Date: 2025-07-03 Page is: DBtxt003.php txt00027391
THE US ECONOMY
BIG POLICY QUESTIONS
Tom Bilyeu: 'You're Being Slaughtered & You Don't Realize It!' - US Dollar Collapse | Raoul Pal vs Peter Schiff
BIG POLICY QUESTIONS
Tom Bilyeu: 'You're Being Slaughtered & You Don't Realize It!' - US Dollar Collapse | Raoul Pal vs Peter Schiff
Original article: https://www.youtube.com/watch?v=Nzo6DMuZkOo
Peter Burgess COMMENTARY
Peter Burgess
Transcript
- Intro
- 0:00
- by the end of this year the national debt will be 2 trillion per year in 3 to four years the government will pay more
- in interest than they collect in taxes so uh we're already uh bigger than
- National Defense in terms of what we pay here in the US just servicing the debt
- um how if it goes for another 20 years somebody with my mentality is is just going to get slapped around the board
- because I'm acting like it's going to happen soon um but is it like how do we
- how do we make sense of these numbers is is there a nothing Burger way out of this or is this a guaranteed Slaughter
- and we just don't know when you are being slaughtered and you don't realize it it all happened already it is
- How do we make sense of this
- underway and everybody's waiting for that all the assets are down
- 90% it can't happen it simply can't happen because it all happened in 2008
- in 2008 the world stopped the whole debt system blew up we
- 1:05
- had to have a debt Jubilee of resetting all government debts around the world at
- 1:10
- zero so we could afford to service it we've kept rates low we've been then
- 1:16
- using the balance sheet of all of the central banks just to pay the interest on the debt from the previous Cycles
- 1:23
- this is this everything code thesis that you and I have talked about so we are paying
- 1:30
- the debts by printing money pure debasement the system broke in 2008 we
- 1:38
- then changed the financial system with the Basel 3 agreements which forced the
- 1:43
- banks to lend less and to hold more treasuries why there's going to be a lot
- 1:48
- of supply of treasuries the whole system everybody's aware that it's broken it broke so what
- 1:57
- is going on now well for it to actually broke the down 90% it's all going to be
- 2:03
- 1929 again can't you just see it you're missing the point they're debasing the
- 2:09
- currency by 15% a year it adds up to a staggering loss of
- 2:15
- wealth it is in a tax That You Don't See 15% a year debasement is easier than
- 2:22
- increasing your tax rate 15% which is politically unacceptable which is what they need to do to pay the debt
- 2:30
- because the printing of money just abases the currency so you are paying it we are all paying it what what they
- 2:36
- should do is default on the debt that is the best thing to do because can't they can't Peter I I agree the Austrian thing
- 2:44
- the Austrian thing is what they should have done it it it was too late and the reason being look they're not going to
- 2:50
- they're not going to they're not going to do the right thing well they can't because bab maybe Malay will do the
- 2:56
- right thing in Argentina at this point we'll see yeah but they see the difference of the structure of the western Society is all the money is held
- 3:03
- by old people the entire system is basically in the hands of retirees and
- 3:08
- all the wealth so if you say all of their assets are down 75% that is the wealth of the nation's
- 3:16
- gone so nobody's going well it's not all their assets but yeah they're they're going to their debt but they're going to lose it through inflation either way
- 3:22
- it's either default or or or de way but you know I wanted to point out you you
- 3:28
- talk about the national debt you know official national debt is 2 trillion but the actual national debt the budget
- 3:34
- deficit they claim is 2 trillion but the national debt is already growing at four trillion a year that's we're that's how
- 3:41
- that's the rate that it's growing already and during the next official recession it's going to be on an even
- 3:47
- greater trajectory so the issue is why we all agree
- 3:53
- right but I just don't think it can collapse why because of debasement but
- 3:59
- that is collapse that's a collapse of the monetary system that's and it could lead to hyperinflation yeah let let me
- 4:05
- just play out my thesis here which is I don't disagree you can't have assets
- 4:12
- going down 90% you know the core collateral of the system if they're
- 4:17
- debating the currency because they go up optically because the currency is going down the Venezuelan stock market goes up
- 4:23
- in bolar terms and down in dollar terms right so therefore if your collateral
- 4:28
- keeps going up which is what they leared in 2008 is we can back stop the entire thing by
- 4:34
- debating the currency quickly the collateral goes up and hey presso my debts aren't so bad okay magic it's not
