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Speaker 1: Hey, and welcome to What Future. I'm your host, Joshua Topolski,

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Speaker 1: and we're back, of course again. I'm looking out my

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Speaker 1: window right now. This is like, um, I think a Trotsky.

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Speaker 1: There's a famous story about when he was I think

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Speaker 1: he was killed. Well maybe I just made this up,

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Speaker 1: but in my in my imagination, Trotsky was sitting at

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Speaker 1: his writing desk. He was looking out at a beautiful

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Speaker 1: sunrise or something, and then somebody took an ice axe

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Speaker 1: to his head or something and killed him. Very sad.

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Speaker 1: But anyhow, I was just looking out my window here

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Speaker 1: where I record the podcast. I have a view out

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Speaker 1: into my backyard, which is just forest. It's just trees,

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Speaker 1: and and it's has been snowing all day, and there

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Speaker 1: is several inches of snow on the ground here in

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Speaker 1: just outside of New York City. And it's a cold, windy,

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Speaker 1: classic winter day. And it's fucking six days away from

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Speaker 1: the beginning of spring. Actually, when you listen to this,

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Speaker 1: it'll be four days away, because we're recording this Tuesday,

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Speaker 1: and the show is released at the strike of midnight

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Speaker 1: on Thursdays. The clock bells ring out and then immediately

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Speaker 1: our editor Adam goes to an arcane ancient computer and

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Speaker 1: pushes a large red button and the show is dispersed

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Speaker 1: to the Internet at midnight. So anyway, but you know,

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Speaker 1: it's been a tumultuous few days for the economy. You

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Speaker 1: may not know this, but there's been a lot of fear, uncertainty,

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Speaker 1: in doubt about our banking structures in America because Silicon

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Speaker 1: Valley Bank, a well known and presumably well well I need,

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Speaker 1: a bank of the VC elite, has gone belly up,

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Speaker 1: had been taken over by the government, and there was

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Speaker 1: of course great fear of a contagion that would plunge

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Speaker 1: us into eternal darkness, not unlike the Last of Us

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Speaker 1: post apocalyptic nightmare world, where we would be forced to

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Speaker 1: befriend a child and take them across the country on

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Speaker 1: a harrowing journey with a very dark dark end. Maybe

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Speaker 1: or not, I don't know, because I haven't seen it,

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Speaker 1: and that's not a spoiler, And if it is a spoiler,

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Speaker 1: that I apologize. That was completely unintentional. Anyhow, with all

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Speaker 1: of this banking calamity, I thought we should have an

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Speaker 1: expert on the show, so I called up Felix Salmon,

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Speaker 1: my old pal Felix Salmon, who is the chief financial

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Speaker 1: correspondent at Axios, and he's also the host of Slate Money,

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Speaker 1: which is a Slate podcast, so he's got Slate in Axio.

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Speaker 1: It's a very lucrative situation, very shrewd. Anyhow, Felix is here.

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Speaker 1: He's going to explain this banking crisis to us. Actually

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Speaker 1: it's not a banking crisis. Is gonna explain the the

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Speaker 1: near banking crisis and help us all understand the future

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Speaker 1: of money on planet Earth. So let's just get into it.

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Speaker 1: So it's all over. The bank crisis is in the past.

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Speaker 1: It is we solved it. Biden has once again swooped

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Speaker 1: in and exactly Janet yelling to the rescue. Okay, So Phelix,

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Speaker 1: I should just say before we get into this, you're podcasting,

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Speaker 1: you're a correspondent. You're writing. I mean, you just wrote

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Speaker 1: something yesterday, so you're writing on a regular basis. I'm

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Speaker 1: writing many things, and I have a book coming out

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Speaker 1: on May the ninth called The Phoenix Economy. You have

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Speaker 1: a book coming out. You wrote a book during all

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Speaker 1: of this. Yeah, what's the book about? Before we get

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Speaker 1: into this topic, I'm curious, what's the book about? It's

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Speaker 1: it's basically how the pandemic caused all manner of weird,

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Speaker 1: unpredictable things to happen, like minor banking crisis. Is that

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Speaker 1: good or bad? Is your book like pro pro the

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Speaker 1: current state of the of the economy? I call it

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Speaker 1: the new normal? Right? You know shit's getting weird. It

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Speaker 1: is weird, right, I mean it is weird because actually

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Speaker 1: this is a great example. So so the reason I'll

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Speaker 1: just get into it. The reason I wanted you to

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Speaker 1: come on is to talk about this SVB Silicon Valley

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Speaker 1: bank collapse and then the ensuing panic. But that's not

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Speaker 1: the only weird thing happening in terms of economics and

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Speaker 1: the way money flows around the world, and a lot

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Speaker 1: of weird shit is going on. And do you take that?

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Speaker 1: It's like, and we'll get into some of the weird stuff.

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Speaker 1: I do you think it's a positive or negative? It's weird,

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Speaker 1: bad or good to you? I mean it's good if

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Speaker 1: you're a financial journalist. Makes makes your life a little

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Speaker 1: more interesting. Right, There's a lot of shit to talk

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Speaker 1: about exactly that keeps me employed. Will you just take

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Speaker 1: us through a little bit of explaining what happened? Everybody

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Speaker 1: knows this bad got like basically shut down and taken

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Speaker 1: over by the government. But I don't know if everybody

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Speaker 1: who's listening will have understood how this happens. Can you

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Speaker 1: give us a little bit of what the big news

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Speaker 1: around SBB was, just if you could explain it. Like, like,

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Speaker 1: I'm five years old. So the first thing you do

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Speaker 1: when you're five years old is you watch Mary Poppins, Yes,

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Speaker 1: very good, which is one of my favorite movies. You're

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Speaker 1: an American, you've seen Mary Poppins, right, Well, Mary Poppins

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Speaker 1: is a Disney movie if I'm not mistaken, And so

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Speaker 1: now the original, the original Mary Poppins with Dick Van

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Speaker 1: Dyke and Julie Andrews, Yeah, that's a Disney film anyway.

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Speaker 1: Vandyke is an American. Am I crazy? Dick Van Dyke

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Speaker 1: is Americans and he has a terrible, terrible accent. Just

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Speaker 1: because it's set I like this that you're taking ownership

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Speaker 1: of it set in It is set in England, right,

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Speaker 1: but it is set in England. It does Julie Andrews,

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Speaker 1: who's undeniably England and Rex Harrison absolutely a Disney production.

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Speaker 1: But anyhow, go on, first forwarding through the question of

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Speaker 1: the nationality of Mary Poppins. Yes, there is a really

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Speaker 1: lovely bank run in Mary Poppins, and everyone talks about

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Speaker 1: it's wonderful life. But Mary Poppins real really nails the

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Speaker 1: mechanics of a bank run. If a lot of people

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Speaker 1: all want to get their money out from a bank

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Speaker 1: at the same time, the only thing that the bank

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Speaker 1: can really do is just shut its doors and closed down,

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Speaker 1: because banks don't have everybody's money just sitting two hand

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Speaker 1: and right. Technically, all of those individual depositors are allowed

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Speaker 1: and within their rights to ask their money back at

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Speaker 1: the same time. But if that ever happens, the bank

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Speaker 1: fails because there's just not enough money to pay them

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Speaker 1: all back. Right. Yeah, The size of the bank run

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Speaker 1: at Silicon Valley Bank was completely unprecedented. The largest bank

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Speaker 1: run in American history was Washington Mutual in two thousand

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Speaker 1: and eight, which suffered a bank run of sixteen points

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Speaker 1: something billion dollars in ten days, so call it one

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Speaker 1: or two billion dollars a day. The bank run at

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Speaker 1: Silicon Valley Bank was forty two billion dollars in one day. Yeah,

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Speaker 1: we have never seen anything like it. That's crazy. No

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Speaker 1: bank can survive that, and therefore it didn't survive that,

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Speaker 1: and it wound up getting nationalized. No, you say no

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Speaker 1: bank could survive that. JP Morgan couldn't survive that. Well,

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Speaker 1: maybe JP Morgan forty two billion. But the point is

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Speaker 1: that JP Morgan is too big to fail, so nobody

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Speaker 1: would try to take their money out with JP Morgan, right,

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Speaker 1: because the whole point about two big to fail banks

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Speaker 1: is they're too big to fail, therefore they won't fail.

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Speaker 1: Therefore you don't need to worry about them failing. Right,

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Speaker 1: Therefore you don't need to try and get your cash

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Speaker 1: out now before everyone else. And those banks are actually

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Speaker 1: there's a way to refer to those banks in the

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Speaker 1: grand scheme of the economics of this that they're called

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Speaker 1: what the what is the term? It's like g sibs

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Speaker 1: g sibs, which means global systemically important banks, Global systemically

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Speaker 1: important banks. Okay, And so JP Moore is a g

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Speaker 1: SUP which means it's too big to fail. Silicon Valley

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Speaker 1: Bank was not a GCUP. It was small enough to fail,

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Speaker 1: and it did fail. Right. It's funny because when I

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Speaker 1: did my startup many years ago, all of the vcs

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Speaker 1: who funded it were like, well, you've got to open

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Speaker 1: an account of Silicon Valley Bank. That's the bank that

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Speaker 1: everybody uses. The weird thing about this, and I know

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Speaker 1: this isn't true. I know there was an enormous amount

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Speaker 1: of money in Silicon Valley Bank, and it was a

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Speaker 1: very storied bank with very serious clients. But it always

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Speaker 1: felt a little flimsy to me. Just calling a bank

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Speaker 1: Silicon Valley Bank just to me said suggested that it

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Speaker 1: could fold very easily. So I was only a little

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Speaker 1: bit surprised, doesn't I mean, when you think about Silicon Valley,

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Speaker 1: what I think about his companies like Yo, I think

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Speaker 1: about like things like Yo. You remember the app Yo?

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Speaker 1: I not only remember it, I think I might even

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Speaker 1: still have it on my phone. You're an early investor

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Speaker 1: in Yo. But frankly, I don't know if people even

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Speaker 1: remember it. It was all it did was you could

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Speaker 1: send a message to someone in the message was Yo,

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Speaker 1: and they could send a message back, I believe, and

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Speaker 1: it was also Yo. Is that correct? That's correct? Yeah? Right?

