March 15, 2018 - Freedomain Radio - Stefan Molyneux
44:00
4029 Why The U.S. Dollar Will Collapse | Mike Maloney and Stefan Molyneux
Mike Maloney is the founder of GoldSilver.com, a global leader in gold and silver sales and is also the author of the bestselling precious metals investment book of all time, “Guide To Investing in Gold & Silver: Protect Your Financial Future.”Get "Guide to Investing In Gold and Silver: Protect Your Financial Future" at: http://www.fdrurl.com/mike-maloneyCheck out GoldSilver.com at: http://goldsilver.comHidden Secrets Of Money: Top 4 Reasons For Deflationhttps://www.youtube.com/watch?v=8GP87dgTqF8Your support is essential to Freedomain Radio, which is 100% funded by viewers like you. Please support the show by making a one time donation or signing up for a monthly recurring donation at: http://www.freedomainradio.com/donate▶️ 1. Donate: http://www.freedomainradio.com/donate▶️ 2. Newsletter Sign-Up: http://www.fdrurl.com/newsletter▶️ 3. On YouTube: Subscribe, Click Notification Bell▶️ 4. Subscribe to the Freedomain Podcast: http://www.fdrpodcasts.com▶️ 5. Follow Freedomain on Alternative Platforms🔴 Bitchute: http://bitchute.com/stefanmolyneux🔴 Minds: http://minds.com/stefanmolyneux🔴 Steemit: http://steemit.com/@stefan.molyneux🔴 Gab: http://gab.ai/stefanmolyneux🔴 Twitter: http://www.twitter.com/stefanmolyneux🔴 Facebook: http://facebook.com/stefan.molyneux🔴 Instagram: http://instagram.com/stefanmolyneux
Hi everybody, it's Stefan Molyneux here with our favorite, everybody's favorite redhead who's interested in monetary issues, Michael Maloney, the founder of GoldSilver.com, a global leader in gold and silver sales.
He's also the author of the best-selling and I certainly recommend Precious Metals Investment book, the best-selling one of all time, Guide to Investing in Gold and Silver, Protect Your Financial Future, it's GoldSilver.com and Twitter.com forward slash Mike, underbar Maloney Mike.
How are you doing? How's life in sunny Puerto Rico?
Well, Puerto Rico is still quite a mess.
I was in California during the hurricane, so I got to miss that, which was very nice.
And all of the people that moved down here with me, the people that I work with, were able to get out, one of them, just like an hour before the hurricane hit.
It was actually the last plane out of the airport.
And so they were all able to join me in California.
And we rode the hurricane out there in 72 degree weather that was just perfect.
It was great. But I've been back a few times since.
And then just last week, I got back here pretty much permanently.
But all of the traffic lights are blown out of the...
There's no traffic lights working anywhere.
And what's amazing is the traffic gets along just fine until some authority figure Comes along and tries to direct traffic.
As soon as there's a traffic cop, everything gets screwed up.
So it just shows you how the free market can work if you let it.
Oh, I did a video years ago on a town in Europe that had all this problem with congestion and traffic accidents and so on.
And they had a picture of like, it looked like some spider web of lanes and signs.
And they just took it all out, just painted everything black, took it all out.
And traffic congestion went way down.
Accidents went way down.
It's like, hey, turns out when you stop controlling people, funny story, they actually start to control themselves to much better effect.
Yes. So we're going to talk about the Fed.
Now, this is not particularly provoked by rage at my listenership sometimes, but every single time I talk about the Federal Reserve, I get the same comments.
And I just, I want people to know that I know, but it's better that you tell them because you know even more than I do.
So they say this, Mike, they say, don't you understand that the Federal Reserve is a private bank?
It is about as much in common with the federal government as Federal Express does.
And it's like, I kind of know that.
But it's got a monopoly on currency.
You have to use the legal tender to pay your taxes and for other things.
So the idea that it's somehow a free market institution, it's more the fascist model.
It's public control or public protection from competition, but private profiteering.
That's more fascistic. But yeah, I do understand it is not a direct arm of the government.
Is that a fair way to put the tension?
It's a hybrid. I mean, it's sanctioned by the government and can never have any competition, just like you said.
So it's not truly free market, even though it is private.
