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Justin Haskins' New Book "The Next Big Crash" · Conversations: Special Guests with Preston Scott

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  Speaker 1: Gooda, friends, and welcome. It is Tuesday, February The tenth
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  Speaker 1: Morning Show with Preston scottis Oseiam Preston and this is
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  Speaker 1: our friend Justin Haskins. He's Vice president policy with the
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  Speaker 1: Heartland Institute. He's a New York Times bestseller and he
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  Speaker 1: has a new book, justin How are you?
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  Speaker 2: I'm doing great? How are you well?
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  Speaker 1: I'm curious. The President of the United States says, you
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  Speaker 1: know what, you ain't seen nothing yet. The doubt fifty thousand.
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  Speaker 1: Come on, We're going to one hundred thousand by the
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  Speaker 1: time I'm done. And your new book is the next
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  Speaker 1: Big Crash? Tell us about it?
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  Speaker 2: Yeah, great timing to release a book with that title. Yeah. Perfect.
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  Speaker 2: So the idea behind this book is not the when
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  Speaker 2: the next big crash is going to occur, or even
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  Speaker 2: what's going to cause the next big crash. That's I
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  Speaker 2: do discuss that and the first after the book, and
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  Speaker 2: I lay out some of the big systematic problems we
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  Speaker 2: have in the economy right now, even under Donald Trump,
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  Speaker 2: even with some of the improvements that have been made,
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  Speaker 2: and there have been improvements made. What this book is
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  Speaker 2: about potential effects of the next big crash whenever it happens.
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  Speaker 2: Whether that's next month, next year, ten years, twenty years,
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  Speaker 2: doesn't matter. They are What people don't realize, and this
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  Speaker 2: took me three years to put the research for this
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  Speaker 2: book together, is that the vast majority of Americans and
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  Speaker 2: institutions do not actually own directly own their investments. Not
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  Speaker 2: in their four oh one k's, not in their iras,
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  Speaker 2: not ETF stocks, bonds. You're not the actual owner, the
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  Speaker 2: direct registered owner of those investments, even though you think
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  Speaker 2: you are, even though you paid for them. You think
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  Speaker 2: you are, but you're not. The laws have already been
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  Speaker 2: changed that effectively strip away those rights, and as a
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  Speaker 2: result of that has happened over several decades, and as
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  Speaker 2: a result of that, when the next big crash happens,
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  Speaker 2: all these other laws have been built on top of
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  Speaker 2: it that could make it so that you lose access
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  Speaker 2: to your investments, potentially lose them entirely as part of
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  Speaker 2: a scheme to help prop up Wall Street to save
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  Speaker 2: too big to fail banks and investment management firms and
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  Speaker 2: other Wall Street firms, and many of the laws that
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  Speaker 2: could cause this are already on the books right now,
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  Speaker 2: and most people just have no idea that any of
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  Speaker 2: this has happened, and the story behind how it happened
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  Speaker 2: involves a massive conspiracy that I document in the book
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  Speaker 2: very clearly, with some of the most powerful private families
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  Speaker 2: in America's history, a former officer of the CIA, all
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  Speaker 2: kinds of really nefarious figures, and the whole reason they
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  Speaker 2: cooked up the scheme is so that they could make
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  Speaker 2: lots and lots and lots of money.
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  Speaker 1: As I'm hearing you describe this justin it almost sounds
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  Speaker 1: as if as you're writing, as you're researching and putting
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  Speaker 1: this all together, it's almost like you have to laugh
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  Speaker 1: to keep from crying. It's like, this is unbelievable what
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  Speaker 1: we're seeing. It can't be true, but it is.
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  Speaker 2: Yeah, that's exactly right, that's exactly right. This whole thing
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  Speaker 2: started several years ago when I had lawmakers come to
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  Speaker 2: me at the state level from various places across the country,
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  Speaker 2: and they had been hearing from some researchers that there
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  Speaker 2: was these sort of secret things in the code that
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  Speaker 2: not secret, but things in the code that most people
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  Speaker 2: never see in uniform commercial code and other laws that
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  Speaker 2: mean that you don't actually own your investments. And then
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  Speaker 2: what does that what are the ramifications of that? And
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  Speaker 2: I thought they were totally nuts. I thought there was
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  Speaker 2: no way that any of this could be true. And
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  Speaker 2: I started out with that idea in mind to just
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  Speaker 2: the more I researched, the more I realized it is true,
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  Speaker 2: and it's even worse than I had imagined.
