1 00:00:01,080 --> 00:00:04,480 Speaker 1: Welcome. Its verdict was Senator Ted Cruz Ben Ferguson with 2 00:00:04,559 --> 00:00:07,480 Speaker 1: you and Senator the biggest news story of the week. 3 00:00:07,600 --> 00:00:12,119 Speaker 1: Many Americans are concerned about their banks. They're concerned about banking. 4 00:00:12,520 --> 00:00:16,200 Speaker 1: They're concerned about what's happened with a fallout of Silicon 5 00:00:16,560 --> 00:00:18,959 Speaker 1: Valley Bank. This wasn't a little bank. This was a 6 00:00:19,000 --> 00:00:21,720 Speaker 1: big bank. It was one of the top three failures 7 00:00:21,720 --> 00:00:24,919 Speaker 1: of my lifetime. I want to get your initial reaction 8 00:00:25,040 --> 00:00:28,120 Speaker 1: to this and what you've heard, at least from those 9 00:00:28,160 --> 00:00:30,160 Speaker 1: in Washington that were supposed to be keeping an eye 10 00:00:30,160 --> 00:00:33,400 Speaker 1: on this bank and many others every day. Well, this 11 00:00:33,479 --> 00:00:36,720 Speaker 1: has been a very chaotic time in the markets. We've 12 00:00:36,760 --> 00:00:40,640 Speaker 1: seen two different banks fail, including the sixteenth largest bank 13 00:00:40,680 --> 00:00:43,080 Speaker 1: in the United States, Silicon Valley Bank, with two hundred 14 00:00:43,080 --> 00:00:46,720 Speaker 1: and ten billion dollars in assets. That has called into 15 00:00:46,800 --> 00:00:50,840 Speaker 1: question a lot of the financing for the tech industry. 16 00:00:51,479 --> 00:00:53,760 Speaker 1: It's called into question a lot of the financing for 17 00:00:53,840 --> 00:00:59,400 Speaker 1: venture capital, and it has potentially imperiled a significant number 18 00:00:59,400 --> 00:01:03,960 Speaker 1: of midside banks. In response to this, the Biden administration 19 00:01:04,160 --> 00:01:09,919 Speaker 1: rolled out a major bailout, conveniently bailing out the politically 20 00:01:09,920 --> 00:01:14,800 Speaker 1: collected connected friends of the Biden White House in a 21 00:01:14,840 --> 00:01:19,240 Speaker 1: way that we'll have lasting repercussions for the economy and 22 00:01:20,360 --> 00:01:27,000 Speaker 1: will almost certainly incentivize future bad conduct by other banks. 23 00:01:27,959 --> 00:01:30,480 Speaker 1: When you look at this from a standpoint of it 24 00:01:30,520 --> 00:01:33,360 Speaker 1: being called a bailout, a lot of people have been 25 00:01:33,360 --> 00:01:37,000 Speaker 1: calling it that, but this administration keeps saying, this is 26 00:01:37,040 --> 00:01:40,720 Speaker 1: not a bailout. Is this a bailout? Or the taxpayers 27 00:01:40,760 --> 00:01:42,959 Speaker 1: going to have to put the bill for this? Is 28 00:01:42,959 --> 00:01:46,280 Speaker 1: this a delayed bill for taxpayers? How should the American 29 00:01:46,319 --> 00:01:50,840 Speaker 1: people be reacting to this? This is one of bailout, 30 00:01:51,240 --> 00:01:55,640 Speaker 1: and the Biden administration is spinning like crazy trying to 31 00:01:55,680 --> 00:02:00,280 Speaker 1: pretend that it's not. What they are arguing is the money. 32 00:02:00,360 --> 00:02:02,800 Speaker 1: There's one hundred and twenty billion dollars in a fund 33 00:02:03,720 --> 00:02:06,000 Speaker 1: that is paid by banks, and they say, well, that's 34 00:02:06,000 --> 00:02:09,519 Speaker 1: not taxpayer money. Well, the last time I checked banks 35 00:02:09,600 --> 00:02:12,080 Speaker 1: or taxpayers, banks pay quite a bit in taxes. Not 36 00:02:12,160 --> 00:02:15,200 Speaker 1: only that, but the fees that the banks are paying 37 00:02:15,240 --> 00:02:20,639 Speaker 1: into this fund they get from in turn extracting revenues 38 00:02:20,680 --> 00:02:23,960 Speaker 1: from consumers, and