1 00:00:00,200 --> 00:00:03,160 Speaker 1: Hello, and welcome to another episode of the Mark Mos Show, 2 00:00:03,160 --> 00:00:06,520 Speaker 1: where we talk about the decentralized revolution. Of course, we 3 00:00:06,519 --> 00:00:09,160 Speaker 1: talk about the way the world is changing right before 4 00:00:09,280 --> 00:00:11,560 Speaker 1: our very eyes. As I say, the world we're going 5 00:00:11,560 --> 00:00:14,120 Speaker 1: into is not the same as the one that we're 6 00:00:14,200 --> 00:00:15,880 Speaker 1: leaving behind, and we like to look at it through 7 00:00:15,920 --> 00:00:20,759 Speaker 1: the lens of of course politics, finance and technology, and 8 00:00:20,880 --> 00:00:23,840 Speaker 1: the technology that is changing the world is of course 9 00:00:23,880 --> 00:00:26,960 Speaker 1: bitcoin and the decentralized technology. And you know, I like 10 00:00:27,000 --> 00:00:30,280 Speaker 1: to bring to you some of the some different ways 11 00:00:30,320 --> 00:00:32,200 Speaker 1: to look at the world, and I try to expand 12 00:00:32,440 --> 00:00:35,640 Speaker 1: your thinking so you can really understand these complex subjects 13 00:00:35,640 --> 00:00:37,640 Speaker 1: that we're dealing with, some of the latest breaking news, 14 00:00:37,640 --> 00:00:41,040 Speaker 1: and some interesting people to listen to as well, so 15 00:00:41,080 --> 00:00:42,600 Speaker 1: you don't have to hear me talk all the time. 16 00:00:42,640 --> 00:00:46,080 Speaker 1: But today I want to start off talking about something 17 00:00:46,120 --> 00:00:51,280 Speaker 1: that's basically dominating most conversations today and I want to 18 00:00:51,320 --> 00:00:53,159 Speaker 1: explain it to you in a way that you probably 19 00:00:53,240 --> 00:00:56,000 Speaker 1: haven't yet heard. And so we're going to talk about 20 00:00:56,000 --> 00:00:59,480 Speaker 1: this because this is actually what's changing the world, and 21 00:00:59,520 --> 00:01:03,520 Speaker 1: it's really all about the money. So we said, I 22 00:01:03,560 --> 00:01:06,520 Speaker 1: talked about it from politics of finance and technology and 23 00:01:06,600 --> 00:01:10,120 Speaker 1: really this financial piece on about an eighty year timeframe, 24 00:01:10,440 --> 00:01:13,400 Speaker 1: we have these financial revolutions, and that's exactly what we're 25 00:01:13,440 --> 00:01:15,600 Speaker 1: facing right now. We can see where at the end 26 00:01:15,680 --> 00:01:20,039 Speaker 1: of a long term debt credit cycle, potentially a hundred 27 00:01:20,160 --> 00:01:23,959 Speaker 1: year sovereign debt bubble that's blowing up. And of course 28 00:01:24,000 --> 00:01:26,920 Speaker 1: you see all over the news everything you know. You 29 00:01:26,959 --> 00:01:31,440 Speaker 1: see inflation, and you see debt sealing limits increase, and 30 00:01:32,280 --> 00:01:35,960 Speaker 1: money being printed and sent around the world to people, etc. 31 00:01:37,600 --> 00:01:40,760 Speaker 1: And it's hard to really understand what's going on, especially 32 00:01:40,840 --> 00:01:45,280 Speaker 1: when you have some intellectual mouthpieces like Paul Krugman talking 33 00:01:45,319 --> 00:01:48,600 Speaker 1: about this and trying to explain to you. But it's 34 00:01:48,680 --> 00:01:51,760 Speaker 1: all wrong. Now, if you watch my main YouTube channel, 35 00:01:51,760 --> 00:01:53,600 Speaker 1: just the Mark Moss YouTube channel, like to start off 36 00:01:53,600 --> 00:01:56,000 Speaker 1: the videos by saying, I'm trying to change the way 37 00:01:56,200 --> 00:01:59,320 Speaker 1: you think about money because almost everything you've learned is wrong. 38 00:01:59,560 --> 00:02:03,240 Speaker 1: And when you listen to people like Paul Krugman, they're 39 00:02:03,320 --> 00:02:06,280 Speaker 1: lying to you. So of course everything you've learned is 40 00:02:06,320 --> 00:02:10,040 Speaker 1: wrong because they're telling you the wrong information. We're going 41 00:02:10,080 --> 00:02:13,360 Speaker 1: to talk about that specifically, but also what we learn 42 00:02:13,480 --> 00:02:16,400 Speaker 1: in school is wrong. They don't teach you about the 43 00:02:16,440 --> 00:02:19,000 Speaker 1: way money works. They don't teach you about the way 44 00:02:19,040 --> 00:02:22,520 Speaker 1: the financial system works or the banking system works. And 45 00:02:22,600 --> 00:02:26,400 Speaker 1: of course they don't tell you how to get wealthy. 46 00:02:26,680 --> 00:02:29,720 Speaker 1: They tell you how to basically live within this system 47 00:02:29,960 --> 00:02:33,399 Speaker 1: without disrupting it, without changing the way the system works, 48 00:02:33,400 --> 00:02:35,520 Speaker 1: and without really getting ahead. Which is why, of course, 49 00:02:35,760 --> 00:02:40,520 Speaker 1: today over about half of all people retiring today, that 50 00:02:40,560 --> 00:02:45,320 Speaker 1: baby boomers, are broke. They have no money. About half 51 00:02:45,360 --> 00:02:47,960 Speaker 1: of the people today couldn't come up with a thousand 52 00:02:48,080 --> 00:02:53,560 Speaker 1: dollars for an emergency. And so how is that financial 53 00:02:53,720 --> 00:02:57,160 Speaker 1: education you've been getting working for you? If half the 54 00:02:57,160 --> 00:02:59,840 Speaker 1: people retiring have no money, and of the people that 55 00:03:00,240 --> 00:03:03,160 Speaker 1: of the half that do, half of them have less 56 00:03:03,160 --> 00:03:05,400 Speaker 1: than one hundred thousand dollars, which is not enough to 57 00:03:05,560 --> 00:03:09,280 Speaker 1: retire off of. So how's that financial education been working? 58 00:03:10,400 --> 00:03:14,080 Speaker 1: I saw I think sixty percent fifty or sixty percent 59 00:03:14,080 --> 00:03:17,360 Speaker 1: of people making over one hundred thousand dollars per year, 60 00:03:17,680 --> 00:03:20,239 Speaker 1: which most of you might consider that being rich or 61 00:03:20,919 --> 00:03:25,400 Speaker 1: well off or something like that, about half of those 62 00:03:25,440 --> 00:03:29,639 Speaker 1: people report living paycheck to paycheck. So how's that financial 63 00:03:29,720 --> 00:03:33,120 Speaker 1: education coming for you? It's obviously not working very well. 64 00:03:33,120 --> 00:03:34,839 Speaker 1: We saw, I've talked about it on the radio last 65 00:03:34,840 --> 00:03:41,520 Speaker 1: week in Baltimore and then in Chicago. In Baltimore was 66 00:03:41,560 --> 00:03:44,240 Speaker 1: more about reading. In Chicago, fifty five school districts, not 67 00:03:44,360 --> 00:03:50,040 Speaker 1: one single student, not one could pass math or reading. 68 00:03:50,560 --> 00:03:52,880 Speaker 1: So how's that education going for you? So let's talk 69 00:03:52,880 --> 00:03:56,000 Speaker 1: about this a little bit and let's explain what's going on. Now. 70 00:03:56,280 --> 00:03:59,600 Speaker 1: The Treasury, which is the United States government. So we 71 00:03:59,640 --> 00:04:03,480 Speaker 1: have the Reserve and we have the Treasury. The Treasury 72 00:04:03,520 --> 00:04:06,480 Speaker 1: is the United States government. The Federal Reserve is a bank. 73 00:04:06,720 --> 00:04:10,480 Speaker 1: It's a collection of banks, and it's a private bank. Now, 74 00:04:11,080 --> 00:04:12,920 Speaker 1: for some of you listen to this, you doubt that 75 00:04:13,480 --> 00:04:15,680 Speaker 1: it was set up as a private group of banks. 