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Speaker 1: And they raised ten I think ten million dollars, at

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Speaker 1: least ten million dollars on the basis of this concept

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Speaker 1: of Yo. Yeah. So Yo as a service Yo as

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Speaker 1: a service. Right, And I'm sure that was the headline

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Speaker 1: of an article that you wrote in twenty What gear

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Speaker 1: is that twenty thirteen or something. So I need to

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Speaker 1: ask you as someone who actually did this. You had

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Speaker 1: a start up, you had VCS. They invested some quantum

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Speaker 1: of money which I'm going to assume it was more

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Speaker 1: than two hundred and fifty thousand dollars, it was more

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Speaker 1: than two or to fifty thousand surprisingly into your company.

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Speaker 1: You then deposited that money at Silicon Valley Bank. Yes,

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Speaker 1: we got a check and then we put the check

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Speaker 1: into the bank. Right. Did it ever occur to you

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Speaker 1: that you were lending Silicon Valley Bank a whole bunch

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Speaker 1: of money interest free, and that this was an unsecured

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Speaker 1: liability of Silicon Valley Bank, and that really you ought

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Speaker 1: to worry about that. You know, Well, the answer is no.

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Speaker 1: But and I assume that for the most people the

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Speaker 1: answer would be no, Right. I mean I assume that

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Speaker 1: if you asked anybody, or even VCS or the founders

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Speaker 1: this question, I presumably they all would say no. I

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Speaker 1: didn't feel like I was giving them alone. I'm putting

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Speaker 1: money in the bank where I keep it to be

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Speaker 1: used for my purposes. But you bring up an interesting point,

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Speaker 1: which is, like my perception of money, and perhaps this

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Speaker 1: is just me. I think for humans in this age,

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Speaker 1: the concept of money, it sort of doesn't exist the

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Speaker 1: way it used to, right you. Actually we're talking about

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Speaker 1: the people would go to the bank right in Mary Poppins,

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Speaker 1: where they go to the bank right to get their money.

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Speaker 1: Right in the nineteen twenty nine people went to the

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Speaker 1: banks to get their money that was there, or their

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Speaker 1: jewelry that was in a lockbox somewhere or whatever. I

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Speaker 1: don't think we think of money like that. So the

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Speaker 1: check is like this like totally weird piece of paper

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Speaker 1: that represents something. Then it's sitting somewhere, and our money

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Speaker 1: is like wildly distributed across all of these different credit

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Speaker 1: cards and services and you know, automatic payments and things,

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Speaker 1: and so I feel like money itself, I think it's

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Speaker 1: become much less of a real thing. Like no one

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Speaker 1: even takes cash anymore. I mean, you live in New York, right,

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Speaker 1: Like you know what it's like. I mean you used

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Speaker 1: to go to restaurants in New York and they were like,

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Speaker 1: we only take cash, and those are like gone now.

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Speaker 1: As I just think money has kind of disappeared as

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Speaker 1: a concepts why like NFTs could be as valuable as

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Speaker 1: they were at one point, because it just seems like, well,

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Speaker 1: it's just as good as money. It's just like a thing. No.

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Speaker 1: I have a chapter in my book about this actually,

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Speaker 1: which is basically the way that money is this thing.

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Speaker 1: I think I compare it to tomato seeds. Every time

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Speaker 1: you try and get a grip on the mint like

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Speaker 1: slid its away. It's hard to understand money. It's hard

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Speaker 1: to get a grip on money. But one thing that

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Speaker 1: happened during the pandemic, I don't know if you remember this,

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Speaker 1: Towards the end of the pandemic is Russia invades Ukraine

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Speaker 1: and the US government decides to retaliate by basically confiscating

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Speaker 1: all of Russia's money that it has on deposit of

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Speaker 1: the New York Fed. Yeah, I remember this violate. It

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Speaker 1: was only like a year ago or something. Yeah, it

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Speaker 1: was a year ago. And this like completely undermines this

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Speaker 1: whole concept of like having was money being something you

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Speaker 1: can own, Like suddenly you can have I think Russia

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Speaker 1: had like seventy five billion dollars or something on deposit

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Speaker 1: of it just disappeared. Right, I mean money is not real.

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Speaker 1: I mean this is a well known thing, right, I

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Speaker 1: mean this is money is just a concept. I mean

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Speaker 1: money is a necessary collective fiction. If it didn't exist,

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Speaker 1: we would have to invent it. I really love what

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Speaker 1: direction you're taking this podcast. Just really do you hear?

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Speaker 1: This does get you a little bit of SVB fails?

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Speaker 1: What was the other bank that failed? I'm like, it's

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Speaker 1: it's great. They sat Signature, they got lost in the shuffle.

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Speaker 1: They're like small potatoes by comparison. These two banks fail.

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Speaker 1: And then it's Friday, right, I think it was Friday?

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Speaker 1: Is that correct? Last Friday? Technically SVB fails on Friday

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Speaker 1: and Signature fails on Sunday, right, Okay, this bank collapsed

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Speaker 1: and then Monday morning all of the banks started dropping,

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Speaker 1: like all of their prices started just falling off a cliff,

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Speaker 1: including big banks like Schwap stuff. Right, And this is

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Speaker 1: just pure fear. So what causes that? So two things

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Speaker 1: caused this, and it's impossible to disentangle them because all

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Speaker 1: we're doing is looking at one thing, which is the

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Speaker 1: stock market. And if money doesn't mean anything, stocks mean

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Speaker 1: much less. And there's always dangerous to try and read

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Speaker 1: too much into stock prices. If you look at the

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Speaker 1: share price of First Republic, you know, it went down

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Speaker 1: by you know, seventy percent on Monday, and it went

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Speaker 1: up by fifty percent on Tuesday. Like, these things bounce

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Speaker 1: around enormously, and reading too much into share price moves

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Speaker 1: can be dangerous. But broadly speaking, what people were scared

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Speaker 1: of on Monday was that if Silicon Valley Bank can fail,

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Speaker 1: if Signature Bank can fail, then other banks can fail too,

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Speaker 1: and so we should sell any bank that might fail.

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Speaker 1: And more broadly than that, there is a banking crisis.

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Speaker 1: Like you know, you have three banks closing down within

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Speaker 1: like four days. If you add in Silvergate, right, that

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Speaker 1: is not normal. Between them, they had four hundred billion

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Speaker 1: dollars of assets. This is an absolutely enormous number of

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Speaker 1: assets in closed banks, unresidented since the global financial crisis. Right,

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Speaker 1: So there's a banking crisis. It kind of stands to

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Speaker 1: reason that if there's a banking crisis and in bank

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Speaker 1: bank trucks are going to go down, Right, that's the

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Speaker 1: first order thing. The second order thing is just they

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Speaker 1: used to be up until a few weeks ago, We

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Speaker 1: used to live in a world where people like Josh

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Speaker 1: Tapolski could keep a couple million bucks in the bank

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Speaker 1: and not really worry about it. It would just kind

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Speaker 1: of sit there and no one ever really worried about

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Speaker 1: how much of that is insured, how much of that

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Speaker 1: is uninsured? You know? And now people are realizing that

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Speaker 1: lending money to banks is risky, and what's more, it

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Speaker 1: is actually much more attractive to just take that money

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Speaker 1: invested in t bills which yield five percent and that

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Speaker 1: is risk free. Right. Why would you get zero percent

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Speaker 1: on your money in the bank account, which is risky,

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Speaker 1: when you can get five percent on your money in

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Speaker 1: a risk free treasury bill? So right, right? What is

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Speaker 1: happening is that a whole bunch of people, either in

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Speaker 1: reality or just like this is what the stock market viered,

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Speaker 1: removing their money from banks, from deposit accounts in banks

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Speaker 1: and putting it somewhere else. And that is bad for

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Speaker 1: banks because deposits are very cheap sources of funding for banks, right,

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Speaker 1: And if banks lose that cheap funding, then they will

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Speaker 1: be less profitable. And then again it stands to reason

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Speaker 1: that their share price will go down. Right, I mean

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Speaker 1: this all makes sense. What is the origin of the

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Speaker 1: banking crisis as you see it? Because I mean, it

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Speaker 1: is interesting that the last real I guess, the last

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Speaker 1: major banking crisis, what we say was two thousand and eight.

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Speaker 1: Would we say that was like when there was a

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Speaker 1: real definitely very much in the expectation he or the fear.

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Speaker 1: Rather much of it ginned up by, like weirdly by

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Speaker 1: people in Silicon Valley, like vcs like Jason Calcanus, who

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Speaker 1: were like literally absolutely panicking on Twitter that he had

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Speaker 1: to buy guns and oil now or something. Jason was

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Speaker 1: the Jim Kramer of twenty twenty three. You know, it's shouting,

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Speaker 1: They don't, they have no idea. How about it is

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Speaker 1: out there just screaming, screaming like a maniac. Meanwhile, the

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Speaker 1: government like very nonchalantly was like, don't it's fine, we

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Speaker 1: got it. We'll cover this, like yelling, jumped it. It

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Speaker 1: was like, it's fine. Even after the government was like

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Speaker 1: we're gonna handle it. Don't worry, everybody's gonna get their money,

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Speaker 1: people were still panicking, like for reasons I can't quite explain,

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Speaker 1: except that they don't I don't know, they don't have

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Speaker 1: anything better to do. Or they want to incite panic,

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Speaker 1: they want people to be panicked, you know. Sort of

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Speaker 1: the point about the bank stocks and their prices dropping,

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Speaker 1: It is a lot of like fear of things happening

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Speaker 1: that motivated. I mean, fear is often motivating the way

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Speaker 1: the market moves. Surprisingly strangely, you would think there'd be

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Speaker 1: some way to not do that. There are only two

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Speaker 1: motivations for the way the market moves. Josh, it's fear

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Speaker 1: and greed. You know that. Yeah, But so what is

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Speaker 1: this banking crisis? Like, what is the root of this?

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Speaker 1: Where does this come from? Why are we at this point?