- 4:41
- magic as you know it's a slight of hand it's not pure magic what they're doing is robbing you in a different way okay
- 4:49
- this has happened before this is exactly what happened in the 1940s and 50s saddled with massive debts after World
- 4:56
- War II the large economies did the same thing Financial repression that yield
- 5:02
- curve control which is buying of government bonds keeping interest rates low which we've
- 5:09
- seen and they just printed money and over time the value of the debt had
- 5:16
- eroded and what they'd managed to do was create a productivity Miracle which drove GDP growth one one thing you're
- What happened after WWII
- 5:24
- you're you're overlooking though a key difference back then so after the second world war and the government ran up a
- 5:30
- lot of debt uh during the War uh but they did it they paid for a lot of the war with tax hikes they had tremendous
- 5:37
- tax hikes uh particularly the income tax which tripled uh when the war started in fact they introduced a withholding tax
- 5:43
- in 1942 as a victory tax so before the second world war hardly anybody paid income taxes by the end of the second
- 5:50
- world war a lot of people were paying income taxes and when the war ended the government had all of this income tax
- 5:57
- revenue coming in and they initi initially it was temporary to win the war but when they stopped the war they
- 6:03
- didn't stop the income tax and so the government was flushed with cash and so it paid down a lot of that debt debt
- 6:10
- collapsed in the years because the government ran huge surpluses and paid down a lot of that debt so it wasn't all
- 6:17
- just inflated away yeah when the 1960s and70s rolled around there was a lot of inflation but the initial big drop in
- 6:24
- debt was an honest repayment because we stopped spending money on the war the
- 6:29
- problem now is we haven't cut any spending we're taxing people to the hilt right now and we don't have the type of
- 6:36
- economy we had a real industrial economy in the 1940s we had we had wealthy consumers that that loan money to the
- 6:43
- government that bought the the war bonds uh we sold the war bonds to China you know Americans are broke so we're a
- 6:49
- levered up country running huge trade deficits uh you know we're we're we're and we we have no means of repaying the
- 6:56
- debt like we did in 1946 so the the debt is now going to go straight
- 7:02
- up it's not going to go down like it did uh during those decades we we're just go
- 7:07
- we're it's getting started it's 125% of GDP it's going to go to 150 200% 300% it
- 7:14
- can't stop until everything implodes I don't disagree I'm so I'm wildly crazily
- 7:22
- bullish because I'm so bearish bullish on what assets because
- 7:28
- they're going inom terms in nominal terms correct but in Gold terms a lot of these assets have to come down the real
- 7:34
- price has to come down so you know I also believe that GDP growth equals
- 7:42
- productivity plus population plus debt growth I think debt growth died in 2008
- 7:48
- and all debt growth now servicing of old debts and population has been shrinking
- 7:53
- so economies have been slow and productivity is low because of Aging populations we're just bringing AI and
- 7:59
- robots into the workforce it's infinite human infinite humans so we GDP growth
- 8:07
- driven by productivity and population growth is what I think is on the horizon
- 8:12
- which is what rescues this rescues this but after what 15% a year debasement of
- 8:18
- currency you know you add 10 years of that and you've lost most of your money so none of us disagree we're all getting
- 8:25
- but it's how are you going to get are you going to get in one go CU it Burns to the ground or they
- 8:31
- going to you so you don't really know you're being screwed but you're just going to get angrier and angrier that's what we're seeing politics has
- 8:38
- gone like this because everybody's so bloody angry because they can't figure out who's screwing them and they're
- 8:44
- blaming each other what Screwed them is there was too many old people and they borrowed too
- 8:50
- much money what I want to understand is the timeline on all of this because it seems
- 8:56
- like the debt is going to ratchet up so fast uh and if we're only going to be able to
- 9:01
- print our way out of it I get at first maybe for the next three maybe five years um I don't notice that I'm being
- 9:09
- screwed over but unless you guys tell me that the amount that we can print before we break
- 9:15
- the camels back is 180 trillion or just some unbelievable number that is so far
- 9:21
- from where we are today this feels like if we're really in a race for do do I
- 9:27
- get to that number of trillions of dollar before the robots come and increase productivity so much that I'm back to a