76 00:04:16,080 --> 00:04:22,440 Speaker 1: It is recognized and allowed by Congress. So it's semi 77 00:04:22,560 --> 00:04:26,200 Speaker 1: quasi private, if you will. It's really private. It does 78 00:04:26,279 --> 00:04:29,800 Speaker 1: maintain its autonomy, and they control monetary policy, so they 79 00:04:29,839 --> 00:04:34,839 Speaker 1: control the banks. The United States government and the Treasury 80 00:04:34,839 --> 00:04:38,240 Speaker 1: control the fiscal all right, so that's the money being 81 00:04:38,320 --> 00:04:42,720 Speaker 1: spent in the government. The Fed just controls the monetary policy, 82 00:04:42,720 --> 00:04:45,440 Speaker 1: which is interest rates, in the amount of the banks reserves, etc. 83 00:04:46,000 --> 00:04:49,880 Speaker 1: So the United States government, the Treasury put out a 84 00:04:49,920 --> 00:04:54,039 Speaker 1: report this last week. It's called the Financial Report of 85 00:04:54,080 --> 00:04:58,479 Speaker 1: the United States Government. Fiscal year two twenty two. It's 86 00:04:58,520 --> 00:05:01,719 Speaker 1: at Fiscal Treasury dot gov. If you want to go 87 00:05:01,800 --> 00:05:04,839 Speaker 1: read this report. Now that's two hundred and fifty eight pages, 88 00:05:05,279 --> 00:05:08,040 Speaker 1: so you probably don't want to read all that, but 89 00:05:08,480 --> 00:05:12,760 Speaker 1: it's worth a read. So this is directly from the Treasury. 90 00:05:12,839 --> 00:05:15,479 Speaker 1: This is their own report, and it starts out on 91 00:05:15,680 --> 00:05:20,440 Speaker 1: the first page with a letter written by Janet Yellen, 92 00:05:20,720 --> 00:05:23,400 Speaker 1: which of course is the head. She's the Secretary of 93 00:05:23,440 --> 00:05:26,080 Speaker 1: the Treasury, the Department of the Treasury, which of course 94 00:05:26,200 --> 00:05:33,920 Speaker 1: is the United States government. Basically in this document, surprising 95 00:05:33,960 --> 00:05:36,320 Speaker 1: that they would actually put this document out because in 96 00:05:36,360 --> 00:05:40,640 Speaker 1: this document they basically make the case that the government 97 00:05:41,360 --> 00:05:46,400 Speaker 1: is bankrupt, insolvent, what we'd call a zombie company, and 98 00:05:47,720 --> 00:05:51,960 Speaker 1: they make the statement that says the path that we're 99 00:05:52,080 --> 00:05:57,920 Speaker 1: on is not sustainable. That's what it says. So it's 100 00:05:57,960 --> 00:06:00,920 Speaker 1: pretty interesting they would put out this information. Now, like 101 00:06:00,960 --> 00:06:03,400 Speaker 1: I said, everything you've learned is wrong. So typically they're 102 00:06:03,400 --> 00:06:07,200 Speaker 1: trying to change the story, change the narrave show you 103 00:06:07,279 --> 00:06:11,239 Speaker 1: information that maybe misleads you. But in this information, they've 104 00:06:11,240 --> 00:06:13,760 Speaker 1: basically come out and told you, and like I said, 105 00:06:13,839 --> 00:06:19,239 Speaker 1: even made the statement that it's not a sustainable path. 106 00:06:19,839 --> 00:06:22,240 Speaker 1: I want to see the source of the information. I 107 00:06:22,279 --> 00:06:25,080 Speaker 1: want to see what they have to say first before 108 00:06:25,160 --> 00:06:28,279 Speaker 1: I start listening to other people's opinions of that data. 109 00:06:28,360 --> 00:06:32,479 Speaker 1: Now back to Paul Kruegman. Paul Kruegman is, like I said, 110 00:06:32,560 --> 00:06:37,880 Speaker 1: kind of the mouthpiece of the Fed, the Treasury. He's 111 00:06:37,880 --> 00:06:40,240 Speaker 1: the cheerleader that basically says everything they do is correct. 112 00:06:40,520 --> 00:06:44,120 Speaker 1: And of course Paul Krugman is not correct. He's never 113 00:06:44,160 --> 00:06:47,760 Speaker 1: been correct. Paul Kruegman is the one who famously said 114 00:06:48,760 --> 00:06:51,480 Speaker 1: the Internet's impact on the economy has been no greater 115 00:06:51,560 --> 00:06:56,520 Speaker 1: than the fax machines. That's what he said. Ten years 116 00:06:56,560 --> 00:07:01,760 Speaker 1: from now. The phrase quote information economy will sound silly. 117 00:07:02,640 --> 00:07:08,240 Speaker 1: So look, when somebody, when we have economists, we have forecasters, 118 00:07:08,520 --> 00:07:12,160 Speaker 1: when they give us their information, we should take that 119 00:07:12,480 --> 00:07:14,800 Speaker 1: and pay attention to it, and then we should then, 120 00:07:14,880 --> 00:07:18,160 Speaker 1: of course, see if that information comes true. So if 121 00:07:18,240 --> 00:07:20,800 Speaker 1: this is somebody we want to continue to listen to. So, 122 00:07:20,920 --> 00:07:24,440 Speaker 1: for example, al Gore said in two thousand and nine 123 00:07:24,480 --> 00:07:27,560 Speaker 1: that the North Pole will be ice free by the 124 00:07:27,640 --> 00:07:31,800 Speaker 1: summer of two thirteen because of man made global warming. 125 00:07:32,120 --> 00:07:36,040 Speaker 1: The polar bears would be gone by twenty thirteen. So 126 00:07:36,120 --> 00:07:38,840 Speaker 1: he said this in two thousand and nine, so we 127 00:07:38,920 --> 00:07:39,920 Speaker 1: have to take a look at that. We're to look 128 00:07:39,960 --> 00:07:41,800 Speaker 1: at what Paul Krugman says, I want to come back. 129 00:07:41,800 --> 00:07:43,440 Speaker 1: I'm gonna explain that even more, and then we're gonna 130 00:07:43,480 --> 00:07:45,920 Speaker 1: dig into this Treasury report. I'm going to show you 131 00:07:45,960 --> 00:07:48,360 Speaker 1: what they said, what the data shows, and then we're 132 00:07:48,360 --> 00:07:51,440 Speaker 1: gonna look at some data points actually in the economy, 133 00:07:51,800 --> 00:07:54,200 Speaker 1: in the markets, in real estate to see if this 134 00:07:54,320 --> 00:07:56,840 Speaker 1: is true, so you can understand exactly what's going on 135 00:07:56,960 --> 00:07:59,360 Speaker 1: how to better navigate this. If you're just tune in 136 00:07:59,480 --> 00:08:01,720 Speaker 1: right now, you're listen to the Mark Moish show, we're 137 00:08:01,760 --> 00:08:05,480 Speaker 1: talking about, of course, the decentralized Revolution, really kind of 138 00:08:05,480 --> 00:08:08,760 Speaker 1: focusing right now on this eighty year financial revolution cycle 139 00:08:08,800 --> 00:08:11,160 Speaker 1: that's being reset right now. I got a whole lot 140 00:08:11,240 --> 00:08:13,160 Speaker 1: to cover at this show. You don't want to miss this. 141 00:08:13,360 --> 00:08:15,440 Speaker 1: We're gonna break it down and it's gonna make sense 142 00:08:15,480 --> 00:08:17,600 Speaker 1: to you. All right, So I gotta take a quick break. 143 00:08:17,640 --> 00:08:19,000 Speaker 1: I'm gonna be back in a minute. You don't want 144 00:08:19,040 --> 00:08:21,520 Speaker 1: to miss this, don't go away. I'm gonna be right back, 145 00:08:23,040 --> 00:08:24,600 Speaker 1: all right, Welcome back. If you just tune in, you're 146 00:08:24,600 --> 00:08:26,520 Speaker 1: listening to the Mark Mos show, we talk about the 147 00:08:26,680 --> 00:08:30,520 Speaker 1: decentralized revolution, how the world is changing as we look 148 00:08:30,520 --> 00:08:33,000 Speaker 1: at it through the lens of politics, finance, and technology. 149 00:08:33,040 --> 00:08:36,920 Speaker 1: Today we're looking at the financial revolution piece, and I 150 00:08:37,000 --> 00:08:40,640 Speaker 1: was explaining how when we have experts and they make predictions, 151 00:08:40,960 --> 00:08:42,760 Speaker 1: we should listen to those and then we should see 152 00:08:42,760 --> 00:08:44,840 Speaker 1: if they got them right, to see if it's somebody 153 00:08:44,840 --> 00:08:47,360 Speaker 1: that we want to continue listening to. So as I 154 00:08:47,480 --> 00:08:51,040 Speaker 1: was saying with al Gore in two thousand and nine, 155 00:08:51,120 --> 00:08:54,840 Speaker 1: he told us that the ice would be gone, the 156 00:08:54,880 --> 00:08:59,080 Speaker 1: polar bears would be extinct by summer of twenty thirteen. 157 00:08:59,280 --> 00:09:02,000 Speaker 1: Here we are a decade later, and the ice caps 158 00:09:02,000 --> 00:09:04,720 Speaker 1: are even bigger than they were before. Polar bears are 159 00:09:04,880 --> 00:09:08,040 Speaker 1: flourishing more than they ever have. So Al Gore is 160 00:09:08,040 --> 00:09:11,880 Speaker 1: someone we should not be listening to in regards to climate. 