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Speaker 1: So depends how far back you want to go. I

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Speaker 1: want to know. Actually, you tell me how far back,

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Speaker 1: and you go to trace this crisis they were experiencing

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Speaker 1: right now. So I would go back to more than

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Speaker 1: the decade of zero interest rates from the federal which

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Speaker 1: created this huge flood of liquidity into tech broadly and

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Speaker 1: crypto in particular. And this idea that money was worthless

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Speaker 1: and you couldn't get any interest on your money. And

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Speaker 1: this was true for over a decade, right, and it

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Speaker 1: was a specific policy of the federal there. It's called

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Speaker 1: z zero interest rate policy. It's just in any way

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Speaker 1: spurred by two thousand and eight, or is it connected

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Speaker 1: in anyway or yes, yes, this is this is the

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Speaker 1: fed's attempt to goose the economy in the wake of

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Speaker 1: the financial crisis. Right, So you could go further back

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Speaker 1: if you really tried, Yeah, you could go yeah, but

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Speaker 1: let's start with the Yeah. What ZEB does is it

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Speaker 1: causes a huge amount of money to wind up sitting

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Speaker 1: in deposit accounts, especially at Silvergate and Silicon Valley Bank,

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Speaker 1: where no one cares that they're not earning any interest

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Speaker 1: because there is no interest in this world, and no

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Speaker 1: matter why you keep your money, it earns no interest. Right.

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Speaker 1: And what's more, vcs are raising huge amounts of money

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Speaker 1: because they're like, you know, get rich quick and all

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Speaker 1: of this kind of stuff. So all of that money

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Speaker 1: that flows into VC funds from big foundations and endowments

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Speaker 1: and suffering wealth funds and all of that kind of

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Speaker 1: stuff winds up flowing into startups and crypto companies. And

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Speaker 1: all those ups and crypto companies need a bank account,

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Speaker 1: and the vcs all given the same advice, which is

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Speaker 1: the same advice they gave you, which is just opening

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Speaker 1: the account of Silicon Valley Bank Cilicon Valley, Yeah, except

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Speaker 1: for when Silicon Valley Bank would look a scance at

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Speaker 1: people who are a bit too crypto and say like,

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Speaker 1: we'll take pretty much any any startup, but not if

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Speaker 1: it's too crypto, right, And then those people weren't wound

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Speaker 1: up going to Silvergate. So what you wound up with

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Speaker 1: was basically, you know, on the order of three hundred

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Speaker 1: plus billion dollars of deposits which were all you know,

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Speaker 1: the result of equity funding from vcs, just kind of

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Speaker 1: sitting in these accounts waiting to get spent. Right. Then

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Speaker 1: what happened is the Fed started raising interest rates. Those

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Speaker 1: deposits started looking like, why are they earning zero percent

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Speaker 1: when I couldn't be making more in treasury bills. And

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Speaker 1: at the same time, all of the VC funding started

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Speaker 1: drying up, and there was a crypto winter, right, and

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Speaker 1: so the crypto winter people all started needing to pay

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Speaker 1: out dollars, the tech startups all started needing to pay

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Speaker 1: out dollars. The deposits therefore started going down quite significantly.

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Speaker 1: And when deposits go down, what the banks need to

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Speaker 1: do is sell their assets. Now what were their assets?

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Speaker 1: Their assets were longer dated bonds that they had bought. Unfortunately,

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Speaker 1: what had happened is they bought those bonds when interest

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Speaker 1: rates were low. They are now selling those bonds when

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Speaker 1: interest rates are high. And Josh Topolski is a master

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Speaker 1: of bondmath. You can tell me what happens to the

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Speaker 1: price of a bond between if you buy it when

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Speaker 1: interest rates are low and sell it when interest rates

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Speaker 1: are high. Well, I would assume the value of that

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Speaker 1: bond goes down to the potential buyer. I assume they

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Speaker 1: want to paid lasts for it. That's exactly correct. And

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Speaker 1: so what happens is these banks wind up losing money

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Speaker 1: on their bond sales. And in fact, if you mark

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Speaker 1: their bond holdings to market, it looks like the banks

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Speaker 1: were insolvent. The banks look like they're insolvent. Depositors will

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Speaker 1: start panicking. Peter Thiel starts a bank run, and right,

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Speaker 1: you know, and the rest is history. You said they

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Speaker 1: look like they're insolvent, are they not? Is that just

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Speaker 1: an appearance? So it's a kind of weird existential question. Right,

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Speaker 1: if you're a bank and you have a bond and

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Speaker 1: you're intending to hold it to maturity, and that bond

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Speaker 1: will pay out one hundred dollars when it matures. As

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Speaker 1: far as you're concerned, that is one hundred dollars On

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Speaker 1: a long enough timeline, it's one hundred bucks. Yeah, it's like,

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Speaker 1: you know, the whole point of a bank is that

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Speaker 1: they invest through the cycle, right, and then if suddenly

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Speaker 1: an emergency happens and you have to sell it and

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Speaker 1: you can only get eighty three dollars for it, then shit,

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Speaker 1: you're insolvent. But you're only insolvent when you're forced to sell.

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Speaker 1: If you're not forced to sell, you're not insolvent. You're saying,

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Speaker 1: those bonds are like if you look at the value

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Speaker 1: of them and go, well, this will be cashed out

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Speaker 1: at some point at the face value. The bonds were

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Speaker 1: issued by Fannie Mae and Freddie Mack, and you know

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Speaker 1: entities that have zero credit risk. Right, you know you

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Speaker 1: will get paid back, There's no doubt about that, right,

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Speaker 1: unless you need to sell them sooner exactly right, unless

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Speaker 1: you need to sell them when the interest rates are

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Speaker 1: high and they are not fully mature, in which case

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Speaker 1: am I understanding this correctly? In which case things go

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Speaker 1: very badly. Yes, this is fascinating to me, I mean,

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Speaker 1: it also seems obvious. It seems obvious, seems like banks

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Speaker 1: shouldn't do this. Seems like there's a way for banks

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Speaker 1: to prevent themselves from doing this. I'm not an expert,

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Speaker 1: but is there a mechanism, Yeah, by which a bank

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Speaker 1: like Silicon Valley Bank could have prevented totally itself from

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Speaker 1: becoming or appearing insolvent at the time when everybody started

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Speaker 1: drawing their money out. So one of the things that

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Speaker 1: could have done is not go eight months without having

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Speaker 1: a chief risk officer. That would have been smart. Maybe

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Speaker 1: it could should have listened to regulators who maybe the

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Speaker 1: regulators should have been a bit more firm about don't

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Speaker 1: take that kind of interest rate risk. There are lots

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Speaker 1: of ways that banks could avoid taking massive amounts of

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Speaker 1: interest rates. They can invest in floating rate bonds instead

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Speaker 1: of fixed rate bonds, they can put on rate swaps,

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Speaker 1: they can you know, there's like, this is not rocket science.

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Speaker 1: Every bank knows this. For reasons that remain a bit unclear,

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Speaker 1: Silicon Baldy Bank did not do this, but yes, totally

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Speaker 1: they A lot of this was unforced errors on the

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Speaker 1: part of SVB. Right, So unforced errors but also has

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Speaker 1: a lot to do with the mentality of the people

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Speaker 1: who bank it. At SVB, there's a there's a thread

427
00:23:29,480 --> 00:23:32,040
Speaker 1: doing the rounds, which I'm sure you've seen of this

428
00:23:32,080 --> 00:23:34,280
Speaker 1: guy kind of gone I forget, you know, it's on

429
00:23:34,320 --> 00:23:37,280
Speaker 1: Twitter and he's sort of like, oh, here's my story

430
00:23:37,320 --> 00:23:39,760
Speaker 1: about the last few days. And it's like Wednesday morning.

431
00:23:39,840 --> 00:23:41,879
Speaker 1: I wake up and I go into my you know,

432
00:23:42,080 --> 00:23:45,680
Speaker 1: slack with hundreds of founders, and they're all panicking about

433
00:23:45,680 --> 00:23:49,320
Speaker 1: the banks, like they're panicking about um silver Gate. Yes,

434
00:23:49,400 --> 00:23:51,280
Speaker 1: so they're panicking about silver Gate or whatever. They're like,

435
00:23:51,320 --> 00:23:54,240
Speaker 1: what about SVB or something like that anyhow, and they're

436
00:23:54,240 --> 00:23:56,200
Speaker 1: all like, we should take our money out of here, right.

437
00:23:56,640 --> 00:23:58,399
Speaker 1: He takes his money out and then correct me if

438
00:23:58,440 --> 00:24:01,720
Speaker 1: I'm wrong, but he then buys h A's an SVB. Yes,

439
00:24:01,880 --> 00:24:04,520
Speaker 1: He's like, this is temporary and SBB is a good investment.

440
00:24:04,840 --> 00:24:06,480
Speaker 1: I'm get taking my money out now, but I know

441
00:24:06,480 --> 00:24:08,800
Speaker 1: it's going back up because this is there's nothing to

442
00:24:08,840 --> 00:24:12,439
Speaker 1: worry about, even though even though literally the reason I

443
00:24:12,480 --> 00:24:14,639
Speaker 1: am taking my money out is because there was something

444
00:24:14,680 --> 00:24:17,679
Speaker 1: to worry about. The bank run is happening because of

445
00:24:17,760 --> 00:24:20,320
Speaker 1: those conversation. Oh the bank run. Yeah, they are the

446
00:24:20,320 --> 00:24:22,120
Speaker 1: bank run, right, Like those people are like, we gotta

447
00:24:22,200 --> 00:24:26,639
Speaker 1: get out of this, and in doing so, it's a

448
00:24:26,640 --> 00:24:30,199
Speaker 1: self fulfilling prophecy essentially. Right. Yes, but this guy, yeah,

449
00:24:30,240 --> 00:24:33,479
Speaker 1: he bought shares that day he took his money out,

450
00:24:33,480 --> 00:24:35,439
Speaker 1: and he's like this it'll be it's crashing now, but

451
00:24:35,480 --> 00:24:37,600
Speaker 1: it'll be back up him that he was like, I

452
00:24:37,680 --> 00:24:39,520
Speaker 1: made I made a mistake. It's like, well, I think

453
00:24:39,520 --> 00:24:41,880
Speaker 1: it could have been several mistakes. But but but do

454
00:24:41,880 --> 00:24:44,639
Speaker 1: the I mean, do the do the customers of SBB.