so it comes from you and me. 39 00:02:24,040 --> 00:02:25,799 Speaker 1: At the end of the day. This money didn't grow 40 00:02:25,840 --> 00:02:29,600 Speaker 1: on a magic money tree that the Biden administration has 41 00:02:29,720 --> 00:02:33,320 Speaker 1: that they decided to spend well over one hundred billion 42 00:02:33,400 --> 00:02:36,320 Speaker 1: dollars in response to this. And here's what happened. So, 43 00:02:36,400 --> 00:02:40,240 Speaker 1: Silicon Valley Bank has two hundred and ten billion dollars 44 00:02:40,280 --> 00:02:47,160 Speaker 1: in assets, and a big chunk of its portfolio was 45 00:02:47,639 --> 00:02:52,600 Speaker 1: held in securities and in particular long term government debt. 46 00:02:53,760 --> 00:02:57,680 Speaker 1: And in fact, it had the highest securities portfolio as 47 00:02:57,680 --> 00:03:04,040 Speaker 1: a percentage of total assets of any bank, and it 48 00:03:04,120 --> 00:03:08,560 Speaker 1: took long term government debt. But then the Fed's policies 49 00:03:09,400 --> 00:03:14,440 Speaker 1: raising interest rates made that government debt made those bonds 50 00:03:14,760 --> 00:03:19,000 Speaker 1: go down in value about twenty percent. And what happened 51 00:03:19,160 --> 00:03:23,600 Speaker 1: is that the bank was required to mark to market 52 00:03:23,639 --> 00:03:28,280 Speaker 1: those securities at their current valuations. Now, if it held 53 00:03:28,320 --> 00:03:32,639 Speaker 1: those government bonds to maturity, it would get the full payout, 54 00:03:33,240 --> 00:03:37,400 Speaker 1: but their worth about twenty percent less because the interest 55 00:03:37,480 --> 00:03:40,640 Speaker 1: rates they were taken out at are significantly lower than 56 00:03:40,680 --> 00:03:45,440 Speaker 1: where interest rates are today. That in turn caused an 57 00:03:45,440 --> 00:03:48,800 Speaker 1: old fashioned run on the bank, which is depositors and 58 00:03:48,880 --> 00:03:53,480 Speaker 1: in particular venture capital companies and tech companies began removing 59 00:03:53,520 --> 00:03:58,000 Speaker 1: their funds in mass, and it was one after the 60 00:03:58,040 --> 00:04:01,240 Speaker 1: other after the other that began pulling their their funds out. Now, look, 61 00:04:01,280 --> 00:04:04,920 Speaker 1: we all know, uh from from classic movies like It's 62 00:04:04,920 --> 00:04:09,520 Speaker 1: a Wonderful Life, that that a bank doesn't have all 63 00:04:09,560 --> 00:04:12,120 Speaker 1: of the deposits just sitting there in cash, that it 64 00:04:12,120 --> 00:04:16,840 Speaker 1: it in the case of an snlor or a mortgage bank, 65 00:04:16,920 --> 00:04:21,839 Speaker 1: it is loaning them out. Uh. In in this instance, 66 00:04:21,920 --> 00:04:25,240 Speaker 1: the bulk of the funds were in securities, including in 67 00:04:25,279 --> 00:04:29,200 Speaker 1: particular both government debt and mortgage bonds. And so when 68 00:04:29,720 --> 00:04:32,240 Speaker 1: when a ton of the depositors are saying, give me 69 00:04:32,320 --> 00:04:36,080 Speaker 1: my money back, uh, they ran ran into real trouble 70 00:04:36,080 --> 00:04:39,840 Speaker 1: because there was a liquidity mismatch. In other words, the 71 00:04:39,839 --> 00:04:43,600 Speaker 1: the assets they had available to give the depositors back 72 00:04:43,640 --> 00:04:47,440 Speaker 1: where were less than the demand for from the depositors 73 00:04:47,440 --> 00:04:51,200 Speaker 1: to get it back. And so California stepped in and 74 00:04:51,360 --> 00:04:57,640 Speaker 1: shut the bank down on Friday. Uh. And what happened 75 00:04:57,720 --> 00:05:03,040 Speaker 1: next was a series of things. So one consequence, the FDIC, 76 00:05:03,360 --> 00:05:08,280 Speaker 1: the