Latest / Financial Survival Network / Jerome Powell's Biggest Fan (Just Ask Him) - Michael Pento #6303

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Jerome Powell's Biggest Fan (Just Ask Him) - Michael Pento #6303 · Financial Survival Network

0:00
Speaker 1: I find myself in a very peculiar position. I'm kind
0:03
Speaker 1: of in defending Jerome Powell, which I never thought I
0:06
Speaker 1: would do in my life, you know, carry for the
0:09
Speaker 1: life of me. I don't understand what the administration, who
0:13
Speaker 1: I support, is thinking when they say they want to
0:16
Speaker 1: fire Powell and cut interest rates to one percent.
0:19
Speaker 2: You are listening to Carrie Let's's Financial Survival Network, where
0:23
Speaker 2: you get valuable information you just can't find anywhere else
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0:39
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0:46
Speaker 3: And welcome. You are listening to and watching the Financial
0:50
Speaker 3: Survival Network. I'm your host. Carrie Let's Michael Pento is
0:54
Speaker 3: on vacation, although as long as Michael has a phone,
0:57
Speaker 3: he's never really on vacation. In fact, he manages hundreds
1:01
Speaker 3: of millions of dollars, not with computers but with his iPhone.
1:05
Speaker 3: If you could believe it, that's how easy he's got
1:09
Speaker 3: the job down to.
1:10
Speaker 1: Right Michael, Yeah, I'm in a beautiful Belmore New Jersey
1:14
Speaker 1: in the upstairs apartment of a close friend, and I
1:17
Speaker 1: forgot we were doing these interview But I'm here, here
1:20
Speaker 1: my athletic freaky shirt on, and I'm ready to go.
1:24
Speaker 3: So you no, you know what Woody Allen said, ninety
1:27
Speaker 3: percent of life has showing up, right.
1:30
Speaker 1: Well, I'm going to show up at the pick a
1:31
Speaker 1: ball courts in maybe about a half an hour, so
1:33
Speaker 1: let's see what happens.
1:34
Speaker 3: All right. I'll say a prayer for you, because everybody
1:37
Speaker 3: that I know, except for one or two people, has
1:40
Speaker 3: sustained fairly significant injuries from a very low impact, low
1:46
Speaker 3: effort sport with jarring lateral movements, studden stops running backwards
1:53
Speaker 3: like I don't know how you do it?
1:55
Speaker 1: Oh hey yeah, I'm so Just to digress for a second,
1:58
Speaker 1: I had preci gift significant concussion from doing a Frankenstein
2:02
Speaker 1: walk backwards and soup pine on my head, and then
2:08
Speaker 1: I popped a calf muscle and now I'm nursing a
2:12
Speaker 1: broken tendon in my foot as well as of displaced bones. Well,
2:18
Speaker 1: pick a bowl is very safe. I suggest everybody do it.
2:22
Speaker 4: Just put a hell out.
2:23
Speaker 3: I think it's about as safe as the bright Line train,
2:27
Speaker 3: you know. Just talking a little Florida biz. I wrote
2:29
Speaker 3: an article about this, The bright Line is unsafe at
2:32
Speaker 3: any speed. We thought there were only one hundred twenty
2:36
Speaker 3: six deaths bright Line related since twenty seventeen, but the
2:41
Speaker 3: Miami Herald just came out with an expose. It's actually
2:44
Speaker 3: one hundred and eighty six deaths. So they've been covering
2:48
Speaker 3: it up. But I'm not so much worried about the
2:51
Speaker 3: carnage on the tracks in Florida. I'm worried about the
2:54
Speaker 3: carnage and the tracks coming out of Wall and Broad Street, right.
3:00
Speaker 1: Yeah, and the echoes building at the at the Federal Reserve.
3:04
Speaker 3: Yeah, So what's what's going on here with the Federal Reserve.
3:07
Speaker 3: It seems like they got some pretty luxurious digs there.
3:11
Speaker 3: Central banking is good business, isn't it.
3:14
Speaker 1: I find myself in a very peculiar position. I'm kind
3:17
Speaker 1: of in defending Jerome Powell, which I never thought I
3:20
Speaker 1: would do in my in my life, you know, Kerry,
3:23
Speaker 1: For the life of me, I don't understand what the administration,
3:27
Speaker 1: who I support, is thinking when they say they want
3:30
Speaker 1: to fire Powell and cut interest rates to one percent.
3:33
Speaker 1: Now the curve the funds rate is for four and
3:35
Speaker 1: a quarter to four and a half, so it's just
3:36
Speaker 1: swing up. We're talking about one percent, which is an
3:39
Speaker 1: over you know, a three hundred and twenty five basis
3:41
Speaker 1: point rate cut immediately.