455
00:24:45,000 --> 00:24:47,080
Speaker 1: I'm not trying to focus my ire on you know,

456
00:24:47,080 --> 00:24:50,920
Speaker 1: Silicon Valley or or founders or vcs. I mean, it's

457
00:24:50,960 --> 00:24:54,200
Speaker 1: not like anybody deserves to be in a situation where,

458
00:24:54,280 --> 00:24:56,320
Speaker 1: you know, they have like the kinds of problems people

459
00:24:56,320 --> 00:24:59,040
Speaker 1: are having when this bank sort of became insolvent. But

460
00:24:59,640 --> 00:25:01,800
Speaker 1: I mean, did they bear some responsibility? Man? This is

461
00:25:01,920 --> 00:25:04,360
Speaker 1: like if all those two hundred founders or however many

462
00:25:04,400 --> 00:25:06,120
Speaker 1: and there were, that was once in the only group chat.

463
00:25:06,160 --> 00:25:09,040
Speaker 1: I assume if they just hadn't pulled their money out

464
00:25:09,160 --> 00:25:11,000
Speaker 1: like this wouldn't have happened. It would have all have

465
00:25:11,000 --> 00:25:13,280
Speaker 1: been found right, Yeah, it was absent the bank run

466
00:25:13,960 --> 00:25:17,879
Speaker 1: Cilicon Baldy Bank would would still be pootling along quite happily,

467
00:25:18,280 --> 00:25:20,400
Speaker 1: like they'd be fine. Those bonds would be sitting there

468
00:25:21,640 --> 00:25:24,960
Speaker 1: accruing value over the long enough timeline to be worth

469
00:25:25,000 --> 00:25:27,320
Speaker 1: whatever they say they are, and we would just be

470
00:25:27,359 --> 00:25:30,320
Speaker 1: there as having a normal afternoon when not talking about

471
00:25:30,359 --> 00:25:33,080
Speaker 1: this at all. SCB, like, you know, it might feel

472
00:25:33,080 --> 00:25:35,960
Speaker 1: like it needed a bit more capital. It might you know,

473
00:25:36,040 --> 00:25:38,240
Speaker 1: have actually been able to do the capital raise it

474
00:25:38,400 --> 00:25:42,639
Speaker 1: announced it needed funding VC funding. It might have had

475
00:25:42,680 --> 00:25:44,800
Speaker 1: a couple of years of losing money, but that was okay.

476
00:25:44,800 --> 00:25:46,320
Speaker 1: Banks can lose money for a few years. Look at

477
00:25:46,320 --> 00:25:48,359
Speaker 1: credit squeets. It's lost money for every year that I

478
00:25:48,440 --> 00:25:50,680
Speaker 1: can remember, and it's still going. That's why I say

479
00:25:50,720 --> 00:25:52,600
Speaker 1: that all the time to people. I said, just take

480
00:25:52,640 --> 00:25:56,800
Speaker 1: a look. I don't. I wasn't aware of that. Actually,

481
00:25:56,840 --> 00:25:59,240
Speaker 1: that's interesting information. I won't be doing it. I would

482
00:25:59,240 --> 00:26:02,520
Speaker 1: have bet any bank with them. Okay, But here's a question. Now.

483
00:26:03,400 --> 00:26:05,679
Speaker 1: First off, the contagion worry, there was a big concern,

484
00:26:05,800 --> 00:26:08,160
Speaker 1: right like that. Then the reason why all of these

485
00:26:08,160 --> 00:26:10,840
Speaker 1: banks are eating crushed on Monday. Now they're way back up.

486
00:26:10,960 --> 00:26:13,640
Speaker 1: If you had just bought some shares. By the way,

487
00:26:13,640 --> 00:26:15,440
Speaker 1: I want to be clear, I'm in no way ever

488
00:26:15,560 --> 00:26:18,400
Speaker 1: giving financial advice. But if a person had just bought

489
00:26:18,480 --> 00:26:20,639
Speaker 1: some shares, like I was, like, boy, if I had

490
00:26:20,640 --> 00:26:23,040
Speaker 1: just bought some schwab, you know, when it was way

491
00:26:23,080 --> 00:26:25,600
Speaker 1: down on Monday. On Tuesday, I'd be looking pretty good.

492
00:26:26,280 --> 00:26:29,080
Speaker 1: But the fear was this is going to create a

493
00:26:29,119 --> 00:26:31,560
Speaker 1: domino effect and all of the banks, or many of

494
00:26:31,600 --> 00:26:34,840
Speaker 1: the banks are going to end up in the SVB boat.

495
00:26:35,600 --> 00:26:37,919
Speaker 1: Two questions here, One is like, is there still a

496
00:26:38,000 --> 00:26:41,160
Speaker 1: risk of contagion? And if not, or if so, even

497
00:26:41,880 --> 00:26:43,760
Speaker 1: how do we fix this problem? You take them in

498
00:26:43,800 --> 00:26:46,960
Speaker 1: whatever order you want. Yeah. So the reason why the

499
00:26:47,000 --> 00:26:49,200
Speaker 1: government stepped in on Sunday night was because there was

500
00:26:49,240 --> 00:26:53,399
Speaker 1: clearly a risk of contagion. The steps they took on

501
00:26:53,480 --> 00:26:57,399
Speaker 1: Sunday night with their attempt to fix the problem. By

502
00:26:58,800 --> 00:27:02,760
Speaker 1: Tuesday morning, it was more or less apparent that they

503
00:27:02,800 --> 00:27:06,760
Speaker 1: had succeeded in fixing the problem, and therefore the stunks

504
00:27:06,840 --> 00:27:12,320
Speaker 1: went up. You're just speaking to the meme I assume

505
00:27:12,359 --> 00:27:15,840
Speaker 1: of the guy right, the weird the weird like humanoid

506
00:27:15,880 --> 00:27:20,280
Speaker 1: guy with the three D the stunks guy sk So

507
00:27:20,320 --> 00:27:22,000
Speaker 1: we're good. We solved it. We fixed it. We don't

508
00:27:22,000 --> 00:27:23,600
Speaker 1: have anything to worry about, is what you're saying. Like

509
00:27:23,880 --> 00:27:26,960
Speaker 1: SVB can fail, it's not a big deal. Well, no,

510
00:27:27,320 --> 00:27:32,360
Speaker 1: SDB failing is a big deal for the Silicon Valley ecosystem, right,

511
00:27:32,400 --> 00:27:36,080
Speaker 1: As you know, the poor vcs, they don't have a

512
00:27:36,119 --> 00:27:38,800
Speaker 1: lot of imagination. They only know that one bank exists,

513
00:27:39,119 --> 00:27:41,600
Speaker 1: and they tell all of their company, their portfolio companies,

514
00:27:41,600 --> 00:27:43,400
Speaker 1: to go put all of their money into this one bank.

515
00:27:43,720 --> 00:27:46,680
Speaker 1: If that one bank fails and like literally just doesn't

516
00:27:46,760 --> 00:27:52,000
Speaker 1: reopen or just like winds down under national ownership, right,

517
00:27:52,400 --> 00:27:55,760
Speaker 1: that would be a real problem for Silicon Valley broadly

518
00:27:55,800 --> 00:27:58,120
Speaker 1: because they would need to find another bank, and apparently

519
00:27:58,160 --> 00:28:01,000
Speaker 1: that's beyond their can. Right. The definitely other banks in

520
00:28:01,040 --> 00:28:04,520
Speaker 1: the area, though apparently there's only one. Judge that I've been,

521
00:28:04,560 --> 00:28:07,600
Speaker 1: I've been reliably informed there's only one bank in Silicon Valley.

522
00:28:07,640 --> 00:28:10,439
Speaker 1: I've been. I've been to that part of California, and

523
00:28:10,480 --> 00:28:13,240
Speaker 1: I can tell you I've seen multiple branches of all

524
00:28:13,280 --> 00:28:16,119
Speaker 1: sorts of different banks up there. In any case, the

525
00:28:16,240 --> 00:28:19,840
Speaker 1: overwhelming likelihood is the Silicon Valley Bank will end up

526
00:28:19,880 --> 00:28:24,400
Speaker 1: getting sold to someone or other. It will reopen under

527
00:28:24,480 --> 00:28:29,120
Speaker 1: new ownership, it will be owned by Barkley's or Truist

528
00:28:29,240 --> 00:28:31,639
Speaker 1: or JP Morgan or Goldman Saxe or someone else or

529
00:28:31,640 --> 00:28:34,479
Speaker 1: maybe or maybe Elon Moscus. Someone suggested, I feel like,

530
00:28:34,680 --> 00:28:37,320
Speaker 1: did I see this? Am? I imagine that somebody was

531
00:28:37,400 --> 00:28:40,760
Speaker 1: like tweeting in him, going like, maybe you should buy SVB?

532
00:28:41,000 --> 00:28:43,360
Speaker 1: And he and he replied saying I'm open to the idea.

533
00:28:43,400 --> 00:28:46,840
Speaker 1: I hope to the idea. Yeah. The fucking guy incredible stuff.

534
00:28:46,960 --> 00:28:49,080
Speaker 1: I can tell you there is exactly zero chance that

535
00:28:49,200 --> 00:28:52,400
Speaker 1: the FDIC would allow him to own a bank. He's

536
00:28:52,440 --> 00:28:54,520
Speaker 1: so good at running businesses. I think this is there

537
00:28:54,640 --> 00:28:57,040
Speaker 1: is also like it does kind of need to be

538
00:28:57,080 --> 00:29:01,280
Speaker 1: a bank. I would be shocked if SVB got bullet

539
00:29:01,360 --> 00:29:05,280
Speaker 1: by a non bank. Right, maybe Jason Calcanis could run it.