161 00:09:12,120 --> 00:09:14,600 Speaker 1: And back to Paul Kruegman telling us about the economy, 162 00:09:15,160 --> 00:09:17,600 Speaker 1: it's the exact same thing. He said that the internet's 163 00:09:17,600 --> 00:09:19,559 Speaker 1: impact in the economy has been no greater than the 164 00:09:19,600 --> 00:09:22,720 Speaker 1: fax machine, and that ten years from now the information 165 00:09:22,720 --> 00:09:24,960 Speaker 1: economy would sound silly, but yet here we are in 166 00:09:25,000 --> 00:09:30,120 Speaker 1: the information economy. The information economy, you're listening to me 167 00:09:30,240 --> 00:09:32,839 Speaker 1: right now making my living in the information economy, and 168 00:09:32,920 --> 00:09:35,319 Speaker 1: of course that doesn't sound silly. And so again, is 169 00:09:35,360 --> 00:09:37,520 Speaker 1: Paul Krugman someone we should be listening to And I 170 00:09:37,559 --> 00:09:41,040 Speaker 1: would say absolutely not. But of course the government needs 171 00:09:41,120 --> 00:09:45,080 Speaker 1: someone to be out there shilling their data points, and 172 00:09:45,160 --> 00:09:47,720 Speaker 1: that's exactly what Paul Krugman does. Now, there's an article 173 00:09:47,760 --> 00:09:49,640 Speaker 1: that came out this week that thought was pretty interesting, 174 00:09:51,000 --> 00:09:55,280 Speaker 1: and of course he's a Nobel Prize winning economist, but 175 00:09:55,320 --> 00:09:58,640 Speaker 1: he recently wrote some articles in the New York Times, which, 176 00:09:58,679 --> 00:10:01,679 Speaker 1: of course The New York Times is also a mouthpiece 177 00:10:01,720 --> 00:10:04,920 Speaker 1: for the government. It's important to listen to the information 178 00:10:04,960 --> 00:10:09,080 Speaker 1: and know where it came from, what their interests are, 179 00:10:09,240 --> 00:10:11,600 Speaker 1: what their biases might be, and then you have to 180 00:10:11,640 --> 00:10:15,880 Speaker 1: start to learn to separate the facts from opinion. And 181 00:10:15,920 --> 00:10:19,559 Speaker 1: so we know that, for example, if I was reading 182 00:10:19,720 --> 00:10:22,559 Speaker 1: RT Times, I would know, well, that's a Russian news 183 00:10:22,559 --> 00:10:26,640 Speaker 1: outlet and it's probably biased towards Russia. If I listened 184 00:10:26,679 --> 00:10:29,720 Speaker 1: to the New York Times or the Washington Post, well, 185 00:10:29,760 --> 00:10:31,840 Speaker 1: I know that's like a CIA mouthpiece, and I have 186 00:10:31,880 --> 00:10:36,200 Speaker 1: to know that it's biased from that potentially, at this point, 187 00:10:36,240 --> 00:10:40,120 Speaker 1: maybe some of the most neutral news might be Al Jazeera. 188 00:10:40,280 --> 00:10:42,920 Speaker 1: I'd like to get some news from there. I tried 189 00:10:43,000 --> 00:10:45,040 Speaker 1: to look at it from both sides, so I'm going 190 00:10:45,080 --> 00:10:47,520 Speaker 1: to be equally critical of both sides that are trying 191 00:10:47,559 --> 00:10:50,440 Speaker 1: to spin this bias, but still fact check me as well. 192 00:10:50,480 --> 00:10:52,800 Speaker 1: It starts to try to separate what I tell you 193 00:10:52,840 --> 00:10:55,080 Speaker 1: as fact from what I tell you as opinion, so 194 00:10:55,120 --> 00:10:57,320 Speaker 1: you can start to formulate your own ideas anyway. So 195 00:10:57,360 --> 00:10:59,560 Speaker 1: he wrote this in The New York Times, and he 196 00:10:59,600 --> 00:11:03,320 Speaker 1: claimed that the debt of the government is quote over 197 00:11:03,559 --> 00:11:11,520 Speaker 1: hyped issue and isn't all that unusual from a historical perspective. Now, 198 00:11:11,679 --> 00:11:13,840 Speaker 1: this article that came out said that his attempts to 199 00:11:13,880 --> 00:11:19,079 Speaker 1: support these employ the kind of fraudulent accounting that would 200 00:11:19,240 --> 00:11:24,200 Speaker 1: land a corporate executive in jail. So what he's doing 201 00:11:24,320 --> 00:11:27,400 Speaker 1: is he's taking this data and trying to spin it 202 00:11:27,440 --> 00:11:31,800 Speaker 1: to support his point. But it's such it's such a 203 00:11:32,360 --> 00:11:34,679 Speaker 1: it's so much of a speculator, so much of a 204 00:11:34,760 --> 00:11:37,720 Speaker 1: spin that it would literally land a corporate executive in 205 00:11:37,880 --> 00:11:41,920 Speaker 1: prison if they try to do this. He says that, 206 00:11:42,160 --> 00:11:45,920 Speaker 1: of course he's trying to say that taming quote the 207 00:11:46,000 --> 00:11:48,840 Speaker 1: federal debt should be well down on the list of 208 00:11:48,880 --> 00:11:51,760 Speaker 1: government priorities. So he's saying that it's not a problem. 209 00:11:52,000 --> 00:11:54,360 Speaker 1: The debt's not a problem. We shouldn't even be worried about. 210 00:11:54,360 --> 00:11:56,720 Speaker 1: A matter of fact, it should be way down the 211 00:11:56,880 --> 00:12:00,200 Speaker 1: list of all the things that we worried about before. 212 00:12:00,000 --> 00:12:06,560 Speaker 1: After we worry about things like climate change and child poverty. 213 00:12:07,320 --> 00:12:11,680 Speaker 1: Because the debt projections have become quote much less dire 214 00:12:11,840 --> 00:12:14,480 Speaker 1: over the past decade or so. In reality, the debt 215 00:12:14,600 --> 00:12:19,320 Speaker 1: is far higher than projected, and Krugman's own words prove it. Now, 216 00:12:19,559 --> 00:12:21,600 Speaker 1: let's again, let's see what these numbers are. I'm gonna 217 00:12:21,640 --> 00:12:25,240 Speaker 1: give you the numbers directly from the Treasury's own report, 218 00:12:25,760 --> 00:12:28,440 Speaker 1: not from Paul Kruegman, and not opinion based. We're going 219 00:12:28,480 --> 00:12:30,120 Speaker 1: to look at what the Treasury put out now. I 220 00:12:30,160 --> 00:12:32,040 Speaker 1: do want to just say, going back to Paul Kruegman, 221 00:12:32,520 --> 00:12:36,520 Speaker 1: in two thousand and nine, under President Obama, they started 222 00:12:36,600 --> 00:12:41,960 Speaker 1: racking up debt and they projected nine trillion dollars in 223 00:12:42,120 --> 00:12:44,760 Speaker 1: deficits over the coming decades. Over that wou'd be from 224 00:12:44,760 --> 00:12:49,600 Speaker 1: two thousand nine nineteen, Krugman wrote back then, quote, even 225 00:12:49,679 --> 00:12:52,800 Speaker 1: if we do run these deficits, federal debt would be 226 00:12:52,920 --> 00:12:56,719 Speaker 1: ninety percent of GDP in twenty nineteen, or substantially less 227 00:12:56,720 --> 00:12:58,040 Speaker 1: than it was at the end of World War Two. 228 00:12:58,280 --> 00:13:02,800 Speaker 1: So again the Noel Prize winning economist is telling us 229 00:13:02,800 --> 00:13:06,320 Speaker 1: that no problem, no problem running these deficits. Even if 230 00:13:06,320 --> 00:13:08,120 Speaker 1: we do, even if we do run a nine trillion 231 00:13:08,120 --> 00:13:10,560 Speaker 1: dollars in deficits, it's gonna be way less than it 232 00:13:10,559 --> 00:13:13,480 Speaker 1: would in World War Two. However, he said it would 233 00:13:13,480 --> 00:13:16,319 Speaker 1: be ninety percent. However, it turned out to be twenty 234 00:13:16,320 --> 00:13:19,400 Speaker 1: one percent higher than that one hundred and ten percent. 235 00:13:20,440 --> 00:13:23,800 Speaker 1: So again he's wrong. He's wrong, he's wrong, he's wrong. 