we get people to just support the issue that you obey the Constitution?
Because the guideline is there.
It's imperfectly, but we could always improve on that.
But no, what we do is hide from that.
And just think, do you know that everybody takes the oath of office when they get to go to Congress?
And guess what?
I think there was probably, if I could find maybe five or six that always took that into consideration when they voted.
And they take that oath of office.
There were some that had bragged that that's what they would do when they get in office.
So I would say a new member comes in and I say, I wonder how long it'll be.
So after about a week, I say, ah, he's not living up to it.
Because it's such a system that has developed in the pressure.
That's why the answers are simple.
The people could do it if all of a sudden we turned over a new leaf and did what we were supposed to do.
It's not likely to happen.
And that's why we advocate people be preparing.
My efforts is to direct it toward getting people to understand why it has to have people, we have to have less government, less spending, less debt, more principles on the sound economic and monetary policy.
That is what has to happen, and the people have to endorse that instead of saying, oh, I mean, just look at the effort right now to cut back and propose some of these cuts in spending or the outrageous spending.
People are getting angry about that.
They're burning up cars.
And, oh, there's some demonstrating, oh, they're going to cut back on spending all this evil doing it.
And they all know, we have to take care of people like that.
So it's a long way to go.
I think we know the directions.
I think we really know the answers.
We just need to inspire people to check it out.
And they'll find out that peace and prosperity can be gained by following the principles of personal liberty.