It's privatized profits.
Any losses are shared by the public, of course, or will be, because their balance sheet is so screwed up that, you know, one day there's going to be a big problem.
But it's It's highly immoral when currency is created.
It's theft. And it's theft of, you know, we trade huge portions of our lifetimes for currency.
So when they take part of it through inflation, they're actually taking part of your lifetime.
And you have to work hard to sort of replace that lost purchasing power that you can't see.
It wasn't directly taken out of your bank account or out of your pocket.
It was taken out of your pocket and bank account by making The purchasing power of each unit of currency smaller or less.
And so prices don't go up, the currency goes down.
And it's because of the Federal Reserve and fractional reserve lending, both of which are highly immoral in their theft.
Right. And the funny thing is, too, if it was the free market, of course, there would be options and choices.
And also, would you necessarily want to, if you had the choice, have a currency that caused your savings to dissolve?
When I first came to Canada in the 70s, a candy bar cost 10 cents.
I remember that because, you know, when you're a kid, you measure everything in sugar quantities.
And then within, I don't even know how long, but it wasn't that long, it went up to like 80 cents, 90 cents a buck.
I mean, things were just going mental.
I mean, not Weimar mental, but pretty mental, like a tenfold increase in not that long a time.
Who on earth would want that?
As part of their currency portfolio, work really hard, trade absolute hours for relative currency, and then watch it slowly dissolve into smoke.
Nobody would choose that if they had a choice.
Well, this is the great thing about the Internet and programs like yours is people can actually find out about this.
Nobody really understood back in the 60s and the 70s what was causing all of that inflation in the 70s.
They were victims of it.
And they didn't know that it was actually being caused by the people that have the arrogance, the hubris to say, oh, I know how to run things.
I can do it better than the free market.
Let me through here to the front.
I'll show you the way to do things.
And these people that run the central banks, these Keynesians, it's impossible to have all of the information that goes on in a society.
Only the free market has that through the price discovery mechanism.
And so everything they do has unintended consequences that they can't see that come back to haunt them later.
And part of that haunting is the theft of purchasing power, causing a candy bar to go from 10 cents to a buck.
It is horrifying in so many ways because there's an old saying that nothing is more permanent than a temporary government program.
Like here in Canada, the income tax was a temporary measure put in just for World War I. Don't you know?
Seems that war, well, it never ends.
But here's the thing that's amazing about the Fed.
Which is, they regularly, decades later, admit that they completely screwed things up.
Like you got Bernanke saying, oh yeah, the stock market boom in the 1920s followed by a 13-year Great Depression, followed by, you know, the deaths of 50 million people in the worst war known to mankind.
Oh yeah, a lot of that was the Fed.
Oh, totally. Now they admit that.
Stagflation, right? The whole theory, right?
Oh, you've got too much of this, you've got to balance it with that.
They never should have been.
A stagnant economy with high inflation, but they managed to produce it.
Stagflation in the 70s completely destroyed the Keynesian theory, but it doesn't matter because they already have the power.
The politicians are already dependent upon the free money, and therefore you can't cancel it even when they admit the most egregious, basically if the Fed in the 1920s in particular, if the Fed was inflicted on America by a foreign power, it would have been considered an act of war.
You're absolutely right.
And when it comes to all of these unintended consequences, wait until you see what's coming.
Because the things that they did that caused the Great Depression and all of the things that you just talked about, the things that they did, the manipulations, were minor compared to zero interest rates and more than $3 trillion of currency creation.
This is the Greatest manipulation that there has been of an economy in history.
What's interesting is, you know, it all went to Wall Street, and we've got this sort of fake recovery, and if it wasn't fake, you would see the- what you see is that they pumped a bunch of currency into Wall Street, into the base money supply, and The Wilshire 5000 total market cap index, which is basically the value of the stock market, went up almost exactly with it.
I mean, the correlation was astounding.
But tax revenues, after about two years of this, leveled off and started falling.
And that means if Main Street was getting it, tax revenues would be increasing, and that would be absolute proof that this was working.
What this was was theft from the populace to Wall Street.
It was a gift. Ben Bernanke just transferred a bunch of people's lifetimes to Wall Street.
They get to ride around for free on this basically.
