In this episode of TFTC, Peter St. Onge discusses El Salvador's transformation and potential economic reforms in the US.
In this episode of TFTC with Peter St. Onge, we explore the transformation of El Salvador under President Nayib Bukele, highlighting the country's newfound safety and growing Bitcoin community, while discussing the shifting political landscape in the United States. The conversation includes insights from St. Onge's recent visit to El Salvador, the upcoming US elections, and the effectiveness of the Democratic Party's policies. It touches on election integrity, voter disenfranchisement, and shifting political allegiances. The discussion also covers nationalism, Trump's proposed economic policies, the influence of media and education, and the current state of the US economy with a hopeful outlook on future reforms.
The episode presents a narrative of optimism and potential amidst systemic challenges and political tumult, emphasizing the power of political will, informed voter bases, and sound policy decisions to enact meaningful change. It discusses the radical economic strategy of shifting from income taxes to tariffs, the influence of perception and media, and the importance of fostering national pride.
0:00 - Intro
0:50 - El Salvador
4:23 - Vibe shift
12:26 - River & Unchained
13:42 - Mass immigration and nationalism
17:51 - Trump’s rumored tariff plan
24:49 - Media and education
29:18 - Gradually, Then Suddenly & Zaprite
30:56 - Countering lies
38:10 - Headwinds for next election
45:40 - Dedollarization
50:42 - Has the melt up already started
1:00:27 - Feeling the inflation
1:06:42 - Bitcoin and Trump
1:14:02 - We’re gonna win
1:16:44 - Presidential debate
1:21:35 - Back to tariffs and taxes
00:00:02:21 - 00:00:11:24
Marty
Jesus. I've seen what you've done for others, and I want that for myself. Is that how you felt felt coming back from El Salvador?
00:00:11:27 - 00:00:30:05
Peter
Souttar is fantastic. Yeah. I mean, first off, he had a bunch of bitcoiners down there, so it was a lot of fun. You got a lot of bitcoiners living down there permanently now. So you got like Lena from little HODLers. Yeah. Max and Stacey of course. So there's a hollow community kind of cropping up in San Salvador and down by the beach and just the vibe.
00:00:30:05 - 00:00:54:01
Peter
And in El Salvador is fantastic. You know, people are. I mean, first off, they're they're very nice, very welcoming. They're thrilled to see tourists. That's something they haven't seen in a long time. And people are really just proud of what's happening in the country. You know, talking to, waitresses or taxi drivers, just kind of regular salvadorians. They're just so proud of of, of what's become of their country.
00:00:54:01 - 00:01:13:06
Peter
And of course, all that is Kelly. And it was a crap hole until, he started changing things, so. But it's exciting. I mean, if you get a chance to go down, without a doubt, you know, it's a good tourist destination. He has surfing, you got volcanoes, you got, like, the Costa Rica experience, but it's actually safer. And I think you get a different vibe.
00:01:13:06 - 00:01:33:19
Peter
Like you get a much more optimistic vibe and El Salvador than you might even in Costa Rica, which it's not that bad to begin with. but both of them certainly be what's happening in America now where, you know, people are kind of convinced that it's all downhill from here. so it's it's kind of a relaxing change of pace to actually be in a country where people are optimistic about the future.
00:01:33:21 - 00:01:40:23
Peter
We may get that here. We'll see what happens in November. But we did have that not so long ago, so it'd be exciting to get that again.
00:01:40:25 - 00:02:14:10
Marty
It would be. And it's it's hard to think that you can get higher vibes and of the vibes in Costa Rica, but I mean, he described it with Tucker as literally a miracle, but I think, yeah, well, Salvador story over the last four years, particularly going from the most dangerous country in the world to one of the safest countries in the world, is really a needle in the eye of the incumbent power structure, which has led people to believe that these problems cannot be fixed and El Salvador is proving the exact opposite.
00:02:14:10 - 00:02:18:02
Marty
It just takes political will and action.
00:02:18:04 - 00:02:41:08
Peter
That's the thing. You know, Salvador is a very poor country. they're working with, you know, they're talk about being outgunned by the bad guys. poverty stricken country. The government has no money. And if they could manage this, then that suggests that the crap that's going on in American cities. Yeah, there's a lot of money in San Francisco or New York or Detroit, for that matter.
00:02:41:09 - 00:03:10:02
Peter
Right. You take the amount the city budget in Detroit, and you compare that to something like El Salvador. I mean, we're swimming in money and what the heck do we have to show for it? And so voters should walk away with the understanding that all the crap that's going on, right. If you list through all the problems in America right now, the broken families, the education system, the crime, the delinquency, the inflation, the, you know, flat wages, people, what you got suicide rates.
00:03:10:02 - 00:03:31:06
Peter
People feel like there's no purpose in life. Everything's getting worse. Every last one of those is a choice, all right? These are not things that are falling out of heaven. These are not things that we're fated to suffer. These are all a policy choice. United States is one of the richest countries on Earth. If a country like Salvador can fix that, there's absolutely no excuse.
00:03:31:08 - 00:03:56:00
Marty
No. And like you said, it's a it's a reason for optimism. And I can feel the optimism growing here in the United States despite the economic conditions that people are living through, the stagflation that one could argue we are going to right now, it does feel like there is a vibe shift, as many people are calling it, and people waking up to, hey, the government seems to be in the way.
00:03:56:03 - 00:04:13:04
Marty
And in the lead up to the election later this year, it seems that many people are throwing their arms up and saying, hey, we're going back to Trump because it seems like his administration will enact policies that that actually enable us to flourish, which is good to say.
00:04:13:06 - 00:04:39:26
Peter
Yeah, you're seeing a lot of people flip over. And I think what happened, you know, when we had a lot of discussions about election cheating, I had this conversation a lot. But a funny thing happens when a government starts to cheat, which is that, you know, the reason you cheat is so you you can ignore the voters on the other side, but once you start cheating, it turns out you can actually ignore your own voters too.
00:04:39:28 - 00:05:05:13
Peter
You can ignore all the voters, right? And every political party is like this permanent civil war between the activists and the donors who run the party, and the voters who they need to go to, you know, to actually win the election. And so once a party starts cheating, it doesn't just win elections. Okay, maybe like the first, you know, six months, it's all pure profit, right?
00:05:05:13 - 00:05:28:09
Peter
They can win the election. This is awesome, guys. and then very quickly, the party loses their mind because the the party's own voters drop out of the equation, right? They no longer have a seat at the table. Now it's just the activists and donors. And I think if you look at what the Democratic Party used to be like when I was growing up, right, it was the party, the little guy, the working man, working class unions.
00:05:28:16 - 00:05:47:06
Peter
It was conservative, socially conservative. Bill Clinton, one of his big issues was, he was beefing up the border wall. Okay, he's going to deport all these illegals, right? If you look at what the Democratic Party was and you look at what it is now, I think very clearly what's happened is that the Democrat voters dropped out.
00:05:47:09 - 00:06:08:06
Peter
They're no longer they don't have a seat at the table. Now, a lot of them are still voting almost on autopilot. I think you see this in the black community for example, where a lot of people, they identify as Democrats, third generation Democrats. Yeah, of course I'm gonna vote Democrat. But then you're getting like a lot of young blacks now who are starting to question these things are actually, you know, watching they're watching content from the other side.
00:06:08:08 - 00:06:30:26
Peter
Okay. And a lot of them are saying, wait a second, what in the heck is going on? Because they recognize that the party is no longer even appealing to its voters. you've got cities that are just an absolute defunding the police, right? If you live in a dangerous inner city, that's you have got to be out of your mind to think that that's a good idea.
00:06:30:28 - 00:07:02:06
Peter
You know, when you've got, you know, murders and, gunplay going on every day in your neighborhood. Yeah, a swell idea. Let's defund the police. That could only come out of university faculty. And the reason that those policies are becoming reality is exactly that. I think that one party, whether it's cheating at the ballot box or whether it's just sort of soft cheating, where you've got the media and Google search and all these kind of, you know, putting their finger on the scale one way or the other, the sort of ruling party of America that's been the Democrats for my entire life.
00:07:02:08 - 00:07:30:03
Peter
they started cheating. They no longer need the voters. And so now they're pumping out this stuff that is just absolute, pure insanity. And so what happens at that point is that, you know, regular people, even people who are inclined left, you know, like Elon Musk was he was generally a left leaning guy. He was, you know, whether it's climate or I mean, really across the board, he was a left winger and he, he, you know, red pilled on one topic.
00:07:30:03 - 00:07:52:18
Peter
And then at that point, just the floodgates opened. So I'm starting to see that now. A lot of people in my life, I grew up as a liberal, as a progressive, and so a lot of, you know, my family members and people I grew up with, they're, Democrats, they're old school Democrats. And I see a lot of those people waking up to realize that this monstrosity is no longer the party they, knew and loved.
00:07:52:21 - 00:08:12:29
Peter
it's not necessarily a party that's even paying attention to voters anymore. If I were rooting for the Democrat Party at this point, I would be tearing my hair out. I'd be like, what on earth are you guys doing? The 34 genders that, you know, men getting their balls waxed with kids. What I mean, just what the heck are you people even thinking you're never going to win an election like that?
00:08:12:29 - 00:08:43:27
Peter
And that's what's happening. So I don't know if it's durable. I don't know if it's necessarily an American renaissance. You know, it could just be that one party lost their frickin mind. They, sort of got raised in this orchid like greenhouse environment where, you know, they they're no longer really in touch with reality. And so maybe they're, they're going to go through a correction, at which point, you know, if we look through history, say, in the past 50 years, we've had a couple episodes there where one party the other went off the reservation, they lost an election.
00:08:43:27 - 00:09:00:03
Peter
Really badly, like they won like one state or three states or something. And then they, you know, sort of went back to the smoke filled room and they said, okay, we kind of need to reinvent our brand. maybe we get that. I would welcome that. It would be nice to have it, you know, to not have, one in the same party.