236 00:13:23,800 --> 00:13:25,160 Speaker 1: I don't know why we continue to look at him 237 00:13:25,280 --> 00:13:27,160 Speaker 1: or listen to him, But let's take a look at 238 00:13:27,200 --> 00:13:30,320 Speaker 1: some of these things that the Treasury put out in 239 00:13:30,400 --> 00:13:33,640 Speaker 1: their own data. Now, what we can see is that 240 00:13:34,679 --> 00:13:38,360 Speaker 1: the US has a massive spending problem. So if we 241 00:13:38,480 --> 00:13:41,000 Speaker 1: go back, Unfortunately I can't show you the chart because 242 00:13:41,000 --> 00:13:43,800 Speaker 1: we're here on the radio. But if I showed you 243 00:13:43,840 --> 00:13:47,800 Speaker 1: a chart, you can go onto the thread. So the 244 00:13:47,880 --> 00:13:51,360 Speaker 1: FED puts out its own data, and you can go 245 00:13:51,400 --> 00:13:55,079 Speaker 1: to Fred dot st. Louis, fed dot org and you 246 00:13:55,080 --> 00:13:58,400 Speaker 1: can get all this data that the FED actually puts out. 247 00:13:58,400 --> 00:14:00,080 Speaker 1: I like to go to the source. And so if 248 00:14:00,120 --> 00:14:02,439 Speaker 1: we look at this, we can see basically a chart 249 00:14:02,480 --> 00:14:05,480 Speaker 1: of lines which shows the debt, the amount of debt 250 00:14:05,520 --> 00:14:08,440 Speaker 1: that we're building, and the amount of gross domestic product 251 00:14:08,520 --> 00:14:12,040 Speaker 1: that we're producing. So remember wealth is not money, wealth 252 00:14:12,160 --> 00:14:14,040 Speaker 1: is goods and services. So we want to look at 253 00:14:14,040 --> 00:14:17,280 Speaker 1: the gross domestic product, the amount of goods and services 254 00:14:17,320 --> 00:14:19,600 Speaker 1: that are being produced. Now it's a little bit of 255 00:14:19,600 --> 00:14:22,280 Speaker 1: amis leading number because the amount of spending the government 256 00:14:22,600 --> 00:14:26,160 Speaker 1: actually does that increases. The GDP has grown bigger and 257 00:14:26,160 --> 00:14:28,320 Speaker 1: bigger and bigger. But that's a whole another topic for 258 00:14:28,360 --> 00:14:31,360 Speaker 1: another time. But if we look at just the GDP growth, 259 00:14:31,960 --> 00:14:36,280 Speaker 1: we can see that until about nineteen seventy, the GDP 260 00:14:36,480 --> 00:14:39,880 Speaker 1: growth and debt we're growing at about the same pace. 261 00:14:40,600 --> 00:14:43,920 Speaker 1: But since around nineteen seventy they really started getting off, 262 00:14:44,000 --> 00:14:48,360 Speaker 1: really nineteen eighties where they just really took a drastic turn, 263 00:14:49,880 --> 00:14:52,440 Speaker 1: and we can see that now the amount of debt 264 00:14:52,480 --> 00:14:57,640 Speaker 1: we're growing is way outpacing the amount of growth. Now, 265 00:14:57,680 --> 00:15:01,000 Speaker 1: the problem with this is that means it's not sustainable. Now. 266 00:15:01,040 --> 00:15:03,880 Speaker 1: The scam is that they tell us that, hey, we 267 00:15:04,280 --> 00:15:06,760 Speaker 1: took an economic hit, we're not going to get as 268 00:15:06,800 --> 00:15:09,560 Speaker 1: much growth as we normally would because of whatever recession 269 00:15:09,720 --> 00:15:12,480 Speaker 1: or whatever the pandemic or whatever it is, and so 270 00:15:12,560 --> 00:15:14,440 Speaker 1: we should just take on a little bit of debt. 271 00:15:14,600 --> 00:15:16,840 Speaker 1: Let's go ahead and spend more than we bring in, 272 00:15:17,160 --> 00:15:19,960 Speaker 1: because we'll make it up later. It's sort of like 273 00:15:20,000 --> 00:15:22,560 Speaker 1: if you lost your job and you're gonna live on 274 00:15:22,600 --> 00:15:24,440 Speaker 1: a credit card for a little while. But it's okay 275 00:15:24,440 --> 00:15:26,640 Speaker 1: because when you get another job, then you're gonna go 276 00:15:26,640 --> 00:15:29,600 Speaker 1: ahead and pay that debt back off. Or you're going 277 00:15:29,640 --> 00:15:32,840 Speaker 1: to go into debt to build a new product or 278 00:15:32,840 --> 00:15:35,440 Speaker 1: a business line, or a new business, and then when 279 00:15:35,480 --> 00:15:37,680 Speaker 1: the business grows, you wible to pay that off. The 280 00:15:37,680 --> 00:15:39,760 Speaker 1: problem is that the business doesn't ever take off, it 281 00:15:39,760 --> 00:15:41,480 Speaker 1: doesn't grow, but yet you keep spending more and more 282 00:15:41,480 --> 00:15:43,640 Speaker 1: and more and more debt, and eventually, eventually it's going 283 00:15:43,680 --> 00:15:45,480 Speaker 1: to hit. Eventually it's going to hit. But the problem 284 00:15:45,600 --> 00:15:48,680 Speaker 1: is all that debt bogs you down and doesn't allow 285 00:15:48,720 --> 00:15:51,040 Speaker 1: you to grow. All the money that should be going 286 00:15:51,080 --> 00:15:54,760 Speaker 1: into productive investments gets spent just to cover the debt, 287 00:15:55,160 --> 00:15:58,160 Speaker 1: or what we call the interest coverage. Now you might 288 00:15:58,160 --> 00:16:01,760 Speaker 1: have heard the term of a zombie company before. We 289 00:16:01,840 --> 00:16:04,240 Speaker 1: have lots of zombie companies in the US and around 290 00:16:04,240 --> 00:16:06,760 Speaker 1: the world. And a zombie company would basically be a 291 00:16:06,760 --> 00:16:12,360 Speaker 1: company that that doesn't make enough money enough profit to 292 00:16:12,400 --> 00:16:16,360 Speaker 1: cover even the interest on their debt. That's a zombie company. 293 00:16:16,680 --> 00:16:20,000 Speaker 1: So no matter how much they grow, they just can't 294 00:16:20,000 --> 00:16:22,160 Speaker 1: pay off the debt because the just to cover that 295 00:16:22,280 --> 00:16:25,440 Speaker 1: the interest is more than the money they make. Now, 296 00:16:27,480 --> 00:16:30,880 Speaker 1: could the government be in that position? Could the government? 297 00:16:30,920 --> 00:16:34,320 Speaker 1: Could the United States government be a zombie company. I'm 298 00:16:34,360 --> 00:16:36,840 Speaker 1: going to answer that question with some data and some facts, 299 00:16:36,840 --> 00:16:38,640 Speaker 1: and we're gonna show you exactly what the Treasury said 300 00:16:38,640 --> 00:16:42,520 Speaker 1: about where we're going. And I gotta be honest, it's shocking, 301 00:16:42,920 --> 00:16:46,200 Speaker 1: and you're gonna understand exactly why we're arguing over debtsillion limits, 302 00:16:46,240 --> 00:16:50,040 Speaker 1: and you're gonna understand exactly what is going to happen 303 00:16:50,080 --> 00:16:53,280 Speaker 1: because there's no other option once you hear the data 304 00:16:53,280 --> 00:16:55,280 Speaker 1: directly from them. So let's take into that. I'm going 305 00:16:55,320 --> 00:16:56,960 Speaker 1: to take a break. If you're just tune and you're 306 00:16:57,000 --> 00:16:59,880 Speaker 1: listening to the Markma Show talking about the decentralized rever 307 00:17:00,480 --> 00:17:02,960 Speaker 1: we're talking about this eighty year financial revolution that we're 308 00:17:02,960 --> 00:17:05,560 Speaker 1: focusing on right now. I'm going to cover a lot 309 00:17:05,640 --> 00:17:07,040 Speaker 1: you don't want to miss this, I'll be back. Don't 310 00:17:07,040 --> 00:17:10,080 Speaker 1: go away, all right, welcome back. If you just tune in, 311 00:17:10,119 --> 00:17:13,160 Speaker 1: you're listening to the Markama Show. We're talking about, of course, 312 00:17:13,200 --> 00:17:15,680 Speaker 1: each and every week, the decents realized revolution, the politics, 313 00:17:15,720 --> 00:17:19,480 Speaker 1: finance and technology. We're focusing on just the financial revolution 314 00:17:19,560 --> 00:17:21,840 Speaker 1: aspect today and we're going over this report that the 315 00:17:21,960 --> 00:17:24,840 Speaker 1: US Treasury just put out. Now, I explained to you 316 00:17:24,880 --> 00:17:27,640 Speaker 1: what a zombie company was. A zombie company is someone 317 00:17:27,680 --> 00:17:32,840 Speaker 1: that doesn't have enough income to cover the interest revenues, 318 00:17:32,920 --> 00:17:38,080 Speaker 1: must cover expenses plus interest, or your zombie. Now, the 319 00:17:38,200 --> 00:17:41,440 Speaker 1: US government has a problem, and that is that they're 320 00:17:41,640 --> 00:17:45,800 Speaker 1: entitlement spending, which is the mandatory This is money they 321 00:17:45,840 --> 00:17:48,360 Speaker 1: owe to people, you know, Medicare and Medicaid, so security, etc. 322 00:17:48,640 --> 00:17:53,400 Speaker 1: They have to pay this mandatory expenses. So just that alone, 323 00:17:53,480 --> 00:17:56,880 Speaker 1: not all the other expenses. Just that plus the interest 324 00:17:57,000 --> 00:18:00,760 Speaker 1: on the debt is more than the revenue, the tax 325 00:18:00,800 --> 00:18:04,920 Speaker 1: revenues they bring in. That means there a zombie company. 