- 9:33
- 1946 place where I'm generating so much productivity I can actually pay the debt down I'm sure Peter won't agree with
- What is an economy
- 9:39
- this and you will half agree with it and half hate it and that's okay if I'm right that AI plus robots is
- 9:48
- infinite productive units and you see how fast it's coming
- 9:54
- you literally are not capable of understanding what an economy looks like Beyond 2013
- 10:00
- that's the problem I've got here I'm not concerned about the Cliff of death right
- 10:05
- that we're going through I found an asset that I can invest in crypto or I could buy technology and it's offsetting
- 10:11
- the mess of the debasement so I'm fine what's harder is to say what the
- 10:17
- hell does an economy mean after 2030 when you've got endless Ai and robots
- 10:24
- and AGI what is a company what value do you provide in
- 10:30
- that world or I provide we sit there talking to people about it and thinking
- 10:35
- our way through it but both you and I are developing AI tools of which we will
- 10:41
- have a digital Tom and a digital R and we don't even need to turn up to these and they'll do a pretty good job we're
- 10:47
- both working on these things right but are we going to be just repl the point being is when you go to like Nick
- 10:54
- Bostrom who who is the the key thinker about this at Oxford University un who
- 11:00
- wrote the book I can't remember the famous book about the whole kind of where the future's going there's a group
- 11:07
- there an economics group there who share the same concerns as me as like if this is right you could double GDP in a year
- 11:15
- Global GDP or a weak what what what do companies mean
- 11:22
- when AI I have a theory that open AI is using AGI to build its own AI
- 11:29
- which is why they're iterating so fast with what 500 people it's Madness what they're doing how how fast
- 11:36
- they're iterating I've never seen anything like it even Elon Musk is like I've never seen anything like what's going on here the more we have ai to to
- 11:43
- build AI to build businesses the faster and faster this
- 11:49
- goes so in answer your question the explosion could be the other way
- 11:54
- around it could not it might not be the economy imploding it could be the economy exploding in a way that we don't
- 12:01
- even know how to deal with it what do humans mean what is our jobs you know all of this stuff you and I have talked about I actually worry about very
- 12:08
- different things I don't worry about the economy going down the toilet because I know how they're dealing with that
- 12:15
- they've kind of set the rule book I can make money from that that's okay it's this other bit that's the hard bit
- 12:22
- that's more scary what do you give the odds Peter one do you think that he's onto something or does that seem just
- 12:28
- completely completely sci-fi to you well um I mean I think there's no question
- Artificial Intelligence Robotics
- that over time um artificial intelligence robotics
- is going to lead to a dramatic increase in human productivity I mean that's just
- what capitalism does and this is a I think a potentially game-changing Innovation the question is how long is
- it going to take to build out and scale up and you know uh and how are politicians going to react uh to the
- 13:00
- creative destruction which always comes from uh Innovation uh there's always
- somebody that loses uh but net net Society gains and eventually you know over time everybody gains because we we
- don't want jobs I mean we want stuff I mean that that that is the the the the
- secret of of an economy it's a scarcity of things uh we all desire uh certain
- things and the constraint is the ability to supply them and and Supply is constrained by land by labor by Capital
- uh but uh Ai and Robotics has the potential to dramatically increase uh
- the supply of labor uh intellectual you know thinking and and processing and so
- at the end of the day we could produce a lot more with a lot less and we'd all be
- wealthier I mean you know again means work is a means to an ends you don't want your job you want the things that
- you could buy with the paycheck that you earned if you could skip the job and go right to the stuff most people would do
- 14:05
- it right most people don't work because they like to work they'd rather not work they just like what they could buy uh
- with with with the paycheck so I mean I I I think that all of this could be good and you know certainly a lot of
- potential you know I'm 61 years old I'd like to think that this AI could figure out how to do something about that so so
- I could I could I could be younger and live longer and so that's another game Cher I mean what if our life expectancy
- is dramatically extended too right I mean maybe maybe we don't live to 100 maybe we live to 150 I don't know 200