3:43
Speaker 3: Yeah, I guess.
3:44
Speaker 1: I guess inflation that has wiped out the middle class
3:47
Speaker 1: isn't good enough when you have sixty percent of Americans
3:50
Speaker 1: that have a networth of one thousand dollars or less.
3:55
Speaker 4: Sixty big zero? What are we doing here?
3:58
Speaker 1: But do we want to make home prices go up
4:00
Speaker 1: even faster and make them ever expensive? I don't understand it.
4:04
Speaker 1: So on what premise would you cut interest rates? Let's
4:07
Speaker 1: see the unemployment rate is is? I think it's four
4:09
Speaker 1: point one or four point two percent is historically very
4:13
Speaker 1: very very low. The stock market is that an all
4:16
Speaker 1: time record high valuation. Home price to income ratios are
4:19
Speaker 1: an all time high. Credits reds are extremely tight, Financial
4:23
Speaker 1: conditions are extremely loose. We're not in a recession. GDP
4:28
Speaker 1: growth for this quarter is supposed to be about a
4:30
Speaker 1: little bit over two percent, and inflation is inflation carry
4:36
Speaker 1: has been above the Fed's asinine two percent target for
4:41
Speaker 1: fifty months. Right now, If I just told you, what
4:47
Speaker 1: if you just heard that, if you came from Mars
4:49
Speaker 1: and said, you know, I understand the federal reserves shorter
4:53
Speaker 1: is to maintain you know, a level prices, you know,
4:57
Speaker 1: stable prices. And I just told you all those things
5:01
Speaker 1: and you and I also said that the Fed has
5:03
Speaker 1: missed its target to the north, it's two percent target
5:07
Speaker 1: to the north for fifty months, and that target is
5:09
Speaker 1: moving further away.
5:10
Speaker 4: In other words, the.
5:11
Speaker 1: Inflation rate is moving further away from the target two.
5:15
Speaker 1: What do you think the conversation would be. It wouldn't
5:18
Speaker 1: be when are you going to cut rates? It shouldn't
5:22
Speaker 1: certainly shouldn't be when you're going to lower rates to
5:24
Speaker 1: one percent. It's gonna be when you're going to raise
5:26
Speaker 1: interest rates.
5:27
Speaker 3: Yeah. Well, and really historically, going back, you know, as
5:34
Speaker 3: far back as you can go, really, the rates are
5:38
Speaker 3: not out of line. They're kind of normalized. Now, if
5:42
Speaker 3: we need zero percent interest to keep this economy going,
5:47
Speaker 3: then we've got a real problem here, don't we.
5:50
Speaker 4: No, we not.
5:51
Speaker 1: If we have a real problem. We have a tremendous
5:54
Speaker 1: credit bubble.
5:56
Speaker 5: We have an an unbelievable equity bubble two hundred Well,
6:04
Speaker 5: the total market cap of equities is now two hundred
6:06
Speaker 5: and twelve percent.
6:07
Speaker 1: Of GDP, so it's more than double the size of
6:11
Speaker 1: the entire US economy. Now, the normal relationship there's around
6:15
Speaker 1: ninety to one hundred percent. That's just normal. So that
6:19
Speaker 1: means stock prices could drop fifty percent and still be
6:21
Speaker 1: above valuation historical valuations. That's how that's how crazy. And
6:26
Speaker 1: then you also have you know, the cape ratio, which
6:30
Speaker 1: is that I think it's at almost twenty seven or
6:34
Speaker 1: thirty seven, I forgot where it was anyway, it's astronomically high.
6:39
Speaker 1: It's historically speaking, prices, deals ratio is three. Risk premiums
6:46
Speaker 1: are negative in the risk premium the inverse of the
6:50
Speaker 1: pe ratio, right, Sure, get your earnings yield, and the
6:54
Speaker 1: earnings yield is less than what you can earn in
6:56
Speaker 1: a T bill. This is all highly unusual record low
7:00
Speaker 1: dividend yields. So the stock market's in an epic bubble.
7:04
Speaker 1: Home prices are the most expensive they've ever been in history,
7:08
Speaker 1: even relate in relation to incomes. And we have a
7:11
Speaker 1: massive credit bubble when there's like, you know, trillions of
7:14
Speaker 1: dollars of things like private credit, which hardly ever existed before,
7:19
Speaker 1: I mean, in the previous decades. Now there's a whole
7:21
Speaker 1: cottage industry of businesses that can't get loans from a
7:25
Speaker 1: bank or float corporate paper, so they get loans from
7:28
Speaker 1: you know, the shadow banking system. Yeah, that's a huge
7:32
Speaker 1: problem these that's a huge when we have when not
7:35
Speaker 1: the not if, when we have a recession, because the
7:38
Speaker 1: the the business cycle hasn't been repealed.