326 00:18:06,080 --> 00:18:10,320 Speaker 1: Now that doesn't take into consideration all the other long 327 00:18:10,440 --> 00:18:13,560 Speaker 1: term contracts they're committed to, like defense contracts. But let's 328 00:18:13,560 --> 00:18:16,800 Speaker 1: go ahead and skip past that. So just per the Treasury, 329 00:18:17,119 --> 00:18:22,280 Speaker 1: the CBO Congressional Budget Office. This is the government estimates 330 00:18:22,280 --> 00:18:24,240 Speaker 1: that for this year twenty twenty three, there will be 331 00:18:24,240 --> 00:18:28,120 Speaker 1: four point eight trillion in tax revenue. But the mandatory expenses, 332 00:18:28,160 --> 00:18:32,800 Speaker 1: which are the entitlements, also the defense budget eight billion 333 00:18:32,840 --> 00:18:35,320 Speaker 1: for defense and seven hundred billion, which is the net 334 00:18:35,359 --> 00:18:39,040 Speaker 1: interest on federal debt equals five point three trillion. So 335 00:18:39,880 --> 00:18:41,680 Speaker 1: you have to be super good at math. Five point 336 00:18:41,760 --> 00:18:45,040 Speaker 1: three trillion of mandatory expenses is more than the four 337 00:18:45,119 --> 00:18:51,080 Speaker 1: point eight trillion of income. So that's a zombie company. 338 00:18:51,119 --> 00:18:53,840 Speaker 1: Now that doesn't include all the other spending. Well, I'm 339 00:18:53,880 --> 00:18:57,040 Speaker 1: not talking about, you know, all the other money that 340 00:18:57,040 --> 00:18:59,200 Speaker 1: we're sending into Ukraine and all the other money we're 341 00:18:59,200 --> 00:19:01,960 Speaker 1: sending to other country for gender studies. I'm not krying 342 00:19:02,000 --> 00:19:04,200 Speaker 1: all the money for welfare and UBI. I'm not talking 343 00:19:04,240 --> 00:19:07,080 Speaker 1: about any of that. I'm just talking about the mandatory, 344 00:19:07,320 --> 00:19:10,200 Speaker 1: the entitlements, the money we owe to other people, medicare, medicaids, 345 00:19:10,200 --> 00:19:12,320 Speaker 1: so security. I'm talking about the defense, and I'm talking 346 00:19:12,359 --> 00:19:15,399 Speaker 1: about the interest on the debt. That's it. Now. You 347 00:19:15,480 --> 00:19:17,800 Speaker 1: also know that the FED is on a warpath to 348 00:19:17,960 --> 00:19:21,680 Speaker 1: fight inflation. They are raising rates higher, higher, higher, higher, higher, 349 00:19:21,720 --> 00:19:24,920 Speaker 1: to fight inflation. But there's a couple of problems that 350 00:19:25,080 --> 00:19:29,800 Speaker 1: lead that really lead to the zombie company really going overboard. 351 00:19:30,000 --> 00:19:32,920 Speaker 1: And so as they continue to raise, as the FED 352 00:19:32,960 --> 00:19:36,480 Speaker 1: continues to raise interest rates, the net interest on the 353 00:19:36,560 --> 00:19:41,080 Speaker 1: debt goes up. So per the CBO Congressional Budget's Office 354 00:19:41,200 --> 00:19:45,400 Speaker 1: estimates for this year, they estimated seven hundred billion in 355 00:19:45,400 --> 00:19:49,200 Speaker 1: interest on the federal debt. However, you keep hearing about, well, 356 00:19:49,200 --> 00:19:51,240 Speaker 1: the economy is still pretty good, the jobs markets so 357 00:19:51,280 --> 00:19:53,119 Speaker 1: pretty good. The FED is going to keep hiking rates. 358 00:19:53,560 --> 00:19:56,240 Speaker 1: Now they're talking about the FED getting to potentially a 359 00:19:56,440 --> 00:20:00,880 Speaker 1: six percent rate, six per What does that mean, Well, 360 00:20:00,880 --> 00:20:04,240 Speaker 1: that means at six percent, the interest of the government 361 00:20:04,320 --> 00:20:07,840 Speaker 1: is now not seven hundred billion, it's about one point 362 00:20:07,960 --> 00:20:12,040 Speaker 1: eight trillion, one point eight tit Now that's on the 363 00:20:12,160 --> 00:20:14,200 Speaker 1: thirty one and a half trillion dollars a debt we 364 00:20:14,240 --> 00:20:17,239 Speaker 1: have today. That's not including where it might be by 365 00:20:17,280 --> 00:20:19,760 Speaker 1: the end of the year. So that's not seven hundred billion, 366 00:20:19,800 --> 00:20:23,400 Speaker 1: it's one point eight one. That's that's an extra trillion dollars, 367 00:20:23,440 --> 00:20:28,280 Speaker 1: an extra trillion dollars a year. Now, the CBO Congressional 368 00:20:28,240 --> 00:20:31,560 Speaker 1: Budget Office, again they have these projections where they show, 369 00:20:31,840 --> 00:20:35,240 Speaker 1: just like any business would, what their revenues are expected 370 00:20:35,280 --> 00:20:38,239 Speaker 1: to be moving forward twenty twenty four, twenty five, six, 371 00:20:38,359 --> 00:20:40,879 Speaker 1: twenty seven, all the way till twenty thirty three. So 372 00:20:40,880 --> 00:20:42,840 Speaker 1: they show the revenues, how much they expect to get 373 00:20:42,840 --> 00:20:45,280 Speaker 1: from income tax, perill tax, etc. And then they show 374 00:20:45,280 --> 00:20:48,080 Speaker 1: their outlays and they break it down by mandatory, what's 375 00:20:48,119 --> 00:20:51,080 Speaker 1: the mandatory expense they have to spend, and then what's discretionary. 376 00:20:51,200 --> 00:20:53,840 Speaker 1: So mandatory for you personally would be like your house payment, 377 00:20:53,920 --> 00:20:56,239 Speaker 1: your electricity bill, or your car payment. You have to 378 00:20:56,240 --> 00:20:57,960 Speaker 1: pay those things or you get put on the street 379 00:20:58,000 --> 00:21:01,119 Speaker 1: and you have no car. Discretionary would be like you know, 380 00:21:01,240 --> 00:21:03,399 Speaker 1: going clothes shopping, going out to dinner, and things like that, 381 00:21:03,480 --> 00:21:06,240 Speaker 1: going on a vacation, so you have the mandatory and discretion. 382 00:21:06,320 --> 00:21:08,360 Speaker 1: They break that out and then they show the total deficits, 383 00:21:08,359 --> 00:21:10,760 Speaker 1: so the shortcoming. So in twenty twenty three they're showing 384 00:21:10,760 --> 00:21:14,520 Speaker 1: a deficit of one point four trillion. By the end 385 00:21:14,560 --> 00:21:17,879 Speaker 1: of the decade, they're showing it to have a By 386 00:21:17,920 --> 00:21:21,560 Speaker 1: twenty thirty, you have a deficit of two point one trillion, 387 00:21:22,480 --> 00:21:27,440 Speaker 1: So basically adding in two trillion dollars of debt every 388 00:21:27,440 --> 00:21:31,720 Speaker 1: single year, two trillion dollars of debt every single year. Now, 389 00:21:32,440 --> 00:21:36,200 Speaker 1: first of all, this is based off of tax revenues 390 00:21:36,400 --> 00:21:39,000 Speaker 1: staying the same, which they're not. As a matter of fact, 391 00:21:39,200 --> 00:21:44,040 Speaker 1: tax revenues are down nine percent year over year, Wire 392 00:21:44,080 --> 00:21:46,879 Speaker 1: tax revenues down. Well, turns out the FED is on 393 00:21:46,880 --> 00:21:49,720 Speaker 1: a warpath. The Fed is on a warpath to stop inflation. 394 00:21:49,840 --> 00:21:52,399 Speaker 1: They want prices to stop going up. They want prices 395 00:21:52,440 --> 00:21:55,000 Speaker 1: to stay stable. They don't really want prices to come 396 00:21:55,000 --> 00:21:57,880 Speaker 1: back down, but they want prices to stop going up. 397 00:21:57,920 --> 00:22:01,320 Speaker 1: So what they're doing is they're crushing demand. And if 398 00:22:01,320 --> 00:22:05,120 Speaker 1: we raise rates higher, that will bring asset prices down, 399 00:22:05,160 --> 00:22:07,760 Speaker 1: your stocks, bonds, your retirement account, that will bring your 400 00:22:07,800 --> 00:22:10,520 Speaker 1: real estate, your house value down. And if we can 401 00:22:10,640 --> 00:22:13,320 Speaker 1: bring the value your assets down, people feel broke and 402 00:22:13,320 --> 00:22:17,320 Speaker 1: they don't spend as much. That's their theory. The problem 403 00:22:17,359 --> 00:22:21,880 Speaker 1: with that is that as asset prices come down, then 404 00:22:22,000 --> 00:22:25,159 Speaker 1: there's no capital gains. Like I'm not selling stocks or 405 00:22:25,200 --> 00:22:27,560 Speaker 1: real estate at a profit, there's no capital gains tax 406 00:22:27,560 --> 00:22:29,879 Speaker 1: going to the governments. Now, tax revenues went down. Also, 407 00:22:30,280 --> 00:22:33,240 Speaker 1: they want people to feel broke so they stop spending. 408 00:22:33,680 --> 00:22:38,000 Speaker 1: But if people stop spending, then the tax revenue drops. 