- who the hell knows you know um but yeah there's a lot of things that could happen that I would be looking forward
- to I'm not you know apprehensive about these things um but I also don't think that it's
- necessarily it could be but I don't think it's necessarily A get out of jail free card uh for the sins of the past uh
- that we're not going to have have to deal with the debt well you probably all agree Peter that we are dealing with it
- Inflation
- 15:03
- now right we're all we're all get having the effects of this put upon us already
- well we're we're feeling it and I I I've been saying for a while that's why Biden is so unpopular it's not because of his
- mental gaffs it's because the economy sucks and the voters know this and they're blaming Biden because he's at
- you know at the Helm of the ship that's sinking and and so despite all the hype and all the statistics the average
- American family is feeling the inflation tax in a big way and and and yes there's
- a lot of jobs but there's second jobs and third jobs that people would rather not have they're struggling to make ends
- meet and they hate having to take on these extra jobs and and this is going
- to get worse I think the inflation Genie is out of the bottle uh it never was really gone it's just that the
- government was able to cover up inflation uh with a you know by cooking the books but the inflation is now so
- pricious and the and the impact on prices is so great that even when you whitewash it you know with the CPI it it
- 16:06
- can't hide it anymore because the numbers are so big the costs are rising so rapidly people can see it and there's
- a limit to how small they can make the packages at some point they can't keep shrinking stuff they got to raise prices
- and make it even more obvious uh but and it's not just America it's happening in Europe it's happened in Japan I mean all
- these countries that said for years the problem is we don't have enough inflation we need to create more they
- now have too much inflation and and they can't stop it because stopping it would require politically unexpectable things
- they have to cut government spending you know they have to default on a bunch of promises they have to deliver a lot of
- bad news to the voters and nobody wants to do that and so everybody is just going to continue and they think oh
- we've gotten away with it before we did qe1 we did QE2 we did qe3 we did covid
- so we could do it again right look every time we get into trouble we just print money and we're out of trouble well all
- 17:02
- that is is inflation and so if your problem uh is uh uh uh deflation or
- 17:08
- collapse of assets or whatever and you think you can solve the problem by creating inflation the problem is when inflation
- 17:15
- is the problem when that's the source of everybody's misery you can't solve the
- 17:20
- inflation Problem by creating more inflation because that's been the solution to every problem we've had is
- 17:26
- let's create inflation that's our solution we can call it quantitative easing easy money but what we're really
- 17:31
- doing is we're solving the problem by papering it over with inflation well now we're at the point where inflation is
- 17:38
- the problem so more inflation just makes it worse so it's you know we're past the point of no return uh and it's just a
- 17:44
- question of yeah you know when when do we look down and realize we're standing on nothing and I think that applies to
- 17:51
- bitcoin too you know you look down and you realize there's nothing there you know there's a lot of uh false
- 17:56
- perceptions that are going to uh meet reality uh in the near future just as a
- Not everybody is wrong
- 18:03
- side note what happens Peter if all of these value assets that are gonna catch up eventually and haven't done for the
- 18:09
- last 20 years don't what happens if gold continues to underperform what happens if your model of the world is out moded
- 18:17
- I'm not saying it is but could you possibly consider that not everybody's
- 18:23
- wrong it's just the way that you assume that everybody's wrong I just find that
- 18:28
- a little bit I'm not saying everybody is wrong I'm saying the people that believe in Bitcoin are wrong but that's
- 18:35
- certainly not everybody and the Market's wrong and the technology price is wrong and that that your source of truth is
- 18:42
- the truth and the market pricing is not the truth markets markets get it wrong a lot
- 18:49
- you know in the short run it's a voting machine in the long run it's a weighing machine and right now I think people are
- 18:54
- are making bad bad votes you know uh and and and so you know I just think it's a
- 18:59
- Mania I mean you know every time there's a Mania right it means assets are mispriced I mean we've had plenty of
- 19:05