7:42
Speaker 4: When we have the next versus.
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Speaker 1: When we have the next credit crisis or recession, this
7:48
Speaker 1: is when reality is going to hit. So it's not if,
7:50
Speaker 1: it's when I have a timing model that lets me
7:53
Speaker 1: know when to get out.
7:55
Speaker 4: I'm been, I've been you.
7:56
Speaker 1: Know in a you know, I have a long short strategy,
7:59
Speaker 1: so mostly long, sometimes short. The past few years mostly
8:03
Speaker 1: went out long, but holding our nose because we know
8:06
Speaker 1: that if you're gonna be one of those people, one
8:08
Speaker 1: of those automatic buy and hold dollar course to averaging
8:13
Speaker 1: funding their four to one k in as target date fund,
8:17
Speaker 1: and you're gonna be down thirty five percent in a
8:19
Speaker 1: few weeks time, not a few weeks from now, but
8:22
Speaker 1: in a few weeks, a truncated period of time, when
8:25
Speaker 1: the when the poop hits the bed, we're gonna be
8:28
Speaker 1: down thirty percent in a very quick period of time.
8:32
Speaker 1: And then you're gonna panic and call your administrator for
8:35
Speaker 1: your four to one K plant and say move my
8:37
Speaker 1: plan into cash. And that's what market goes down fifty
8:41
Speaker 1: to sixty seventy percent.
8:43
Speaker 3: But haven't people been programmed to not behave that way?
8:46
Speaker 1: They have been inculcated through the decades to just buy
8:50
Speaker 1: and hold. But Carrie uh, stock ownership among Americans has
8:55
Speaker 1: never been higher, and the stocked ownership is concentrated mostly
8:59
Speaker 1: in people who.
9:00
Speaker 4: Are my age or older.
9:03
Speaker 1: So you went around in their fifties, like fifties, early sixties,
9:08
Speaker 1: or in their retirement ages. Not not not in the
9:11
Speaker 1: twenty year old, not in the mean stock people. It's
9:14
Speaker 1: our age, yes, approaching retirement or in retirement, Kerry. When
9:19
Speaker 1: they're down thirty five percent in their portfolio, I don't
9:23
Speaker 1: know the exact number, but it's probably around. That's my
9:25
Speaker 1: guest to mint. They're gonna exist because they cannot see.
9:29
Speaker 1: Then it becomes what you just said, it's a it's
9:31
Speaker 1: an existential crisis. I am not going to be their
9:34
Speaker 1: wife is going to tell them from probably being a
9:37
Speaker 1: little sexist here, But if you're a man, your wife's
9:41
Speaker 1: going to tell you, Hey, I'm not canceling my trip
9:44
Speaker 1: to Europe and I'm not selling my my lake house.
9:49
Speaker 4: You can sell.
9:49
Speaker 1: You're gonna sell, and you're gonna sell now and will
9:52
Speaker 1: wait for it to settle down. That is going to happen,
9:56
Speaker 1: and that is gonna be synergistic. It's going to be
9:58
Speaker 1: a death spiral in my opinion. It's just it's just
10:01
Speaker 1: a matter of mean reversion. If you believe in nature,
10:04
Speaker 1: heats vacuums, this is a mean Listen, this is one
10:07
Speaker 1: or two things are gonna happen mathematically certain, Either stought
10:12
Speaker 1: preceres are gonna crash. So the ratio that you know
10:17
Speaker 1: they're not the enumerator matches the denominator, or they're going
10:20
Speaker 1: to stay where they are for a decade not could
10:22
Speaker 1: not do anything until the denominator catches up. Now, the
10:27
Speaker 1: latter scenario never happens in history. It just never has
10:30
Speaker 1: happened before. Bubbles burst. They don't just stay bubblicious for
10:35
Speaker 1: a decade.
10:36
Speaker 3: Wow, all right, So uh ah, so you got to
10:42
Speaker 3: think what should you be doing now because this appears,
10:46
Speaker 3: from what you're saying here, Michael, to be inevitable.
10:50
Speaker 4: Well, you better.
10:51
Speaker 1: First of all, if you're you're in one of those
10:54
Speaker 1: buy and hold dollar cost averaging rubrics, you've got to
10:57
Speaker 1: get the hell out of there as fast as possible.
10:59
Speaker 4: You got to put yourself in.
11:00
Speaker 1: An active money managuer. It doesn't have to be me.