00:09:00:05 - 00:09:28:07
Peter
not that I'm a fan of either party. but anyway. Right. I think that's going to be the big question. you know, it's possible that they do cheat again. Again, whether it's hard or soft cheating. and they, you know, sweep the election 2024, if that's the case, that I assume that we just get a continuation of that process where they even more, continue peddling policies that are completely insane, I imagine they'll I don't know, I mean, really, what's next, like bestiality?
00:09:28:07 - 00:09:47:06
Peter
I don't know, you know, you kind of have to use your imagination. Like, how how insane can you get? so, you know, we can have a rough patch there, but, you know, I mean, fundamentally, we are a largely, democratic polity still, meaning that, you know, voters still do have a say. it's just a question of how many are waking up.
00:09:47:06 - 00:10:09:29
Peter
I think a lot are. We're watching them in real time. But the question is, you know, are we actually going to get a policy change out of that? There's a study that I wanted to mention. I think it comes out of Stanford, and Princeton. But anyway, there were a couple of political science professors, and what they did was they correlated the popularity of a particular policy or law.
00:10:10:01 - 00:10:34:26
Peter
Okay. They correlated that with its likelihood of actually becoming law. And there's a fascinating paper, because what they concluded, they looked at hundreds and hundreds of laws. They concluded that there's almost no impact. Right. So like what the voters want has almost no bearing on what government actually does. I think that is a fundamental flaw, in our system right now.
00:10:34:28 - 00:10:55:12
Peter
what kind of gives me hope is that the experience of one party going insane? You could argue both parties have gone insane. But anyway, that that sort of wakes people up to the point where we get much more, informed electorate that actually starts to fix that so that we can get to a world where, you know, people actually do believe in their leaders.
00:10:55:15 - 00:11:18:17
Peter
one thing we saw in the recent G7, right, a lot of people were commenting on what everybody's approval rating was. So the G7 is, you know, the seven biggest economies in the world. And all these guys were sporting like 30% approval ratings. Right. So like, is that still a democracy? Right. If people are being ruled by somebody they despise where, you know, whether it's cheating or however they manage it, they do win the election.
00:11:18:17 - 00:11:39:05
Peter
But then the rest of the time, everybody despises their rulers. I think that there's a lot of room for improvement. And in a sense, you don't necessarily like drama, you know, because bad things can happen. Civil war, whatever. but I do sort of welcome some sort of, fundamental change in our political systems, the way they function today.
00:11:39:08 - 00:12:05:18
Marty
Yeah, there's a great shakeup happening. I think the two things really driving this, particularly for incumbent voters of liberal leaning parties, is obviously inflation. People feel it and have felt it for years, despite the fact that, every administration is telling you that they've tamed inflation. It's overtly false. You see it at the grocery store, at the gas station every day.
00:12:05:18 - 00:12:28:08
Marty
That and then immigration, whether it's here in the United States. I mean, you mentioned the inner cities. I think New York, Chicago are great examples of cities that have had immigrants flow in, in New York. They're giving them debit cards with $10,000 on them. And the people who have voted for Democrats for, for decades now are like, wait a second, you're supposed to help me, and you're inviting all these people into my city and just giving the money.
00:12:28:10 - 00:12:49:09
Marty
I've never gotten that. And that's happening globally now. I mean, big, yeah. I don't know if I'd necessarily want to consider it a nationalist uprising, but people who are fed up with immigration in Germany, Ireland. I saw some videos out of France, Sweden, it's popping off this this mass immigration policy is definitely backfiring.
00:12:49:12 - 00:13:15:27
Peter
Yeah. I mean, I've been an immigrant most of my life. we lived a long time in Japan, Taiwan, Mexico, Germany. I, you know, immigrants are fantastic. They create jobs. they create businesses. The trick, of course, is that you want good quality immigrants. And I should mention, immigrants do generally vote crap. almost everyone in the world, immigrants tend to vote left wing.
00:13:15:29 - 00:13:41:07
Peter
there's probably deep psychological reasons for that. There's a book called Darwinian Politics, if you're interested. But at any rate, setting aside that and we're going to tend to be crap voters, the left wing voters, economically, they tend to they tend to be wonderful, right? In fact, poorer countries get upset. They called the brain drain, right. They're upset that like every, you know, doctor in Mexico, ends up in the US and they're like, well, maybe we could keep some of our doctors every so often.
00:13:41:10 - 00:13:58:22
Peter
so immigration is fantastic. Mass immigration where you have zero standards. We don't even know who these people are. Right. Like, if I commit a crime in Mexico. Yeah, I would go to the US. I'd be an idiot not to. Nobody knows who I am. I don't have a criminal record. so, I mean, a lot of these people are just,
00:13:58:24 - 00:14:19:02
Peter
Nobody wants them. Mexico doesn't want them. Nobody wants them. That, I think, is what's bringing it to a head. Unfortunately, I think that that's probably going to end a backlash on high quality, immigrants as well, you know, who like Silicon Valley, for example. I mean, if you look at who founds, the big companies, they're there.
00:14:19:05 - 00:14:39:22
Peter
Probably most of them are immigrants, but there are high quality immigrants. So unfortunately, I think that, they are breaking that up. But you know, fundamentally, I am a huge fan of nationalism. I'm a fan of nationalism for everybody. You know, I was a professor in Taiwan for five years, and I taught my students they should be nationalistic for Taiwan.
00:14:39:25 - 00:15:02:04
Peter
You should love your country for the same reason. You should love your city. You should love your neighborhood. You should love your family. and you know, the reason is that if people feel nationalist, if they feel a sense of pride towards their country, they're invested in it, right? They're willing to make things better. they pick up trash on the side of the road all the way up to they vote, they advocate, they get involved in public policy, they make things better.
00:15:02:04 - 00:15:26:24
Peter
So, you know, I think that the there's a confusion that to be nationalistic doesn't mean that you hate, you know, a specific type of people. I think everybody should be nationalist. Kenyans should be very nationalistic about their country. Everybody should be nationalistic. And I do think that we are seeing a resurgence of that pretty much for the same reason that the ruling class went completely insane, and now we're getting this massive backlash to it.
00:15:26:26 - 00:15:48:00
Peter
I hope it doesn't go too far historically. Sometimes it does, but I mean, what I've seen for now, you know, people like, Malay or, Berkeley in Latin America, people like Donald Trump. I've been really encouraged and, you know, them sort of, bringing, nationalism out of the shadows and rehabilitating it as a positive social force.
00:15:48:02 - 00:16:12:22
Marty
Well, that is a good natural segue into the topic that I reached out to you to discuss, which is the economic policy that Thomas Massey sort of leaked after GOP meeting a few weeks ago. And you made a video about it, I believe, last week, which is a rumor that Trump would like to eliminate income taxes, replace them with tariffs.
00:16:12:22 - 00:16:36:17
Marty
And the idea behind this is it would help render realize the United States put money back in American citizens pockets and really get the federal government out of the way, and let Americans do their thing. There's been a lot of back and forth in economic circles about whether or not this would be a good policy. People like Larry Summers coming out and saying there would be truly idiotic because it would create stagflation.
00:16:36:17 - 00:16:58:21
Marty
And, but again, bring up Malay, specifically what he's done in Argentina with his left, where a vendetta of ripping out the government. Is there a way to implement a, an economic policy that would eliminate income tax, increase tariffs and not lead to a stagflation free period in the United States?
00:16:58:24 - 00:17:28:01
Peter
Yeah. So my metaphor for what I think we've done on trade over the past couple of decades is that essentially, we shot ourselves in the foot with regulation and, taxes and actually government spending, things like the Apollo project, which brain drained our electronics industry and put them into this stupid moon adventure. you know, we we lost the American electronics industry almost on the point of when we started with the Apollo project.
00:17:28:04 - 00:17:49:15
Peter
Anyway, we had all these government own goals, and we essentially shot ourselves in the foot. And at that point now where, you know, forced to, like, rent crutches from China, so, you know, one idea might be stop shooting ourselves in the foot. you know, in general, I'm, I'm relet it. I don't blame China so much as I blame Washington.
00:17:49:20 - 00:18:14:26
Peter
Right? I mean, if it weren't, China would have been Mexico, or who knows, it would have been somebody. what I think the real problem is, is that government is making it impossible to run a business in America, especially manufacturing business. You've got to be a masochist, or you've got to have some niche product where you've got, you know, ten x mark ups, like, you know, some, skateboard, you know, with art printed on or something, right?
00:18:14:26 - 00:18:35:20
Peter
I mean, if you've got like, normal products, like a broom, you've got to be absolutely insane if you're going to manufacture that in the US. And so, you know, broadly speaking, anything that removes those domestic handicaps, I am a huge, huge fan of now, if we talk about the tariffs versus income tax trade off, you know, the first thing is that it's not science fiction.
00:18:35:20 - 00:18:54:23
Peter
That's how the country worked in the late 19th century. which is really the golden age of American growth. I mean, it actually was the golden age of all of human history. If you look at the period from about 1870 to at 1910, when the progressive destroyed it, everything was getting better just so fast. It was incredible.
00:18:54:26 - 00:19:23:29
Peter
you know, when you look at science fiction of the era and they predicted flying cars and all this, and then people say, ha! They were so naive. No, they weren't naive. They were precisely on track. We destroyed our ancestors. Our grandparents destroyed it. So if you look back at that era, like the 1880s, our federal government was in was almost entirely funded by import tariffs and, you know, if we sort of translate what those import tariffs would do in a modern age, back then they were about 30%.
00:19:24:01 - 00:19:45:21
Peter
Apparently things did not fall apart. We did not have stagflation. The contrary, we had Singapore levels of, economic growth, along with falling prices, which was actually great. Right. So everybody got rich really fast. so apparently we can't sustain that level. Call it 30% tariffs across the board. If we were to do that today, we import about 4 trillion in goods and services.