Wall Street doesn't produce much of anything that somebody would open up their wallet and buy.
They don't produce a good or a service that you can live in, eat, drive around in or wear.
They're fairly useless, actually, except for handing back and forth digits and hoping to gain more of them.
They're usually handing back and forth your digits, and they're skimming off the top.
Oh, yeah. No, we're told it's a blood bank when actually it's just a congregation of vampires.
Oh, it's necessary. It's going to get you healthy.
It's like, why can I not be killed now?
And here's the strange thing.
Can you just trace to people?
I mean, I complain about the welfare state quite a bit.
And the welfare state, which is the transfer of money from the productive classes to the less productive or nonproductive classes, is a big issue.
But if you widen it out, The welfare state that is going the other way from the poor.
I mean, when you have inflation and you have money, you have financial advisors, you've got accountants and so on, you can do a lot to hedge it.
You can do a lot to minimize it and so on.
Same thing with tax increases and regulatory increases as well.
But if you're poor and they're cranking out a whole bunch of money, I mean, it's just evaporating in your bank account.
It is horrendous. I mean, as we know, inflation hits those on fixed incomes with little income or with less savings because it matters.
If you lose 10% of $5 million, well, you can still get by.
You lose 10% of $500, you are down quite a lot.
And so how does it go from being created out of thin air by the Fed into the pockets of the Wall Street?
Help people understand that weird river that had these corpses of currency float down.
Well, whenever new currency is created, it's the first users that get the benefit.
Everybody else then gets punished.
By the way, you talked about first, you talked about the redistribution of wealth, the government taxing productive individuals and giving it to nonproductive individuals.
I mean, if they're going to punish success and reward failure, what are they going to get more of?
But yes, most people don't.
You know, I interviewed Ron Paul back in 2008 when he was running for president.
Or 2007.
And he was talking about welfare for the rich.
And way back then.
And it is true.
And this is perpetrated by everybody that can afford a lobbyist.
You've got to be able to afford your own lobbyist to get a piece of this pie.
So it's an absolutely horrible thing.
The founding fathers of the United States would be turning in their graves.
Right. So the Fed creates the money.
And then where does it go so that it ends up buying a yacht in the Hamptons or whatever they do out there?
Well, when the Fed creates currency, that's base currency.
It's the paper dollars that exist or the deposits that the commercial banks have at the Federal Reserve.
The Federal Reserve is the bank for the commercial banks.
And there's 28 primary dealers, the commercial banks that are allowed to Show up at the Treasury auctions.
They buy bonds from the government, and through open market operations, if the Federal Reserve wants to stimulate the economy, they force the banks to sell them bonds at a profit.
So the banks love this.
But now an asset has been pulled off of their balance sheet, and on a bank's balance sheet, cash is a liability.
And so a liability has been added, and their balance sheet looks worse.
So when the banks have a bunch of cash, they want to get rid of it and create loans, supposedly.
When they create loans, they have to compete and offer lower interest rates, and that indirectly stimulates the economy.
So the Fed does this shell game that sort of indirectly stimulates the economy by encouraging the banks to compete to create loans.
But it's always the first users.
And a lot of these banks are like Goldman Sachs and stuff, and they're big brokerage houses.
And they've got their own accounts that they're trading on Wall Street.
And so now they've got a bunch of extra cash that can be used for margin lending.
And so they get the basis for a whole bunch of leverage to go into the stock market and win more away from it.
So not only does it dilute the currency supply, But they get the full purchasing power of it because they're the first user.
It dilutes the currency supply after this new currency enters circulation.
And that lowers the purchasing power of everyone else.
And so that's where the purchasing power came from.
It was stolen from everybody else by lowering their purchasing power.
It was a gift to these big banks so that they could then take that stolen purchasing power and gamble with it in the stock market and win even a greater share of the economy from you.
Oh, it's terrible. I mean, it's like the richest and fattest people get the very best food and then the poor end up with a Venezuelan pigeon on a stick.
I mean, it's just horrible, horrible stuff as far as that goes.
And now I, you know, as far as the stock market goes, I mean, I'm with, I think it was Mises who said that, you know, the one thing that is required for free market is for there to be a stock market that's functional.