Federal Deposit Insurance Corporation, insures deposits up to two 77 00:05:08,320 --> 00:05:10,400 Speaker 1: hundred and fifty thousand dollars. So if you or I 78 00:05:10,600 --> 00:05:14,000 Speaker 1: have our checking account or savings accounts, most of us 79 00:05:14,000 --> 00:05:16,680 Speaker 1: presumably have less than two hundred and fifty thousand dollars 80 00:05:16,720 --> 00:05:20,640 Speaker 1: in our checking or savings accounts. Those are entirely insured 81 00:05:20,680 --> 00:05:22,680 Speaker 1: by the government. And that's true for anyone that has 82 00:05:22,760 --> 00:05:25,400 Speaker 1: less than two hundred and fifty thousand. That's also true 83 00:05:25,400 --> 00:05:28,520 Speaker 1: for smaller businesses, for mom and pop businesses, smaller businesses, 84 00:05:29,360 --> 00:05:32,600 Speaker 1: but above two hundred and fifty thousand, that is not 85 00:05:32,720 --> 00:05:37,840 Speaker 1: supposed to be insured by the FDIC. And in the 86 00:05:37,920 --> 00:05:42,000 Speaker 1: case of Silicon Valley Bank, a massive amount ninety six 87 00:05:42,120 --> 00:05:46,440 Speaker 1: percent of their deposits were uninsured. In other words, it 88 00:05:46,520 --> 00:05:51,320 Speaker 1: had a bunch of big, big, big deposit accounts way 89 00:05:51,400 --> 00:05:54,280 Speaker 1: above the two hundred and fifty thousand dollars insurance cap. 90 00:05:55,440 --> 00:06:00,760 Speaker 1: The folks that had deposits in Silicon Valley Bank that 91 00:06:00,960 --> 00:06:04,279 Speaker 1: were above the two hundred and fifty thousand dollars insurance 92 00:06:04,320 --> 00:06:09,120 Speaker 1: cap include a ton of politically connected venture capital firms 93 00:06:09,200 --> 00:06:14,719 Speaker 1: in Silicon Valley and startups. So, for example, Circle, the 94 00:06:14,760 --> 00:06:20,839 Speaker 1: payment technology firm, had three point three billion dollars in 95 00:06:20,960 --> 00:06:23,520 Speaker 1: Silicon Valley Bank. That's a bunch of money. Three point 96 00:06:23,560 --> 00:06:27,160 Speaker 1: three billion is way way way above two hundred and 97 00:06:27,200 --> 00:06:30,920 Speaker 1: fifty thousand. There were a total of one thousand and 98 00:06:31,000 --> 00:06:35,080 Speaker 1: seventy four private equity and venture capital funds that were 99 00:06:35,120 --> 00:06:38,440 Speaker 1: banking with Silicon Valley Bank. And if you look at 100 00:06:38,880 --> 00:06:42,400 Speaker 1: some of the players. In addition to Circle, Roku, the 101 00:06:42,480 --> 00:06:45,920 Speaker 1: streaming service, had four hundred and eighty seven million dollars 102 00:06:45,920 --> 00:06:51,200 Speaker 1: in Silicon Valley Bank. The crypto lender Block five, which 103 00:06:51,240 --> 00:06:56,760 Speaker 1: is now defunct, had two hundred and twenty seven million. Roadblocks, 104 00:06:57,440 --> 00:07:02,240 Speaker 1: the online gaming platform had one hundred and fifty million, 105 00:07:03,080 --> 00:07:09,240 Speaker 1: and BuzzFeed, the online media platform, had about fifty six 106 00:07:09,360 --> 00:07:12,000 Speaker 1: million in cash and cash equivalence at the end of 107 00:07:12,320 --> 00:07:15,080 Speaker 1: twenty twenty two, the majority of which was held at 108 00:07:15,120 --> 00:07:18,119 Speaker 1: Silicon Valley Bank. So you have a lot of big 109 00:07:18,160 --> 00:07:22,560 Speaker 1: players with huge amounts of money. Now, these players chose 110 00:07:22,560 --> 00:07:26,200 Speaker 1: to deposit it knowing what the FDIC limits were. They 111 00:07:26,200 --> 00:07:28,960 Speaker 1: didn't seek to ensure it, they didn't seek to find 112 00:07:29,000 --> 00:07:33,720 Speaker 1: any other way to protect it. They counted on number 113 00:07:33,760 --> 00:07:36,360 