540
00:29:05,440 --> 00:29:08,320
Speaker 1: See how he does Every time you sees eddy fluctuation

541
00:29:08,320 --> 00:29:10,720
Speaker 1: of the numbers, he just loses his shit, just complete

542
00:29:10,800 --> 00:29:14,920
Speaker 1: madness every twenty four hours. Okay, So, but is it good?

543
00:29:15,360 --> 00:29:18,560
Speaker 1: Have we fixed like the banking crisis? Like concept? Are we?

544
00:29:18,880 --> 00:29:21,959
Speaker 1: Are we no longer and in danger of I mean,

545
00:29:22,000 --> 00:29:24,000
Speaker 1: I guess like I'm asking this and I'm wondering. Part

546
00:29:24,040 --> 00:29:26,920
Speaker 1: of me is just going, are we just totally admitting

547
00:29:26,920 --> 00:29:30,560
Speaker 1: that money is absolutely meaningless and made up and like

548
00:29:30,720 --> 00:29:33,479
Speaker 1: doesn't there doesn't really hit there's no real value except

549
00:29:33,480 --> 00:29:36,280
Speaker 1: the one that we are all, you know, sharing in

550
00:29:36,280 --> 00:29:38,520
Speaker 1: the illusion of like it feels like rights, just like, hey,

551
00:29:38,560 --> 00:29:41,760
Speaker 1: here's look at you. You're getting You're getting onto logical again. Joe, Well,

552
00:29:41,800 --> 00:29:44,120
Speaker 1: I just think it's interesting. I'm a big fan of money.

553
00:29:44,120 --> 00:29:46,360
Speaker 1: I think it's great for purchasing things, which is my

554
00:29:46,400 --> 00:29:50,840
Speaker 1: favorite pastime, shopping, the American great American pastime. But one,

555
00:29:50,880 --> 00:29:54,040
Speaker 1: have we solved any future banking crisis just by the

556
00:29:54,080 --> 00:29:56,360
Speaker 1: fact that you know, the government can step in and

557
00:29:56,440 --> 00:30:00,880
Speaker 1: handle it. You know, what do you think this banking

558
00:30:00,960 --> 00:30:04,280
Speaker 1: crisis was? It turns out a lot easier to solve

559
00:30:04,320 --> 00:30:06,640
Speaker 1: than the two thousand and eight banking crisis, right, right,

560
00:30:06,720 --> 00:30:10,280
Speaker 1: The two thousand and eight financial crisis was based on

561
00:30:11,040 --> 00:30:16,040
Speaker 1: absolutely enormous real losses around the planet. There was a

562
00:30:16,080 --> 00:30:19,080
Speaker 1: credit crisis, and a lot of people lost a lot

563
00:30:19,120 --> 00:30:22,040
Speaker 1: of money. Right in this banking crisis, the only people

564
00:30:22,080 --> 00:30:25,320
Speaker 1: who really lost a lot of money were the shareholders

565
00:30:25,320 --> 00:30:27,920
Speaker 1: of Silicon Valley Bank and Signature Bank, And there weren't

566
00:30:27,920 --> 00:30:30,280
Speaker 1: that many of them. And they'll be fine, right because

567
00:30:30,280 --> 00:30:35,800
Speaker 1: they were all diversified. So yeah, so the stakes are

568
00:30:35,880 --> 00:30:39,120
Speaker 1: much lower this time around. And it turns out that

569
00:30:39,280 --> 00:30:43,760
Speaker 1: the federal government with by extending the FDIC guarantee to

570
00:30:44,240 --> 00:30:47,160
Speaker 1: all of the deposits in Silicon Valley Bank, not just

571
00:30:47,360 --> 00:30:50,880
Speaker 1: the insured ones. The FED opening up its discount window

572
00:30:50,960 --> 00:30:53,760
Speaker 1: to you know, the other banks that people were worried about,

573
00:30:53,840 --> 00:30:57,160
Speaker 1: like Chua and First Republican people like that seems to

574
00:30:57,240 --> 00:31:02,560
Speaker 1: have done the job right. So yeah, I think, you know, like,

575
00:31:02,640 --> 00:31:07,160
Speaker 1: without getting to ontological, we you know, we had a crisis.

576
00:31:07,240 --> 00:31:11,840
Speaker 1: The crisis as of Tuesday afternoon seems as though it's

577
00:31:11,920 --> 00:31:15,320
Speaker 1: more or less than the best. Yeah, there's a kind of, um,

578
00:31:15,720 --> 00:31:16,760
Speaker 1: I don't know if it's what you call it. A

579
00:31:16,840 --> 00:31:20,200
Speaker 1: rumor comes some thinking that the FED will cool its

580
00:31:20,680 --> 00:31:23,680
Speaker 1: rate hikes because of this situation. Is there any indications

581
00:31:23,760 --> 00:31:26,120
Speaker 1: that's actually true or that that would make any sense?

582
00:31:26,640 --> 00:31:29,200
Speaker 1: You know, I'm sort of an armchair observer to all

583
00:31:29,200 --> 00:31:31,440
Speaker 1: of this. Obviously I care about the global economy and

584
00:31:31,480 --> 00:31:34,160
Speaker 1: certainly the US economy, though I'm of the mind that

585
00:31:34,520 --> 00:31:36,800
Speaker 1: whenever things are bad, it's just a matter of time

586
00:31:36,840 --> 00:31:39,120
Speaker 1: before they're good again. I don't know about you, but

587
00:31:39,440 --> 00:31:41,480
Speaker 1: when the markets having a bad day. What I don't

588
00:31:41,520 --> 00:31:44,320
Speaker 1: do is look at any investments that I have and

589
00:31:44,480 --> 00:31:47,239
Speaker 1: think about how poorly they're doing, because it feels like

590
00:31:47,720 --> 00:31:51,320
Speaker 1: ultimately a waste of energy. The first thing you should

591
00:31:51,360 --> 00:31:54,200
Speaker 1: do when it comes to looking at any investments you

592
00:31:54,280 --> 00:31:56,720
Speaker 1: might have is never look at how they're doing. There

593
00:31:56,800 --> 00:32:00,400
Speaker 1: is a lot of empirical research showing that the more

594
00:32:00,480 --> 00:32:03,040
Speaker 1: often you look at your stockport vidio, the less well

595
00:32:03,120 --> 00:32:06,760
Speaker 1: you perform. Um. Sure, I mean, I don't know if

596
00:32:06,760 --> 00:32:08,320
Speaker 1: that's true. That sounds like a lie that you just

597
00:32:08,360 --> 00:32:10,840
Speaker 1: made up, But no, that is true. That is actually

598
00:32:11,000 --> 00:32:13,920
Speaker 1: it's it's a core finding in behavioral finance. But to me,

599
00:32:14,000 --> 00:32:15,440
Speaker 1: it feels like if you just look, if you just

600
00:32:15,480 --> 00:32:18,720
Speaker 1: look at the history of the of the markets. I

601
00:32:18,760 --> 00:32:22,200
Speaker 1: mean again, I'm not giving anybody advice, but for me personally,

602
00:32:22,760 --> 00:32:26,120
Speaker 1: I just think, well, the line is going up. It's

603
00:32:26,160 --> 00:32:28,560
Speaker 1: just constantly going up over a long enough timeline. And

604
00:32:28,640 --> 00:32:31,480
Speaker 1: I'm I've still got a few years left. So you're

605
00:32:31,640 --> 00:32:34,280
Speaker 1: you're a baby, Josh, you have a decades ahead of you.

606
00:32:34,440 --> 00:32:36,560
Speaker 1: I'm a young man. I've got at least a few years.

607
00:32:36,720 --> 00:32:39,840
Speaker 1: I will answer your question about the FED, yeah, and

608
00:32:40,120 --> 00:32:45,080
Speaker 1: the answer is that at the margin, credit conditions and

609
00:32:45,160 --> 00:32:49,760
Speaker 1: monetary conditions are slightly tighter now than they wear a

610
00:32:49,760 --> 00:32:52,840
Speaker 1: week ago. All of these banks that you know have

611
00:32:53,160 --> 00:32:59,440
Speaker 1: suffered deposit withdrawals, uh, that much less likely to lend

612
00:32:59,480 --> 00:33:01,280
Speaker 1: out money and they wear a couple of weeks ago.

613
00:33:01,960 --> 00:33:06,080
Speaker 1: And it's therefore conversely that much more difficult to borrow

614
00:33:06,120 --> 00:33:09,320
Speaker 1: money to start a business, to invest in your business, whatever.

615
00:33:09,920 --> 00:33:13,840
Speaker 1: So that is exactly what the FED is trying to

616
00:33:13,880 --> 00:33:18,920
Speaker 1: achieve with its rate hikes. So in one way, the

617
00:33:19,000 --> 00:33:21,920
Speaker 1: market and the little baby banking crisis we just had

618
00:33:22,280 --> 00:33:24,840
Speaker 1: has done the Fed's job for it, and then the

619
00:33:24,840 --> 00:33:27,240
Speaker 1: Fed doesn't need to be quite as aggressive because the

620
00:33:27,280 --> 00:33:30,200
Speaker 1: market is already doing it. Oh, I say, interesting, Do

621
00:33:30,240 --> 00:33:33,560
Speaker 1: I think the FED is going to just stop raising raids? No?

622
00:33:33,840 --> 00:33:35,800
Speaker 1: I mean, like if I had to bet. Part of

623
00:33:35,800 --> 00:33:38,520
Speaker 1: the problem here is there in this quiet period. The

624
00:33:38,600 --> 00:33:40,440
Speaker 1: rate decision comes on the twenty first, and they're all

625
00:33:40,440 --> 00:33:42,840
Speaker 1: meant to just shut up in the run up to

626
00:33:42,920 --> 00:33:45,560
Speaker 1: the meeting. So we don't really know what they're thinking

627
00:33:45,600 --> 00:33:48,240
Speaker 1: about this crisis and what its effect it's going to

628
00:33:48,280 --> 00:33:51,720
Speaker 1: be on monetary policy. Right, but in general, do they

629
00:33:51,720 --> 00:33:55,000
Speaker 1: care about Silicon valley startups? Not really. They're interested in

630
00:33:55,000 --> 00:33:57,200
Speaker 1: the broad economy, which still seems to be pretty hot.