I think stock market is great.
It takes a lot of skill and a lot of expertise to figure out which companies are going to make it, to figure out future demand and who's going to be the most efficient at running things.
I mean, that's a big, complicated job of no problem with people getting paid well for that.
However, that having been said, remember, before the word but, throw out everything I just said.
But, or however... When it comes to being a financial genius, I'm not sure that borrowing money at zero percent interest from the Fed and buying a bunch of bonds that pay you three percent qualifies you to be a financial genius anymore.
No, it doesn't. And there's only a few people that get that privilege.
That's the problem, borrowing money from the Fed at zero.
But, you know, you were talking about the stock market and having value because that was the price discovery mechanism.
That created that value, that set things in equilibrium in an economy.
When Meises was talking about the necessity of a stock market, it helped the price discovery mechanism and set supply and demand in equilibrium throughout an economy.
But today, you've got a bunch of black boxes trading Not on fundamentals.
Nobody's looking at the value of a stock.
They're looking at the technicals of whether the stock is going up or down or whether the chart is making this pattern or that pattern, and they're trading off of that.
And we've got this insane stock market that's back up into huge bubble territory.
We've talked before about the everything bubble.
And that was like six months or nine months ago when we talked about that, you and I. It's gone.
It's still going insane.
You know, we've had this nice pullback that was destined to happen.
People didn't think so, though, that especially traders with the low volatility index risk was not being priced into the markets.
And this is a very dangerous thing because all of these black boxes are trading on algorithms That when the technical indicators turn negative, they're all going to start selling at the same time.
You saw the speed of this correction.
People were calling it a crash, but the first few days of it, it had only dropped back to the 50-day moving average, a place that it should normally be touching every few weeks.
And I made a video saying, well, it's going to go further because it's got to go back and touch the 200-day moving average.
That's just something that markets have to do from time to time.
And it did. But still, the markets are insane, but the insanity can last much longer than, you know, if you've got cents, you would be saying, this can't last, I'll short the market.
Well, that's not a good idea either, because the insanity can last a lot longer than you think.
Oh, well, okay. Now that touches on another issue that I think is really important.
And the one thing I wanted to mention about this high-speed trading, there are companies that have actually built their own data lines or moved closer to the internet hub because they need to gain that tenth of a millisecond speed on this kind of trading.
And that is not looking at fundamentals.
I mean, nobody can read a spreadsheet that fast or go through an IPO offering.
So they really are crazy, crazy volume trading on very hair-trigger response times.
Yeah, and that means that the individual is pretty much excluded from all this.
All the instant trading that they're doing, most of that is for themselves.
If you've bought into a mutual fund or something, you've got a very slow program that is trading on the technical indicators still, but it's over a long period of time.
It isn't this high-speed trading that And so the individual, even all of the, you know, I've got friends that are stock traders, and they develop this system or that system, and they've got a program, but they don't have, they're not right next to the main internet hub that's plugged into Wall Street.
And so they can't really win.
The game is rigged against the average person now.
And so the markets have less and less use for the economy.
Their basic use is to transfer wealth away from the average citizen at this point.
I think it was Eric Sprott that said that the small retail investor was the plankton of the financial world and that the financial world needs him to feed off of.
And that's a very good analogy and it's absolutely true.
So let's talk about another criticism that I think is reasonable to address regarding those of us How we look from the outside, I'm going to just give you a little imitation to some degree of how we look from the outside.
It's sort of something like this.
We're doomed! No, wait, okay.
Okay, now, no, no.
Oh, hey, wait, okay. Doomed!
No, wait, hang on. Oh, no, no, now we're doomed.
No, wait, okay. Pull back.
No, doomed! And I think that that feeling of this, it's almost like we have doomed Tourette's or something like that.
And there is this, I remember, gosh, back in the 80s, you know, reading people and talking about the doom, we're doomed.
And things are lurching along in horrible ways.
The debt is escalating and unfunded liabilities are through the roof.
Derivatives are through the roof.
But I just I'm concerned about the crying wolf aspect of these kinds of conversations and how long this death, you know, we used to call when I was an actor, you know, you, ah, I've been shot, you know, and you stagger all over the stage for like 20 minutes.
really milking the death.