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  Speaker 1: Justin Haskins from the Hartland Institute, author The Next Big Crash,
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  Speaker 1: the book we're talking about. Justin, you use the term
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  Speaker 1: too big to fail, And of course I think a
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  Speaker 1: lot of people because I was on the air talk
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  Speaker 1: about dating somebody here. I was on the air during
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  Speaker 1: the two thousand and eight financial crisis when we really
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  Speaker 1: heard that term popularized. But it goes back to Congressman
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  Speaker 1: Stuart McKinney in nineteen eighty four in the bailout of
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  Speaker 1: Continental Illinois National Bank and Trust Company. Is this go
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  Speaker 1: back to eighty four? Does this even predate that?
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  Speaker 2: Yeah, this whole thing started back in the nineteen sixties
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  Speaker 2: and seventies when Walls three was having a work crisis.
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  Speaker 2: As volume on Wall Street was increasing, people trading more
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  Speaker 2: investments and things like that. Everything was being done on paper,
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  Speaker 2: and your ownership was tied up in paper. So when
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  Speaker 2: you bought a stock back in those days, and there's
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  Speaker 2: probably some people listening who remember this, you would actually
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  Speaker 2: get a stock certificate, a physical stock certificate with your
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  Speaker 2: name printed on it, and that was actual ownership. That
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  Speaker 2: was real ownership. So what Wall Street did was they
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  Speaker 2: and the banks got together and they decided, you know,
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  Speaker 2: this would all be a lot easier if people just
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  Speaker 2: didn't own any of these investments directly, and instead we
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  Speaker 2: just created one institution called DTC, the Depository Trust Company,
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  Speaker 2: that would own everything. And then that way, when anything
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  Speaker 2: happens on Wall Street, all we're really doing is just
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  Speaker 2: moving things around on a spreadsheet. And that's essentially the
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  Speaker 2: system that they came up with. In the process that
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  Speaker 2: it required them going to every state and getting state
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  Speaker 2: code changed in all fifty states. It required them getting
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  Speaker 2: Congress to change some laws, required regulatory help from the
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  Speaker 2: SEC and from all sorts of other federal agencies. The
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  Speaker 2: Fed was involved. This institution that now owns eighty trillion
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  Speaker 2: dollars worth of securities investments like stocks and bonds and
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  Speaker 2: other things. DTC is part of the Federal Reserve Bank.
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  Speaker 2: And it took them years to put all of this together.
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  Speaker 2: They were still changing the code all the way into
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  Speaker 2: the nineties, and what they realized throughout that process was,
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  Speaker 2: not only can we capitalize on this and make more
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  Speaker 2: and more money by allowing people's stocks and bonds that
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  Speaker 2: we actually own in this one institution to be lend
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  Speaker 2: out to other people. The whole derivatives trading market like
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  Speaker 2: options and futures and all of that kind of stuff
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  Speaker 2: derives from this. It would not be possible at today's
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  Speaker 2: levels without this DTC centralized ownership system. And then they said,
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  Speaker 2: you know what, we should build some rules in here,
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  Speaker 2: because if this whole thing goes haywire and the market
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  Speaker 2: goes really it gets really ugly, this system's going to
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  Speaker 2: completely collapse. That we're building this house of cards, so
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  Speaker 2: we better make sure that we can protect ourselves. So
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  Speaker 2: they started putting rules in the code that are on
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  Speaker 2: the books right now that make sure that if there
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  Speaker 2: is a big crash they at least have the option
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  Speaker 2: of being able to capitalize on all this wealth being centralized,
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  Speaker 2: so that the big financial firms can protect themselves from
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  Speaker 2: a crash. In fact, one of the people who helped
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  Speaker 2: draft the law said that they're guarding against quote armageddon
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  Speaker 2: that's what they're thinking was when they put all this together,
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  Speaker 2: and most people have just never heard of any of it,
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  Speaker 2: and all of this was cooked up as part of
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  Speaker 2: this crazy conspiracy with some really shadowy figures that suggest
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  Speaker 2: that it wasn't even as simple as just Wall Street
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  Speaker 2: being green, that there may have been other forces at
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  Speaker 2: play as well. Potentially the CIA, maybe the State Department,
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  Speaker 2: the Nixon administration, the Rockefellers were heavily heavily involved in
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  Speaker 2: everything going on here. It is a crazy, crazy, crazy story,
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  Speaker 2: and I think anyone who reads it is going to
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  Speaker 2: see that you really can't look at Wall Street the
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  Speaker 2: way we've been looking at it, or the economy it is.