11:03
Speaker 1: I mean, I'm I mean, let me speak altruistically. Find
11:07
Speaker 1: somebody else besides me. I have plenty of money, and
11:09
Speaker 1: I have plenty of money under management. I don't care.
11:11
Speaker 4: But find yourself a robust a robust.
11:15
Speaker 1: Model that is in the purview of a very honest
11:18
Speaker 1: and experienced money manager.
11:20
Speaker 4: Does not have to be me.
11:21
Speaker 1: But do it for your own retirement sake.
11:24
Speaker 3: You need to do it all right, sir.
11:27
Speaker 4: You've worked your.
11:28
Speaker 1: Entire life to get where you are. Realize where you are.
11:34
Speaker 1: Realize the triumvirate of bubbles that we have, unprecedented in history,
11:39
Speaker 1: all three of them. Yeah, and be a historian. See
11:43
Speaker 1: what has happened, not only in the United States but
11:45
Speaker 1: around the world. What happens to asset prices when they
11:50
Speaker 1: get this this elevated and the inculcation the mindset is overwhelming.
11:55
Speaker 1: Where you know, you have to now convince people that
11:59
Speaker 1: there is such thing is a business cycle. You have
12:01
Speaker 1: to convince people that the Fed and the Treasury and
12:05
Speaker 1: the administration can't always bail you out. And you know,
12:11
Speaker 1: in the past, Carrie, what is it. What does the
12:14
Speaker 1: Treasury and particularly the FED have done. They've always solved
12:19
Speaker 1: the problem every hiccup in the stock market or a
12:21
Speaker 1: steed speed Buk economy. They just lower interest rates and
12:25
Speaker 1: print money. Carry Do it again, do it one more time,
12:29
Speaker 1: and see what happens to inflation if they actually start cutting,
12:32
Speaker 1: if they ever stop, If they started cutting interest rates
12:35
Speaker 1: now to desert QE helicopters money, I think it would
12:41
Speaker 1: be an absolute disaster. It already is a disaster for
12:43
Speaker 1: this country. When you have when you have over sixty
12:47
Speaker 1: percent of the population with really no or negative net worth,
12:53
Speaker 1: you can't have a viable nation. So try try now
12:58
Speaker 1: pursuing a policy that bails out Street and screws Main Street.
13:02
Speaker 3: See what happens. It ain't gonna be pretty, is it? No?
13:07
Speaker 3: So gold, silver, It appears certainly for silver we're on
13:12
Speaker 3: the verge of a major breakout and things are not
13:16
Speaker 3: looking good for those silver shorts, are they.
13:19
Speaker 1: No. Now, I've I've I have, so I took a
13:24
Speaker 1: nice position in platinum several months ago, bit.
13:28
Speaker 4: More gold for a very long time too.
13:30
Speaker 1: So my proxy for the the bit so the precious
13:34
Speaker 1: metal is proxies that I use are gold and platinum,
13:38
Speaker 1: but silver too is you I'm not going to argue
13:40
Speaker 1: against silver, but you should. You have to get your
13:43
Speaker 1: your hands on some of this. And there's a there's
13:46
Speaker 1: a bull market happening in platinum. You know, for decades
13:49
Speaker 1: and decades on end, platinum was more expensive than gold.
13:53
Speaker 4: It's a it's.
13:54
Speaker 1: A rarer, more more rare metal, it's a more precious metal.
13:59
Speaker 1: It has some industrial components to it as well, and
14:02
Speaker 1: that flip that has flipped. So I would not only
14:05
Speaker 1: own gold, I would definitely own some platinum here because
14:08
Speaker 1: there's only one thing that's going to happen. There's only
14:11
Speaker 1: one thing that I could be assured to occur, and
14:14
Speaker 1: that stackflation like we've never before imagined. We're going to
14:17
Speaker 1: have another recession. Business cycle hasn't been repealed. We're going
14:21
Speaker 1: to have a credit crisis. The playbook is going to
14:23
Speaker 1: be deployed because it's worked all that every time in
14:25
Speaker 1: the past. What's the Pavlovian response from the Fed and
14:28
Speaker 1: Treasury borrow print spend or it was automatic stabilizers that
14:33
Speaker 1: kick in are going to send a deficit not to
14:35
Speaker 1: you know, the deficit was two hundred billion in prior
14:38
Speaker 1: to the global financial crisis. Then it went to you know,
14:41
Speaker 1: the trillion trillion now it's now it's two trillion. In
14:45
Speaker 1: the party times man, in the good times with full
14:48
Speaker 1: employment and record a stock market, it's two trillion. So
14:53
Speaker 1: when the automatic stabilizers kick in, the unemployment benefits kick in,
14:58
Speaker 1: this deficit is going to go between from from two
15:01
Speaker 1: to four to six trillion per ADAM.