And I'm just a little bit, and there are criticisms which I can completely understand about that approach to things.
Yeah, well, you know, we tend to be right once or twice a decade, though.
Just because you haven't died yet doesn't mean you're immortal, right?
The insanity can go a lot longer than anybody can predict.
I didn't think that this particular economic expansion, because it's not based on fundamentals, it was based purely on manipulation, I didn't think that it could go along.
It's now the second longest one in history, and in less than a year it'll become the longest economic expansion.
Out of the previous 47 economic expansions and recessions, And because it was created solely off of a manipulation, and because the fundamentals are just so far out of whack, it should disintegrate.
But the longer this goes on, the worse the reaction will be, because it's all stored energy.
The economy is a closed system.
It isn't. Keynesians think you can stick a straw into outer space and suck in economic energy.
And you can't. You can transfer it from one sector to another, and that's about it.
But when the market, the free market, overwhelms the manipulations and balances everything, it's going to be very, very painful for most people.
It's going to reward certain people, because there's always a wealth transfer in these things.
And I'm still confident.
I mean, I've been accumulating precious metals since 2002.
I made a large purchase of silver just a week ago, I think it was.
When I look at the markets, I know that the stock market is insane and way overvalued.
I know that bonds are in this bubble that's been in a bull market since 1980, and that can't go on forever.
And the only thing that I can identify, you know, I have no idea how to measure something like Bitcoin.
There's no history.
You can't look back at 5,000 years of history and measure Bitcoin against an economy or against other asset classes and so on.
So I can't say whether that's in a bubble or not.
I have a feeling that the cryptocurrencies may do well because it's an alternative financial asset.
So you'll see people Well, of course, as you know, fiat currency is a debt-based instrument and cryptos are not.
Fiat currency is unlimited in its production and cryptos are not.
Fiat currency has an enormous amount of regulations and controls, but you can wander around the world with your key in your head and have access to your cash anywhere.
And of course, it's a whole programmable infrastructure.
I've got a whole presentation on this.
So it certainly will be interesting to see where that goes.
And this idea that this has been such a massive growth in the economy, the big question I have for people who think it's sustainable is, okay, well, what was fixed in 2007-2008?
What changed? Nothing.
Nothing fundamentally was fixed.
All there was a massive creation of money.
There was an artificially low set of interest rates.
And, you know, other economies had problems which made people flee to the US dollar, which still remains the reserve currency and so on.
I mean, what was fixed?
Okay, hundreds of billions of dollars were transferred to Wall Street oligarchs and taxes and regulations went through the roof.
What was fixed that justifies any kind of continued expansion?
Nothing was fixed. Everything was made worse.
The too-big-to-fails got bigger.
Everything is worse than it was then.
The only thing that's different is we don't have the huge mortgage-backed security bubble with all the subprimes that have been packaged and sold as primes.
That doesn't exist today.
So that's about the only difference.
Otherwise, everything else is worse.
And that just says that the next, you know, 2008 was just the first half of, we've been in this giant eye of the hurricane.
2008 was the first half.
The second half of this hurricane is going to be a whole lot worse than 2008.
Whatever happens is caused by what happened before it.
It's the result of what happened before it.
And the manipulations that happened after 2008 We're unprecedented.
There's nothing like it in history.
And the proof that we're still in a major emergency is the fact that there's countries that still have negative interest rates around the world, and that close to a decade after the global financial crisis, the Fed is still at an extraordinarily low interest rate.
When the 2008 crisis happened, They had 5% available to cut, and they cut that to 0.25 and created $3.2 trillion worth of base currency.
Now, they've got $4 trillion worth of base currency out there, plus I think the interest rates are 1.25 now.
Where can they go from here?
The only thing they can go is negative, but to take things severely negative, You would have to have a digital national currency.
The dollar would have to be a blockchain dollar, a crypto dollar.
I can't even imagine. I mean, just for those who don't know, like negative interest rates are when your money is so crappy that you have to pay people to take it.
And we all know what that means in the dating arena.
You basically turn your girlfriend into a whore and negative interest rates turns the citizenry into prostitutes.
And it is horrible, horrifying stuff.
And it should be a wake-up call, but often these things go kind of unremarked upon.