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  Speaker 2: We're in a much more dangerous situation than most people realize.
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  Speaker 1: Justin Haskins with me. We'll take a break here in
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  Speaker 1: a second. Just a quick response to this question, Justin,
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  Speaker 1: is there any way around this? You mentioned four one
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  Speaker 1: k's the large investment firms, even the small investment firms.
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  Speaker 1: What if I just go out and decide to be
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  Speaker 1: a day trader and I'm just going to buy stock myself,
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  Speaker 1: Do I own it?
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  Speaker 2: You really can't buy stock yourself in the current system.
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  Speaker 2: It's almost impossible. Everything is owned by DTC. No matter
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  Speaker 2: what you do, you go out and you buy stock.
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  Speaker 2: Even the big Wall Street firms, even Blackrock, they don't
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  Speaker 2: own most of their own stock. It's almost all of
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  Speaker 2: it is centralized into one place at DTC, and so
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  Speaker 2: it is extremely difficult to own your own securities. Theoretically,
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  Speaker 2: could you force force them to give you a paper certificate?
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  Speaker 2: It might some some investors might be willing to figure
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  Speaker 2: that out for you if you pay, but the vast
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  Speaker 2: majority of them won't do it, almost never do it.
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  Speaker 2: And so no, it's essentially impossible today to invest in
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  Speaker 2: Wall Street without going through this system.
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  Speaker 1: Justin said, thanks for helping me plug the book. Are
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  Speaker 1: you kidding me? He has been bailing us out with
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  Speaker 1: Intel for years. The least we can do is make
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  Speaker 1: you aware of something that might be useful. Good night, Justin.
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  Speaker 1: We're talking about the next big crash and the conspiracy
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  Speaker 1: collapse and the men behind history's biggest hest We're not
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  Speaker 1: talking about the men specifically that you get into in
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  Speaker 1: the book. I'm curious, though, did States go into this willingly? Unknowingly?
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  Speaker 1: Were they pushed and nudged and threatened into this? How
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  Speaker 1: did we get this into the fifty States.
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  Speaker 2: Yeah, it's an incredible thing. And I did a lot
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  Speaker 2: of research on how that happened, and the answer is
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  Speaker 2: really simple. This was all brought into the States through
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  Speaker 2: something called the Uniform Commercial Code, which is a state
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  Speaker 2: law that's been passed in all fifty states. It's massive
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  Speaker 2: and incredibly complicated, and it's all about commercial laws. So
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  Speaker 2: there's all kinds of rules in there about mortgages and
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  Speaker 2: financial institutions, all kinds of stuff. It's extremely complicated, very
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  Speaker 2: difficult to read. And the way those laws get amended
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  Speaker 2: they get changed, is you basically have this big commission
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  Speaker 2: called the Uniform Law Commission that's full of lawyers and academics,
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  Speaker 2: and they run around all over the country and they
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  Speaker 2: convince the lawmakers you've got to make xyz change. And
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  Speaker 2: they tell all of them at the same time, you
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  Speaker 2: got to make this change. And nobody understands it. No
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  Speaker 2: one really understands it. They are relying entirely on the
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  Speaker 2: quote unquote experts who tell them you really need to
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  Speaker 2: do this. And for the most part, people have trusted
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  Speaker 2: this organization, the Uniform Law Commission and the American law
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  Speaker 2: institutes and others that have been backing this uniform commercial code.
