1 00:00:00,400 --> 00:00:03,800 Speaker 1: What happens when the government's debt can't be repaid, Well, 2 00:00:04,120 --> 00:00:06,840 Speaker 1: it's different than when it's your personal credit card versus, 3 00:00:06,880 --> 00:00:09,399 Speaker 1: of course, the government's debt, but it's also sort of 4 00:00:09,480 --> 00:00:12,000 Speaker 1: the same thing, meaning if the debt can't be repaid, 5 00:00:12,280 --> 00:00:14,320 Speaker 1: then there has to be some sort of an agreement, 6 00:00:14,480 --> 00:00:16,960 Speaker 1: like it's a for example, on personal debt, you might 7 00:00:17,000 --> 00:00:19,720 Speaker 1: negotiate with the lender for smaller payments spread over a 8 00:00:19,760 --> 00:00:22,919 Speaker 1: long timeframe, maybe some sort of like a debt restructuring, 9 00:00:23,000 --> 00:00:25,160 Speaker 1: or sometimes it's just like sorry, I just can't pay. 10 00:00:25,160 --> 00:00:27,760 Speaker 1: It's not great default, or sometimes it's something in between. 11 00:00:27,840 --> 00:00:30,360 Speaker 1: But what happens when you look at all the debt 12 00:00:30,600 --> 00:00:32,800 Speaker 1: and you look at the ability to pay it back 13 00:00:32,920 --> 00:00:35,519 Speaker 1: and you realize there's just no way, and you realize 14 00:00:35,640 --> 00:00:38,080 Speaker 1: it can't even be paid back. And with about thirty 15 00:00:38,120 --> 00:00:40,879 Speaker 1: four trillion dollars of debt for the US government about 16 00:00:40,920 --> 00:00:43,800 Speaker 1: three hundred trillion dollars a debt for governments around the world, 17 00:00:44,080 --> 00:00:46,599 Speaker 1: that's the realization that many are starting to have. So 18 00:00:46,640 --> 00:00:48,320 Speaker 1: in this video, I'm going to go over how the 19 00:00:48,440 --> 00:00:51,360 Speaker 1: US got into this debt mess, the speed at which 20 00:00:51,360 --> 00:00:54,120 Speaker 1: it's growing, what the government projects it to get to 21 00:00:54,560 --> 00:00:57,720 Speaker 1: and the only four ways out of this mess. Now, 22 00:00:57,760 --> 00:00:59,480 Speaker 1: for those of you that don't know me, my name 23 00:00:59,520 --> 00:01:01,440 Speaker 1: is Mark mas. I've been an entrepreneur for over twenty 24 00:01:01,480 --> 00:01:04,759 Speaker 1: five years. I've invested and made millions in tech, real estate, bitcoin, 25 00:01:04,880 --> 00:01:07,040 Speaker 1: and a whole range of other sectors. Over the years. 26 00:01:07,200 --> 00:01:09,440 Speaker 1: I speak at some of the largest financial conferences in 27 00:01:09,480 --> 00:01:12,120 Speaker 1: the world, but through this channel, I've been able to 28 00:01:12,160 --> 00:01:14,600 Speaker 1: reach more people than I ever could in any of 29 00:01:14,600 --> 00:01:16,800 Speaker 1: those rooms, and I'm thrilled. And on this channel we 30 00:01:16,840 --> 00:01:19,640 Speaker 1: just hit five hundred thousand subscribers. So if you're new here, 31 00:01:20,120 --> 00:01:22,800 Speaker 1: click that subscribe button and let's just get into the video. 32 00:01:24,680 --> 00:01:27,080 Speaker 1: All right, So talking about the debt that can never 33 00:01:27,120 --> 00:01:29,000 Speaker 1: be paid back, the first thing is we have to 34 00:01:29,080 --> 00:01:32,600 Speaker 1: understand first of all, what is the debt and how 35 00:01:32,640 --> 00:01:34,760 Speaker 1: does it get paid back. Then we'll get into like 36 00:01:34,880 --> 00:01:36,520 Speaker 1: what does that mean for our portfolios and all that, 37 00:01:36,560 --> 00:01:39,119 Speaker 1: But first thing, let's just talk about the debt and 38 00:01:39,200 --> 00:01:40,720 Speaker 1: how do we pay it back. So the first thing 39 00:01:40,840 --> 00:01:43,360 Speaker 1: is if we want to understand the debt, let's first 40 00:01:43,440 --> 00:01:45,679 Speaker 1: understand the ability to pay it back. And we want 41 00:01:45,680 --> 00:01:47,520 Speaker 1: to look at the money supply. Now this is the 42 00:01:47,600 --> 00:01:49,960 Speaker 1: United States. We'll look at the global money supply as well. 43 00:01:50,000 --> 00:01:53,200 Speaker 1: But if I borrow money, if I have debt, I 44 00:01:53,280 --> 00:01:55,720 Speaker 1: have to pay it back with money, right, So the 45 00:01:55,720 --> 00:01:57,080 Speaker 1: first thing is let's take a look at the money. 46 00:01:57,160 --> 00:01:59,919 Speaker 1: So what we see here is the FED, the Central 47 00:02:00,040 --> 00:02:02,240 Speaker 1: Bank of the United States, the Federal Reserve, and the 48 00:02:02,240 --> 00:02:03,840 Speaker 1: money supply. And what you can see I put some 49 00:02:03,880 --> 00:02:06,240 Speaker 1: trend lines here. It had been going at this trend 50 00:02:06,320 --> 00:02:09,280 Speaker 1: right here, at this even pace. Then it started it 51 00:02:09,360 --> 00:02:11,280 Speaker 1: sort of picked up to the next trend line, and 52 00:02:11,320 --> 00:02:14,240 Speaker 1: then it started getting steeper, and then it started getting steeper, 53 00:02:14,280 --> 00:02:17,760 Speaker 1: and now the money supply is growing at this insane 54 00:02:18,000 --> 00:02:21,480 Speaker 1: alarming rate