00:19:45:21 - 00:20:11:24
Peter
If you put a 30% tax on that, it would go down. So, you know, maybe you'd maybe we'll go down to three, 3.2 or something, in which case you'd be raising about a trillion in revenue. The current income tax charge takes about 2.8 trillion. Right. So you would have a reduction in government revenue by about 1.8 trillion, if they were prudent, which is a big if, then of course, they would reduce spending in line with that.
00:20:11:24 - 00:20:31:23
Peter
And so we would get a much smaller federal government. We had a much smaller federal government. Then you have fewer bureaucrats, creating these these new regulations and harassing businesses. and of course, you know, the, the the main benefit is that if you don't have an income tax, then it becomes much more attractive to run a small business here.
00:20:31:25 - 00:20:53:08
Peter
So if we imagine America, where you've got, say, one tenth as many, you know, EPA and OSHA and whatnot, regulators, okay. So if you cut those by 90%, you do a job here. Malay, a Fuehrer type, throw those guys out. And on top of that, if you had zero income tax, well, at that point, you know, it would be crazy to make a broom in China.
00:20:53:13 - 00:21:19:05
Peter
You'd make it here in America, right? So I think absolute I mean, it's a fantastic idea. It's never, ever going to pass because it's too good. You know, it's like ending the fed. it's got to it's just an amazing idea across the board. But it's too good for Washington. And unfortunately, those kinds of obviously good ideas, they probably won't come in unless we have some sort of crisis in Washington where you, you know, you get like a great reset.
00:21:19:07 - 00:21:44:24
Peter
if they keep cheating, right, then we'll we'll probably get there sooner than later, actually, ironically, because, you know, each each time that people sort of get more and more extreme, if you shut them up, then they just, you know, they, they, they actually start to get more and more extreme. And then when finally, sort of the spring pops up, then then, you know, it can be a lot more dramatic and we get a bigger change.
00:21:44:26 - 00:22:04:22
Peter
I was at a talk this a couple years ago in Canada. And the former. Yeah. Who's the Canadian prime minister before? Trudeau? Harper and Harper is kind of, you know, he's like, I'm middle, middle of the road conservative. he would be a rhino in the US, without a doubt. And Harper was giving a talk where he was talking about Trump.
00:22:04:24 - 00:22:47:24
Peter
And, you know, I assumed, okay, he's going to trash the guy, but actually, he said, you can't silence, somebody like Trump because he's speaking for a large percent of the population is very frustrated. And if you shut him up, then you're not going to like what comes next, right? So I think we're at that stage where you are a contrarian or an acceleration is would almost root for them to cheat at this point, because that gets us closer to a state break where you can get ideas like ending the fed or Bitcoin legal tender, or, you know, trading out the income tax for tariffs where those things do actually become a possibility.
00:22:47:27 - 00:22:51:23
Marty
I wish I didn't have to come to that. I wish.
00:22:51:26 - 00:22:52:22
Peter
For sure.
00:22:52:24 - 00:22:55:21
Marty
Then, like I swear I just cut everything.
00:22:55:24 - 00:23:20:13
Peter
yeah. We lost that battle. Yeah. Between public education, the progressives, Dewey and them and again, about, you know, 19 tens, public education, which, you know, of course, was state doctrine, nation, and then mass media, where, you know, for the first time you had this very, very concentrated, ownership of really sort of the opinion molding of, of society and mass media.
00:23:20:13 - 00:23:46:24
Peter
Obviously, the first thing they did was made friends, government, and cut deals, licensing, you know, censoring, the competition. And so between those two, mass media and education and then out of that felt different things. You know, they captured institution after institution like universities. And we discovered during Covid, apparently they had captured Frick and everything like the National, you know, Book Binders Association of America had opinions about BLM.
00:23:46:24 - 00:24:06:24
Peter
And you're like, what? Like when when did you guys get captured by Marxists? But there we were, but yeah. So unfortunately, it'd be really nice if we were back in like 1870 where you could talk to regular voters and they had a brain. but we've fallen quite a bit. I actually did a study, a couple of years ago.
00:24:06:24 - 00:24:36:23
Peter
Study is a grand word I went through and correlated. I looked at every state of the not. I'm sorry, the inauguration address. So every inauguration address of every president since 1900. And if you go back. Right, that was before public education. So in theory, everybody was literate. Right. And so you go back to 1900 and 1904 and remember, if you're in an inaugural address, those are written by professional speechwriters who are aiming at the 50th percentile of voters.
00:24:36:26 - 00:24:59:03
Peter
Right? They're not aiming at PhDs. They're trying to speak to voters, because what they're trying to do is, you know, to gain enough popularity that they can muscle Congress to get stuff passed. So anyway, you've got these inaugural addresses. And back in 1900 and 1904, the inaugural address is were running, you know, if you run them through Flesch Kincaid grade level scores, okay.
00:24:59:03 - 00:25:23:00
Peter
To, to sort of estimate the grade level that these things are written at, they're written at like 14th, 13th, 14th grade, in other words, college. All right. So the median American in 1900 was college educated equivalent. All right. Now you can then tell me that forward. And it is a stunning straight line decline. By the time you get to Trump.
00:25:23:00 - 00:25:50:15
Peter
It was something like eighth grade. no, I'm sorry, Obama was eighth grade. Trump was like sixth grade. And then Biden was like fourth grade. All right. So and you can try this at home. You can run the inaugural speeches through Flesch Kincaid. It is stunning. So the the, you know, there's, this theory in, in sociology that we've all gotten smarter, I guess, because of the internet or, TV or whatever.
00:25:50:17 - 00:26:10:24
Peter
It is false. Certainly, when it comes to policy matters. I mean, the voters have just been absolutely gutted, intellectually gutted. If you look at what happened in Covid, that seems to have accelerated. So I fear for the next generation of voters. But yes, it would be wonderful if we could have these adult conversations like we used to in the 1890s.
00:26:10:24 - 00:26:30:17
Peter
You know, you read like monetary debates in the 1890s, and most PhD economists would not be able to follow them. And these were public, right? These were newspapers. These were aimed at average median voters. So, but unfortunately it's fallen so far that I think that it's probably going to take a pretty big crisis to break. The crisis doesn't necessarily have to be existential.
00:26:30:17 - 00:26:57:05
Peter
Right. So 1970s was a big enough crisis that it led to, Ronald Reagan. Ronald Reagan, I think, dramatically underestimated the scale and powers of the swamp. So he more or less bounced off without a without leaving a mark. Trump did a little bit better, but not a whole lot better, because I think even Trump didn't. he talked about the swamp, but I don't think he fully appreciated how deep that swamp was and how difficult it is to fight it on anything.
00:26:57:08 - 00:27:18:06
Peter
So, unfortunately, you know, the good news is it doesn't take that much of a crisis to turn voters around. but maybe the bad news is that if we look at people like Reagan or Trump, when we did have voter revolts, not much changed. And so if we really want fundamental change, that unfortunately may take a much bigger crisis in the 1970s.
00:27:18:09 - 00:27:42:21
Marty
I'm curious, is media in education obviously plays a big role in having the voting base think the way they do and vote the way they do. Ultimately. Like for you personally, I mean, I think you are officially or unofficially the economics professor of Twitter, and you've been doing this probably two years now. How long you've been doing your job?
00:27:42:21 - 00:27:47:20
Peter
Yeah, year and a half. Yeah. Yeah. Thank you for saying that. But yeah, yeah, I've been doing it for a year and a half.
00:27:47:22 - 00:28:04:24
Marty
Have, have you had people reach out to you and let you know that your videos are changing their minds? I'm just gonna try to get out here. I like, do we live in a media landscape where individuals like yourself can actually affect the way people think, and then go out and act in the world?
00:28:04:26 - 00:28:32:22
Peter
We can, I think massively. The trick is, you know, it's the, it's like the matrix, right? You've got to unplug first and until you do, like people have to be ready to hear an alternative. They have to be dissatisfied with what they're hearing. And mainstream, it's almost like you're born with a religion, and at a certain percent of people start to question that religion, and then they go out and they're like, okay, maybe I'm a Buddhist, maybe I'm a muslim, maybe I'm a Zoroastrian.
00:28:32:24 - 00:28:49:01
Peter
And people have to get to that point where they start to doubt. Now, that's part of what you know motivates me, is that I know that you don't actually have to counter every single lie. You just have to counter one line. You have to do it so effectively that somebody in the audience says, yeah, wait a minute, that doesn't make sense.
00:28:49:01 - 00:29:11:26
Peter
And then it's like a thread on the sweater and the whole thing unravels. So I mean, I've been not only impressed but humbled that, you know, I've got listeners who are like truck drivers, nuns, you know, completely working class like carpenters. And they understand the history of the fed. You know, they got they, they've, they've like, read through like the French Revolution.
00:29:11:26 - 00:29:35:22
Peter
They understand like all the stages of I mean, it's it's really frickin impressive. what people understand when they feel like something's wrong with the world and they get motivated to go out there and actually figure out what's happening. so it's exciting. But unfortunately, I think that, you know, whether it's 30 or 50 or 60% of the population, they don't really care.
00:29:35:22 - 00:29:53:08
Peter
They have no idea what's happening in terms of policy. they just want to ignore it. You know, there's the line, you may not care about war, but war cares about you. policy cares about these people. It's destroying their lives, but they don't understand it. And, of course, they're surrounded by mainstream media. that is gaslighting.
00:29:53:08 - 00:30:15:14
Peter
Everything. So, you know, the the prices are high at the supermarket. Obviously, this is Mr. Putin. and it's greedy grocery stores. Grocery stores have a 1.2% margin. Okay? Grocery stores are the least greedy business on earth. They make like 1.2 pennies per dollars. All greedy grocery stores are not what's making the prices go up. It's obviously money printing.
00:30:15:21 - 00:30:36:05
Peter
But if you don't have access, like if you haven't, sort of decided to open your mind enough to hear alternative points of view, then you're just going to more or less assume that whatever you hear on TV is true. I mean, after all, you've got PhD economists who are saying it on CNN. you know, these are the experts, you know, most people figure, who am I?