Certainly the mainstream media. I mean, the amount of economic illiteracy in the mainstream media is absolutely appalling, even by people who are supposed experts in this.
And to go there, you're just running off a cliff.
Well, I see the great hope, though, as being in the free market cryptocurrencies, and I hope that, you know, as many people as possible support this.
I just did episode eight of Hidden Secrets of Money, which is called the crypto revolution from Bitcoin to Hashgraph.
Hashgraph is a new technology that's the underlying accounting system that replaces blockchain.
And it's just a The episode is a report on the evolution of the technology and the space.
But this can either lead to freedom or enslavement, and it's our choice.
And if we choose to, you know, eventually, right now, countries around the world are just beginning to come out with crypto-based currencies, with blockchain-based or whatever.
As they do more and more, if it's not decentralized, that means that they can switch you off as a person.
They can control you.
They can lock you out of the financial system if they don't like you.
And that means that they would be able to go to severely negative interest rates.
Right now, If they went to a negative interest rate of, say, minus 5%, you'd just draw everything out of the bank and hold it at home in a safe and cash, and you wouldn't be getting this extra 5% annual tax that they would try to inflict on you.
But if all of the dollars are digital, and it's basically dollars that are allocated to you that are always being held by the Fed, they're in their system, and they're just creating settlement credits here and there, When you spend your money, but it's basically all in their accounting system, then they can decide.
Not only do they know everything that you do and everything that you buy and every place that you go, but if they don't like you, they can shut you off.
And they can tax you as you earn your income.
And if they decide to make taxes retroactive, which I've seen done before, they change the tax percentage and They make it retroactive back a year.
They can just rip that out of your account.
And another thing that concerns me, you know, even with all of the free market, the distributed ledger technology that's happening that underlies Bitcoin that was introduced when Satoshi Nakamoto created Bitcoin in 2008, the full consensus distributed ledger technology is the thing that is going, whether it's based on blockchain or Hashgraph, Or some technology yet to be developed.
This is going to touch most aspects of our life.
With Hashgraph, there's been video games developed on it, so it can actually record and decide every motion in a video game.
It's that fast.
And so it can underlie just about everything on the internet and make a permanent record of it and make it fair and impartial.
However, It's also a roadmap.
There's a whole lot of people that aren't worried about artificial intelligence.
I'm actually not one of them because once it gains a certain amount of intelligence and its intellect is magnitudes greater than any human that's ever lived, when there's all these distributed ledgers everywhere that have recorded everything we do, do, it's a roadmap to fully understanding human beings and being able to manipulate them.
And so I don't know what the future holds.
I just know that there's a lot of dangers out there, and we need to give these things a lot of thought, and we need to talk about it.
Government is the thing that inflicts the most pain on us and creates more suffering than anything else in our lives.
Being vigilant for the development of distributed ledger technology, blockchain, national currencies.
It's very important that we all decide what our future is now, because I see this period of time, especially between now and artificial intelligence becoming something really big, I see this period of time as a choice between freedom and enslavement.
And I hope that people learn enough to select freedom.
Well, yeah, that's the goal, certainly.
I mean, there's going to be a crisis.
The question is, which way do we head after the crisis?
Because the crisis will be exploited by bad people to expand oligarchical control over all of our lives.
And we need to have a good counter-argument.
And cryptocurrencies and so on is fantastic because as the...
As the value of fiat currency is at some point or another, as it always does, goes to zero.
Having an alternative that is already out there and embedded, where you have a currency that's not, I don't know, camel teeth and bullets.
It's really, really cool that something like that has emerged.
I, myself, not particularly concerned with artificial intelligence.
I spent many, many years as a computer programmer and Computers are still only at the phase where you do what we tell them to.
But let me ask you about this, because there are some bubbles, I think, that are kind of erupting from the swamp.
I'm sorry, you were going to say? And you don't think that that phase of the computers doing what we tell them to is going to switch one day?
I don't see how increases in computational power Magically create the incredible complexity of human intelligence.
I mean, if you look at something like, I mean, if you have a dream at night, sometimes you can get amazing insights, creative ideas.
Some physicists, I think it was, came up with the structure of the carbon atom through a dream of a snake eating its own tail or something like that.