- Bubbles and they pop and and that's that um I just think that that that this is
- 19:10
- this is another one so you know I I I think the the onus is on the people who
- 19:16
- believe in it to try to say why this you know this is different of course you know that's the famous words of every bubble This Time It's Different uh I
- 19:23
- don't think it is I think this time it's the same I mean you know and and and and and so I think that the same thing is
- 19:29
- going to happen but as far as why you're saying why is gold not gone up look in the scheme of things when people look at
- 19:36
- a long-term chart of gold the fact that it's gone sideways for 10 years is is is
- 19:42
- immaterial to the you know the thousands of years that gold has been around and gold has been a store of value but
- 19:49
- that's over the period of the worst debasement that we've seen in the last 100 years and gold didn't do it right so
- 19:59
- let's say gold all of a sudden has a year or two where it catches up and it goes from 1,000 to 5 or 10,000 right so
- 20:06
- it it doesn't necessarily have to go there in a straight line gold could go up go sideways go up you know and so
- yeah over a longer period of time it's going to smooth its way out now the question is why did gold not go up
- higher sooner well remember it went from 300 to almost 2,000 it had a very big
- move uh in a in a real relatively short historical period of time and and so
- then it went sideways for a decade and the reason I believe is because
- investors have complete confidence in central banks they don't believe that
- there's a a threat of of inflation out there or a debt bubble uh and and so
- they don't see the reason to buy gold they would rather buy tech stocks um and
- and so I I I I think it's just people have a misconception just like you know you
- 21:03
- mentioned the subprime and I remember you know when I was when I first found out about these subprime mortgages a guy
- showed up at my office named Andy Lotti probably in 2005 or six and you know I
- was already bearish on the housing market and he came to me with an idea to set up a hedge fund to short these these
- subprime uh mortgages this trunch and he explained it to me and I was like well why the hell would anybody buy these
- These are obviously going to go to zero I mean how can people be bu them and they were trading above par they were
- they were actually paying more than than par to buy these tranches that I knew were going to zero and I was like well
- you know people just believed in this you know and so the assets were mispriced and they were mispriced for a
- few years until they eventually were priced correctly at zero but but I knew that they were worth zero the minute
- they were explained to me but you know and what the guy told me is he had gone to a lot of uh you institutions with the
- same story and everybody laughed at him I was like the first guy that didn't laugh at him because I knew that real
- 22:04
- estate prices were going to go down everybody else thought real estate prices could never fall and so as long as real estate prices never fell well
- then it didn't matter if anything defaulted right I was a guy that knew that eventually real estate prices would come down uh and and so you can have a
- period of time where a lot of smart people can believe something that's wrong and so assets could be mispriced
- as a result of that shared delusion and I believe that's the situation with with Bitcoin and what happened to me was
- I was the macro bear
- actually the opposite cuz I was the macro bear that everything reverts to the mean that it was all terrible and it
- is all terrible and I realized I had the wrong mental model and the moment I actually freed
- myself of my own biases and tried to understand what the was going on
- and why were these assets going up why why was this happening
- I then could see what was going on and what the big game was and as soon as I could see that it became a game I could
- 23:05
- make money from and that I didn't have to be stuck wishing and I've seen a lot of
- friends of mine do this wishing that value stocks or small Caps or whatever
- it is are going to work for them and it's been 20 years now and I've realized
- I had the wrong mental model and the moment I changed it I feel felt liberated cuz the World kind of makes
- sense and I just urge all of us to just make
- sure that we don't get obsessed by our own mental models because they will change and the world changes and
- sometimes we can be dead wrong and sometimes we can be dead right I mean I nailed the financial crisis I nailed the
- European Sovereign crisis I nailed Co I nailed all of these things by being a big bear and something I suddenly
- realized is yeah but assets kept going up that whole period I should have just been long and have made more money and
- 24:05