right almost going parabolic. You can see that 55 00:02:21,600 --> 00:02:25,920 Speaker 1: right here. However, as parabolical as that is, that's about 56 00:02:25,960 --> 00:02:29,160 Speaker 1: twenty trillion dollars, which it sounds like a lot, but 57 00:02:29,240 --> 00:02:32,000 Speaker 1: not in comparison to the debt. So that's what we're 58 00:02:32,000 --> 00:02:34,679 Speaker 1: looking at. Now. If I take out debt in US dollars, 59 00:02:34,919 --> 00:02:36,560 Speaker 1: what do we have to pay the debt back with 60 00:02:36,960 --> 00:02:40,880 Speaker 1: US dollars? So we have about twenty trillion of US dollars. Okay, 61 00:02:40,919 --> 00:02:43,240 Speaker 1: Now this is the debt clock, and this kind of 62 00:02:43,320 --> 00:02:45,440 Speaker 1: keeps track of how the debt's been going up. You 63 00:02:45,480 --> 00:02:47,680 Speaker 1: might have seen this before. There's a whole lot of 64 00:02:47,760 --> 00:02:49,360 Speaker 1: data on here. I'm not going to go through all 65 00:02:49,400 --> 00:02:50,480 Speaker 1: of that, but the main thing I want to look 66 00:02:50,520 --> 00:02:52,520 Speaker 1: at right here is this. You can see this in 67 00:02:52,560 --> 00:02:55,480 Speaker 1: real time, like ticking higher, higher, higher, or over thirty 68 00:02:55,520 --> 00:02:59,360 Speaker 1: four almost thirty five trillion dollars in debt. So right 69 00:02:59,400 --> 00:03:02,880 Speaker 1: off the bat, like we owe thirty five trillion dollars, 70 00:03:02,880 --> 00:03:05,960 Speaker 1: but we only have twenty trillion dollars to pay it back. 71 00:03:06,400 --> 00:03:08,880 Speaker 1: That sounds like a problem, and you would be right, 72 00:03:09,000 --> 00:03:11,600 Speaker 1: it certainly is. Now if we look at the government debt, 73 00:03:11,639 --> 00:03:13,800 Speaker 1: we looked at the money supply is growing, we can 74 00:03:13,840 --> 00:03:16,480 Speaker 1: also look very similar and the debt. The debt had 75 00:03:16,480 --> 00:03:20,520 Speaker 1: been on this trend line barely even moving forever, and 76 00:03:20,560 --> 00:03:23,560 Speaker 1: then the debt started going higher, and then the debt 77 00:03:23,560 --> 00:03:26,280 Speaker 1: started going higher. Look at these trend lines changing, and 78 00:03:26,360 --> 00:03:29,239 Speaker 1: now the debt is almost going straight up. As a 79 00:03:29,320 --> 00:03:31,720 Speaker 1: matter of fact, we're adding about the United States adding 80 00:03:31,760 --> 00:03:36,120 Speaker 1: about one trillion dollars every quarter every ninety days. To 81 00:03:36,120 --> 00:03:39,080 Speaker 1: put this into perspective, the US government added about a 82 00:03:39,120 --> 00:03:42,120 Speaker 1: trillion dollars from the inception of the country all the 83 00:03:42,120 --> 00:03:44,040 Speaker 1: way to like the eighties and now we're doing that 84 00:03:44,360 --> 00:03:48,480 Speaker 1: every single quarter. Now, this is government debt again, this 85 00:03:48,600 --> 00:03:51,680 Speaker 1: is government debt, thirty five trillion dollars. But then we 86 00:03:51,720 --> 00:03:54,800 Speaker 1: also have all the people, me and you, all the 87 00:03:54,800 --> 00:03:57,880 Speaker 1: individuals that owe debt as well. And we can see 88 00:03:57,880 --> 00:03:59,720 Speaker 1: this is what we call household debt, not public debt, 89 00:03:59,720 --> 00:04:03,040 Speaker 1: but househ debt. And we're at about almost eighteen trillion 90 00:04:03,080 --> 00:04:08,240 Speaker 1: dollars there, thirty five trillion plus eighteen trillion, and we 91 00:04:08,280 --> 00:04:11,280 Speaker 1: only have twenty trillion dollars of all the money to 92 00:04:11,320 --> 00:04:13,400 Speaker 1: pay it back. It sounds like a problem, and it is, 93 00:04:13,440 --> 00:04:16,600 Speaker 1: but it even gets worse because that's just the United States. 94 00:04:16,640 --> 00:04:19,080 Speaker 1: But of course there's a whole world out there. So 95 00:04:19,080 --> 00:04:21,320 Speaker 1: if we look at the whole world, what we see 96 00:04:21,440 --> 00:04:26,560 Speaker 1: is that the entire global debt is three hundred trillion. 97 00:04:26,680 --> 00:04:28,360 Speaker 1: As a matter of fact, it's even higher than that. 98 00:04:28,760 --> 00:04:32,520 Speaker 1: So over three hundred trillion dollars in debt. But do 99 00:04:32,560 --> 00:04:34,400 Speaker 1: we have enough money to pay it back? Now, if 100 00:04:34,440 --> 00:04:37,640 Speaker 1: we look globally, there's a problem. Part of the problem 101 00:04:37,720 --> 00:04:40,880 Speaker 1: is that how much money is there even in the world, 102 00:04:41,000 --> 00:04:43,760 Speaker 1: And that's a question that we really can't even answer. 103 00:04:44,080 --> 00:04:45,880 Speaker 1: But we can get a couple of measurements and take 104 00:04:45,880 --> 00:04:47,520 Speaker 1: a look at it, and we can see that it's 105 00:04:48,440 --> 00:04:51,400 Speaker 1: difficult to give a specific answer, so we'll see different 106 00:04:51,440 --> 00:04:53,560 Speaker 1: numbers if you look at it. We'll take the high number. 