631
00:33:57,280 --> 00:33:59,680
Speaker 1: Inflation still seems to be well above where they want

632
00:33:59,680 --> 00:34:03,040
Speaker 1: it to be, and so yeah, we'll probably see another

633
00:34:03,120 --> 00:34:06,200
Speaker 1: quarter point, right Like, But I mean, Silicon Valley is

634
00:34:06,240 --> 00:34:08,759
Speaker 1: not like a Bellweather No, no, it really is not.

635
00:34:08,840 --> 00:34:11,560
Speaker 1: I mean it's it's the economy of Silicon Valley in

636
00:34:11,600 --> 00:34:15,520
Speaker 1: the in the startup world is completely deranged by comparison

637
00:34:15,560 --> 00:34:17,880
Speaker 1: to I mean, you know this because you know all

638
00:34:17,920 --> 00:34:20,640
Speaker 1: these people and you've covered this and read about it assuredly.

639
00:34:20,680 --> 00:34:22,880
Speaker 1: It's just a I mean, what is it, like ninety

640
00:34:22,880 --> 00:34:25,880
Speaker 1: percent of startups fail. It's it's people are dumping enormous

641
00:34:25,880 --> 00:34:28,920
Speaker 1: amounts of cash into things that are inevitable failures. I

642
00:34:28,920 --> 00:34:30,440
Speaker 1: mean it's it's so it's like, I feel like it

643
00:34:30,480 --> 00:34:33,360
Speaker 1: doesn't indicate much of anything for the rest of the

644
00:34:33,360 --> 00:34:47,360
Speaker 1: country or the world, right correct. The one thing we

645
00:34:47,440 --> 00:34:52,560
Speaker 1: do need to underscore is that SVB did not make

646
00:34:52,719 --> 00:34:56,279
Speaker 1: bad loans to startups. Well, if it did, that wasn't

647
00:34:56,280 --> 00:34:59,120
Speaker 1: the problem, right, No one is. No one is saying

648
00:34:59,160 --> 00:35:02,200
Speaker 1: that like they lend a whole bunch of money to

649
00:35:03,200 --> 00:35:05,919
Speaker 1: you know, Adam Newman and Elizabeth Holmes, and they lost

650
00:35:05,920 --> 00:35:08,960
Speaker 1: all of their money, and now right and now their bust. Right,

651
00:35:09,000 --> 00:35:11,600
Speaker 1: that was not the cause of the problem. Now, those

652
00:35:11,600 --> 00:35:13,480
Speaker 1: people had the money and lasted. It wasn't like the

653
00:35:13,520 --> 00:35:16,800
Speaker 1: bank gave it to them. Right, Like, those people raised

654
00:35:16,840 --> 00:35:19,000
Speaker 1: a lot of equity capital. They did not raise a

655
00:35:19,040 --> 00:35:21,759
Speaker 1: lot of debt capital, because lenders are smarter than that

656
00:35:21,920 --> 00:35:24,279
Speaker 1: as a general rule, right, right, correct? No, I mean

657
00:35:24,360 --> 00:35:26,600
Speaker 1: I'm not I mean I wasn't suggesting that. I'm just

658
00:35:26,600 --> 00:35:29,200
Speaker 1: saying that the entire world of economics there just seems

659
00:35:29,760 --> 00:35:32,400
Speaker 1: deranged by comparison to the rest of like exactly, like

660
00:35:32,440 --> 00:35:35,200
Speaker 1: there's a there's a class of person who will give

661
00:35:35,280 --> 00:35:37,719
Speaker 1: money to a company that is a ninety has a

662
00:35:37,800 --> 00:35:40,319
Speaker 1: ninety percent chance of failing, and that class of person

663
00:35:40,480 --> 00:35:44,200
Speaker 1: is called a venture capitalist. That class of person is

664
00:35:44,239 --> 00:35:48,040
Speaker 1: not called a lender. Like no lender would ever do that. No,

665
00:35:48,320 --> 00:35:50,680
Speaker 1: that's actually the strangest thing really when you think about it.

666
00:35:50,719 --> 00:35:52,879
Speaker 1: There is no expectation that they'll get the money back.

667
00:35:53,040 --> 00:35:55,399
Speaker 1: I mean for the most part. I mean, if ten

668
00:35:55,440 --> 00:35:57,600
Speaker 1: percent of those have an axit or even you know,

669
00:35:57,640 --> 00:36:01,280
Speaker 1: do better than just have a real meaningful liquidity event,

670
00:36:01,600 --> 00:36:04,000
Speaker 1: it's it's special and wonderful and it helps you know,

671
00:36:04,120 --> 00:36:06,799
Speaker 1: obviously like shorts up the bottom line there, But they're

672
00:36:06,840 --> 00:36:09,960
Speaker 1: not lending it. It's being given. Yeah, it's being given.

673
00:36:10,080 --> 00:36:12,279
Speaker 1: Like I know. I know this because I was given money,

674
00:36:12,280 --> 00:36:14,120
Speaker 1: you know, to do a startup. And yeah, well yeah,

675
00:36:14,160 --> 00:36:16,480
Speaker 1: if you actually technically speaking, I think if you look

676
00:36:16,480 --> 00:36:19,120
Speaker 1: at the term sheet, yeah, it will have been in

677
00:36:19,160 --> 00:36:22,320
Speaker 1: the form of like preferred something something something which technically

678
00:36:22,320 --> 00:36:24,520
Speaker 1: you owe back. Well, yes, of course that converts in

679
00:36:24,560 --> 00:36:27,680
Speaker 1: many different ways. Obviously in reality it was equity. It

680
00:36:27,719 --> 00:36:30,040
Speaker 1: wasn't that. Did the YO founders have to pay back

681
00:36:30,080 --> 00:36:32,960
Speaker 1: their ten million? I don't think so. It is definitely

682
00:36:33,040 --> 00:36:36,480
Speaker 1: non recourse right, but that is again not the cause

683
00:36:36,520 --> 00:36:40,400
Speaker 1: of the SBB failure. So now where do we go.

684
00:36:40,600 --> 00:36:43,279
Speaker 1: Are we in a recession? No, you're an expert, I am.

685
00:36:43,400 --> 00:36:45,480
Speaker 1: We're not in a recession. We're not in a recession. Yeah,

686
00:36:45,600 --> 00:36:47,440
Speaker 1: Felex says it's not a recession. Then it's fucking not

687
00:36:47,520 --> 00:36:50,160
Speaker 1: a recession. That's it. That's I'm I'm good as far

688
00:36:50,200 --> 00:36:52,279
Speaker 1: as hearing that. If you if you look at this

689
00:36:52,440 --> 00:36:56,160
Speaker 1: this wonderful Yugov pole which they've been running every week

690
00:36:56,239 --> 00:36:58,600
Speaker 1: for like the best buds of a year now, and

691
00:36:58,680 --> 00:37:00,200
Speaker 1: they come out every week and they ask for two

692
00:37:00,200 --> 00:37:02,759
Speaker 1: thousand Americans, are we in a recession? And every week

693
00:37:03,640 --> 00:37:06,600
Speaker 1: a majority of Americans says, yes, we are in a recession,

694
00:37:06,600 --> 00:37:09,200
Speaker 1: and every week a majority of Americans is wrong. And

695
00:37:09,239 --> 00:37:11,560
Speaker 1: it's just one of those things where most people are wrong.

696
00:37:11,960 --> 00:37:14,760
Speaker 1: To me, it's like, I remember what a real ression.

697
00:37:14,800 --> 00:37:17,120
Speaker 1: I feel like, I remember what a real recession feels like.

698
00:37:17,320 --> 00:37:19,719
Speaker 1: Even if we were in a recession, it wouldn't be

699
00:37:19,719 --> 00:37:22,520
Speaker 1: what you call a real recession. One of the problems

700
00:37:22,600 --> 00:37:26,680
Speaker 1: here is that the last two recessions we've had have

701
00:37:26,840 --> 00:37:31,680
Speaker 1: both been unbelievably enormous, gut wrenching, massive things, and everyone

702
00:37:31,760 --> 00:37:34,560
Speaker 1: now thinks, oh my god, if it's a recession, it

703
00:37:34,600 --> 00:37:37,080
Speaker 1: has to be like two thousand and eight or twenty twenty.

704
00:37:37,560 --> 00:37:39,840
Speaker 1: It doesn't. Most recessions are much milder than that and

705
00:37:40,520 --> 00:37:42,480
Speaker 1: kind of no a big deal, right, But yeah, we

706
00:37:42,560 --> 00:37:45,799
Speaker 1: are not in a recession right now. Yeah, And do

707
00:37:45,840 --> 00:37:48,759
Speaker 1: you believe that we are going to enter some kind

708
00:37:48,800 --> 00:37:53,040
Speaker 1: of recession era in the near future? Does it feel

709
00:37:53,040 --> 00:37:55,640
Speaker 1: like the fear is warranted? Why do so many Americans

710
00:37:55,719 --> 00:37:59,200
Speaker 1: keep answering this? Yougo of pol on a geological time

711
00:37:59,239 --> 00:38:02,160
Speaker 1: frame then sure, but like, yeah, okay, yes, someday there

712
00:38:02,160 --> 00:38:04,760
Speaker 1: will be a recession. Someday there will be a recession,

713
00:38:04,800 --> 00:38:07,799
Speaker 1: but like it's a mug's game trying to predict when right.