00:30:36:08 - 00:30:51:08
Peter
I work at Burger King, you know, what? Am I going to second guess Paul Krugman? Because they don't necessarily understand that a lot of these expert, infrastructures are certainly corrupt, right? The people are saying the things because they're essentially paid to directly or indirectly.
00:30:51:10 - 00:31:19:29
Marty
Yeah, they're all sharp charlatans, people for listening. And today was a perfect example, this juxtaposition that you're describing, where you had your video talking about the new regulations that are going to go live under the Biden administration that will increase the cost, for appliances and other things due to environmental regulations. And in the same day, I'm not sure if you call it this, but wired released an article saying that climate change is the economic crisis of our time.
00:31:19:29 - 00:31:28:01
Marty
Is climate change is driving all of these prices higher, which is, yeah, it's got the causality completely backwards.
00:31:28:04 - 00:31:56:03
Peter
Oh for sure. And I mean, fundamentally, it's the socialist revolution. It's been going on since, I mean, really since the progressives, gained power in the late 19th century. And the excuse changes every time. you know, maybe it's, inner city poverty. Maybe it's, I mean, it's just, you know, it's like a constantly rotating cast of what the excuses are, but they all come out at the same punchline, which is that we have to hand over more control, more resources to the government, so that they will take care of us.
00:31:56:03 - 00:32:21:13
Peter
And, you know, the mainstream mainstream media tends to be dominated by people who, went to the Ivy League. They tend to call the shots. And, you know, those are they're almost religious schools at this point. They're like madrassas for the socialist revolution. so, you know, I don't even think those people are lying. I think that they genuinely believe this just in their worldview.
00:32:21:16 - 00:32:40:17
Peter
The people are dangerous, right? The people are somewhere between wild animals and like, sociopathic children. And you need, you know, whether it's the zookeeper or the teacher, you know, with, with a fake ruler, somebody has to keep these people in order or they're all going to kill each other. I think that's actually how they view the world.
00:32:40:19 - 00:32:57:17
Peter
And if you think that's the case, right? If you think that the people are like dangerous monsters, then all of it makes sense, right? Yes, absolutely. you need government control. You need the experts, you know, to be telling us what to eat, what to put in our bodies, and so on. All of that naturally follows from it.
00:32:57:19 - 00:33:16:06
Peter
But then you sort of back up for a second and you say, well, okay. Number one, are the people actually dangerous monsters? you know, keep in mind, I mean, we do live in a democracy. And, you know, if the people are dangerous monsters, then I would assume we have bigger problems. because that would mean that our societies are being run by dangerous monsters.
00:33:16:08 - 00:33:41:08
Peter
But, you know, and, I mean, I think that that's a big reason why they do go after democracy. I mean, of course, they claim to defend democracy, but they don't. They try to take as much power away from the people as possible is because they are afraid of that. Right. if you look at, you know, for example, in Europe where they're fighting against populists and a lot of the speeches are pretty close to saying the people are dangerous and we can't let the people think for themselves.
00:33:41:08 - 00:34:05:08
Peter
Right. We have to, we have to filter this, right. We have to have experts who can decide what the people can handle and the sort of, sort of background assumption on this is that the people are wild animals. they're, they're they're psychopaths. They're murderers. You you cannot let them actually control things. So I think it's funny that we live in a world where, you know, really, for the first time in history, almost the entire world does have elections.
00:34:05:11 - 00:34:28:07
Peter
it's not run by, you know, monarchs, or dictators. It I mean, you know, we do actually have semi functioning democracies, and yet the entire elite power structure is absolutely convinced that the most dangerous thing possible is for the people to actually control their governments. Yeah.
00:34:28:09 - 00:34:32:24
Marty
Feels like,
00:34:32:26 - 00:34:53:24
Marty
It's really, I don't want to say dehumanize. It's just like, again, all of this going back to the literacy rate of the, the state of the Union address or the inaugural speech. Yep. Right. To all this zoo keeping, policing and managing. It's like, so belittling, which is.
00:34:53:24 - 00:34:55:07
Peter
Oh, for sure. Yeah.
00:34:55:09 - 00:35:20:19
Marty
It's it's like winter. And I think people are waking up again, going back to, like, climate change. I think I saw a stat earlier today that Gen Z, the, the, the number of Gen Z individuals who believe climate change is an existential crisis fell by something like 20% between. That's fantastic. 2017 and 2022. wow. So I think people are are getting it again.
00:35:20:19 - 00:35:49:21
Marty
They can feel it, in their everyday lives. And I guess that begs the question. There's a lot of hope as we head into this next election. People are believing that Trump is going to get in. Who knows where the they've rigged election again or not, and what will come of that? But you do have this backdrop where we have passed many Republicans in terms of the interest expense on the debt surpassing, what we spend on defense on an annual basis.
00:35:49:21 - 00:36:13:29
Marty
You have you mentioned earlier delinquency rates on credit cards are going up and you have this commercial real estate, bubble, and it looks like it's imploding. You have large buildings in New York City, in DC selling at 80% discounts. how big are these headwinds for either administration coming in to the 2024 election?
00:36:14:02 - 00:36:40:18
Peter
Yeah. So since I mean, really since the 1970s, well, arguably for a lot longer than that. But anyway, sharpening since 2008, the playbook out of Washington is that, they make policy according to what they want to spend, like they have their own goals. And then if anything breaks in the economy, then you just shoot it with $1 trillion, and you do that over and over until it goes away.
00:36:40:21 - 00:37:07:18
Peter
And, you know, I think that's I mean, we saw that in full effect during Covid, where they just did things that were absolutely insane. Right? I mean, closing down the entire economy, like what? but the reason they could do that is because of the, you know, of course, fiat money. And specifically, I think the lesson that they thought they learned from 2008, which is that in 2008, they shot several trillion dollars to the banking system to fix it.
00:37:07:20 - 00:37:27:27
Peter
they didn't reform anything, right? They they didn't actually make any policy changes. They just shot a lot of money at rich people. and indeed, it made the problem go away, right? The banks got back on their feet. We did not actually see much inflation. a lot of people predicted it at the time. But what happened was those 2 trillion were, you know, the banks used to plug their balance sheets.
00:37:27:27 - 00:37:45:00
Peter
They they essentially held on to the money. It didn't go circulating. And so our power structure, the lesson that they took from that was, hey, wait a minute, this is awesome. We can do whatever the heck we want, right? We could even something as sci fi nuts as shutting down the entire economy, and we'll just shoot a bunch of money.
00:37:45:02 - 00:38:03:18
Peter
So they did that with Covid and they ended up shooting one. I think it was about 6 trillion, 7 trillion. I'm sorry that the money supply grew in about a year and a half was just utterly unprecedented. certainly in modern times it was about twice the pace of the 1970s, which was, you know, our last stagflation crisis.
00:38:03:20 - 00:38:30:09
Peter
And why would they do something so reckless? I think because the lesson they took away from 2008 was no problem. It breaks. We just shoot money at it. The money, whatever. You know, it could salt it away in the basement of this in that bank and no problem at all. And so they tried that. And what we saw is, you know, sort of the traditional wisdom research, like the reason why you can't just shoot $1 trillion, everything that moves is because it's going to turn into inflation.
00:38:30:11 - 00:38:45:18
Peter
And then once you get that inflation, people are going to get angry and it's going to cause a bunch of ancillary problems. Right. So, you know, the fed had to hike rates in order to strangle the economy and choke off the inflation that then sent the banks tanking and all this bank crash last year. So they're just all these problems that dribble out of it.
00:38:45:23 - 00:39:11:03
Peter
Once you start getting double digit inflation. And so now I think they're they're kind of in a tight spot where for the past couple of decades and certainly during Covid, they've really just stomped on the accelerator to build out this mega state where it spends whatever it wants. at this point, you know, the the federal government is running $2 trillion deficits, for example, we're not in a major war.
00:39:11:10 - 00:39:50:19
Peter
I mean, we're always at war because we have been for 200 years now. But like, we're not abnormally at war compared to, say, 5 or 10 years ago. so we're in what passes for peacetime for America. we're not in the middle of a major recession. and yet we've got $2 trillion deficits which suggest that when one of those two thing changes, which, you know, we've got a lot of stagflation numbers coming in, the Biden administration seems very, very interested in escalating the wars, particularly in Ukraine and Taiwan, when one of those changes then at that point we go back to that, you know, sort of direct conversion of deficits into
00:39:50:19 - 00:40:09:11
Peter
inflation. And I think that it's possible that, the system could break on that. What I mean by break is that we could start to get inflation galloping up ten, maybe even more percent. I think 20 is one standard of hyperinflation. a lot of left wing economists like a number where it's like, got to be 1,000,000,000% before it qualifies.
00:40:09:13 - 00:40:27:24
Peter
the there's an accounting, there's a major accounting outfit that uses 20% a year. The reason they use 20% is at 20% is when people start doing things differently that that making inflation accelerate, right? People start trying not to hold money in their bank account, not to hold money in their wallet. And then it tends to tends to be off to the races.
00:40:27:27 - 00:40:52:12
Peter
So I think at this point Washington senses Washington, but also Europe is just very, very reckless. they've kind of grown into being able to spend whatever they want, to create any kind of financial crisis and just sort of assume that, you know, they'll shoot money at it. And at this point, the debts are getting so big that it looks like they might, that might not be possible for many more years.
00:40:52:19 - 00:41:11:04
Peter
And there's a name for this, right? It's it's, it's called fiscal dominance. When you get to the point where the government debt is so massive that governments lose freedom of, of action. Right? They can no longer bail out Wall Street. They can no longer, patch up, you know, the next, recession. They can no longer fund the next war.
00:41:11:06 - 00:41:32:10
Peter
And at that point, I think it gets it gets pretty interesting. That's kind of where the rubber meets the road, and we start to get. It'll be interesting to see what happens. So we've seen this in many, many countries. Dozens of poorer countries have gone into fiscal crises. And you know, they worst case scenario, they shrink down to the point where they can only pay the the pretorian guard.