And those kinds of inspirations, nobody knows.
I mean, you can't say to the computer, okay, well, here's the dream you're going to have at night that's going to give you an insight.
Here's how you're going to create a novel that explores the human condition.
There is still a fertility and creativity that is not just computers, but not quite as fast.
It's a different order and level of what goes on in the human mind than can occur within computers.
And faster computers... Do not equal the human mind.
Now, of course, computers can vastly outstrip the human mind in search capabilities and so on.
But I don't see how a binary programmable gate, no matter how fast or how many of them are, are going to replicate what...
I mean, I would be happy if some central planning was turned over to computers.
But again, it really depends all on the programming.
Sorry, are you going to say it? It isn't the speed.
It's the programming of its ability to self-learn, to not have to be told what to do, but to figure out what to do.
And the better and better it gets at that, I don't know if it even needs all of this speed, because eventually I mean,
computers are going to have their place.
That's why we're talking, so I think it's great.
Maybe I just need more research in this, but I've read a fair amount of it.
I still don't see how the fertility and creativity of human thought, of human consciousness, which, of course, we still don't really understand that well as yet.
So computers don't learn in the way that people learn because you still have to program them what to do with the new information and how they then behave on that information is relatively predictable, where it's not the safest to human beings.
Yeah. Okay. Well, let's go on.
So let's talk a little bit about some of these bubbles that are floating up from the swamp, you know, these early warning signals.
The two that I see, there is, of course, I think some bubbles in the American auto loan, a lot of huge increases in delinquencies and so on.
But I think the big one that people don't see as much, and I think it's well north of a trillion dollars now, is the student loan bubble.
My lord, that is really quite astonishing.
Higher education is not market-driven.
It's push-driven. It's propaganda-driven.
And it is selling people on increased earnings, which can't possibly be given to everyone now who has a university degree.
What is it, north of 40% of people now, or it used to be below 10% back in the day?
And so I think the promise of, well, you know, go $50,000, $80,000 into debt, and you'll end up Being an executive somewhere can't be fulfilled for 40% of the population.
And I think that bubble is another indication that, and that's one I really hope will pop soon because a lot of damage I think is being done to people's minds in what used to be called higher education and now is base propaganda.
So do you see any other or do you agree with those ones or do you see any other ones floating around that are a concern to you?
Well, I really, you know, Real estate is back into a bubble.
The stock market, like we said, was in a bubble.
The student loans is one of the things that could pop the bubble.
This is a debt thing that is very, very big.
And you talked about auto delinquencies.
Living here in Puerto Rico, this is interesting because we've just had this hurricane and property values.
Here in Puerto Rico, the laws are It's hard to describe.
You can have two houses that are identical right next to each other.
If one has a wooden roof, it can't get insurance.
And it doesn't qualify for insurance, so you can't get a mortgage on it.
So it sells for cash, which means it sells for half the price of the one right next door.
Anything like that has fallen in value tremendously.
There's this spiral going down.
So it's like the bubble already got popped here.
It's sort of a preview Of what's to come in the rest of the world.
What I see, though, is that economies are so interlinked today.
It could be a problem in China, or it could be the Australian real estate bubble that finally pops.
Whatever it is will cascade in this chain effect around the world and drag the world back into another financial crisis, and it's going to be worse than 2008.
And so the people that aren't talking about crying wolf and perpetually being, you know, we're doomed.
Well, we're getting closer and closer to that point.
And it takes an economic expansion that goes into a bubble.
Once we pass this bubble point and it goes further and further, That's what causes the big reaction.
Something is going to happen within the next year or two, and the people that aren't prepared are really going to suffer.
But yes, student loans is one of the biggies, and I don't believe that you can file bankruptcy against them in the United States.
You really can't get out from under this debt.
It ruins people's lives permanently.
I know people and so many people, very few people are taking courses in engineering or something that is going to be useful in the future.
If you want to be an actor to be really successful, this is like a 500 or 1000 to one shot.
There's a whole lot of people that want to be actors and the successful ones, very, very small percentage.
But even if you're getting a degree in business, this is something that, like you said, may not pay off these days just because there's so many people getting degrees and becoming that executive at some company.
It's a difficult thing.