714
00:38:08,120 --> 00:38:11,879
Speaker 1: You don't feel like the temperature is that hot or cool. Rather,

715
00:38:12,600 --> 00:38:14,759
Speaker 1: now the economy is still pretty hot if you look

716
00:38:14,760 --> 00:38:16,720
Speaker 1: at the GDP numbers, if you look at the consumer

717
00:38:16,760 --> 00:38:20,120
Speaker 1: spending numbers, even if you just look at the inflation numbers,

718
00:38:20,160 --> 00:38:22,279
Speaker 1: Like the reason why there's so much inflation is because

719
00:38:22,280 --> 00:38:25,720
Speaker 1: people are out there spending loss of money. Right again,

720
00:38:25,920 --> 00:38:29,920
Speaker 1: getting back to emotion, there's a mood of like could

721
00:38:29,920 --> 00:38:32,399
Speaker 1: something be wrong? It's something wrong. Maybe everybody's a gun

722
00:38:32,480 --> 00:38:36,279
Speaker 1: shy following the pandemic, Like it feels like you're just

723
00:38:36,320 --> 00:38:40,040
Speaker 1: waiting for the next thing to go wrong. Do you

724
00:38:40,040 --> 00:38:42,480
Speaker 1: think there's a single thing that could change the attitude

725
00:38:42,520 --> 00:38:45,439
Speaker 1: of people? Is there some way to get that ugo

726
00:38:45,480 --> 00:38:47,480
Speaker 1: of pull to shift in a different direction? Like what

727
00:38:47,480 --> 00:38:49,720
Speaker 1: would it take to convince the people who are wrong

728
00:38:50,160 --> 00:38:52,920
Speaker 1: about the recession that there actually isn't a recession? So

729
00:38:53,200 --> 00:38:55,919
Speaker 1: big question. I don't know, if you get aheadser it's yeah,

730
00:38:55,960 --> 00:38:58,120
Speaker 1: I mean, like I'm trying to think, like when was

731
00:38:58,160 --> 00:39:02,040
Speaker 1: the last time you remember like a feeling of national

732
00:39:03,080 --> 00:39:08,200
Speaker 1: optimism and hope and jubilation, like when Wow, Obama was

733
00:39:08,200 --> 00:39:10,640
Speaker 1: elected in two thousand and eight, you know, I mean

734
00:39:11,640 --> 00:39:14,759
Speaker 1: react maybe the reelection probably like there people were at

735
00:39:14,840 --> 00:39:18,520
Speaker 1: least like this is not a one term you know situation,

736
00:39:18,600 --> 00:39:20,480
Speaker 1: this is this is real. I don't know. I mean

737
00:39:20,800 --> 00:39:22,799
Speaker 1: when was when was gay marriage? When did that? When

738
00:39:22,800 --> 00:39:24,640
Speaker 1: did that get Yeah? That was the gay marriage. But

739
00:39:24,680 --> 00:39:28,759
Speaker 1: like like that, there hasn't been a lot of sort

740
00:39:28,760 --> 00:39:32,200
Speaker 1: of caused the great celebration in the United States of

741
00:39:32,400 --> 00:39:35,160
Speaker 1: late right, Yeah, I mean obviously the Trump years were

742
00:39:35,239 --> 00:39:38,279
Speaker 1: very depressing, um for I feel like even for people

743
00:39:38,280 --> 00:39:39,880
Speaker 1: who liked Trump, I don't think they were that happy.

744
00:39:39,880 --> 00:39:42,800
Speaker 1: They were mad. Yeah, the reason they supported Trump is

745
00:39:42,840 --> 00:39:45,600
Speaker 1: because they were unhappy and you know about things, they

746
00:39:45,600 --> 00:39:47,840
Speaker 1: were aggrieved and they were like now we can like

747
00:39:47,920 --> 00:39:51,640
Speaker 1: shout out loud or whatever. And then the pandemic, which

748
00:39:51,680 --> 00:39:54,640
Speaker 1: was obviously huge downer. And I wouldn't say that by

749
00:39:54,680 --> 00:39:57,080
Speaker 1: I mean, I like, you know, there's something about Biden.

750
00:39:57,120 --> 00:39:59,440
Speaker 1: He's just a charming, just a hilarious kind of president

751
00:39:59,560 --> 00:40:02,480
Speaker 1: just like seems to be seems to be just like

752
00:40:02,560 --> 00:40:05,160
Speaker 1: floating through everything in a way that it is sort of,

753
00:40:05,880 --> 00:40:08,799
Speaker 1: I don't know, comforting to some degree. He did a

754
00:40:08,840 --> 00:40:11,560
Speaker 1: great job here of just like delegating everything to Janet

755
00:40:11,600 --> 00:40:12,960
Speaker 1: Yellen and is saying like, are you going to deal

756
00:40:13,000 --> 00:40:15,000
Speaker 1: with this? And she's like yep, and she did well.

757
00:40:15,000 --> 00:40:17,360
Speaker 1: The value of having really good, smart people around you

758
00:40:17,400 --> 00:40:20,080
Speaker 1: who know how to get it done is in calculabot.

759
00:40:20,360 --> 00:40:22,399
Speaker 1: I mean, I mean one of the things I will

760
00:40:22,520 --> 00:40:25,960
Speaker 1: say this is also in my book. I have a

761
00:40:25,960 --> 00:40:29,520
Speaker 1: whole chapter about like how Steve Manusian is massively underrated

762
00:40:29,520 --> 00:40:33,360
Speaker 1: and was actually an incredibly good Treasury secretary. He seems horrible,

763
00:40:33,440 --> 00:40:35,680
Speaker 1: but maybe he's great. I mean, like as a person,

764
00:40:35,800 --> 00:40:37,560
Speaker 1: I'm not going to start coming out and saying like,

765
00:40:37,600 --> 00:40:40,760
Speaker 1: oh yeah, he's made a bunch of really great personal

766
00:40:40,800 --> 00:40:43,160
Speaker 1: decisions in terms of like who he marries and stuff.

767
00:40:43,160 --> 00:40:48,080
Speaker 1: But I am going to say, wow, that the if

768
00:40:48,160 --> 00:40:51,680
Speaker 1: he would in charge during this banking crisis, as someone

769
00:40:51,719 --> 00:40:54,439
Speaker 1: who you know, used to run a bank, he would

770
00:40:54,480 --> 00:40:57,239
Speaker 1: have probably done the exact same thing, right, Like he like,

771
00:40:57,400 --> 00:41:02,560
Speaker 1: it's not rocket science what they do, right. So I mean, again,

772
00:41:02,800 --> 00:41:05,799
Speaker 1: that's Biden delegating, like you said, to somebody who knows

773
00:41:05,800 --> 00:41:07,680
Speaker 1: what the hell they're doing, I mean, having somebody in

774
00:41:07,719 --> 00:41:09,840
Speaker 1: place to deal with it. Not that it seemed to

775
00:41:09,840 --> 00:41:14,680
Speaker 1: calm anybody down Listen, in California, I think I think

776
00:41:14,760 --> 00:41:19,279
Speaker 1: it did. Honestly, I think that things are common right,

777
00:41:19,360 --> 00:41:22,320
Speaker 1: like as we speak on Tuesday, things are common in California.

778
00:41:22,400 --> 00:41:25,400
Speaker 1: Like it took an extra day of like not really

779
00:41:25,440 --> 00:41:28,080
Speaker 1: knowing whether any more banks were going to get taken

780
00:41:28,120 --> 00:41:30,960
Speaker 1: over and nationalized on Monday. When we all woke up

781
00:41:31,000 --> 00:41:34,080
Speaker 1: on Tuesday morning and there had been no bank failures

782
00:41:34,360 --> 00:41:36,040
Speaker 1: and it was pretty obvious that there weren't going to

783
00:41:36,160 --> 00:41:38,839
Speaker 1: be any more bank failures. I think there really was

784
00:41:38,920 --> 00:41:42,839
Speaker 1: this kind of large sigh of relief, this excellation and

785
00:41:43,000 --> 00:41:48,240
Speaker 1: even the panic throne vcs in Silicon Valley like yeah,

786
00:41:48,280 --> 00:41:50,480
Speaker 1: you know, just keep your money in Silicon Valley Bank,

787
00:41:50,640 --> 00:41:52,560
Speaker 1: encourage people to take it over, and let's try and

788
00:41:52,600 --> 00:41:56,080
Speaker 1: go back to how we were. Right, they climbed out

789
00:41:56,120 --> 00:41:59,799
Speaker 1: of their bunkers exactly, took off their body armor. Yeah,

790
00:42:00,000 --> 00:42:02,000
Speaker 1: they emerge from their bunkers and they were ready to

791
00:42:02,840 --> 00:42:07,880
Speaker 1: reintegrate into society. It's true though today definitely felt different.

792
00:42:07,960 --> 00:42:09,840
Speaker 1: In fact, I mean, you know, looking at the market,

793
00:42:09,880 --> 00:42:13,640
Speaker 1: it's things almost feel optimistic, right, Like it's kind of like, oh, well,

794
00:42:13,680 --> 00:42:16,480
Speaker 1: you know better than anyone not to really mead too

795
00:42:16,560 --> 00:42:20,080
Speaker 1: much into one day's stock market moves. But yeah, no, no,

796
00:42:20,120 --> 00:42:22,560
Speaker 1: I don't. It's it's actually the worst we should as

797
00:42:22,880 --> 00:42:25,680
Speaker 1: as someone you know, with your day Joe. No, it's true,

798
00:42:25,680 --> 00:42:28,200
Speaker 1: it is true. It's very important. I have to look

799
00:42:28,200 --> 00:42:32,399
Speaker 1: at it. If you care about stocks, you know, look

800
00:42:32,400 --> 00:42:34,560
Speaker 1: at how they're doing over ten years, don't look at

801
00:42:34,560 --> 00:42:36,879
Speaker 1: how they're doing over twenty four hours. I mean, that's

802
00:42:36,920 --> 00:42:38,680
Speaker 1: to me that at the base of all of this,

803
00:42:38,760 --> 00:42:40,480
Speaker 1: and it is like that that, you know, the chat

804
00:42:40,520 --> 00:42:42,480
Speaker 1: with the founders who are like, oh my god, you've

805
00:42:42,480 --> 00:42:43,920
Speaker 1: got to get our money out of there. All of this,

806
00:42:44,000 --> 00:42:46,759
Speaker 1: to me is the world of money, and the world

807
00:42:46,800 --> 00:42:50,960
Speaker 1: of global economics is one that would seemingly require an

808
00:42:51,080 --> 00:42:55,440
Speaker 1: enormous amount of nerves of steel, right, and also an

809
00:42:55,440 --> 00:42:59,080
Speaker 1: analytical perspective on it, right, a kind of very pragmatic