15:05
Speaker 4: So that means when four.
15:07
Speaker 1: To six trillion, where's six trillion dollar annual deficit, and
15:12
Speaker 1: and that means the money is going to go directly
15:15
Speaker 1: to the people. It's not gonna be like it wasn't
15:17
Speaker 1: the global financial crisis where you just bail out Wall
15:19
Speaker 1: Street by taking the banks got their assets bailed out
15:24
Speaker 1: from the Fed. Now this is going to go right
15:26
Speaker 1: into the hands of the pockets of the people through
15:30
Speaker 1: these through the unemployment insurance that they're gonna get right
15:34
Speaker 1: and through the subsidies that they're gonna get from from
15:36
Speaker 1: the Fed, and the helicopter money coming from the Treasury.
15:40
Speaker 1: So we're going to have inflation, not the way they
15:42
Speaker 1: measure it. Stop at nine, it's going to go to nineteen. Yeah,
15:46
Speaker 1: and that's you know, if you that's what you have
15:49
Speaker 1: to be prepared for, because if you're saying to yourself,
15:52
Speaker 1: you know, I think I'm gonna I think I'm going
15:54
Speaker 1: to retire, and five percent on a thirty year treasury
15:58
Speaker 1: bond sounds pretty pretty good because the first is only three.
16:03
Speaker 4: You know, that's wonderful.
16:06
Speaker 1: Uh, tell me how you feel about earning five percent
16:09
Speaker 1: when inflation is nineteen.
16:12
Speaker 3: So that's a that's an existential problem in and of itself, right.
16:17
Speaker 1: Garry inflation core inflation rose to two point nine percent
16:23
Speaker 1: year over year, Co wrote, I mean, then the morons
16:27
Speaker 1: that speak on mainstream financial media when the when the
16:32
Speaker 1: inflation report came out, they're.
16:33
Speaker 4: Like better than expected because.
16:36
Speaker 1: The month over month was a little bit better the core.
16:39
Speaker 1: But here the core rate of inflation increased. At the
16:43
Speaker 1: end of the form reading was two point seven or
16:46
Speaker 1: two point six, it jumped to two point nine core
16:49
Speaker 1: inflation year over year. That's that is that is a
16:53
Speaker 1: disastrous conversation to have him. Inflation on the core level
16:58
Speaker 1: is spiking, and I want to have a scenario where
17:00
Speaker 1: I'm firing the central bank so I can put a
17:03
Speaker 1: what I would call it an obsequious sicko fan, a
17:07
Speaker 1: puppet of the president, to put rates at one percent.
17:12
Speaker 3: Yeah, what could possibly get wrong here?
17:14
Speaker 1: What happened to that stuff? What would happened to the
17:16
Speaker 1: housing market? Let me hear here's the scenario. The scenario
17:19
Speaker 1: scenario is this some so April April two thousand or
17:23
Speaker 1: May twenty twenty six comes, Powell is shoved out the door,
17:27
Speaker 1: an obsequious sick ephan, a puppet of the president, comes in.
17:30
Speaker 1: He cuts rates to one percent. And what what happens
17:33
Speaker 1: when the long end of the bond market interest rates
17:37
Speaker 1: go ballistic? I mean, if that can control the overnight
17:41
Speaker 1: interbank lending rate, and the money markets will will trade
17:44
Speaker 1: in sympathy with that. But let's say, unless they assent
17:47
Speaker 1: to buy every single treasury bond issued, like the Bank
17:49
Speaker 1: of Japan does, we're gonna have a huge problem with
17:53
Speaker 1: the interest rates. And if they do buy everything, we're
17:56
Speaker 1: gonna have a bigger problem with inflation.
17:59
Speaker 3: M h yeah, it sounds like we got problems on
18:03
Speaker 3: the way here. Huh.
18:05
Speaker 4: Well, I mean, listen, what.
18:09
Speaker 1: When you when you abrogate free markets, when you say,
18:11
Speaker 1: you know, the free market doesn't have to function. We
18:13
Speaker 1: could just nineteen eighty seven, just print some money, Greenspan says,
18:17
Speaker 1: we'll just print some money. We have, we have a tool,
18:20
Speaker 1: we have a technology. We don't need to Why would
18:23
Speaker 1: we Why would we make money peg to something like gold?
18:28
Speaker 4: Why would we do that?
18:29
Speaker 1: Well, because mine supply of gold is limited, and you
18:33
Speaker 1: have something real and tangible that's backing your currency. But
18:37
Speaker 1: then they came up with the idea we could just
18:39
Speaker 1: we could just live in faeryland. We could just back
18:44
Speaker 1: our currency with nothing. We'll back it with the taxing
18:47
Speaker 1: authority of the US Treasury and the American military complex.