There's a ladder to climb. Right.
So let's see if we can sell people on Doom.
Combine. Doom! Now!
50% off! Get them while they're hot!
Because for me, the sooner it happens, the better.
I mean, not only just because, you know, if you're going to get out of drugs, then the less time you've been on drugs, the better, right?
But also because I'm really concerned...
About the number of people not in the workforce and what it's doing to their intellectual capital, their motivation, their ambition, their human capital as a whole.
I mean, it's just you get out of the workforce and was close to 100 million Americans now, like of working age, kind of out of the workforce and so on.
With the crash will come some pain, but will come a more rational reallocation of resources for productivity.
Jobs will open up on the other side.
Significant freedoms, entrepreneurial opportunities will open up on the other side.
These massive social experiments like giant welfare states and huge mass migration programs and so on, all of the warfare welfare state will be starved of money on the other side of doom.
And so I wonder, I mean, there definitely is a bit of a wood to go through and the wood has eyeballs and tentacles, but on the other side, what can people look forward to, do you think?
Well, the problem that I see here is that such a large percentage of people now are in favor of socialism.
In the United States, it's a very large percentage.
I think it's close to 50% of youth.
Yeah, right.
And this is very disturbing.
And there's going to be a whole lot more.
When people are out of work and desperate, they tend to vote to take something away from somebody else that still has something.
And so the worse that this correction is, this coming catastrophe, it's more than a correction, the more likely I see of the entire social structure and political structure changing and moving much toward socialism or communism.
And that really worries me because Nothing will affect people's lives more than economics.
The average person, unless there's a death in the family or they're diagnosed with cancer or something like that, there's nothing else that will affect your life more than economics.
Economics determines the political system that you live under, how much freedom you've got, and what your own level of prosperity is.
But people don't want to know about it.
I try and talk about economics all the time.
And I, like, scare people off a lot of times.
I sit around a campfire.
I went to see the total eclipse of the sun up in Utah, and I'm sitting around a campfire with a dozen other people.
And I start talking about economics.
And after a while, these women go, I don't want to talk about politics.
Don't sit next to Mike. He'll totally put you off your creme brulee.
It's just, it's horrible. They confuse economics with politics.
It's really funny that they don't even understand the difference between economics.
You can't do much about politics, but you sure as heck can do something about economics.
You can prepare for it. You can plan for it.
You can, well, do all the stuff you talk about and have helped people to understand.
And your vote will help change future economics by the political system, the direction that it goes, and the particular policies.
But I really, you know...
The wealth redistribution goes on with both parties in the United States, and I understand why the libertarians will never win, and that's because they're all independent.
You can't get them all to, like, agree on one thing or do the same thing, and so that's a party that will never become a major party, and it's too bad because it's really the only party of freedom.
Yeah, it's like that old, there was an old album cover, he sells, but who's buying?
And it's sort of like these conversations, freedom is for sale, but who's buying?
Who's lining up? You know, there's freedom, which is going one direction, and then there's free stuff, or the appearance of it, which is like the other direction, and everyone's stampeding off that way.
It's like Pied Piper, Cliff, have you not read this story before?
Well, listen, I really appreciate you coming in to talk about the Fed just to remind everyone that I do know that it's not exactly the same as a government branch.
But again, it's not particularly material because you're forced to use its product and you're not allowed to compete with it and its teller window is...
It's open to people only with monocles and top hats, it would seem.
But I just wanted to remind people, the book is great.
You should just pick it up and read it.
No matter where you are in your financial journey, it's good to know.
The book is called Guide to Investing in Gold and Silver, Protect Your Financial Future.
It's goldsilver.com.
And make sure to check out Mike's very good Twitter feed at Mike Underbomb.
We'll put links to all of that below.
Great chat, my friend. Thank you so much for taking the time today.
The YouTube series also, Hidden Secrets of Money, is something that people should check out.
And the free stuff that you were talking about, that comes with a free set of handcuffs.
That's right. You know, it's like if you can't get your own food, you can just commit a crime, go to jail, get three hearts and a con, and you've given up a lot more than you've got.
So thanks, Emil. And yes, Hidden Secrets of Money, we'll put a link to that below.
The work on that is excellent and well worth exploring.