409 00:22:38,280 --> 00:22:42,359 Speaker 1: So the CBO has this baseline projection, but they're basing 410 00:22:42,440 --> 00:22:46,240 Speaker 1: it off of tax revenues going up, but in reality, 411 00:22:46,320 --> 00:22:50,480 Speaker 1: tax revenues are coming down. They're down nine percent year 412 00:22:50,520 --> 00:22:52,840 Speaker 1: over year. Now, if we have a recession, which it 413 00:22:52,880 --> 00:22:54,320 Speaker 1: looks like we're going into, I'm going to have talked 414 00:22:54,320 --> 00:22:55,880 Speaker 1: about some of the data here in a minute. If 415 00:22:55,880 --> 00:22:58,480 Speaker 1: we have a recession, then we would expect tax revenues 416 00:22:58,520 --> 00:23:02,560 Speaker 1: to dip by twenty percent. So now what does this 417 00:23:02,680 --> 00:23:08,280 Speaker 1: due to the qualifications to calculations, So you can see 418 00:23:08,320 --> 00:23:12,080 Speaker 1: we're in a really, really big problem. Now, the CBO, 419 00:23:12,160 --> 00:23:15,400 Speaker 1: again directly from the CBO Congressional Budget Office, they show 420 00:23:15,440 --> 00:23:18,200 Speaker 1: here in twenty twenty three, we have about one hundred 421 00:23:18,280 --> 00:23:25,360 Speaker 1: percent of debt to GDP one percent ratio of GDP 422 00:23:25,520 --> 00:23:28,280 Speaker 1: wrote debt to GDP. But they're showing this on a 423 00:23:28,359 --> 00:23:30,680 Speaker 1: chart I wish I could show to you going straight up, 424 00:23:30,720 --> 00:23:35,240 Speaker 1: almost like a hockey stick. And by twenty fifty, again 425 00:23:35,320 --> 00:23:38,879 Speaker 1: the CBO projects by twenty fifty will be at two 426 00:23:39,320 --> 00:23:44,000 Speaker 1: hundred percent debt to GDP. Well, that's not sustainable. They 427 00:23:44,080 --> 00:23:46,240 Speaker 1: go on to tell us more. The Treasury goes on 428 00:23:46,280 --> 00:23:49,720 Speaker 1: to tell us they actually published in this report I'm 429 00:23:49,720 --> 00:23:54,240 Speaker 1: talking about, they titled it, well, this was an executive 430 00:23:54,240 --> 00:23:56,520 Speaker 1: coming to the fiscal year for twenty twenty one, and 431 00:23:56,560 --> 00:24:00,840 Speaker 1: they titled it quote an unsustainable fiscal path. And in 432 00:24:00,880 --> 00:24:04,960 Speaker 1: this they showed that the amount of debt held by 433 00:24:04,960 --> 00:24:09,720 Speaker 1: the public is going to go up by astronomical amounts. 434 00:24:09,880 --> 00:24:11,800 Speaker 1: Like I said, by about the year, they showed about 435 00:24:11,840 --> 00:24:14,040 Speaker 1: by the year twenty forty five, we've been two hundred percent, 436 00:24:14,400 --> 00:24:18,480 Speaker 1: but they showed by the year like twenty eighty six 437 00:24:18,720 --> 00:24:24,560 Speaker 1: hundred percent, what six hundred percent, So we are on 438 00:24:24,720 --> 00:24:26,760 Speaker 1: an unsustainable path. Let me give you a couple of 439 00:24:26,760 --> 00:24:29,440 Speaker 1: other data points then we'll move on. But what else 440 00:24:29,520 --> 00:24:32,919 Speaker 1: was in the report or what else is relevant to 441 00:24:33,000 --> 00:24:37,320 Speaker 1: the report? I should say, is that this is based 442 00:24:37,320 --> 00:24:39,399 Speaker 1: off of the debt, right, the amount of outlay. So 443 00:24:39,480 --> 00:24:42,720 Speaker 1: we again they're showing seven hundred billion dollars in interest 444 00:24:43,040 --> 00:24:47,640 Speaker 1: being owed, but again rates are going up, which means 445 00:24:47,640 --> 00:24:50,119 Speaker 1: though oh more. Now, a lot of the debt that 446 00:24:50,160 --> 00:24:53,680 Speaker 1: the government has is locked in by timeline. So there's 447 00:24:54,160 --> 00:24:58,640 Speaker 1: zero to one year maturities, there's one to three year maturities, 448 00:24:58,680 --> 00:25:01,800 Speaker 1: there's five year, ten year, twenty year thirty year maturities. 449 00:25:02,160 --> 00:25:05,000 Speaker 1: So not just as the FED continues to raise rates 450 00:25:05,240 --> 00:25:07,639 Speaker 1: doesn't mean all of the rate goes up, which is 451 00:25:07,680 --> 00:25:10,280 Speaker 1: why the FED is showing a seven hundred billion dollar 452 00:25:10,359 --> 00:25:12,680 Speaker 1: amount even though I'm sorry, the Treasury is showing seven 453 00:25:12,720 --> 00:25:15,240 Speaker 1: hundred billion oh, even while the FED is raising rates. 454 00:25:15,280 --> 00:25:17,000 Speaker 1: It's because a lot of that debt is locked in. 455 00:25:17,200 --> 00:25:19,359 Speaker 1: But that's part of the problem. So what we know 456 00:25:19,520 --> 00:25:22,159 Speaker 1: is that all the US government debt, we can see 457 00:25:22,160 --> 00:25:24,760 Speaker 1: what the maturities are, and what we can see is 458 00:25:24,800 --> 00:25:27,520 Speaker 1: that fifty percent of the debt, of the thirty one 459 00:25:27,520 --> 00:25:31,520 Speaker 1: trillion of that matures in the next three years and 460 00:25:31,640 --> 00:25:35,000 Speaker 1: is going to have to be refinanced. Now the FED 461 00:25:35,080 --> 00:25:37,200 Speaker 1: is telling us they're going to raise rates and leave 462 00:25:37,320 --> 00:25:41,200 Speaker 1: them there, raise rates and leave them there. Now they're 463 00:25:41,200 --> 00:25:44,920 Speaker 1: talking about maybe get into six percent. So what does 464 00:25:44,920 --> 00:25:48,800 Speaker 1: that mean for the outstanding government debt and what should 465 00:25:48,840 --> 00:25:51,959 Speaker 1: we expect. I'm going to tell you exactly what that 466 00:25:52,080 --> 00:25:54,280 Speaker 1: looks like, and then we're going to look at some 467 00:25:54,359 --> 00:25:57,719 Speaker 1: of this economic data to really back this up, and 468 00:25:57,800 --> 00:26:01,280 Speaker 1: it is it's not good, not good now. And so 469 00:26:01,520 --> 00:26:04,720 Speaker 1: when you have these Paul Krugman's of the world painting 470 00:26:04,760 --> 00:26:08,439 Speaker 1: these rosy pictures as the article that I read to 471 00:26:08,480 --> 00:26:12,679 Speaker 1: you from stated it's criminal. If a CEO did this, 472 00:26:12,720 --> 00:26:14,480 Speaker 1: it would be criminal. And so I want you to 473 00:26:14,520 --> 00:26:16,479 Speaker 1: understand this now. The reason why it's important to understand 474 00:26:16,480 --> 00:26:20,120 Speaker 1: it is because it basically shows what's inevitable. So if 475 00:26:20,119 --> 00:26:21,720 Speaker 1: you want to know what you should be thinking about 476 00:26:21,760 --> 00:26:24,480 Speaker 1: with your business, or your retirement account or your house, 477 00:26:24,800 --> 00:26:26,159 Speaker 1: then you want to stay tuned to what I have 478 00:26:26,200 --> 00:26:29,240 Speaker 1: because it's going to show what is inevitable. If you're 479 00:26:29,240 --> 00:26:30,960 Speaker 1: just tuning in, you're listening to the Mark Moa show 480 00:26:31,000 --> 00:26:33,600 Speaker 1: talking about the decentralized revolution this week, talking about the 481 00:26:33,640 --> 00:26:36,240 Speaker 1: financial revolution that's happening. I got a lot more to 482 00:26:36,240 --> 00:26:38,000 Speaker 1: cover when I come back. Don't go away, I'll be 483 00:26:38,080 --> 00:26:42,199 Speaker 1: right back, all right, Welcome back. If you just tune in, 484 00:26:42,200 --> 00:26:44,600 Speaker 1: you're listening to the Mark Moa Show talking about, of 485 00:26:44,600 --> 00:26:47,040 Speaker 1: course each and every week, the decentralized revolution. We're talking 486 00:26:47,040 --> 00:26:50,800 Speaker 1: about right now, the financial revolution piece that's happening, and 487 00:26:50,840 --> 00:26:53,720 Speaker 1: I'm telling you what's inevitable. All right. I was setting 488 00:26:53,800 --> 00:26:56,399 Speaker 1: up the read new information from the Treasury report. If 489 00:26:56,440 --> 00:26:58,240 Speaker 1: you're missed in this, don't worry. You can go catch 490 00:26:58,280 --> 00:27:00,240 Speaker 1: it on the archives just go check out the Mark 491 00:27:00,320 --> 00:27:02,800 Speaker 1: Moss Show on your favorite podcast player, or you can 492 00:27:02,840 --> 00:27:05,520 Speaker 1: watch me and listen to me on YouTube under the 493 00:27:05,640 --> 00:27:08,800 Speaker 1: Market Disruptors YouTube channel. Check it out, and while you're 494 00:27:08,800 --> 00:27:11,200 Speaker 1: at it, follow me on social media at one Mark 495 00:27:11,240 --> 00:27:13,480 Speaker 1: Moss at that's just the number one, Mark Moss. Shoot 496 00:27:13,480 --> 00:27:15,600 Speaker 1: me a message, tell me you're listening, ask me some questions. 