- that made me ask the question of Myself by the dip by the dip that ask the question is like that dumb meme of by
- 24:11
- the dip I wanted to go all the way across the bell curve go to the middle bit arguing it all come to the other
- 24:16
- side and realize that by the dip was actually the single best strategy to have ever existed over this period of
- 24:24
- financial mess and I was stupid for not seeing it so anyway I'm just saying be
- 24:30
- careful cuz Tom I can see that you're so allured by the black hole the black hole
- 24:35
- that is there you it kind of comes to you and we have this conversation I try and pull you back from the black hole and say yeah it's there but there's an
- 24:43
- opportunity here and you're like but the black hole just be careful of the mental model because it will massively restrict
- 24:51
- you in what you do even how you think about life and how you interact with
- 24:56
- people around you so so it's something I've learned the hard way is we've all
- 25:02
- got to be a little more open to a everyone's opinions and be our own biases and how
- 25:10
- ingrained they are and have they become part of our personality just because it
- 25:16
- is or it's part of the how we fear like some people fear risk so they become a
- 25:24
- certain way and present that to the world around them or somebody some people have made money and then they've
- 25:29
- worried about losing it because their family didn't come from money we're all set of our own human ridiculous biases
- 25:35
- so just we should just all in all of these conversations just step back a little bit you're looking at it from the
- 25:42
- vantage point of where we are everything is at record highs and so it looks like yes that was the right thing to do to to
- 25:49
- buy the dip but we haven't had the crisis yet that's the thing we we've been able to Kick the Can down the road
- 25:55
- and all of these structural problems have been growing the entire time uh that we've been ignoring them and and
- 26:02
- the question is you know how many more times can this work um because there we
- 26:08
- get I mean I think you gotta you got to watch the bond market you got to watch the gold market the Foreign Exchange
- 26:14
- Market but at some point it's going to crack Tom did this Tom did this earlier
- 26:20
- and it was a very good question is what would make you think the
- 26:25
- opposite and we all need to be able to do
- 26:30
- that because you we can't keep saying well asset price have gone up so therefore you don't know whether you
- 26:35
- were right or wrong it's like and it's this is no attack on you or anything
- 26:40
- it's me thinking through this stuff is how do you know that maybe you have done yourself a
- 26:48
- disservice or I've done myself a disservice or Tom is doing himself a disservice by thinking the way that we
- 26:54
- do have we held ourselves back have we lost an opportunity cost that we didn't
- 26:59
- imagine because we're so Anchored In what we think we think or we project to
- 27:05
- other people I'm just that's all I'm trying to get across is not about who's right who's wrong I'm saying at a human
- level what happens if you had bought Bitcoin and bought the NASDAQ and were 10 times richer than you are today would
- you care about some of the things you think about now maybe not Tom if you
- hadn't made money when you were young and then fear losing it maybe you
- wouldn't be worried about the black hole maybe you'd be more risk seeking
- maybe it you know just think about it in a bigger context
- than fighting over what price and asset is we need to ask ourselves why we think
- that I think that's really interesting yeah the point is as long as the underlying problems continue to get
- worse I don't I don't think I'm wrong so if we actually find a way to solve
- 28:03
- these problems you know if if uh you know we get dramatic Cuts in in
- government spending if we start paying down the debt if we get enough
- deregulation but Peter sorry I just want to ask you a question what is the end
- the worst case scenario game what is the thing that you fear that we are well the worst case scenario is we destroy the
- currency completely right and so the dollar has no okay let's assume that happens right let's say we do that which
- we've been doing but slower but let's say it completely goes it hasn't got there's a lot there there's a long way
- to go between where we are now and zero okay so let's assume it goes to zero I'm
- long crypto and technology stocks you're long gold they all go up we're fine
- what's the problem well first of all there's a big problem because a lot of people first of
- all you maybe crypto goes up maybe it goes down who that you know there's no way to know but but explain to me what
- 29:02
- I'm fearing here myself when the dollar because you're wiping out the savings of