Speaker 1: one that they believe Silicon Valley Bank was too big 114 00:07:36,400 --> 00:07:40,640 Speaker 1: to fail. But number two what happened is the White 115 00:07:40,680 --> 00:07:45,760 Speaker 1: House very quickly responded to Democrat politicians and tech firms 116 00:07:45,760 --> 00:07:52,920 Speaker 1: and VC firms expressing dismay, and the Biden administration said, 117 00:07:52,960 --> 00:07:56,080 Speaker 1: you know what, We're going to guarantee every deposit doesn't 118 00:07:56,080 --> 00:08:00,520 Speaker 1: matter how big that was. Any way, you look at 119 00:08:00,560 --> 00:08:06,080 Speaker 1: it a massive bailout, and it was a bailout that 120 00:08:06,320 --> 00:08:11,520 Speaker 1: was done, was done with no authorization from Congress. You know, 121 00:08:11,600 --> 00:08:16,920 Speaker 1: you think back to the financial crisis that we saw 122 00:08:17,040 --> 00:08:19,760 Speaker 1: in two thousand and eight. Two thousand and eight, there 123 00:08:19,800 --> 00:08:22,120 Speaker 1: was a financial crisis and there was a massive bailout. 124 00:08:22,120 --> 00:08:24,760 Speaker 1: And what happened there The George W. Bush administration went 125 00:08:24,800 --> 00:08:28,440 Speaker 1: to Congress and they seek sought to pass what was 126 00:08:28,480 --> 00:08:33,360 Speaker 1: called TARP, the Troubled Asset Recovery Program, and the first time, 127 00:08:33,400 --> 00:08:35,640 Speaker 1: in fact, the House of Representatives voted it down and 128 00:08:36,320 --> 00:08:39,959 Speaker 1: didn't give the Bush administration the bailouted asked for. Then 129 00:08:40,040 --> 00:08:45,520 Speaker 1: ultimately it did, and actually the response to TARP prompted 130 00:08:46,080 --> 00:08:50,839 Speaker 1: in significant part the Tea Party, the enormous wave of 131 00:08:51,240 --> 00:08:54,720 Speaker 1: fed up voters that were very unhappy. Why rich connected 132 00:08:54,760 --> 00:09:00,559 Speaker 1: bankers were getting billions in government money. It king here. 133 00:09:00,600 --> 00:09:04,360 Speaker 1: The Biden administration didn't go to Congress, didn't think Congress 134 00:09:04,360 --> 00:09:06,559 Speaker 1: had anything to say at all. They just announced it, 135 00:09:07,040 --> 00:09:11,760 Speaker 1: we're giving away money. Why because these are Democrat donors 136 00:09:11,760 --> 00:09:15,040 Speaker 1: and people we listen to, and you know what, mom 137 00:09:15,040 --> 00:09:17,360 Speaker 1: and pop across this country are going to pay more. 138 00:09:17,480 --> 00:09:21,280 Speaker 1: Local community banks in Texas and all across the country 139 00:09:21,520 --> 00:09:24,079 Speaker 1: are going to end up paying more because the Biden 140 00:09:24,120 --> 00:09:28,719 Speaker 1: administration decided to bail out Silicon Valley Bank and to 141 00:09:29,720 --> 00:09:36,400 Speaker 1: ignore the FDIC cap and give unlimited guarantees on deposits. Senator, 142 00:09:36,440 --> 00:09:38,200 Speaker 1: I want to ask you a question, and this really 143 00:09:38,280 --> 00:09:42,000 Speaker 1: is a political one, about the money that was coming 144 00:09:42,160 --> 00:09:46,160 Speaker 1: out of Silicon Valley Bank. We've now been told that 145 00:09:46,240 --> 00:09:50,840 Speaker 1: apparently they had given more than seventy three million in 146 00:09:51,000 --> 00:09:55,920 Speaker 1: donations to Black Lives Matter and related organizations. Before I 147 00:09:55,960 --> 00:09:57,400 Speaker 1: get your thoughts on that, though, I want to tell 148 00:09:57,400 --> 00:10:00,320 Speaker 1: you about Chalk. 