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  Speaker 2: So when they say it, pretty much everybody just listens
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  Speaker 2: because nobody really knows how to interpret any of these things,
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  Speaker 2: especially at the state level. And that's pretty much how
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  Speaker 2: it came into being. It was just because the experts
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  Speaker 2: said to all of these lawmakers at the same time,
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  Speaker 2: you got to do this, and if you don't do it,
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  Speaker 2: your state's going to be left behind and there's going
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  Speaker 2: to be all these economic problems in your state. So
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  Speaker 2: you better go along with it. And that's what people did.
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  Speaker 1: Justin it occurs to me as you're describing this, I'm
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  Speaker 1: seeing the classic, you know movie where the bomb is
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  Speaker 1: ready to go off in thirty seconds and they've got
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  Speaker 1: a series of wires that to disconnect the bomb. They
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  Speaker 1: have to disconnect the wires and clip the wires in
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  Speaker 1: a certain sequence or it detonates. I get the feeling
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  Speaker 1: to undo this is a similar type of thing. You
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  Speaker 1: can't just undo it. You have to do it in
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  Speaker 1: a specific way, in a specific order. Is that fair.
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  Speaker 2: A lot of it, yes, yes, The foundational pieces of
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  Speaker 2: it that you no longer directly own your investments, you
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  Speaker 2: just own basically a contract that's related to investments. Okay,
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  Speaker 2: that cannot be taken down overnight. That would be really,
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  Speaker 2: really hard to do. The entire system of Wall Street
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  Speaker 2: is built on that model where you don't really own
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  Speaker 2: the investments that you're paying for, so you can't just
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  Speaker 2: take that apart overnight. There are long term ways to
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  Speaker 2: return property ownership back to individuals, but that is a
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  Speaker 2: really that's something that will take decades to do. But
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  Speaker 2: there can be laws that are passed at the state
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  Speaker 2: level that change the parts of the code, the most
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  Speaker 2: egregious parts of the code, that allow for some really
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  Speaker 2: bizarre things to happen in the next big crash, including
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  Speaker 2: that you could end up losing all of your investments
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  Speaker 2: if your investment manager has been pledging your investments as collateral,
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  Speaker 2: whether they're supposed to do that or not in lending agreements.
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  Speaker 2: It allows the bank to actually take your investments even
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  Speaker 2: if the investment company that did this to you wasn't
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  Speaker 2: supposed to be doing it. That's insane. There are other
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  Speaker 2: laws on the books right now, emergency powers laws and
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  Speaker 2: things that would allow these investment man these investment companies,
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  Speaker 2: Wall Street firms to do this legally, to actually take
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  Speaker 2: your investments and use it to help get lending so
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  Speaker 2: that they can protect themselves from failing. There are laws
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  Speaker 2: on the books that would allow that to happen now
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  Speaker 2: if they were to trigger it. So there's all kinds
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  Speaker 2: of crazy things in the code that just people have
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  Speaker 2: no ideas there, and your investments really are not as
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  Speaker 2: safe as what most people think. And by the way,
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  Speaker 2: I am not making any money on this book. I
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  Speaker 2: just want to make this clear, because so many people
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  Speaker 2: who are involved in this discussion are making money. I'm
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  Speaker 2: not making money. All of the money from the book
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  Speaker 2: goes to nonprofits who are fighting to change laws. All
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  Speaker 2: of it. I don't make any money. So this is
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  Speaker 2: something that I learned about and I'm passionate about it,
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  Speaker 2: and I want to change it and fix it. And
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  Speaker 2: that's the only reason that I'm doing it.
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  Speaker 1: All right, We got literally thirty seconds here justin is
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  Speaker 1: this going to be best attacked from a state level
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  Speaker 1: or congressional level.
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  Speaker 2: Some of the most important changes can happen at the
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  Speaker 2: state level. That's the first step, and that's a much
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  Speaker 2: easier path than doing it at federal level. And there
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  Speaker 2: are people working on it right now. There are some
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  Speaker 2: states that have proposed legislation to fix some of these problems,
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  Speaker 2: and bank lobbyists and others have been killing it all
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  Speaker 2: across the country. And so we need people to talk
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  Speaker 2: to their state lawmakers out this problem and let them
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  Speaker 2: know we need solutions.
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  Speaker 1: Justin Haskins Heartland Institute the book The Next Big Crash.
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  Speaker 1: Get It,