18:51
Speaker 4: That's what will.
18:53
Speaker 1: Yeah, and then the dollars, you know, crashes. You know,
18:56
Speaker 1: go look at what the dollar has done since nineteen thirteen.
19:00
Speaker 1: It's purchasing power. And then those people have the nerve
19:03
Speaker 1: to tell you that they're they're they're they're in charge
19:06
Speaker 1: of protecting the purchasing power of the of the currency.
19:11
Speaker 1: That's a comedy routine, Kerry, it's a joke.
19:14
Speaker 3: Yeah, that is a comedy routine. And you know it's
19:19
Speaker 3: that old uh, that old saying. Will Rogers said, every
19:23
Speaker 3: time Congress makes a joke, it becomes a law, and
19:26
Speaker 3: every time they make a law, it's a joke.
19:29
Speaker 1: Right Gary, Let me just I have I had this
19:33
Speaker 1: written down. I want to make sure when I talk
19:35
Speaker 1: about credit bubbles, total non financial US debt as a
19:39
Speaker 1: percentage of GDP is higher today than at the start
19:43
Speaker 1: of the global financial crisis and the start of the
19:46
Speaker 1: Nasdaq crash in two thousand. So current ratio is two
19:50
Speaker 1: one hundred and fifty seven percent of GDP total non
19:55
Speaker 1: financial debt. In two thousand and seven, before the stocks
19:59
Speaker 1: lost fifty percent of their value, the S and B,
20:01
Speaker 1: it was two hundred and thirty four percent. And in
20:05
Speaker 1: two thousand that great recession where the NASDAK lost eight
20:08
Speaker 1: percent of its value, it was one hundred and eighty
20:10
Speaker 1: nine percent. And the current ratio is two hundred and
20:13
Speaker 1: fifty seven percent. That's your credit bubble. That's your credit bubble.
20:20
Speaker 4: Man.
20:21
Speaker 3: So there's no way out of this.
20:24
Speaker 1: There isn't any easy way out of it. I mean,
20:26
Speaker 1: they're gonna try to hyperinflate their way out of it.
20:28
Speaker 1: But since we haven't adjustable rate mortgage as a as
20:30
Speaker 1: A as our you know, everybody said, hey, Janet Yellen,
20:35
Speaker 1: why don't you know when interest rates were like aero
20:37
Speaker 1: point three on the ten year note, why don't you
20:40
Speaker 1: like float some thirty year dead out there and finance
20:43
Speaker 1: it or maybe even issue a fifty year bond. I
20:45
Speaker 1: guess the wasn't any appetite for that, But at least
20:47
Speaker 1: they should have really loaded up on that lawn kerry.
20:51
Speaker 1: If they're gonna, if they're gonna, if Wall Street's gonna
20:53
Speaker 1: supply you with a ten year note that's yielding a
20:56
Speaker 1: third of one percent, wouldn't you want to lock in
20:59
Speaker 1: those that that's a pretty good rate, right right, Well,
21:02
Speaker 1: guess what they said, Now.
21:04
Speaker 6: We're just gonna do T bills. We're gonna do T
21:06
Speaker 6: bills and chill. Well that's now you have to roll
21:09
Speaker 6: over those tea bills every single year. Yeah, and that's
21:13
Speaker 6: what you have.
21:14
Speaker 1: So if if if you really want to know the
21:17
Speaker 1: truth as to why President Trump wants that interest rate
21:22
Speaker 1: artificially suppressed even further lower, is because it would really
21:25
Speaker 1: bring down the interest on the debt. Yeah, with no
21:30
Speaker 1: no negative ramifications with housing or real estate or or
21:35
Speaker 1: or the equity market.
21:39
Speaker 3: So it's that simple huh yeah. So it's it's all
21:45
Speaker 3: about rates, it's.
21:47
Speaker 1: All about interest on the debt, which is over a
21:49
Speaker 1: trillion dollars already.
21:50
Speaker 3: Yeah, gotcha.
21:52
Speaker 4: Do you see how? You see how well doge work?
21:54
Speaker 3: Right?
21:54
Speaker 1: The Doge roared into town and they really slashed the
21:57
Speaker 1: government slashed everything down. I mean, we're all we're good now, right.
22:01
Speaker 1: I think they decided to cut one hundred and sixty
22:04
Speaker 1: billion dollars.
22:05
Speaker 3: Yeah, for I was still cutting in theory.
22:08
Speaker 4: Yeah, I don't know what they cut.