107 00:04:54,040 --> 00:04:56,080 Speaker 1: We can see that the value of notes and coins 108 00:04:56,120 --> 00:04:58,679 Speaker 1: in circulation, so the money that we have is about 109 00:04:58,680 --> 00:05:02,600 Speaker 1: eight point two trillion. That's just the dollar bills, the coins, 110 00:05:02,640 --> 00:05:06,520 Speaker 1: et cetera. Eight point two trillion across twenty major countries 111 00:05:06,640 --> 00:05:10,040 Speaker 1: plus the Euro Area, so not just the United States, 112 00:05:10,080 --> 00:05:14,160 Speaker 1: but globally. That's about the money supply. Now we can 113 00:05:14,200 --> 00:05:15,760 Speaker 1: go a little bit higher. Like I said, let's go 114 00:05:15,800 --> 00:05:17,240 Speaker 1: on the high ends. We can get the benefit of 115 00:05:17,279 --> 00:05:20,040 Speaker 1: the doubt. Here. We can see the global M one supply, 116 00:05:20,160 --> 00:05:22,159 Speaker 1: not just US dollars, but the global IN one supply, 117 00:05:22,360 --> 00:05:27,160 Speaker 1: which includes all the money in circulation plus travelers checks 118 00:05:27,520 --> 00:05:31,320 Speaker 1: plus deposits like checking and savings accounts, was about forty 119 00:05:31,360 --> 00:05:34,840 Speaker 1: eight trillion, So let's call it fifty trillion dollars against 120 00:05:34,880 --> 00:05:37,200 Speaker 1: remember three hundred trillion debt. But if we want to 121 00:05:37,240 --> 00:05:39,040 Speaker 1: go even higher, we could say that the M two 122 00:05:39,160 --> 00:05:42,480 Speaker 1: supply is about eighty two trillion. Let's take that number, 123 00:05:42,720 --> 00:05:46,080 Speaker 1: so we have about eighty two trillion dollars. Some estimates 124 00:05:46,080 --> 00:05:48,719 Speaker 1: are maybe even as high as one hundred trillion. Whatever, 125 00:05:49,120 --> 00:05:52,200 Speaker 1: we have one hundred trillion dollars in money to pay 126 00:05:52,360 --> 00:05:56,080 Speaker 1: back three hundred trillion dollars in debt, and you start 127 00:05:56,120 --> 00:05:58,919 Speaker 1: to understand the magnitude of the problem that we have. 128 00:05:59,040 --> 00:06:01,560 Speaker 1: Here's a graphical four format so you can understand a 129 00:06:01,560 --> 00:06:04,520 Speaker 1: little bit better. This giant section of the pie chart 130 00:06:04,600 --> 00:06:09,000 Speaker 1: right here, that's the global debt, and this little sliver 131 00:06:09,120 --> 00:06:11,840 Speaker 1: area right here that's the amount of money that we have. 132 00:06:12,440 --> 00:06:14,680 Speaker 1: So we don't have near enough money to pay off 133 00:06:14,760 --> 00:06:16,880 Speaker 1: near the debt. So that's the problem. So how does 134 00:06:16,920 --> 00:06:19,160 Speaker 1: that get paid back? We're going to dig into that. 135 00:06:19,400 --> 00:06:21,880 Speaker 1: So the first before we get into how does that 136 00:06:21,920 --> 00:06:24,440 Speaker 1: get paid back? And what does all this mean? First 137 00:06:24,560 --> 00:06:27,080 Speaker 1: we have to kind of project, well, how much more 138 00:06:27,160 --> 00:06:29,360 Speaker 1: will the debt even grow? And of course we can 139 00:06:29,440 --> 00:06:31,800 Speaker 1: just look right at the government for these answers. The 140 00:06:31,839 --> 00:06:34,120 Speaker 1: first thing you have to understand is that we are 141 00:06:34,120 --> 00:06:36,640 Speaker 1: in a debt based monetary system. So you know, we 142 00:06:36,720 --> 00:06:38,560 Speaker 1: talk about the Federal Reserve and the printer go burgh 143 00:06:38,600 --> 00:06:40,480 Speaker 1: those types of things, which is a funny meme, it's 144 00:06:40,520 --> 00:06:43,520 Speaker 1: not actually how it works. Right. Money is created through 145 00:06:43,520 --> 00:06:45,360 Speaker 1: debt expansion. When you get a loan for a house, 146 00:06:45,400 --> 00:06:47,720 Speaker 1: of car, boat, et cetera. That money is created out 147 00:06:47,720 --> 00:06:51,360 Speaker 1: of thin air. Corporations get money from debt, Governments get 148 00:06:51,360 --> 00:06:54,200 Speaker 1: money from debt, and so in this debt based monetary system, 149 00:06:54,200 --> 00:06:57,240 Speaker 1: it has to always be growing or the whole whole 150 00:06:57,240 --> 00:07:01,159 Speaker 1: thing falls apart. So it has to expand, and all 151 00:07:01,240 --> 00:07:04,400 Speaker 1: money comes from debt. And so understanding that key fact, 152 00:07:04,640 --> 00:07:06,440 Speaker 1: let's take a look at some of these projections. So 153 00:07:06,480 --> 00:07:08,279 Speaker 1: here's for the United States, which of course is the 154 00:07:08,360 --> 00:07:10,320 Speaker 1: US dollar, and it doesn't matter where you live in 155 00:07:10,320 --> 00:07:12,320 Speaker 1: the world. US dollars the reserve currency the world's with. 156 00:07:12,360 --> 00:07:14,040 Speaker 1: This matters. Now, what we can see is this is 157 00:07:14,160 --> 00:07:19,080 Speaker 1: US public debt and as it's projected to increase. So 158 00:07:19,080 --> 00:07:21,240 Speaker 1: we can see here in the year two thousand, here 159 00:07:21,240 --> 00:07:23,800 Speaker 1: we are about twenty twenty three, and here we are 160 00:07:23,840 --> 00:07:26,360 Speaker 1: twenty fifty, and what we can see is the payments 161 00:07:26,440 --> 00:07:29,880 Speaker 1: on the debt going up from one percent to five percent. 