- 29:07
- a generation you're wiping out the retirement of of tbt people I thought
- 29:12
- they were in debt you told me they're ring debt so we're wiping yes you're wiping out debt but every time you wipe
- 29:19
- out one person's debt you wipe out somebody else's asset okay you wipe out the value of people's P their insurance
- 29:25
- you said earlier that you wanted the big reset that we should do this and when the money is worthless you can't buy things
- 29:33
- with it the farmer doesn't want to give up his food because you have nothing of value that he that he wants America
- 29:39
- can't import anymore because nobody wants our dollars I mean if if we go through hyperinflation I mean it's going
- 29:45
- to be riots there's going to be I mean it's I mean it's going to be bad it's not like something that I'm looking
- 29:50
- forward to I understand but you've got your gold and your real estate and you'll be fine and I've got my stuff so
- 29:57
- what do you fearing what is the fear look and the other thing is the government can become even more
- 30:03
- oppressive than it is now and that the worst case is they blame it all on capitalism and the solution is that we
- 30:09
- become a complete totalitarian state and the government takes over everything I mean so there's the you ask me what's
- 30:15
- the worst thing that could possibly happen right what is it you fear you you so you're now fearing a totalitarian
- 30:22
- state where they seize all your assets I mean okay well what good is investing in
- 30:29
- gold and what good is doing anything uh I don't know I guess if they if they if they throw me in jail or kill me I guess
- 30:35
- it's not going to matter but I don't know what they're going to do Tom what is it that you fear Tom what is the fear
- 30:41
- what is that black hole Yeah so as somebody who is very practiced in staring into this I'll I'll walk you
- The Black Hole
- 30:48
- through so um because I feel confident I will make it to the other side sort of
- 30:54
- come hell high water when Co kicked off I realized I was afraid for for uh people that I know and love that don't
- 31:00
- understand money and that that began my journey of actually understanding what's going on so like Peter I share exactly
- 31:06
- his concern um and I'm a little unclear on um the only thing that makes sense
- 31:14
- for me for you to push on this is if you think it's basically impossible for it
- 31:19
- to happen because to me it is self evidently horrific to go through
- 31:25
- something where um it's either a War an external war or an internal War because
- 31:31
- like Peter is saying there's just so much anger and resentment at the implosion of the debt which to Peter's
- 31:37
- point is somebody's um asset that now just went away people won't do that
- 31:42
- quietly they will Riot also when you get to the point where you can't feed your populace because there's no money uh and
- 31:50
- your money's hyperin lating and people walking around with wheelbarrows full of money to try to buy a loaf of bread um
- 31:56
- that suddenly the line of Good and Evil that Soldier nson talks about in the gulg archipelago you realize it really
- 32:02
- does run through every human heart and all of a sudden all those narratives and mythology that you're talking about that
- hold us together as a society all of those crumble and I'm sure all three of
- us are students of history but when you become a student of History you realize that the long Arc that bends towards
- Justice is punctuated with moments of such horrible cruelty death and
- destruction that you just pray a sweet baby Jesus you are not one of the people
- that are around for one of those moments of Correction and they they happen and
- they happen so predictably that the black hole I'm staring into again I don't feel like I'm staring into it for
- myself I've and I mean this is a glimpse into my soul I've told the employees
- here if it ever kicks off come to the house first of all we have The High Ground we are up on a hill uh I care
- about them allall and so so I want to see them Thrive we will do better as a part of a collective but the fact that I even have to say that out loud uh is is
- 33:04
- unnerving now I bend towards optimism so I actually think nothing is ever as good
- 33:10
- or bad as you think it's going to be and so I believe there is sort of this stumbly slow erosion of the dollar path
- 33:18
- that will end up looking something like what happened to England now Peter when you and I last spoke you pointed out
- 33:24
- very rightly that World War I and World War II were some pretty bad things and so since that was part of how they end
- 33:32
- up losing their empire and status as a reserve currency I I concede the point
- 33:37
- that that that is absolutely horrific so I just know every Empire of all time has
- 33:44