00:41:32:12 - 00:41:52:05
Peter
There is sort of a silver lining there, which is that, you know, if the government completely collapses, then the people have to take over. so, you know, neighborhood watches instead of police, you don't have any more regulators. You've you've essentially abolished the entire regulatory state in one fell swoop because the government's not paying the EPA regulators.
00:41:52:05 - 00:42:02:14
Peter
So they're not coming out to hassle you. I mean, there is a silver lining to it, but it does feel like we're getting a lot closer to that than we've accelerated since, especially since Covid.
00:42:02:16 - 00:42:22:12
Marty
Yeah. And then you factor in the external variables, which is other countries seeing what we're doing with the fiscal dominance and saying, hey, whether it's fiscal dominance or the weaponization of the Treasury market, they're saying, I don't want to buy treasuries anymore. So you have demand for auctions going down, which we discussed the last time you were on.
00:42:22:15 - 00:42:46:14
Marty
You have the BRICs countries beginning to buddy up in Saudi Arabia, most importantly, joining BRICs and saying that they're open to settling trades and in different currencies outside the dollar. You have what's going on in Japan right now. major bank there came out and announced that they're going to be dumping, I believe, 60 billion in treasuries over the next year to defend their balance sheet.
00:42:46:16 - 00:43:04:15
Marty
and then you have the Bank of Japan being the largest U.S. Treasury holder in the world, trying to defend its currency peg, which I didn't check today, but it's hovering right below 160. yes. Yeah. And yeah. Like, what happens if any of those things break?
00:43:04:17 - 00:43:25:27
Peter
Yeah. So that's fascinating. Pretty much every traditional customer of federal debt is, for one reason or another, not buying. Right. So China is preparing just in case the US goes to war with it. a lot of countries are peeling off just because of what we did to Russia, right? We we seized the, the dollars owned by the Russian central bank.
00:43:25:27 - 00:43:44:03
Peter
A lot of those were in treasuries. Right. And so that made the US dollar a risky thing for central banks to own. So countries all over the world are watching this. the Indonesian president gave a speech at an Asean conference from Southeast Asian countries and he said, hey, guys, you gotta you know, look what happened to Russia.
00:43:44:06 - 00:44:04:18
Peter
it could be our turn next, right? The US could come and seize our the dollars that are backing our currency, and then that would collapse our financial system. so, you know, a lot of countries are pulling out for that. As you say, Japan has just a raft of problems. the, you know, Japanese central bank just pissed away, I think it was about 60 billion as well, that it came out to the price tag.
00:44:04:20 - 00:44:21:01
Peter
they put that away trying to defend the yen, and then about three weeks later, just pop right back to where it had been. So I was completely wasted money. You've got, noting to King, Bank was the one that announced, I think it was 63 billion in treasuries. So they're going down. But there's a lot of banks in Japan that have a lot of issues, right?
00:44:21:01 - 00:44:40:12
Peter
I mean, they got 20, 20 years of, extremely low interest rates that have given them the zombie economy. And so there's probably gonna be a lot more after that, as you said. Right. Saudi Arabia, some of the Gulf states that have traditionally been buyers of, US treasuries, they're now, you know, either they're being courted by BRICs.
00:44:40:12 - 00:45:04:00
Peter
China's trying to tempt them off the dollar. or, you know, there's been a question about whether the so-called petrodollar arrangement, is still in effect, where, you know, those countries would buy US assets in exchange for unpaid mercenary services. and so really, every single buyer in the world is dropping out. And, yeah, I had a video on this recently where the one who's picking up the slack is individual Americans.
00:45:04:02 - 00:45:25:07
Peter
They're doing that right now because Treasury bills are paying like 5%. So traditionally Treasury bills, you know, if they pay 1% and you kind of park your money there, they pay five, that starts to look pretty good considering all that's happening in the world. And, you know, that could cause trouble in stocks or risk. so Americans for the moment are picking up the slack or individual investors around the world.
00:45:25:09 - 00:45:45:21
Peter
But when we get the recession, you know, in the next, whatever, 18 months, at that point, the fed will always slash rates. That is then going to, you know, those individuals are going to dump out of bonds because they're no longer going to pay 5%. They're going to pay like 1%. So at that point, Warren Buffett has this great expression.
00:45:45:21 - 00:46:15:16
Peter
He says, when the tide goes out, we see who's swimming without a suit. So when the tide goes out on these high interest rates and those individuals dump, at that point, we're left with all those institutions, which really don't. I mean, they just they don't have the appetite, for US debt that they used to have. Now you pile on top of that the fact that we are running $2 trillion structural deficits every year as the US government this year is going to be flogging 11 trillion in treasuries between refinancing and fresh debt.
00:46:15:18 - 00:46:38:01
Peter
So if the institutions are dropping out, the individuals they popped in, they're having a couple drinks, but they're going to go home soon. And then meanwhile you've got just this wall of debt coming in. It's hard to see how that doesn't hit a crisis. if that does hit a crisis, then the fiscal, power of the US government shrinks dramatically, right?
00:46:38:02 - 00:46:55:05
Peter
If it effectively can't sell debt without, you know, paying so much for it that it sort of becomes this vicious cycle. if the US can't pay that, then at that point, the trillion dollar bazooka that it's been relying on, you know, where it can just create wars and create crises without ever thinking about it because you just shoot a trillion.
00:46:55:05 - 00:47:03:09
Peter
I know at that point that all goes away. and it gets pretty interesting for what happens to the economy at that point.
00:47:03:11 - 00:47:33:23
Marty
Yeah. It makes one wonder, like, are we at the beginning stages of that recovery already in this late stage fiat melt up when you consider again, interest expense surpassing defense spending and the three expenses above it are structural Ponzi schemes and Social Security, Medicare, Medicaid. you just look at stocks like Nvidia. Who knows, maybe it is in, a markup that's commensurate with the increased revenues they've seen over the last couple of years.
00:47:33:23 - 00:47:59:21
Marty
But just looking at the chart looks, a little crazy to me. And what's even more worrying is the fact that it is holding up, the Nasdaq, potentially the whole U.S. equities market and some people would say the global financial system, you know, delinquency rates of 2010 levels. It's like, it seems like things are, melting up, if you will, in all the wrong ways.
00:47:59:23 - 00:48:27:06
Peter
Yeah. And, you know, that's always the question is timing. and, you know, we can see the markers on the road there. so FDR clearly FDR seizing gold, at which point the US dollar was no longer a global currency. Nixon finishing it off. Right. So before Nixon, countries could still cash our dollars in for gold. But Nixon ended that, and then you sort of see this acceleration at each one of these stages.
00:48:27:09 - 00:48:47:05
Peter
You can see an inflation really cleanly. Right? So the first 150 years of the Republic, we had zero aggregate inflation. You had some years that went up, some years it went down. If you take prices in 1789 and you look at prices in 1912, they were almost identical, like for eggs or, you know, things that you can compare apples to apples, bread, things like that.
00:48:47:07 - 00:49:08:29
Peter
and then of course, once the fed came in, now inflation ran up because that's what central banks do. They create inflation for living. and then Nixon ramp that up. And so the question is did we hit whether it was 2008 or whether it was Covid? Did we hit this point where it's inflecting again and now, you know, we're going to get much higher rates of inflation going forward.
00:49:09:01 - 00:49:36:12
Peter
and, you know, I think you could make a case for both of those. it really in a sense, it was A12 punch between 2000 and 8 and Covid, where the government fundamentally changed its relationship with the economy, where we shifted, you know, from a mostly market driven with like an assist or a corrupt assist from the government, we shifted from that kind of a world into a world where it's really being led by the government at this point.
00:49:36:14 - 00:49:59:24
Peter
I mean, Covid was, all the disasters that came out of Covid, the inflation, the stagflation, now all the bank collapses or all of that was caused by government, right? It like the disease itself was a respiratory illnesses. Those have occurred many times through history. We should be used to them by now. but so we're now in this economy now where it's completely government driven.
00:49:59:26 - 00:50:25:03
Peter
They're almost incentivized to create these new crises. In fact, they they pretend there's crises and there doesn't appear to be one. Right? That goes back to that wired argument. How or that, wired magazine, how, you know, the climate crisis is the like they're they're sort of trying to spawn crises out of nothing like, and, you know, traditionally, we assume that governments actually tried to fight crises and tried to protect us, but it seems like they're actually going for them.
00:50:25:06 - 00:50:42:24
Peter
If that changed in the relationship, right where government has gone from a benign parasite to an active predator, if that has changed us on to another trajectory, then yes, I think that it's quite likely that we're looking at, you know, maybe only another ten years left in the current system before it implodes.
00:50:42:27 - 00:50:51:03
Marty
Yeah, yeah. And then you factor in the escalation, particularly Ukraine. What happened at Crimea exactly over the weekend?
00:50:51:06 - 00:50:55:05
Peter
Oh, God. It's astounding. Yeah, it really is.
00:50:55:09 - 00:51:08:29
Marty
And then the other factor that we haven't touched on is that they're still underreporting lot of these things, whether it's inflation. Look at the jobs numbers and the revisions. whether it's at the federal government at the state level. Tall.
00:51:09:01 - 00:51:09:23
Peter
Yeah.
00:51:09:26 - 00:51:33:10
Marty
All fake. and then the job growth that we have had is either taken up by immigrants or people taking second and third jobs, which force them to get in the car and drive people in Ubers or drive food via DoorDash, which is going to be inflationary itself because you have to fill your gas tank to do those jobs in the first place.
00:51:33:12 - 00:51:55:10
Peter
Yeah, yeah. It's funny, like looking at the statistics these days, it is. It's like dealing with a thief where like, you don't know, he he tells you something, you know, it's not true. And so the trick is just figuring out exactly in what way he's lying. Like, what is he lying about? Right. And, you know, if you look at, for example, in the economic statistics.