162 00:07:30,520 --> 00:07:33,720 Speaker 1: We can see the deficit going higher and higher higher, 163 00:07:33,920 --> 00:07:36,280 Speaker 1: no deficit in two thousand. We actually had a surplus, 164 00:07:36,320 --> 00:07:41,040 Speaker 1: surprise surprise to five percent of deficit in twenty fifty, 165 00:07:41,160 --> 00:07:43,360 Speaker 1: and we can see the percentage of debt. This is 166 00:07:43,360 --> 00:07:47,280 Speaker 1: the alarming one, going from thirty eight percent debt to 167 00:07:47,360 --> 00:07:52,280 Speaker 1: GDP up to one hundred and seventy five percent projected. 168 00:07:52,320 --> 00:07:54,440 Speaker 1: And so basically what we're looking at is the debt 169 00:07:54,480 --> 00:07:57,960 Speaker 1: will continue to go higher at an ever, ever faster rate. 170 00:07:58,560 --> 00:08:01,120 Speaker 1: The CBO again put out this chart that shows this 171 00:08:01,560 --> 00:08:05,320 Speaker 1: in another format. So here we are right here with 172 00:08:05,360 --> 00:08:08,880 Speaker 1: a record amounts of debts, as a matter of fact, 173 00:08:09,040 --> 00:08:11,240 Speaker 1: more than or about where we were in World War 174 00:08:11,240 --> 00:08:14,560 Speaker 1: one world War two, and this is what it's projected 175 00:08:14,600 --> 00:08:16,880 Speaker 1: to do. That's from the government's own admission. This is 176 00:08:16,920 --> 00:08:19,480 Speaker 1: not me making this up. Now. If we want to 177 00:08:19,480 --> 00:08:22,320 Speaker 1: look at this globally again, that's the United States. If 178 00:08:22,320 --> 00:08:24,480 Speaker 1: we look at this globally, what we can see is 179 00:08:24,680 --> 00:08:29,000 Speaker 1: something similar. And we are right about here right now, 180 00:08:29,320 --> 00:08:32,680 Speaker 1: and that is where it's expected to go. We'd already 181 00:08:32,679 --> 00:08:35,320 Speaker 1: don't have near enough dollars to pay back the debt 182 00:08:35,320 --> 00:08:38,160 Speaker 1: that we owe in the first place, and the debt 183 00:08:38,200 --> 00:08:41,640 Speaker 1: is expected to go a whole lot higher. So where 184 00:08:41,679 --> 00:08:44,719 Speaker 1: do we go from here, Well, there's four ways out. 185 00:08:44,760 --> 00:08:47,200 Speaker 1: Radialio broke this down very well in his book talking 186 00:08:47,200 --> 00:08:49,760 Speaker 1: about this sovereign debt crisis, which is basically what we're in. 187 00:08:49,880 --> 00:08:51,760 Speaker 1: And they said, there's four ways that we can get 188 00:08:51,760 --> 00:08:54,840 Speaker 1: out of this. Number one, we can have austerity, and 189 00:08:54,840 --> 00:08:57,719 Speaker 1: that basically means the government goes on a budget. I mean, 190 00:08:57,760 --> 00:09:01,120 Speaker 1: so let's cut spending by whatever, far fifty percent, let's 191 00:09:01,200 --> 00:09:03,440 Speaker 1: increase the taxes. So we cut spending, we bring in 192 00:09:03,480 --> 00:09:06,280 Speaker 1: more revenue, and we'll save our way out of it. 193 00:09:06,440 --> 00:09:09,400 Speaker 1: Of course that doesn't work. The people that are on 194 00:09:09,440 --> 00:09:11,400 Speaker 1: the doll the people that get benefits from the government, 195 00:09:11,400 --> 00:09:15,560 Speaker 1: they certainly don't want that to happen. Sometimes you might hear, well, 196 00:09:15,559 --> 00:09:17,400 Speaker 1: we owe the debt to ourselves, right, we could just 197 00:09:17,760 --> 00:09:20,200 Speaker 1: not pay it back. Well, not really. So we obviously 198 00:09:20,240 --> 00:09:23,880 Speaker 1: owe a lot of other government's money China, etc. Probably 199 00:09:23,880 --> 00:09:25,600 Speaker 1: won't like that if we decide not to pay them back. 200 00:09:25,720 --> 00:09:28,000 Speaker 1: But we owe it not to ourselves. We owe it 201 00:09:28,080 --> 00:09:30,280 Speaker 1: to the people of the United States. So if you 202 00:09:30,280 --> 00:09:32,199 Speaker 1: have a retirement account for our one K mutual fund, 203 00:09:32,240 --> 00:09:34,640 Speaker 1: a lot of your money is probably in the government's 204 00:09:34,640 --> 00:09:37,160 Speaker 1: hand and they owe that money to you. And so 205 00:09:37,160 --> 00:09:39,319 Speaker 1: if they decide not to pay that back, that's your 206 00:09:39,360 --> 00:09:42,200 Speaker 1: retirement money that's gone. Even more. It's not that they 207 00:09:42,200 --> 00:09:45,160 Speaker 1: can always just print the money, right, because they owe 208 00:09:45,200 --> 00:09:49,040 Speaker 1: people medical services, right, and so this is a big problem. 