22:10
Speaker 1: Well, those have been run out of town faster than
22:12
Speaker 1: the shave has been run out of town. And they
22:15
Speaker 1: should be cutting a trillion dollars per We need to
22:17
Speaker 1: cut a trillion dollars per andum to get to that
22:19
Speaker 1: magical Scott Besson you know, three percent. But guess what,
22:23
Speaker 1: we decided to cut one hundred and sixty billion. So
22:25
Speaker 1: we're a little bit short, just about eight hundred and
22:28
Speaker 1: forty billion a year.
22:29
Speaker 3: Just a little, just a little all right? So what
22:34
Speaker 3: about bitcoin here?
22:37
Speaker 1: Well here, well, you you know you opened the Pandora's
22:41
Speaker 1: box here when you talk about Hey, bitcoin, I actually
22:45
Speaker 1: liked as as a concept. I hated the I hate
22:50
Speaker 1: I didn't buy any of it unfortunately, so I've been
22:53
Speaker 1: wrong about the direction of this thing. But the concept
22:56
Speaker 1: of the bitcoin originally, or cryptocurrencies in general, was, Hey,
23:00
Speaker 1: we have a decentralized currency that nobody knows who you are,
23:06
Speaker 1: and it's outside the purview of government, and it protects
23:10
Speaker 1: and it protects you against a falling US dollar. So
23:15
Speaker 1: fast forward in a few years, and of course the
23:18
Speaker 1: pimps and the hookers on Wall Street would they say, oh,
23:22
Speaker 1: we fall in love what bitcoin? We can make some
23:24
Speaker 1: money on this, on this horrified barcode, which is what
23:28
Speaker 1: it is. It's just, you know, all bitcoin is your
23:31
Speaker 1: private key is a bunch of letters and numbers. Okay,
23:33
Speaker 1: it's a it's a password that's worth one hundred and
23:37
Speaker 1: seventeen thousand dollars. But okay, let's just let's just talk
23:40
Speaker 1: about this for a second. So it goes, it goes
23:44
Speaker 1: from basically nothing to one hundred and seventeen thousand dollars
23:47
Speaker 1: per unit. But it got there because it's been bastardized
23:51
Speaker 1: by Wall Street. They've co opted and corrupted it. So
23:54
Speaker 1: now your your decentralized coin that you think you own
23:58
Speaker 1: is completely centralized. It can be taken away from you
24:01
Speaker 1: capriciously by the government because they actually know exactly who
24:05
Speaker 1: you are.
24:05
Speaker 3: Oh yeah, you know.
24:08
Speaker 1: It's Wall Street has know your customer rules and anti
24:11
Speaker 1: money laundering rules. You own an asset that's pimped by
24:16
Speaker 1: Wall Street. They know exactly who owns every single one
24:20
Speaker 1: of these bitcoins, so they can take it from you.
24:22
Speaker 1: So it's no longer it's decentralized. And then to pour
24:26
Speaker 1: icing on the cake is or gasoline on the fire,
24:28
Speaker 1: I guess would be a better analogy. They say it's
24:31
Speaker 1: it's an alternative a dollar, but now they want to
24:33
Speaker 1: link it to the US dollar into treasuries by stable coins. Right,
24:39
Speaker 1: so the whole concept of this thing has been has
24:41
Speaker 1: been obliterated, and they did this so they can pump
24:46
Speaker 1: up the stop the bitcoin price to one hundred and
24:49
Speaker 1: seventeen thousand dollars in unit. Now, two more things I
24:52
Speaker 1: want to tell you about this. Number one, it is
24:54
Speaker 1: hot gold. There's an unlimited number of cryptocurrencies that can
24:59
Speaker 1: be created. I do like the blockchain technology, Yeah, extremely useful,
25:04
Speaker 1: But to think that the blockchain technology is the same
25:07
Speaker 1: thing as a coin that relates gold is ridiculous. Yeah,
25:16
Speaker 1: so there's twenty one million bitcoins, but there's an unlimited
25:18
Speaker 1: number of other currencies that could serve the same purpose.
25:20
Speaker 1: So it's just a Commodityes are commodity and there are
25:25
Speaker 1: limitlessons in supply, unlike platinum and unlike gold.
25:29
Speaker 3: Yeah, this is true. I totally agree with you there.
25:32
Speaker 3: But I think there's something else going on with bitcoin
25:35
Speaker 3: that we're not going to know. I think there's a
25:37
Speaker 3: bitcoin short squeeze coming because you've got a huge synthetic
25:42
Speaker 3: derivatives to market there, and you've only got seven percent
25:47
Speaker 3: of all the bitcoin ever created that actually free trade,
25:51
Speaker 3: which will be substantially less because you've got ETFs. This week,
25:56
Speaker 3: two point two billion more went into bitcoin. Eat where
26:01
Speaker 3: are they getting all these bitcoin from this when they
26:03
Speaker 3: stopped making it?