00:51:55:13 - 00:52:13:26
Peter
Right. So just a couple of days ago, California revised their jobs numbers. And it turns out that they had essentially zero job growth, had 9000, jobs created last year out of an economy of like four, 45 million people or something. I mean that that is effectively zero. Okay. In other words, like it's not conspiracy theory anymore, right?
00:52:13:26 - 00:52:36:01
Peter
This is not just crazy guys. You know, saying the the moon landing was fake and the unemployment numbers aren't real. No, this is literally the official reporters are coming out and saying, oh man, hey, no, it turns out we did the somersault. we saw that also at the federal level. Right. So I think it was the Federal Reserve that, put out a paper where they estimated that 800,000 jobs last year were actually not there.
00:52:36:03 - 00:52:58:27
Peter
we've seen a divergence in the job numbers between, you know, the number of jobs that companies say or that, government surveys claim that companies report as opposed to what households actually report. I mean, just across the board, that the numbers are fake. They are being constantly revised, not just revised, like a tiny bit, but revised just massive amounts.
00:52:59:00 - 00:53:24:11
Peter
inflation is the other big question. Right? So official inflation since since the pandemic has been something like 25%. But if you look at, for example, fast food menus, those are more like 35 or 50% in foreign exchange. they don't look at government reported numbers. They look at something called the Big Mac Index. Right. This is a holy grail in foreign exchange analyzes.
00:53:24:13 - 00:53:39:05
Peter
Like, if, you know, a bank is trying to figure out if the Japanese yen is undervalued, they ask, okay, what is the Big Mac cost in Japan? What does it cost in the U.S? And the reason they do that is that a Big Mac is a bundle of different services. So you have labor, you have gasoline for the truck, you have real estate, you have electricity.
00:53:39:05 - 00:54:04:02
Peter
What are the food? and if so, if you look at that kind of the gold standard of inflation, it hasn't been 25%. It's been like 35%, maybe 50%. People who post stuff online, they post their, you know, grocery bills, they talk about things they bought, vacations. These things all seem to be 50% or more. The reason that matters is not only does it suggest that perhaps they're lying about inflation, right?
00:54:04:02 - 00:54:27:00
Peter
It also means that the way that we count GDP, like whether we're getting rich or not, is we use real GDP. So you take the numbers and then you, you know, take off inflation. If inflation hasn't been 25%, but it's actually been 35%, it implies that we've actually been in a recession for four years now. I don't know if that's the case.
00:54:27:00 - 00:54:52:04
Peter
Right. There are so many inflation numbers. I honestly don't know which one is correct. but it is entirely possible. Now, how could that be? You might say that's ridiculous. We would know if we're in recession. but in fact, you know, if you go back, like, in our minds, a real depression looks like the 1930s where, you know, prices were collapsing, wages were collapsing, people were being laid off.
00:54:52:06 - 00:55:23:15
Peter
But actually, you can look at another recession, which is the Weimar events in Germany during the 1920s. And when Weimar first hit, obviously the economy was completely collapsing. Right? That's that's what gave rise to the social disorders that followed. But early in Weimar, what people were talking about was the stock market going up, okay. Because inflation, as it circulates in the economy, it makes eggs and shoes go up, but it also makes stocks go up because stocks are things people buy.
00:55:23:17 - 00:55:45:24
Peter
Right. And so early in Weimar, people were not worried about the hyperinflation. They were super excited about the hyperinflation of their stock portfolios. Right. So this starts to look a lot like today, right? If we've actually got like a four year depression. And I should give credit to Jeff Tucker, I had a great conversation with him where we sort of teasing this out, and he's got an upcoming article over at Brown Stuff.
00:55:45:27 - 00:56:07:12
Peter
But at any rate, it it seems to me that it's possible that we've actually been in a four year recession here, where asset pumping asset prices have been covering over it. Right? People feel rich. They are rich because their assets went up. Not all people, of course. Only the upper class and the upper middle class. They're doing just fine and everybody else is not.
00:56:07:15 - 00:56:23:24
Peter
If that were the case, right, if we had an economy where the numbers were fake and it was all being propped up by assets, that would look a lot like what we have today, right? Media would sit around, they would say, look at these amazing numbers. What's wrong with you idiots? You know, you Americans can't see how amazing Biden Nomics is.
00:56:23:26 - 00:56:47:16
Peter
You would have rich people who are, you know, that's just ridiculous. Conspicuous consumption. You know, they've got gold flakes in their chardonnay and whatnot. Maybe not Chardonnay in their champagne. while, you know, the working class is, like, struggling to make ends meet. So if we had that type of economy, it would fit the facts. so to me, that's that's kind of as an economist, that's one of the more interesting things going on at the moment.
00:56:47:18 - 00:57:11:03
Marty
Yeah, I would have found it hard to believe at all that we've been in a recession for for four years. I mean, the TikTok videos that you mentioned know, like people sitting in their cars complaining, crying, pleading for help, right? Yeah. You know, out here in Austin, you look at what's going on down the street here on sixth Street, there's a gaggle of homeless people that are in desperate state.
00:57:11:03 - 00:57:28:16
Marty
And I mean, I feel I mean, I'm fortunate to be somewhat comfortable financially and I can still feel I'm like, damn, I'm having a question. Are we going to buy, we're going to go out to dinner. I'm going to go buy these clothes right now. Doesn't make sense. We're going to buy a new car. Like does this any of this makes sense right now?
00:57:28:17 - 00:57:29:16
Marty
You know, force the question.
00:57:29:16 - 00:57:53:11
Peter
Yeah. And, when constantly. I think a lot of us look at it, you know, like you go to McDonald's and it's like 78 bucks to buy food for the family. we got our dog neutered. It was $900. Oh, I'm like, I don't I'm like, that is not 24% inflation, man. Like, and I mean, beyond that, you're like, how on earth are regular people surviving?
00:57:53:11 - 00:58:02:15
Peter
I have a I have, I mean, I know from the numbers they're doing it with debt, but this is, this does not strike me as terribly sustainable.
00:58:02:17 - 00:58:28:20
Marty
No. And. Well, and the debts, they're getting tapped out to look at delinquency rates going up. They can't banks or anything. They're looking at the interest rates. It's like I can't pay 25% interest even though I may need to to survive. It's just a little too much for my liking. And then bank credit offerings are are becoming constricted because they understand the risk profile of what it would be to to lend money out to the people making this much income at these interest rates.
00:58:28:20 - 00:58:48:07
Marty
It's a shit you. And then to make matters all the more worse, even if you were to take the government's statistics at face value, they're still lying to the public, particularly the Biden administration. Oh, we solved inflation's lower. You solve the the rate of inflation, which is still building on a higher base that built up from 20 to 1.
00:58:48:14 - 00:59:08:19
Marty
And so the the indexes is still up quite high. if we are to take your numbers at face value, which yeah, we're not because they're not true at all. But even if you were to, appease the government, what they're trying to tell you, it's like it's still not as good as as you're making it out to be.
00:59:08:22 - 00:59:22:19
Peter
Yeah, well, like, you know, if there's a, junkie who shows up and siphons off a gallon of gas every night out of your fuel tank, okay, and then, you know, you're like, hey, what are you doing? He's like, I can't tell you what. I'll just take a half gallon. You're like, you know what? Yeah. That'll work. Things are a lot better now.
00:59:22:22 - 00:59:40:16
Peter
I mean, that's where we are, like, you know, it's not like prices are ever going to go down. They will never go on to go down again. Of course. as long as the fed exists. Because the reason, you know, that's like the Fed's, go to excuse for why, counterfeits money is, you know, claims that, deflation is always bad, so.
00:59:40:16 - 00:59:58:15
Peter
Right. Those prices are never, ever coming back. The best you can say about Biden is that it's not getting as bad as it was a couple years ago. But of course, you know, I mean, if you look at the inflation rate even now, it's, what, about three and a half, three, seven, even if we take the official numbers, I had a video the other day that inflation expectations.
00:59:58:17 - 01:00:23:04
Peter
Okay. So what Americans think inflation can do in the next ten years are currently at 5.3%. That is ten years. and it's an article of faith that consumer expectations are one of the most accurate reads of future inflation. Extremely accurate. The fed watches them like a hawk because they know they're accurate. And in fact, if we go back to the worst of Biden inflation, right.
01:00:23:04 - 01:00:51:21
Peter
The absolute worst when actual official inflation was it was actually over 10% because they they do this funny thing with housing with delays. Anyway, official inflation was over 10% and it was 9.9. And expectations at that time, okay. Americans thought that inflation was going to be about 4%. Now they're saying 5.36. In other words, if you actually talk to Americans who are the gold standard for predicting inflation, why?
01:00:51:21 - 01:01:13:11
Peter
Because they raise prices. They I mean, they are the inflation. They're the ones who, you know, process the inflation runs through them. inflation actually looks like it's saved up to take another jump. And just going by the expectation numbers that could be bigger than the last bout that we just had with Joe Biden. And that would, by the way, be the exact pattern of the 1970s.
01:01:13:13 - 01:01:46:25
Peter
Right. So the 1970s, we had two look like a camel's back. Right. So you had one inflation that got into double digits. Then it came back down for a little bit. The fed declared victory just like they are now. And then it jumped again. we're almost month to month on track for that. It's pretty astounding. What's concerning for me is that in the 1970s, it ended because we had a fed chair, Paul Volcker, who cranked rates up so hard we had the biggest recession since the Great Depression.
01:01:47:01 - 01:02:13:01
Peter
Finally, it broke the back of inflation. But the problem is he was appointed by Jimmy Carter, who's obviously very inflation. This guy, I don't think Jimmy Carter knew what he was getting in. Paul Volcker I think he was surprised. moreover, by crashing the economy so hard. Of course, Jimmy Carter lost the election, right. Because people blamed him for not only the inflation but the recession, meaning that Washington's not going to be that dumb again.