209 00:09:49,120 --> 00:09:51,640 Speaker 1: Number Two, they can do a debt restructuring. Hey, look, 210 00:09:51,679 --> 00:09:53,439 Speaker 1: we're way over our skis on this. There's no way 211 00:09:53,440 --> 00:09:55,120 Speaker 1: that we can pay this back. We'll pay you back 212 00:09:55,160 --> 00:09:57,080 Speaker 1: fifty cents on the dollar, ten cents on the dollar, 213 00:09:57,320 --> 00:10:01,040 Speaker 1: something like that, maybe extended out the way. And this is, 214 00:10:01,360 --> 00:10:04,080 Speaker 1: of course, the most likely scenario is we'll just print 215 00:10:04,080 --> 00:10:06,360 Speaker 1: the money. And of course this is what governments around 216 00:10:06,400 --> 00:10:08,839 Speaker 1: the world are doing. They'll continuing to expand the money 217 00:10:08,840 --> 00:10:12,120 Speaker 1: supply the debt because they're continuing to print money. Now, 218 00:10:12,160 --> 00:10:15,520 Speaker 1: the reality is that it's not one of these, it's 219 00:10:15,600 --> 00:10:18,360 Speaker 1: really probably all three. So for example, they're going to 220 00:10:18,440 --> 00:10:21,400 Speaker 1: increase the taxes, they're going to restructure the debt for 221 00:10:21,480 --> 00:10:24,040 Speaker 1: longer refinance it, and they're going to print money at 222 00:10:24,040 --> 00:10:26,320 Speaker 1: the same time, and they're continue to use all three 223 00:10:26,320 --> 00:10:28,920 Speaker 1: of these. But there's the fourth way, and it's sort 224 00:10:28,960 --> 00:10:31,480 Speaker 1: of like betting on a miracle, and the miracle is 225 00:10:31,840 --> 00:10:34,439 Speaker 1: we could have a productivity miracle. Now, a lot of 226 00:10:34,480 --> 00:10:36,360 Speaker 1: times people talk about this, like if we could just 227 00:10:36,720 --> 00:10:39,880 Speaker 1: come up with like free unlimited energy, for example, nuclear fission, 228 00:10:39,920 --> 00:10:41,360 Speaker 1: if we could come up with that, then we'd have 229 00:10:41,440 --> 00:10:43,679 Speaker 1: this productivity miracle and we could grow out of it. 230 00:10:43,800 --> 00:10:45,959 Speaker 1: You have to understand that we have remembered the ratio 231 00:10:46,080 --> 00:10:51,680 Speaker 1: is debt two GDP. It's a nominated denominator. So we 232 00:10:51,720 --> 00:10:54,400 Speaker 1: could either bring the debt down or we could bring 233 00:10:54,440 --> 00:10:57,480 Speaker 1: the GDP up. So if we have a productivity miracle, 234 00:10:57,520 --> 00:11:00,400 Speaker 1: we could grow our way out of it. Hype ethically, 235 00:11:00,640 --> 00:11:03,720 Speaker 1: but maybe we actually can. Are we on the verge 236 00:11:03,800 --> 00:11:07,280 Speaker 1: of a productivity miracle that could potentially see us do this? 237 00:11:07,720 --> 00:11:10,679 Speaker 1: And the answer is maybe we are. So what am 238 00:11:10,720 --> 00:11:14,640 Speaker 1: I talking about specifically? Of course AI? We have an 239 00:11:14,679 --> 00:11:18,720 Speaker 1: AI driven boom that is completely changing the landscape of 240 00:11:18,760 --> 00:11:21,520 Speaker 1: the entire world from everything that we know, from how 241 00:11:21,520 --> 00:11:24,320 Speaker 1: we get information to how we work, to whether we 242 00:11:24,360 --> 00:11:26,280 Speaker 1: have a job or not, what type of job you'll have, 243 00:11:26,840 --> 00:11:30,959 Speaker 1: which new businesses are growing, and even potentially saving governments 244 00:11:31,360 --> 00:11:35,080 Speaker 1: from reckless spending by having a productivity miracle. So obviously 245 00:11:35,160 --> 00:11:36,839 Speaker 1: I'm talking about, like I said, the growth of AI, 246 00:11:37,280 --> 00:11:40,120 Speaker 1: and we've seen how fast this is growing. Some ways 247 00:11:40,120 --> 00:11:42,520 Speaker 1: we can look at this just from a chart is 248 00:11:42,760 --> 00:11:45,520 Speaker 1: look at VideA. If you haven't be paying attention in 249 00:11:45,559 --> 00:11:47,400 Speaker 1: video you're not paying attention at all. And what we 250 00:11:47,440 --> 00:11:50,320 Speaker 1: can see is that in Vidia has basically shot up 251 00:11:50,400 --> 00:11:52,160 Speaker 1: like a what is this like a meme stock, a 252 00:11:52,160 --> 00:11:54,560 Speaker 1: crypto stock. I mean, it's basically gone straight up for 253 00:11:54,640 --> 00:11:58,360 Speaker 1: no reason. There's no fundamental reason if we try to 254 00:11:58,360 --> 00:12:00,679 Speaker 1: analyze it like a typical stock, why it's gone up 255 00:12:00,679 --> 00:12:02,679 Speaker 1: like this. But it's gone up like this because of 256 00:12:02,760 --> 00:12:07,360 Speaker 1: the AI boom that's going on. So is business has 257 00:12:07,400 --> 00:12:10,439 Speaker 1: become more productive, meaning I can get more work done 258 00:12:10,480 --> 00:12:13,880 Speaker 1: in my business without hiring additional people. That means my 259 00:12:14,040 --> 00:12:17,720 Speaker 1: profitability goes up. Right, doesn't mean you have to have 260 00:12:17,760 --> 00:12:20,560 Speaker 1: mass layoffs. But let's say that now there's a lot 261 00:12:20,600 --> 00:12:23,440 Speaker 1: more higher level jobs from coders and things like that. 262 00:12:23,559 --> 00:12:26,240 Speaker 1: So now maybe people are making more money again, that 263 00:12:26,280 --> 00:12:30,160 Speaker 1: pushes the GDP up and maybe, just maybe we could 264 00:12:30,200 --> 00:12:33,800 Speaker 1: grow faster to move the GDP up faster than the 265 00:12:33,840 --> 00:12:38,520 Speaker 1: debt's growing. The question is this actually realistic? Well, I've 266 00:12:38,520 --> 00:12:41,920 Speaker 1: studied the data, I've studied the math, and maybe, but 267 00:12:42,000 --> 00:12:45,679 Speaker 1: there's also a big danger as we transition into that. 268 00:12:45,920 --> 00:12:47,680 Speaker 1: I want to break all of that down for you, 269 00:12:47,720 --> 00:12:49,560 Speaker 1: but real quick, before I get into that data, I 270 00:12:49,640 --> 00:12:51,040 Speaker 1: just want to let you know, I got a sponsor 271 00:12:51,120 --> 00:12:53,800 Speaker 1: for this week's show. I want to let you let 272 00:12:53,880 --> 00:12:56,800 Speaker 1: you know about them real quick. I'm talking about iber America. 