810
00:42:59,080 --> 00:43:02,600
Speaker 1: analytical perspect because you're talking about potential for you know,

811
00:43:02,680 --> 00:43:05,760
Speaker 1: huge changes, huge shifts in the economics and huge shifts

812
00:43:05,760 --> 00:43:07,920
Speaker 1: and in the way you know things are going. But

813
00:43:08,080 --> 00:43:10,440
Speaker 1: what seems strange to me is that so many of

814
00:43:10,480 --> 00:43:12,879
Speaker 1: the of the people who are engaging at such high

815
00:43:12,960 --> 00:43:16,200
Speaker 1: levels even are motivated, still motivated, but there's like almost

816
00:43:16,239 --> 00:43:19,640
Speaker 1: animal instinct of like running away from or trying to

817
00:43:19,719 --> 00:43:22,600
Speaker 1: flee some perceived I get it's money. I get it's

818
00:43:22,600 --> 00:43:24,799
Speaker 1: like you're always trying to protect your money. But it

819
00:43:24,840 --> 00:43:28,760
Speaker 1: does feel like it shouldn't be so easy to create

820
00:43:29,200 --> 00:43:33,640
Speaker 1: such panic or such you know, fear so quickly that

821
00:43:33,680 --> 00:43:36,960
Speaker 1: you can you know, tank, Silicon Valley Bank in again

822
00:43:37,200 --> 00:43:41,080
Speaker 1: they're responsible for the ultimate reasons that they became insolvent

823
00:43:41,200 --> 00:43:44,759
Speaker 1: or near to it or apparently but as they're ever

824
00:43:44,800 --> 00:43:47,840
Speaker 1: affixed to, like the fear, uncertainty and doubt that motivates

825
00:43:47,880 --> 00:43:52,200
Speaker 1: people like in the market or conversely that you know,

826
00:43:52,560 --> 00:43:56,880
Speaker 1: greed spirals that we see during your various cycles. No,

827
00:43:57,320 --> 00:44:02,640
Speaker 1: like we're humans, we're animals where you know, we react

828
00:44:02,719 --> 00:44:07,120
Speaker 1: on a very gut level to outside stimuli. Like if

829
00:44:07,160 --> 00:44:11,200
Speaker 1: you don't understand the deeply sort of biological nature of

830
00:44:11,239 --> 00:44:15,520
Speaker 1: all markets, then you don't understand markets. Right. It seems

831
00:44:15,600 --> 00:44:18,520
Speaker 1: ridiculous though, doesn't it in a way, I mean, when

832
00:44:18,560 --> 00:44:20,480
Speaker 1: you get right down to it, doesn't it seem absurd

833
00:44:21,000 --> 00:44:24,239
Speaker 1: to think about it? Yeah? I mean, yeah, like we're

834
00:44:24,239 --> 00:44:27,640
Speaker 1: all playing around with this perceived thing that has this

835
00:44:28,160 --> 00:44:30,920
Speaker 1: made up value, and like if things get scary, we

836
00:44:31,080 --> 00:44:34,279
Speaker 1: like literally people have tantrums and you know, wrack their

837
00:44:34,280 --> 00:44:38,839
Speaker 1: own playpen. Well exactly, I mean that's the irony you know,

838
00:44:38,920 --> 00:44:43,600
Speaker 1: has gone remarked upon ad nauseam of the thing that

839
00:44:43,640 --> 00:44:46,959
Speaker 1: the venture capitalists were most upset about, being the very

840
00:44:46,960 --> 00:44:53,280
Speaker 1: thing that the venture capitalists caused. It's like, come on, people, right, well, listen, Felix.

841
00:44:53,320 --> 00:44:54,400
Speaker 1: I know you have to go. You've got a very

842
00:44:54,440 --> 00:44:56,440
Speaker 1: important meeting to get to that important but I do

843
00:44:56,520 --> 00:44:58,799
Speaker 1: have to get to it. You have a book coming out,

844
00:44:58,880 --> 00:45:00,759
Speaker 1: hunt it. Tell us about the book really quickly, because

845
00:45:00,760 --> 00:45:02,160
Speaker 1: you talked about a little bit. But I just want

846
00:45:02,160 --> 00:45:04,399
Speaker 1: to make sure. Tell me about this book and where

847
00:45:04,440 --> 00:45:05,960
Speaker 1: I can purchase it, and when I can put Yes,

848
00:45:06,239 --> 00:45:09,000
Speaker 1: you can purchase it wherever all good books are sold,

849
00:45:09,080 --> 00:45:13,319
Speaker 1: or even bad books. Go to your favorite book, your

850
00:45:13,360 --> 00:45:15,880
Speaker 1: five feelings book. Well, they definitely won't have it yet

851
00:45:15,880 --> 00:45:17,799
Speaker 1: because it doesn't come out until May the ninth, but

852
00:45:17,880 --> 00:45:21,520
Speaker 1: you can pre order it. And it's called The Phoenix Economy, Life,

853
00:45:21,600 --> 00:45:27,400
Speaker 1: Work and Money in the New Normal, and that idea

854
00:45:27,440 --> 00:45:32,080
Speaker 1: of the new normal things being very unexpected, unpredictable, and

855
00:45:32,239 --> 00:45:37,440
Speaker 1: the way that we can try and understand unexpected events

856
00:45:38,400 --> 00:45:41,080
Speaker 1: as and when they happen through the lens of basically

857
00:45:41,120 --> 00:45:44,799
Speaker 1: the pandemic. The pandemic turns out to have really changed

858
00:45:44,840 --> 00:45:47,080
Speaker 1: the world in quite profound ways that I think a

859
00:45:47,120 --> 00:45:49,680
Speaker 1: lot of people haven't quite realized. This book sounds super

860
00:45:49,719 --> 00:45:51,600
Speaker 1: interesting and may it's kind of a ways off, so

861
00:45:51,719 --> 00:45:53,480
Speaker 1: we will be great. You should come back. I'll, you know,

862
00:45:53,520 --> 00:45:55,080
Speaker 1: check out the book and then we can talk about

863
00:45:55,120 --> 00:45:56,560
Speaker 1: some of the some of the ideas in there, because

864
00:45:56,840 --> 00:45:58,640
Speaker 1: I'm actually excited. I didn't I didn't know you were

865
00:45:58,640 --> 00:46:00,479
Speaker 1: working on this, and I'm excited to read it because

866
00:46:01,040 --> 00:46:03,960
Speaker 1: part of what interests me about money right now and

867
00:46:04,000 --> 00:46:07,160
Speaker 1: the way it moves is that it feels like it

868
00:46:07,239 --> 00:46:09,479
Speaker 1: as a part of culture in a way I felt

869
00:46:09,480 --> 00:46:11,439
Speaker 1: like when I was a kid growing up and when

870
00:46:11,440 --> 00:46:13,880
Speaker 1: I was a young adult, even it wasn't in the

871
00:46:13,880 --> 00:46:17,479
Speaker 1: conversation quite as viscerally or didn't seem to matter quite

872
00:46:17,480 --> 00:46:20,640
Speaker 1: as much. Understanding these sort of like global mechanicians, and

873
00:46:21,040 --> 00:46:23,120
Speaker 1: I think there's like some really I mean kind of

874
00:46:23,160 --> 00:46:25,960
Speaker 1: amazing stories that are that are happening. I think the

875
00:46:25,960 --> 00:46:29,320
Speaker 1: pandemic has sort of either created or you know, inspired

876
00:46:29,440 --> 00:46:32,160
Speaker 1: or altered in some way. So you have to come

877
00:46:32,200 --> 00:46:34,840
Speaker 1: back and we'll talk about your book. I will come back.

878
00:46:35,040 --> 00:46:37,520
Speaker 1: I will definitely come back, all right. Well, Felix, thank

879
00:46:37,560 --> 00:46:41,239
Speaker 1: you so much. I now understand the entire state of

880
00:46:41,280 --> 00:46:44,040
Speaker 1: the economy, and I didn't before. So this is really good.

881
00:46:44,080 --> 00:46:45,840
Speaker 1: Do you see. That's that's what I'm handful exists. You

882
00:46:45,880 --> 00:46:47,640
Speaker 1: really have cleared up a lot of big questions for me,

883
00:46:47,680 --> 00:46:57,719
Speaker 1: so I deeply appreciate it. Thank you so much. You know,

884
00:46:58,600 --> 00:47:01,359
Speaker 1: I think we learned a lot here today. I think

885
00:47:01,360 --> 00:47:03,720
Speaker 1: we learned a lot about ourselves and about the world,

886
00:47:03,760 --> 00:47:07,520
Speaker 1: and about the global economy, and about what fear really

887
00:47:07,560 --> 00:47:10,480
Speaker 1: means and what fear can really do. And I think, um,

888
00:47:11,160 --> 00:47:13,279
Speaker 1: you know, we saw it with with this a near

889
00:47:13,400 --> 00:47:15,960
Speaker 1: banking crisis, and of course all of the characters in

890
00:47:16,040 --> 00:47:19,399
Speaker 1: the new Scream film also experienced a great deal of fear,

891
00:47:19,440 --> 00:47:22,640
Speaker 1: I assume before they were stabbed repeatedly. I haven't seen

892
00:47:22,680 --> 00:47:25,840
Speaker 1: it because I don't know. I feel like the franchise

893
00:47:25,960 --> 00:47:29,000
Speaker 1: is kind of lost. It's it's whatever it had, it

894
00:47:29,080 --> 00:47:32,080
Speaker 1: doesn't have it anymore. I will watch it eventually, because

895
00:47:32,080 --> 00:47:34,759
Speaker 1: I do I do feel like I have, I owe

896
00:47:34,760 --> 00:47:37,840
Speaker 1: it to myself and to the memory of West Craven

897
00:47:37,880 --> 00:47:41,400
Speaker 1: to watch it and then say Wes Craven would have

898
00:47:41,400 --> 00:47:47,279
Speaker 1: hated this. Anyhow, That is our show. We'll be back

899
00:47:47,320 --> 00:47:50,799
Speaker 1: next week with more what future, and as always, I

900
00:47:50,800 --> 00:47:52,640
Speaker 1: wish you and your family the very best.