01:02:13:04 - 01:02:34:28
Peter
Right? They're not going to put somebody in there who is hard money, who's going to lose the president who appointed him the election again. So that's my concern, is that if we get into that kind of 1970s scenario where inflation takes off again, I don't see Jerome Powell having it in him to hike rates the way that, that, Volcker did.
01:02:35:04 - 01:02:54:07
Peter
I mean, you know, current rates are like five, five and a quarter. Volcker got them up to like 16, 18, 19%. We had like 20% on mortgages. I mean, it was it was much, much more than, Jerome Powell has ever, ever thought about doing. So that's my concern, is that if we get to that place again, we may not be able to come out of it.
01:02:54:10 - 01:03:03:13
Peter
rather, Washington may just ride it off the cliff, because the alternative is that they fix it and lose their jobs. And no politicians can take that deal.
01:03:03:16 - 01:03:33:09
Marty
No, they're not coming to save you. So you have to save yourself. This is something that it seems like many more people are waking up to, whether that's individual countries, fading treasuries, in favor of gold or companies. We've seen a big trend over the last six months, particularly of individual companies that are publicly traded and even private, privately held companies following the likes of MicroStrategy, putting bitcoin on their balance sheets as a Treasury asset.
01:03:33:09 - 01:04:02:02
Marty
And I think that is something that if you're listening, I'm sure you already know this because this is a Bitcoin podcast. But with the fact in mind that they're not coming to save you due to the circumstances, in the history that you just explained, you got to save yourself. Like if you're running a company, if you're an individual, you have to get some money on your on your balance sheet, whether it's your corporate balance sheet or your personal balance sheet, that is the only way we're going to manufacture a soft landing, in my opinion, is by winning.
01:04:02:06 - 01:04:03:19
Peter
Yeah. And I think.
01:04:03:21 - 01:04:07:08
Marty
Convincing them that Bitcoin is is the way out.
01:04:07:10 - 01:04:32:12
Peter
Well and it's a moral imperative. I mean, if you run a company, you have a responsibility for your people. I run a business. You run a business. you come to look at your employees, like family. and, you know, if you want your business to survive, you have to hold some of your, assets, some of the Treasury assets in something that's actually hard.
01:04:32:14 - 01:04:55:04
Peter
And, you know, obviously, I mean, Bitcoin compared to gold, you know, I would put the odds if we have a collapse, the odds that we flip the gold versus the odds that we flip the bitcoin, I think obviously, you know, the the end game is Bitcoin. gold has managed to do that many times in the past, but it's also failed over and over because it's got the fundamental physical flaw.
01:04:55:11 - 01:05:05:18
Peter
It's vulnerable to government seizure. so yeah I would argue that, you know, anybody who runs a company actually has a responsibility to put some of those assets in, in Bitcoin.
01:05:05:21 - 01:05:30:08
Marty
Yeah, yeah, we're seeing it to it here at 1031. It's in our portfolio. Companies are starting to bring credit products to market that blend traditional credit with bitcoin. dual collateralized with assets like commercial real estate and bitcoin to enable people that are involved in these businesses to actually ensure that they can have their assets or their assets at value.
01:05:30:11 - 01:05:58:26
Marty
At the end of the day, that's what I think. That's what excites me most about Bitcoin. And hopefully, Trump victory, with very little regulation is that I do think the free market can figure this out. And Bitcoin is viral in nature. And it seems to be a trend that's picking up. Like I would not be surprised if we wake up in 2026 and there's over 100 publicly traded companies with sizable Bitcoin treasuries.
01:05:58:28 - 01:06:17:17
Marty
and at that point it becomes a self-fulfilling prophecy where if inflation isn't tamed and people are seeing the success of Michael Saylor and others that have followed his wake, they may say, hey, this looks like a better strategy. And then depending on the government to to fix this inflation.
01:06:17:20 - 01:06:42:10
Peter
Yeah. And there's a tipping point, right? Companies, CEOs, are conservative. They're financially conservative by nature. you don't get fired for doing what everybody else is doing. Okay. on the other hand, it's very risky to do what nobody else is doing. And so there's this tipping point where you go from, you know, currently for a lot of companies, it's very risky, to put Bitcoin on your balance sheet.
01:06:42:12 - 01:07:12:06
Peter
But there is some level where it's actually risky to do the opposite. And then you get this mass lemming pile on when people talk about million dollar bitcoin. That's probably one of the usual suspects on that. when you get to the point where CEOs see it as risky to not hold Bitcoin, I mean, you'll, you'll get, you know, potentially trillions of dollars, pouring over, you know, because banks will also do that, across the financial system.
01:07:12:09 - 01:07:34:12
Peter
And, you know, I think what's been fascinating this this Trump coming over to Bitcoin. So he'd of course been skeptical for a long time. I don't think Trump understood Bitcoin. I don't think he had really had a strong opinion either way. He just likes the dollar okay. And you know generally when he would criticize bitcoin like back in 2021, he would say things like yeah I'm not really sold on Bitcoin.
01:07:34:12 - 01:07:57:06
Peter
I like the dollar. I want the dollar. Be strong. And I think what happened, you know, a couple of weeks ago when he was talking to libertarians and he came out full on for Bitcoin and you know protecting Self-custody, wanting Bitcoin to be made here in America, which I'll take it. You know, there are economists who, you know, anchored by it, but yeah, okay, I'll take that.
01:07:57:09 - 01:08:23:29
Peter
I think what's happening there is that, you know, Trump to me is an interesting politician where there's a lot of issues where I don't think he has a strong opinion. Either way, he doesn't really care. but what he does have is he loves his people. Okay. In his mind, he has a picture of the people who love him, and he has been astoundingly loyal to them in his first term.
01:08:24:01 - 01:08:47:10
Peter
Anything that he imagined, his people, okay, and his people might be like a farmer in Indiana or something, right? Whatever he imagined that person wants in life, he was for it. He is, I think, exceptionally loyal. That means that, you know, for him to endorse Bitcoin like that with most politicians, he would say, you know, whatever, it's a politician trying to win an election.
01:08:47:13 - 01:09:08:13
Peter
I think in his case he is extraordinarily loyal. I think if he says that he's going to be pro bitcoin, I actually believe him. I don't think it's coming from conviction. I don't think he's read, you know, Saifuddin, but I think that he's incredibly loyal to his people on that. Somebody in his orbit, maybe Don junior convinced them that bitcoiners are his people.
01:09:08:15 - 01:09:17:19
Marty
Yeah, I think Steve Mnuchin Steve Mnuchin but had, perverse influence on him during his first year.
01:09:17:19 - 01:09:20:04
Peter
He did. And it's good to see them. Yeah.
01:09:20:06 - 01:09:29:28
Marty
Yeah. And it's good to see that he's been working closely with Vivek who is pro Bitcoin. And you know I do have hope. And we should mind all the bitcoin here because that that yeah.
01:09:29:28 - 01:09:31:18
Peter
I got no problem with that. Yeah.
01:09:31:20 - 01:09:49:16
Marty
Right I have insights that insights the the the incentives. If Trump signals to the rest of the world hey we're going to mine all the Bitcoin here. Listen no you're not. We're going to mine all the bitcoin here. And then he'd naturally geographically distribute hashrate as as people vie to mine all the bitcoin within their borders. It's it's good for bitcoin.
01:09:49:16 - 01:09:50:27
Marty
At the end of the day.
01:09:51:00 - 01:10:12:25
Peter
And you know people who worry about mining concentration I mean there is a worldwide trend to build useless green energy projects in the middle of nowhere. All of those are eventually going to be Bitcoin mining. Because what else are you gonna do with a dam that's a thousand miles away from the nearest city? So like there's going to be plenty of geographic distribution simply from bailing out all the green projects.
01:10:12:25 - 01:10:22:07
Peter
So, yeah, if we have, policymakers in the US who are, you know, hardcore pro bitcoin mining bring it. Absolutely.
01:10:22:09 - 01:10:25:28
Marty
Yeah. We're going to win. It's dark times.
01:10:26:00 - 01:10:38:18
Peter
I yeah, I think I think we're absolutely going away I think we're going to win on Bitcoin I think we're going to win politically. I mean this is part of the reason, you know, people ask me like, you know, because sometimes, you know, I'll be kind of happy in the videos and people will be like why are you happy man.
01:10:38:21 - 01:11:00:19
Peter
Everything's gone, you know, to hell. And no, we're actually going to win. If you look back through history, you know, the the, you know, the hard times make, weak men and you know that all, which is like a thousand year old thing. Polybius. Right? That's that's ancient wisdom at this point, it is true. the worse things get, the stronger we get.
01:11:00:21 - 01:11:28:00
Peter
Okay. So, I mean, in a way, I don't know, it's. You don't like the suffering that comes when a country collapses. You do have starvation. You have all kinds of terrible things. but there's a silver lining that the faster things collapse, the faster we fix it. And, you know, I have no doubt, if you look at the caliber of our elite right now, like the goofball who Biden just, hired with the I mean, just the, these are not high profile.
01:11:28:00 - 01:11:30:15
Marty
Find out he's stealing luggage in, like, four months.
01:11:30:19 - 01:11:54:17
Peter
Another luggage stealer. I mean, these are pathetic people like these. You know, we have. And the emperor has no clothes. Literally wear like, it's like this Potemkin village of a lead that. I mean, they're just absolute pathetic, people, I have no doubt they're doing everything they can to hold it down. Censorship is pretty much all they got left.
01:11:54:17 - 01:12:17:25
Peter
That's the only thing that's keeping them in power. censorship control over, thought fundamentally right. Whether it's, schooling, universities, media, that's all they got going for them is control over thought. They lose that and holy cow, they're going to be out of here so fast. And even so, even with all the control over thought. Right. You're talking about the Zoomers who aren't buying the, global warming stuff.