273 00:12:56,920 --> 00:12:59,800 Speaker 1: Here's their stock ticker right here. And the reason why 274 00:12:59,800 --> 00:13:02,400 Speaker 1: this company is probably a good one sponsor for this 275 00:13:02,480 --> 00:13:04,800 Speaker 1: video is because they are at the forefront of the 276 00:13:04,840 --> 00:13:08,680 Speaker 1: AI boom. I've talked about before, the different commodities, whether 277 00:13:08,720 --> 00:13:11,760 Speaker 1: that's lithium or cobalt. We talked about copper, how copper's 278 00:13:11,800 --> 00:13:14,240 Speaker 1: being used in the AA boom. One thing that's being 279 00:13:14,320 --> 00:13:15,760 Speaker 1: used in the air boom, and you can see from 280 00:13:15,800 --> 00:13:19,160 Speaker 1: this chart right here is ten, Yes, the old metal tin. 281 00:13:19,520 --> 00:13:22,480 Speaker 1: And you probably don't realize how much ten goes into 282 00:13:22,520 --> 00:13:25,559 Speaker 1: the data centers and more specifically the microchips like Nvidia 283 00:13:25,679 --> 00:13:27,800 Speaker 1: uses when they put them onto a circuit board, they 284 00:13:27,800 --> 00:13:30,840 Speaker 1: have to solder them and that all requires ten. And 285 00:13:30,880 --> 00:13:33,200 Speaker 1: so you can see ten is also going up like 286 00:13:33,200 --> 00:13:35,880 Speaker 1: in Vidia like a meme stock as well, and that's 287 00:13:35,960 --> 00:13:38,760 Speaker 1: because of the demand now we have at this iber 288 00:13:38,840 --> 00:13:43,400 Speaker 1: America basically is going to be Europe's largest ten mine 289 00:13:43,520 --> 00:13:45,760 Speaker 1: in the world. Now why does this matter, Well, it 290 00:13:45,840 --> 00:13:49,280 Speaker 1: matters because the majority of ten around the world right 291 00:13:49,320 --> 00:13:52,520 Speaker 1: now is coming from countries that we would say are 292 00:13:52,559 --> 00:13:55,560 Speaker 1: non friendly. As a matter of fact, China, Indonesia, and 293 00:13:55,640 --> 00:13:58,800 Speaker 1: Peru make up seventy five percent of the supply of ten. 294 00:13:59,120 --> 00:14:01,040 Speaker 1: You already know we're trying to de couple from China. 295 00:14:01,360 --> 00:14:04,280 Speaker 1: We can't depend on them anymore. Indonesia we can't. We 296 00:14:04,360 --> 00:14:09,239 Speaker 1: have such heavy sanctions on them because of their environmental policies. 297 00:14:09,440 --> 00:14:13,960 Speaker 1: And Peru has massive disruption in their mining sector. You 298 00:14:13,960 --> 00:14:16,960 Speaker 1: can see. Foreign investments need to understand that there's massive 299 00:14:16,960 --> 00:14:20,000 Speaker 1: political risk in Peru. And so most of the supply 300 00:14:20,080 --> 00:14:23,280 Speaker 1: of ten comes from non friendly countries, and here we 301 00:14:23,400 --> 00:14:26,000 Speaker 1: have one in Europe. Now. The key to understand this 302 00:14:26,120 --> 00:14:28,400 Speaker 1: also is that the only way to get access to 303 00:14:28,480 --> 00:14:31,480 Speaker 1: ten is different than most commodities. You can't just buy 304 00:14:31,480 --> 00:14:33,600 Speaker 1: it through an ETF. The only way you can get 305 00:14:33,640 --> 00:14:36,560 Speaker 1: exposure to ten is by buying one of the producers. 306 00:14:36,960 --> 00:14:38,720 Speaker 1: And you don't want to buy a producer in Peru 307 00:14:38,880 --> 00:14:42,760 Speaker 1: or China or Indonesia, and so maybe in a European 308 00:14:42,840 --> 00:14:45,040 Speaker 1: company might be a better way. Now, real quickly, just 309 00:14:45,080 --> 00:14:47,160 Speaker 1: got to get back to the video, but real quickly. 310 00:14:47,360 --> 00:14:49,640 Speaker 1: The team is stellar. David Young, he's been head of 311 00:14:49,720 --> 00:14:53,080 Speaker 1: natural resources at Carlisle Group, which is the fifth largest 312 00:14:53,080 --> 00:14:56,200 Speaker 1: private equity firm. He managed over four billion dollars of 313 00:14:56,200 --> 00:14:59,560 Speaker 1: resources at there we have Gene McBurnie. He was the 314 00:14:59,600 --> 00:15:03,880 Speaker 1: CEO of can Accordingenuity, which is the second largest Canadian 315 00:15:03,920 --> 00:15:07,200 Speaker 1: investment bank, co founder of GMP Securities which is an 316 00:15:07,240 --> 00:15:11,000 Speaker 1: investment dealer, massive, massive talent. Here, we also have Hatch 317 00:15:11,080 --> 00:15:14,960 Speaker 1: Consulting which is is on board to get the production 318 00:15:15,200 --> 00:15:18,080 Speaker 1: back on track. We'll talk about that production in a second. 