497 00:27:15,640 --> 00:27:17,960 Speaker 1: I'd love to engage with there. All right, so let's 498 00:27:18,040 --> 00:27:20,240 Speaker 1: keeping the treasury up at night. Remember the treasury the 499 00:27:20,359 --> 00:27:22,600 Speaker 1: US government is that of the thirty one and a 500 00:27:22,600 --> 00:27:25,679 Speaker 1: half trillion dollars of debt they owe, it's locked in 501 00:27:25,760 --> 00:27:29,359 Speaker 1: on these different maturity dates. But fifty percent of the 502 00:27:29,480 --> 00:27:31,720 Speaker 1: debt is maturing and is going to have to be 503 00:27:31,800 --> 00:27:36,080 Speaker 1: refinanced in just the next three years. And so remember 504 00:27:36,080 --> 00:27:40,080 Speaker 1: those CBO projections I was telling you where by twenty 505 00:27:40,119 --> 00:27:43,439 Speaker 1: thirty where at two trillion dollars a year? Well, and 506 00:27:43,680 --> 00:27:47,359 Speaker 1: how grossly misstated those are, because one, the income is 507 00:27:47,400 --> 00:27:50,399 Speaker 1: going to continue to go down, but also the amount 508 00:27:50,440 --> 00:27:51,959 Speaker 1: of interest expense is going to go up. And so 509 00:27:52,000 --> 00:27:54,360 Speaker 1: we can see fifty percent matures the next three years, 510 00:27:54,359 --> 00:27:57,760 Speaker 1: and it's going to be replaced at rates of wherever 511 00:27:57,800 --> 00:28:03,600 Speaker 1: we're at for five six percent. So how's that going 512 00:28:03,640 --> 00:28:08,080 Speaker 1: to work. It's going to take that seven hundred billion 513 00:28:08,119 --> 00:28:11,720 Speaker 1: dollar number and that's going to push it through the roof. 514 00:28:12,080 --> 00:28:14,280 Speaker 1: We're going to go to over a trillion dollars a 515 00:28:14,359 --> 00:28:20,360 Speaker 1: year of just interest only. That's that's where we're headed. Fun, fun, fun, 516 00:28:20,400 --> 00:28:23,040 Speaker 1: fun stuff. So that's why Paul Krugman is wrong. Now, 517 00:28:23,119 --> 00:28:26,359 Speaker 1: if your Social Security or if you're on SO security 518 00:28:26,440 --> 00:28:29,080 Speaker 1: or expecting to get so secured at one point, I 519 00:28:29,200 --> 00:28:31,199 Speaker 1: have something to tell you that you may not like, 520 00:28:31,320 --> 00:28:34,000 Speaker 1: and that's that it is set to start running a 521 00:28:34,040 --> 00:28:36,520 Speaker 1: shortfall by the end of the decade. As a matter 522 00:28:36,560 --> 00:28:40,600 Speaker 1: of fact, if the Sociecurity funds become insolvent and there's 523 00:28:40,600 --> 00:28:44,400 Speaker 1: no change to current laws, beneficiaries would see more than 524 00:28:44,440 --> 00:28:49,000 Speaker 1: a twenty percent reduction in benefits. So I'm not planning 525 00:28:49,000 --> 00:28:51,160 Speaker 1: on getting any at all by the time I retire. 526 00:28:51,360 --> 00:28:53,800 Speaker 1: And if you're on it, that's something to be paying 527 00:28:53,840 --> 00:28:57,080 Speaker 1: attention to. You might start seeing a reduction there, a drawdown, 528 00:28:57,120 --> 00:28:59,520 Speaker 1: which is going to be super important if you're depending 529 00:28:59,560 --> 00:29:02,840 Speaker 1: on that all. But again they're based in all of 530 00:29:02,840 --> 00:29:08,040 Speaker 1: this information on economic data. One the amount of revenue 531 00:29:08,040 --> 00:29:10,720 Speaker 1: they're going to collect. But Again, if the economy continues 532 00:29:10,760 --> 00:29:14,240 Speaker 1: to go downhill, then the amount of tax revenue to 533 00:29:14,240 --> 00:29:17,520 Speaker 1: collect also goes downhill, which puts the deficit even higher. 534 00:29:18,160 --> 00:29:22,040 Speaker 1: And we can see that the economy is seemingly barreling 535 00:29:22,200 --> 00:29:25,800 Speaker 1: into a recession. No matter what they want to tell 536 00:29:25,800 --> 00:29:30,160 Speaker 1: you with the data, the jobs data, the unemployment data, 537 00:29:30,240 --> 00:29:32,440 Speaker 1: it's all wrong. Everything, everything you've learned is wrong. So 538 00:29:32,480 --> 00:29:34,040 Speaker 1: we can see here if we look at some different 539 00:29:34,040 --> 00:29:37,000 Speaker 1: economic indicators, we can try to find it ourselves. There's 540 00:29:37,000 --> 00:29:42,040 Speaker 1: this conference boards Leading Economic Indicators. It's continued. It's declined 541 00:29:42,080 --> 00:29:46,520 Speaker 1: in January, dropping zero point three percent month over month, 542 00:29:47,320 --> 00:29:49,719 Speaker 1: so that's not good. We can see it's the tenth 543 00:29:49,880 --> 00:29:54,880 Speaker 1: straight monthly decline in the LI Leading Economic Indicator. It's 544 00:29:54,920 --> 00:29:59,840 Speaker 1: the longest streak of declines since Lehman, which was twenty 545 00:30:00,400 --> 00:30:05,000 Speaker 1: straight months of decline, so we're currently in the longest 546 00:30:05,040 --> 00:30:10,560 Speaker 1: streak since Layman happened. Among the leading indicators, we have 547 00:30:10,640 --> 00:30:16,240 Speaker 1: deteriorating manufacturing new orders, so manufacturers aren't ordering, so manufacturing 548 00:30:16,360 --> 00:30:19,160 Speaker 1: production is going down. Remember, wealth is not money, wealth 549 00:30:19,280 --> 00:30:22,120 Speaker 1: is goods and services, So when manufacturers aren't producing goods 550 00:30:22,120 --> 00:30:25,880 Speaker 1: and services, that's not good. Also, leading indicators are consumers, 551 00:30:25,920 --> 00:30:33,040 Speaker 1: expectations of business conditions, credit conditions, and all of that 552 00:30:33,080 --> 00:30:36,640 Speaker 1: combined more than offset the strength supposed strength that we 553 00:30:36,680 --> 00:30:41,760 Speaker 1: had in the labor markets. The Conference Board expects high inflation, 554 00:30:42,480 --> 00:30:47,640 Speaker 1: rising interest rates, and contracting consumers spending to tip the 555 00:30:47,720 --> 00:30:50,720 Speaker 1: US economy into recession in twenty twenty three. So if 556 00:30:50,760 --> 00:30:55,720 Speaker 1: that happens, tax revenues go down. It says this is 557 00:30:56,720 --> 00:30:59,120 Speaker 1: on a year of year basis, the li is down 558 00:30:59,280 --> 00:31:04,000 Speaker 1: six point zero three percent, which is close to the 559 00:31:04,040 --> 00:31:06,760 Speaker 1: biggest year over year drop since two thousand and eight. 560 00:31:08,680 --> 00:31:11,000 Speaker 1: So we're on the longest streak since we saw in 561 00:31:11,040 --> 00:31:13,719 Speaker 1: two thousand and eight. It's the we're almost to the 562 00:31:13,760 --> 00:31:16,280 Speaker 1: same size of drop that we saw in two thousand 563 00:31:16,280 --> 00:31:20,360 Speaker 1: and eight. It's not a good sign for GDP. And 564 00:31:20,400 --> 00:31:22,280 Speaker 1: if it's not a good sign for GDP, what does 565 00:31:22,280 --> 00:31:25,120 Speaker 1: that mean, that means tax revenues go down. We can 566 00:31:25,160 --> 00:31:28,720 Speaker 1: also see subprime auto loan delinquencies just had a thirteen 567 00:31:29,040 --> 00:31:32,240 Speaker 1: year high. All this money that got injected into the 568 00:31:32,280 --> 00:31:35,239 Speaker 1: system through the COVID pandemic got you know, all these 569 00:31:35,240 --> 00:31:37,959 Speaker 1: companies to expand very quickly, like Amazon started building out 570 00:31:37,960 --> 00:31:40,080 Speaker 1: all these new shipping centers, started hiring all these people. 