- crumbled and I really do think a lot about how America becomes the next Rome
- 33:51
- but the reason that becomes a meme and the reason that people think it's ridiculous is because the odds of it
- 33:56
- happening in the next few years border on zero the odds of it happening in the next 10 years go up a little bit Rayo
- 34:02
- puts um America being in a world war at 50% over the next 10 years but like
- 34:07
- maybe it happens in the next 20 and so if it's true that it doesn't happen for 10 or 20 years me or Peter and Peter I
- 34:14
- think you know you have this reputation and I have a feeling I'm rapidly gaining it as well is like I've predicted 10 of
- 34:20
- the last two recessions right so I'm so focused on uh the Confluence of things
- 34:27
- that go back that I end up potentially missing the all the opportunities that are present
- The Bias
- 34:34
- that's what I was trying to get in and I'm not saying you're right or wrong right I'm just saying we should think about these things there's another bias
- 34:40
- that I want you to think about is ask your wife if she shares the
- 34:45
- same views and her friends do because she's British and she won't it's a quite a
- 34:52
- uniquely American thing doomsday prepping the fear of the decline of
- 34:58
- Empire and the collapse of society is weirdly an American thing
- 35:03
- even though the Europeans have gone through it twice two world wars where we killed everybody each other in the most
- 35:09
- horrific ways possible Europeans don't think of the same way of the collapse of civilization
- 35:14
- that Americans do it's just a really weird cultural phenomena um and it's because it's the largest most powerful
- 35:22
- economy and it's saddled with debt and everything else so just again just
- 35:28
- there's biases in everything that we do that make us as as you said rightly
- 35:34
- Tom we some we project too far either way and it can still be pretty horrible
- 35:41
- in the middle it can still be a terrible political environment there still could be riots there still could be kinetic
- 35:48
- Wars but it may not have to be the end game yeah remember the the other thing that's uniquely American is the degree
- 35:54
- to which we depend on the dollar status as Reserve currency to run trillion dollar year trade deficits so you know
- 36:00
- we need to be supplied goods from abroad and if we lose those Supply chains uh we
- have no ability to to replace them so it's it's it it we it could be you know
- a m a major collapse but the other we sell the best that what we did though what the US did was really
- clever is it created a dollar deta system where the rest of the world owes
- so many dollars that they can't get rid of the dollar it's like what we exported
- what the Americans exported was debt oh and inflation debt and inflation
- but you know um yeah I mean you know there are people that think that but you know I I I I don't think that the dollar
- is impervious because we have so much of them and have have so much debt but the point I wanted to make about recessions
- is one of the problems with forecasting recessions is the government gets to Define them and the government comes out
- with the GDP numbers and like I think we're in a recession now I think we've been in one for a
- 37:01
- while but the government just doesn't acknowledge it because of the way they keep score I don't think the deflator is
- honest I think GDP is going up because of prices I don't think it's going up
- because the wealth of the economy is expanding we're just paying higher prices for things and we're borrowing a
- lot of money to do it the debt is growing faster faster than the GDP
- numbers so all this is an illusion we're not growing anything we're we're spending ourselves into bankruptcy we're
- buying products uh a lot of those products are are are imported and we're paying higher and higher prices so you
- we we could have been in a Perpetual depression uh for years and years and years I think we kind of just that the
- way that we keep track of it you know we don't officially acknowledge it I think look when you're debasing the currency
- in people's savings by 15% a year over time everybody's going to feel like
- they're not getting ahead everybody feel feels this right and you're right somewhere hidden within all of
- 38:01
- this has been an ongoing depression from 2008 for the average
- person not for a tech company not for certain parts of society but most people
- have been in a miserable mess for a long time their wages haven't gone up their costs have gone up it's been terrible
- and they're they're like choked with debt they can't pay their kids to go to university they can't
- afford retirement savings yeah I agree that's it's been
- bad for a long time if you like that clip check out the full powerful episode here and I'll see you there