319 00:15:18,880 --> 00:15:20,600 Speaker 1: And lastly, real quick before we get back to the 320 00:15:20,640 --> 00:15:23,600 Speaker 1: AI boom, we know that Iber America, while at the 321 00:15:23,640 --> 00:15:26,480 Speaker 1: forefront of this AI boom supplying the ten that we need, 322 00:15:27,080 --> 00:15:30,800 Speaker 1: they basically have done something by going and acquiring this 323 00:15:30,960 --> 00:15:34,560 Speaker 1: mine in Spain in Europe, and they bought it. And 324 00:15:34,600 --> 00:15:35,960 Speaker 1: the reason why they bought it is the company that 325 00:15:36,000 --> 00:15:38,720 Speaker 1: had it before mismanaged it. And part of the mismanagement 326 00:15:38,760 --> 00:15:41,480 Speaker 1: was also just the cycle of it. The AI boom 327 00:15:41,520 --> 00:15:43,720 Speaker 1: wasn't there, neither was ten and they were able to 328 00:15:43,720 --> 00:15:47,400 Speaker 1: buy a mine here that was worth seventy eight million 329 00:15:47,440 --> 00:15:50,720 Speaker 1: dollars and they bought it for only six million. So 330 00:15:50,760 --> 00:15:53,560 Speaker 1: what happens in the siicylity of commodities, So they bought 331 00:15:53,560 --> 00:15:55,960 Speaker 1: a seventy eight million dollar asset for only six million dollars, 332 00:15:56,440 --> 00:16:00,440 Speaker 1: and the buyer, iber America, is only an eighty million 333 00:16:00,520 --> 00:16:03,120 Speaker 1: dollar market cap. So an eighteen million dollar market cap 334 00:16:03,200 --> 00:16:06,760 Speaker 1: is buying an asset for seventy eight million dollars. What 335 00:16:06,800 --> 00:16:10,000 Speaker 1: do you think potentially happens with this company as ten 336 00:16:10,120 --> 00:16:12,720 Speaker 1: continues to take off? Now, the good thing too, is 337 00:16:12,760 --> 00:16:14,680 Speaker 1: this is all happening right now at the time of 338 00:16:14,680 --> 00:16:16,520 Speaker 1: this video. As a matter of fact, they're closing on 339 00:16:16,560 --> 00:16:18,760 Speaker 1: this deal in the next two weeks. And their goal 340 00:16:18,960 --> 00:16:21,400 Speaker 1: is they have the time, they have the money, and 341 00:16:21,480 --> 00:16:23,920 Speaker 1: they have the know how to put this back into 342 00:16:23,960 --> 00:16:26,760 Speaker 1: production right right now, right at the time that AI 343 00:16:27,000 --> 00:16:30,480 Speaker 1: is completely blowing up and they have the ten. Okay, now, 344 00:16:30,720 --> 00:16:32,560 Speaker 1: enough with that sponsor check them out if you want. 345 00:16:32,760 --> 00:16:36,360 Speaker 1: But let's get back to can this AI productivity miracle 346 00:16:36,640 --> 00:16:39,280 Speaker 1: help us grow out of this? Okay? So let's look 347 00:16:39,280 --> 00:16:41,440 Speaker 1: at this from a couple areas. So the first thing 348 00:16:41,480 --> 00:16:44,440 Speaker 1: that we can see is when we've looked at something 349 00:16:44,520 --> 00:16:46,640 Speaker 1: like this in the past, it gives us an idea. 350 00:16:46,800 --> 00:16:49,480 Speaker 1: I always use history. History is our guide to the future. So, 351 00:16:49,600 --> 00:16:52,520 Speaker 1: for example, when we had the Internet boom, what'd the 352 00:16:52,520 --> 00:16:55,920 Speaker 1: Internet do? The Internet increased our efficiency. Now instead of 353 00:16:55,920 --> 00:16:58,400 Speaker 1: having to drive somewhere for a meeting, I just go 354 00:16:58,440 --> 00:17:01,360 Speaker 1: on zoom right, instead of having to drive to a 355 00:17:01,400 --> 00:17:03,160 Speaker 1: store pickup stuff, and I can click a button and 356 00:17:03,240 --> 00:17:05,960 Speaker 1: have it shipped to me. So internet was also something 357 00:17:06,000 --> 00:17:08,520 Speaker 1: that really created this productivity boom. And what we can 358 00:17:08,560 --> 00:17:10,720 Speaker 1: see here in two thousand, this is a chart here 359 00:17:11,040 --> 00:17:14,600 Speaker 1: of corporate profits, I meaning corporations making more money. When 360 00:17:14,600 --> 00:17:17,879 Speaker 1: corporations make more money, that increases the GDP. Right, So 361 00:17:18,080 --> 00:17:20,159 Speaker 1: right here is when the tech boom happened. This is 362 00:17:20,200 --> 00:17:22,880 Speaker 1: the year two thousand, the dot com boom. And look 363 00:17:22,880 --> 00:17:25,720 Speaker 1: at this trend line. So this is the corporate profits. 364 00:17:25,920 --> 00:17:29,679 Speaker 1: We're on this trend line right here. Then it started 365 00:17:29,720 --> 00:17:32,439 Speaker 1: ticking up a little bit because in the eighties we 366 00:17:32,480 --> 00:17:35,000 Speaker 1: started getting you know, computers and some of the businesses 367 00:17:35,000 --> 00:17:37,640 Speaker 1: and things like that. So productivity started picking up here. 368 00:17:37,920 --> 00:17:41,480 Speaker 1: But right here where the two thousand dot com happened. 