571 00:31:40,280 --> 00:31:41,920 Speaker 1: All these people got hired on the new jobs, and 572 00:31:41,960 --> 00:31:44,520 Speaker 1: they went out and bought cars with that stimmy. But 573 00:31:44,600 --> 00:31:46,680 Speaker 1: now all the layoffs are happening, and now people can't 574 00:31:46,680 --> 00:31:49,120 Speaker 1: afford those cars. Now I've been hearing stories and reading 575 00:31:49,200 --> 00:31:53,080 Speaker 1: reading stories of all these cars at car auction lots 576 00:31:53,120 --> 00:31:56,480 Speaker 1: that have never even been registered, meaning they're brand new, 577 00:31:56,800 --> 00:31:58,760 Speaker 1: they're less than one or two years old, where people 578 00:31:58,760 --> 00:32:01,320 Speaker 1: bought them, probably on their stimmy, and then never even 579 00:32:01,400 --> 00:32:04,200 Speaker 1: got to the first registration where they had to pay 580 00:32:04,640 --> 00:32:08,000 Speaker 1: for the tags. And now we're starting to see that 581 00:32:08,320 --> 00:32:13,280 Speaker 1: the FED might start understanding this, because the problem is 582 00:32:13,280 --> 00:32:17,840 Speaker 1: is that they are hell bent on getting inflation back 583 00:32:17,920 --> 00:32:20,920 Speaker 1: down to this two percent supposedly I don't even know where. Well, 584 00:32:21,200 --> 00:32:23,200 Speaker 1: there's a story this week I saw where did two 585 00:32:23,200 --> 00:32:27,000 Speaker 1: percent come from? Supposedly New Zealand just pulled that number 586 00:32:27,000 --> 00:32:28,560 Speaker 1: out of thin air. Oh, let's go with a two 587 00:32:28,600 --> 00:32:32,080 Speaker 1: percent inflation rate, And apparently that's what stuck. But the 588 00:32:32,120 --> 00:32:34,800 Speaker 1: problem is, as the FED continues to try to bring 589 00:32:34,880 --> 00:32:40,240 Speaker 1: inflation down, they're pushing asset prices down and helm price 590 00:32:40,320 --> 00:32:42,600 Speaker 1: down to make you feel poor. But as you feel poor, 591 00:32:42,880 --> 00:32:44,840 Speaker 1: and as you have no cap gains, the government doesn't 592 00:32:44,880 --> 00:32:47,680 Speaker 1: get the funding at the same time as their spendings 593 00:32:47,720 --> 00:32:51,320 Speaker 1: going up. They're already a zombie company and solvent, which 594 00:32:51,400 --> 00:32:55,480 Speaker 1: means they're only even more insolvent. So the question is, 595 00:32:55,800 --> 00:32:58,360 Speaker 1: or the question or the question that I would ask myself, 596 00:32:58,400 --> 00:33:02,160 Speaker 1: is what does all this mean? What does all this mean? Mark? 597 00:33:02,400 --> 00:33:05,800 Speaker 1: I mean, okay, you've made a case the economy is 598 00:33:05,840 --> 00:33:11,040 Speaker 1: going into recession. The Treasury itself, for its own report 599 00:33:11,120 --> 00:33:13,440 Speaker 1: says that it's insolvent and it's only be going to 600 00:33:13,480 --> 00:33:17,360 Speaker 1: come more insolvent. What does this mean. It means that 601 00:33:17,520 --> 00:33:21,880 Speaker 1: money printing is inevitable. That's what this means. So what 602 00:33:22,040 --> 00:33:26,080 Speaker 1: this means is that the federal government is insolvent. They're bankrupt. 603 00:33:26,520 --> 00:33:30,760 Speaker 1: They haven't filed for bankruptcy, but they're insolvent. They're spending 604 00:33:30,920 --> 00:33:34,800 Speaker 1: way more on just mandatory expenses than they bring in 605 00:33:34,800 --> 00:33:36,800 Speaker 1: in income, and at the same time their income is 606 00:33:36,840 --> 00:33:38,800 Speaker 1: going down, their expenses are going up. So we have 607 00:33:38,800 --> 00:33:40,560 Speaker 1: to refinance all this dead at higher rates and all 608 00:33:40,560 --> 00:33:45,480 Speaker 1: these things. So no government with a money printer will 609 00:33:45,520 --> 00:33:48,760 Speaker 1: go bankrupt. So this means they're going to print money. 610 00:33:48,760 --> 00:33:52,520 Speaker 1: So while we have all this posturing and the Fed says, 611 00:33:52,560 --> 00:33:54,400 Speaker 1: they don't, you know, they want to continue to tighten 612 00:33:54,440 --> 00:33:57,160 Speaker 1: the markets. They don't want to ease the markets. We 613 00:33:57,280 --> 00:34:00,560 Speaker 1: know what's inevitable, and I believe the markets it's inevitable, 614 00:34:00,560 --> 00:34:03,680 Speaker 1: which is why the markets aren't going down. Jerome Powell 615 00:34:04,120 --> 00:34:06,640 Speaker 1: keeps one in the markets to go down, but they don't. 616 00:34:08,239 --> 00:34:10,480 Speaker 1: I saw this article this week talking about how the 617 00:34:10,520 --> 00:34:13,320 Speaker 1: Fed minutes appear to argue against what Powe was saying 618 00:34:13,440 --> 00:34:16,279 Speaker 1: in the presser, and they wanted him to go back 619 00:34:16,280 --> 00:34:20,920 Speaker 1: and reiterate again. But Powell declined to try to talk 620 00:34:20,960 --> 00:34:25,399 Speaker 1: down financial markets, saying, we're just going to have to 621 00:34:25,440 --> 00:34:28,719 Speaker 1: see seeing Look, I told them what's going to happen. 622 00:34:28,880 --> 00:34:30,239 Speaker 1: Let's just leave it up to them. They're going to 623 00:34:30,280 --> 00:34:35,600 Speaker 1: figure this out. But the markets don't believe what the 624 00:34:35,640 --> 00:34:37,880 Speaker 1: Fed is saying. And the reason why they don't believe 625 00:34:37,880 --> 00:34:40,840 Speaker 1: it is because they know what's inevitable. They know that 626 00:34:40,880 --> 00:34:43,360 Speaker 1: the treasury is going broke and they're going to have 627 00:34:43,480 --> 00:34:46,319 Speaker 1: to print the money. No government, the money printer will 628 00:34:46,360 --> 00:34:49,000 Speaker 1: go broke. And so while we don't know exactly what's 629 00:34:49,000 --> 00:34:50,840 Speaker 1: going to happen over the next two to three months, 630 00:34:51,920 --> 00:34:53,600 Speaker 1: we do know what's going to happen over the next 631 00:34:53,640 --> 00:34:56,480 Speaker 1: two to three years. Now, what's going to happen over 632 00:34:56,520 --> 00:34:59,799 Speaker 1: the next two to three years is massive amounts of 633 00:35:00,040 --> 00:35:02,920 Speaker 1: money printing. The US dollar is going to have to 634 00:35:02,960 --> 00:35:06,719 Speaker 1: get weaker. When the US dollar gets weaker, it will 635 00:35:06,800 --> 00:35:11,480 Speaker 1: push asset prices higher. There's no other way now, Like 636 00:35:11,520 --> 00:35:13,320 Speaker 1: I said, the other way is the government goes bankrupt. 637 00:35:13,719 --> 00:35:16,000 Speaker 1: But of course, as I said, no government with the 638 00:35:16,040 --> 00:35:19,560 Speaker 1: money printer will go bankrupt, and so I think the 639 00:35:19,680 --> 00:35:24,399 Speaker 1: chance of that happening is slim to none. Now, there 640 00:35:24,440 --> 00:35:27,760 Speaker 1: are two types of defaults. Of course, there's the default 641 00:35:27,800 --> 00:35:31,040 Speaker 1: where I don't pay you, and there's the default where 642 00:35:31,040 --> 00:35:32,879 Speaker 1: I just pay you back with a bunch of made 643 00:35:32,960 --> 00:35:35,399 Speaker 1: up money that's not worth as much as what you're 644 00:35:35,480 --> 00:35:38,600 Speaker 1: actually owed. So I pay you back the million dollars 645 00:35:38,640 --> 00:35:40,000 Speaker 1: I owe you, but it only buys you half a 646 00:35:40,040 --> 00:35:43,600 Speaker 1: million dollars worth goods today. And that's exactly what's happening, 647 00:35:43,760 --> 00:35:45,719 Speaker 1: and that's where we're going. And so if you're trying 648 00:35:45,719 --> 00:35:51,120 Speaker 1: to plan what should I do with my business, my investments, etc. 649 00:35:51,719 --> 00:35:55,360 Speaker 1: If you think long term, you know it's inevitable the 650 00:35:55,520 --> 00:35:58,759 Speaker 1: money printer will burr again. If you're just tuning in 651 00:35:58,800 --> 00:36:00,920 Speaker 1: you're listening to the Markmas Show. We've been talking about 652 00:36:01,680 --> 00:36:05,200 Speaker 1: what the Treasury report said and the inevitability of money printing. 653 00:36:05,640 --> 00:36:08,719 Speaker 1: The financial revolution is here and we're witnessing it. Thanks 654 00:36:08,719 --> 00:36:09,480 Speaker 1: so much for listening.