01:12:17:27 - 01:12:36:24
Peter
I mean, these guys, Zoomers are. They're like, in the religious schools, man. They're in there every day with this stuff crammed down their throats. They probably get flunked out if they, you know, question any of it. All the media, they're getting there on TikTok. I, I think, you know as well we get censored all the time on TikTok, for global warming stuff.
01:12:36:27 - 01:12:59:20
Peter
And nonetheless, they're not buying it. So I am incredibly optimistic. They have to get lucky every single time, right? They have to suppress the truth every single time. If one time it bleeds out, that's going to be the sweater, the little thread in this way that pulls the whole thing apart. I am massively optimistic. It's not going to be fun between here and there.
01:12:59:20 - 01:13:04:28
Peter
It does take a while, right? We got to win minds over one by one, but we are absolutely going to win.
01:13:05:00 - 01:13:23:24
Marty
Yeah, I think we may have a catalyst for the acceleration of acceleration two nights with this debate. And unless they could jack them up with enough amphetamines to make it a somewhat cogent debate, I think that's it's going to be massive mud on the face.
01:13:23:26 - 01:13:41:29
Peter
That's the question. I'm I'm debating this with my wife all the time. Like, are they going to try to yank him, you know, are they going to take the debate and say, well, you guys were right, he's not fit. Let's yank him and they'll stuff in. Nurse Ratchet over in Michigan. Whitmer or, who's the other one?
01:13:42:05 - 01:14:01:24
Peter
Newsom. Joe boy. and I mean, that strikes me as a possibility. you know, any other candidate the Democrats have is kind of damaged goods. But on the other hand, I mean, never underestimate the media distortion, you know, like, you remember, find people on both sides and now the media just pull that out of there.
01:14:01:27 - 01:14:23:22
Peter
I mean, they they can they have a limitless ability to lie. So, you know, like if they stuff Gavin Newsom in there three weeks later, he's gonna be the second coming of JFK. so that for me is going to be the big question is, does Biden do so badly that they try to yank him? Of course, the Biden people, the Biden handlers, want to protect him, right?
01:14:23:22 - 01:14:40:26
Peter
I mean, Biden is, you know, whatever. He's useless. But his his handler, right? Because he's president, he's attracted a lot of the powerful people in DC, and those people are gonna want to keep him, even if it's, you know, cousin at Bernie's propping him up. They're going to want to keep around. They sure as hell don't want Kamala.
01:14:40:28 - 01:14:56:16
Peter
that was probably the most brilliant thing the Biden campaign did. Was put Kamala in as vice president. as insurance. But for me, that's that's that's really gonna be the interesting question is, does he so do so badly that they yank him and try to stuff in somebody else?
01:14:56:19 - 01:15:18:10
Marty
Yeah. Well, that's what apparently the Trump I think he just isn't true. So sure, there's somewhere some interview like he's pretty convinced that they try to make it. So he would turn down the debate due to how biased it was with Jake Tapper and other anchors at CNN who have talked very negatively of in the past. Obviously, the bias tilts.
01:15:18:12 - 01:15:34:16
Marty
he was like, now I'll take the debate. And just a yeah, I think it was, a bluff that Trump called. Now it's like, all right, we gotta roll Joe out here and have him talk for an hour. Let's see. Let's see how that goes. I'm waiting. Yeah. I mean, I had to be at a dinner Thursday night.
01:15:34:16 - 01:15:38:05
Marty
Well, what's going on? I'm thinking about not going. Oh, man. Watch it.
01:15:38:09 - 01:15:43:15
Peter
Now. Yeah, it'll definitely be a popcorn moment. How long are they going to be debating dinner?
01:15:43:17 - 01:15:49:22
Marty
I can't imagine. I mean, the Biden handlers had their way. It'll probably be a half hour debate.
01:15:49:25 - 01:15:58:16
Peter
Yeah, maybe 15 minutes, because you know it. It's a question of the half life on the driver's right. You know, there's some point where they start wearing off and.
01:15:58:19 - 01:16:01:24
Marty
We saw it at the state of the Union this year. He started slurring towards the end.
01:16:01:24 - 01:16:15:14
Peter
And yeah. Yeah. And like he actually started out strong. He sounded legit in the beginning. I don't know what drugs they're using but I'm sure they're expensive. I'm sure it's the good stuff. but yeah, you gotta you gotta get them out of there before you start slurring.
01:16:15:14 - 01:16:35:20
Marty
So let's say it's a different animal, you know, you don't have to respond, you know? Let's be on your toes. You're sort of reading a speech, a debate where, he's forced to cognitively, cognitively compute, parts of a discussion and respond cogently. It's something I'm very excited about. And the how crazy. Like, we're.
01:16:35:22 - 01:16:36:11
Peter
Right.
01:16:36:13 - 01:16:42:21
Marty
Well, the fact that we're even having this discussion, like the president is not gonna be able to speak for debate is like a sign of the times.
01:16:42:23 - 01:17:05:06
Peter
Well, the, the the fact that they decided not to prosecute him because he was like, mentally incompetent. And I'm like, what? What clown world are we living in where? But, you know, to be fair, I'm talking about the debate, the the Fetterman debate. I mean, he was in bad shape, right? He was in really bad shape. And I will say, it's pretty astounding what ended up happening after that.
01:17:05:08 - 01:17:28:09
Peter
The great transformation of John Fetterman, where he, you know, regained his, sanity better than ever. but, you know, I mean, we've got recent, precedent for pretty bad debate performances that don't end up affecting much. So, you know, maybe he comes out, he slurs, the media selectively edits the 60% of Americans who get their news on the evening news.
01:17:28:09 - 01:17:37:18
Peter
You know, the NBC Evening News. They don't know any better. Jimmy Kimmel, you know, gives us the highlights and and maybe he comes out of it.
01:17:37:20 - 01:17:44:09
Marty
Jimmy Kimmel has Hunter Biden back on to, to discuss the debate. And how well is that? Did.
01:17:44:12 - 01:17:45:23
Peter
yeah, exactly.
01:17:45:26 - 01:17:53:23
Marty
Maybe I'm too much of a of an optimist here, but I, I think the, there will be good clips floating around Twitter on Thursday night.
01:17:53:25 - 01:17:57:01
Peter
without a doubt. Yeah, yeah, yeah.
01:17:57:03 - 01:18:00:21
Marty
Well, Peter, thank you for doing this.
01:18:00:24 - 01:18:02:27
Peter
yeah, always. It's always a joy, Marty.
01:18:03:00 - 01:18:14:13
Marty
The, income tax, demolition of income tax and increasing tariffs of something else, like, I haven't thought about that while. And, you.
01:18:14:16 - 01:18:38:23
Peter
Know, I would love it if it happens. Well, that's funny, because, you know, most mainstream economists are, in my mind, just obsessed with tariffs. Like they don't care about anything else. They're like 99% income tax reparations. Do whatever you got to do. But my God don't touch the tariffs. They're just obsessed with them. And I, my colleagues at Irish as well, we, yeah.
01:18:38:23 - 01:18:57:27
Peter
I mean, if you actually look at the impact of tariffs, it's not that big. The impact of taxes is big income tax. The impact of regulations is also very big. Just it's like a neutron bomb, you know, like, why does Detroit suck so bad? Regulations. You can't start a business there. you're going to get harassed out. You're going to get hounded out.
01:18:57:29 - 01:19:18:26
Peter
So, yeah, I love the idea. You know, I think for me, one of Trump's specialties is taking things that are great ideas but are nowhere close to the Overton Window. They're nowhere close to actually being discussed by people. And he puts those out there. and, you know, one of those was, NATO, you know, the idea of the U.S. getting ripped off by NATO.
01:19:18:26 - 01:19:35:23
Peter
And why the heck do we join all these wars anyway? What the heck? It for regular Americans? and this to me is another one, right? This kind of an idea that when most people first hear it, they're like, that's crazy. And I actually, though it's not as crazy as it sounds, we we did it for a long time, and it turned out pretty special.
01:19:35:25 - 01:19:48:08
Marty
Yeah. And the income tax is unconstitutional. Unconstitutional? and it was down to 2% and now it's 50%. Yeah. State and federal in some areas. So.
01:19:48:10 - 01:20:07:11
Peter
Well and that's an open question. So if they jack something in, even if it's an amendment and then they end up, you know, changing it materially so that, you know, in other words, when the income tax came in and hits less than 1% of the population, the top rate was 3%, okay. Now it hits 80% of the population.
01:20:07:11 - 01:20:28:20
Peter
Top rate is, what, 39.5 or something. That's a materially different thing okay. And so you know, to me it's kind of an open question like if they pass a law under false pretenses, I kind of feel like the law should be reverted. I think that's the same on the Federal Reserve. Right. The Federal Reserve was passed to protect the dollar and had one goal in life.
01:20:28:20 - 01:20:47:11
Peter
It was to protect the dollar. As soon as they start with the second mandate, full employment, the third mandate, bail out banks. All right. At that point, I don't feel that it was passed under, you know, under good faith. I think we should repeal it and go ahead and ask the voters again if they want it. So that's that's kind of a meta question, I suppose.
01:20:47:11 - 01:21:06:23
Peter
But yeah, I would agree. The in my mind, the income tax and the Federal Reserve Act, the twin disasters of 1913, because of what they've become, in my mind, those were never passed democratically. They were smoke and mirrors. They've, you know, it was a bait and switch. They've delivered something that the American people never thought that they were voting for.
01:21:06:26 - 01:21:09:05
Marty
for a for the Fuehrer.
01:21:09:10 - 01:21:09:24
Peter
Exactly.
01:21:09:24 - 01:21:15:17
Marty
Well, we will get it all out. Keep crushing it. I enjoy your videos every day.
01:21:15:24 - 01:21:16:08
Peter
Thank you.
01:21:16:08 - 01:21:18:01
Marty
Marty. Love sharing them. Yeah. You do.
01:21:18:01 - 01:21:20:13
Peter
Fantastic. And yeah, keep up the battle.
01:21:20:15 - 01:21:22:17
Marty
You tell peace. Love freaks. Okay.