369 00:17:41,760 --> 00:17:44,320 Speaker 1: Look at the new trend line that started up. See 370 00:17:44,320 --> 00:17:48,160 Speaker 1: how much faster corporate profits went up, how much faster 371 00:17:48,359 --> 00:17:51,440 Speaker 1: GDP started going up. And now you can see since 372 00:17:51,520 --> 00:17:54,320 Speaker 1: twenty twenty we are on a straight line. So the 373 00:17:54,320 --> 00:17:59,360 Speaker 1: precedent shows that technology does increase efficiency, which boost corporate profits, 374 00:17:59,359 --> 00:18:03,239 Speaker 1: which then brings up GDP. Okay. Another way, we can 375 00:18:03,280 --> 00:18:06,320 Speaker 1: take a look at this specifically that's historically, but we 376 00:18:06,359 --> 00:18:08,480 Speaker 1: can also look at this from AI. So this is 377 00:18:08,480 --> 00:18:10,760 Speaker 1: some of the projections. What we can see is that 378 00:18:10,880 --> 00:18:13,760 Speaker 1: the AI market cap we're right here right now, it's 379 00:18:13,800 --> 00:18:16,080 Speaker 1: been growing pretty slowly. But you have to remember this 380 00:18:16,160 --> 00:18:18,879 Speaker 1: is all still pretty new. What do we less than 381 00:18:18,920 --> 00:18:20,640 Speaker 1: two years or a year and a half into sort 382 00:18:20,640 --> 00:18:23,720 Speaker 1: of since open ai was introduced, But it's projected to 383 00:18:23,920 --> 00:18:28,320 Speaker 1: grow at a three or thirty three percent compounded annual 384 00:18:28,359 --> 00:18:31,280 Speaker 1: growth rate. That's amazing. It's enormous and if you're not 385 00:18:31,359 --> 00:18:33,800 Speaker 1: using in your business, you totally should. In our business, 386 00:18:33,800 --> 00:18:36,080 Speaker 1: we use it all over the place already a thirty 387 00:18:36,119 --> 00:18:39,200 Speaker 1: three percent compound and annual growth rate. And so that's 388 00:18:39,240 --> 00:18:42,040 Speaker 1: how fast the aiboom is going to continue to grow, 389 00:18:42,280 --> 00:18:44,800 Speaker 1: and it's going to continue to cause all other things 390 00:18:44,880 --> 00:18:46,760 Speaker 1: to happen, and a lot of it is in the 391 00:18:46,760 --> 00:18:49,280 Speaker 1: demand of the commodities and things like that. Now, there 392 00:18:49,359 --> 00:18:51,399 Speaker 1: is some downsides to this, and I don't want to 393 00:18:51,440 --> 00:18:52,840 Speaker 1: go deep into this right now. I can make another 394 00:18:52,920 --> 00:18:55,320 Speaker 1: video if you want, But typically when we have this 395 00:18:55,480 --> 00:18:58,520 Speaker 1: pulse of productivity, maybe some people lose their jobs. Now 396 00:18:58,520 --> 00:19:01,199 Speaker 1: those people can go find higher pain, but there is 397 00:19:01,280 --> 00:19:03,359 Speaker 1: some danger in the short term. And again we have 398 00:19:03,480 --> 00:19:05,400 Speaker 1: historical precedence for this. If you want me to break 399 00:19:05,400 --> 00:19:06,920 Speaker 1: that down on a video, let me know. In the 400 00:19:06,920 --> 00:19:08,680 Speaker 1: commons down below, we can make a whole separate video 401 00:19:08,720 --> 00:19:11,119 Speaker 1: on that. But what we do know is this AI 402 00:19:11,400 --> 00:19:14,840 Speaker 1: and the tech trend is very very strong. Now. We 403 00:19:14,960 --> 00:19:18,720 Speaker 1: know that technology happens in about fifty year cycles and 404 00:19:18,760 --> 00:19:22,000 Speaker 1: it drives financial markets. So what's driven financial markets the 405 00:19:22,040 --> 00:19:25,320 Speaker 1: last fifty years, Well, it was personal computers, telecom and internet. 406 00:19:25,440 --> 00:19:28,399 Speaker 1: What drove it before that? It was for gmge What 407 00:19:28,560 --> 00:19:31,240 Speaker 1: drove it before that, well it was steel railways. What 408 00:19:31,280 --> 00:19:33,119 Speaker 1: we drove for that oil? Right, And so what we 409 00:19:33,160 --> 00:19:34,520 Speaker 1: know is the next fifty years is going to be 410 00:19:34,560 --> 00:19:37,760 Speaker 1: dominated by AI and crypto part of this fifty year 411 00:19:37,800 --> 00:19:42,320 Speaker 1: technological boom, and maybe, just maybe it could grow our 412 00:19:42,480 --> 00:19:45,119 Speaker 1: way out of this. It's a miracle. Maybe. Now, if 413 00:19:45,119 --> 00:19:46,639 Speaker 1: you want to know more about these fifty year cycles, 414 00:19:46,680 --> 00:19:48,400 Speaker 1: I did a whole video on it. We'll go ahead 415 00:19:48,400 --> 00:19:50,199 Speaker 1: and link it up here if you want to watch that. 416 00:19:50,280 --> 00:19:51,600 Speaker 1: But let me know what you think about the video. 417 00:19:52,000 --> 00:19:54,480 Speaker 1: Can we grow our way out of this as a 418 00:19:54,520 --> 00:19:56,720 Speaker 1: miracle or is it just smoking dreams? Let me know 419 00:19:56,720 --> 00:19:59,560 Speaker 1: own the comments down below for Subscribertion. I subscribed like 420 00:19:59,600 --> 00:20:01,159 Speaker 1: the video if you liked it. If you don't, you 421 00:20:01,160 --> 00:20:02,600 Speaker 1: can give me a thumbs down. That's okay, but at 422 00:20:02,680 --> 00:20:04,960 Speaker 1: least tell me why in the comments down below. And 423 00:20:05,000 --> 00:20:07,400 Speaker 1: that's what I got to your success. I'm out.