26:05
Speaker 1: Yeah, completely wrong on the price, missed the entire thing.
26:09
Speaker 1: This thing much higher. But when you get an unfriendly
26:12
Speaker 1: administration in place, and you will, and an unfriendly sec
26:17
Speaker 1: and you will in the future, this thing will crash
26:19
Speaker 1: because its intrinsic value is maybe closer to one thousand
26:22
Speaker 1: dollars rather than one hundred and seventeen thousand. So just beware.
26:27
Speaker 1: I mean, it's just not something at this especially now,
26:32
Speaker 1: at this price level I'm interested in getting involved with,
26:35
Speaker 1: but hey been wrong with both.
26:37
Speaker 3: Interesting was that I was at the Bitcoin conference and
26:46
Speaker 3: it's amazing guy I know who told me to buy
26:50
Speaker 3: bitcoin at five, who's never sold one bitcoin, he is
26:54
Speaker 3: buying it at a dollar. And let's not forget Michael
26:57
Speaker 3: that if you invested ten cents in coin in twenty ten,
27:02
Speaker 3: it'd be worth one hundred and eighteen hundred nineteen thousand
27:05
Speaker 3: dollars as we're speaking. What he told me is that
27:08
Speaker 3: over half the contributions going to the Republican Party are
27:12
Speaker 3: coming from crypto bros. So that's I think, of course,
27:16
Speaker 3: say are now, Gary.
27:18
Speaker 1: You're exactly right, but you know three years from now,
27:22
Speaker 1: I don't know. Yeah, play with it now. The volatility
27:28
Speaker 1: attributes to this product are just astronomically off the charts.
27:33
Speaker 1: So it's just not something i'd like to That's why
27:35
Speaker 1: I prefer platinum to silver.
27:36
Speaker 4: I don't like that high data. Yeah, Like, can you
27:40
Speaker 4: make money in bitcoin? Yeahp hundred percent? Can you still
27:43
Speaker 4: make money? Probably? Did I miss everything? Yes?
27:46
Speaker 1: I did, But beware because you when you have something
27:51
Speaker 1: that's supposed to have its value derived from having a decentralized,
27:56
Speaker 1: anonymous immutable transaction, and you're to get the value is
28:03
Speaker 1: now derived from government.
28:08
Speaker 4: I'm the only person I've ever heard.
28:09
Speaker 1: Talk about I mean, maybe I just don't have it
28:11
Speaker 1: in my ears out there, but who have you ever
28:13
Speaker 1: heard anybody else say how absolutely absurd?
28:17
Speaker 4: This is?
28:18
Speaker 3: Oh completely but but bus that doesn't mean you can't
28:22
Speaker 3: make money on it, right undred percent?
28:24
Speaker 4: No, I maya kopa here.
28:26
Speaker 1: I'm the last person to ask about the future to
28:30
Speaker 1: make a bitcoin price, can do you know? For me
28:32
Speaker 1: to do that, it'd be it'd be completely inappropriate because
28:37
Speaker 1: I've been so wrong on the picture is interesting though,
28:42
Speaker 1: but but but caveat emptor here though, They will be
28:47
Speaker 1: hell to pay. And it's coming, and it's one day
28:51
Speaker 1: because because what bitcoin really is now has become it's
28:55
Speaker 1: just a derivative of the stock market. So it's a
28:58
Speaker 1: it's a it's a higher a derivative on equity. And
29:04
Speaker 1: if liquidity ever drives up again, not if when it happens, yeah,
29:09
Speaker 1: when it's gonna it's it's gonna be a disaster for
29:13
Speaker 1: the entire space.
29:15
Speaker 3: All right, Well, I think we'll let it go there.
29:17
Speaker 3: We got other things to talk about next time. After
29:20
Speaker 3: you've done traveling things about the worst cycle, what's happening
29:25
Speaker 3: there in Europe, the euro, the dollar, all that good stuff.
29:29
Speaker 3: But you'll find Michael's work excellent work. Sign up pentoport
29:34
Speaker 3: dot com links in the show notes, and if you
29:38
Speaker 3: got a question for Michael myself, shoot me an email
29:41
Speaker 3: k l Atcarrie LUTs dot com. Michael, we'll talk to
29:45
Speaker 3: you in a month or two. Be well. Always a pleasure, Carrie,
29:47
Speaker 3: Thank you, thanks.
29:48
Speaker 2: For listening to Carrie Letz's Financial Survival Network. Your solution
29:53
Speaker 2: to today's trying times. For the latest, go to Financial
29:57
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30:02
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