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Right, and 166 00:10:58,440 --> 00:11:00,800 Speaker 1: you're supposed to have a limit to the first two 167 00:11:00,880 --> 00:11:03,240 Speaker 1: hundred and fifty thousand hours of your deposits in a bank. 168 00:11:03,559 --> 00:11:05,640 Speaker 1: But what Biden basically said is, hey, this is a 169 00:11:05,640 --> 00:11:09,680 Speaker 1: woke liberal bank, and we cover it all. Even though 170 00:11:09,679 --> 00:11:11,839 Speaker 1: the people that were putting the money in the bank 171 00:11:11,920 --> 00:11:15,040 Speaker 1: knew that they were overly leveraged here, that they didn't 172 00:11:15,080 --> 00:11:19,280 Speaker 1: have as sound of a lending practice as many other banks, 173 00:11:19,280 --> 00:11:22,000 Speaker 1: they didn't care. So are we now at the point 174 00:11:22,000 --> 00:11:24,720 Speaker 1: where we have a government that says, Okay, you can 175 00:11:24,800 --> 00:11:30,560 Speaker 1: act recklessly in the financial industry, specifically in banking, as 176 00:11:30,640 --> 00:11:33,040 Speaker 1: long as you are in the right side of giving 177 00:11:33,080 --> 00:11:36,520 Speaker 1: to democrats or to parties, We'll cover you no matter 178 00:11:36,600 --> 00:11:38,880 Speaker 1: how reckless you are no matter how big you are, 179 00:11:39,240 --> 00:11:41,720 Speaker 1: and as long as you're on our team and donating 180 00:11:41,720 --> 00:11:44,240 Speaker 1: to things that we believe in, will get your back 181 00:11:44,360 --> 00:11:48,800 Speaker 1: up to one hundred percent of all of your deposits. Look, 182 00:11:48,840 --> 00:11:50,800 Speaker 1: they're an awful lot of folks. They're going to take 183 00:11:50,920 --> 00:11:55,359 Speaker 1: exactly that message from this. This was an act of cronyism. 184 00:11:56,600 --> 00:11:59,960 Speaker 1: It was also critically your right that Silicon Valley Bank 185 00:12:00,120 --> 00:12:02,400 Speaker 1: was one of the most woke banks in America. It 186 00:12:02,480 --> 00:12:05,760 Speaker 1: was very into ESG, it was very into climate change, 187 00:12:06,240 --> 00:12:08,280 Speaker 1: was very into Black Lives matter, it was very into 188 00:12:08,280 --> 00:12:12,600 Speaker 1: everything except apparently having a risk management process to protect 189 00:12:12,679 --> 00:12:18,079 Speaker 1: its depositors deposits and in fact, stunningly, Silicon Valley Bank 190 00:12:18,240 --> 00:12:21,840 Speaker 1: for a year prior to this didn't even have a 191 00:12:22,520 --> 00:12:26,560 Speaker 1: chief risk management officer at a bank that's pretty damn important. 192 00:12:27,280 --> 00:12:32,959 Speaker 1: They didn't have this hedged against interest rate risk. They 193 00:12:32,960 --> 00:12:35,760 Speaker 1: were gambling that the FED would not raise rates, even 194 00:12:35,760 --> 00:12:38,400 Speaker 1: though they'd been screaming from the mountaintops that they were 195 00:12:38,400 --> 00:12:41,760 Speaker 1: going to raise rates. A bank that is being prudent 196 00:12:41,800 --> 00:12:46,360 Speaker 1: can hedge its investments against interest rates rising by by 197 00:12:46,400 --> 00:12:50,760 Speaker 1: investing also in counterbalancing investments that will go up when 198 00:12:50,760 --> 00:12:53,920 Speaker 1: interest rates go up. They didn't do that. They were 199 00:12:53,960 --> 00:12:58,680 Speaker 1: focused on on virtue signaling. They were focused on showing 200 00:12:58,800 --> 00:13:03,480 Speaker 1: just how woke they are. And it's important understand also 201 00:13:03,520 --> 00:13:08,480 Speaker 1: look back the bank here. These bank officers were bad actors. 202 00:13:08,840 --> 00:13:10,880 Speaker 1: Let me let me tell you two data points that 203 00:13:10,960 --> 00:13:18,720 Speaker 1: have been vastly underreported. Number one, hours before the bank 204 00:13:18,840 --> 00:13:24,599 Speaker 1: was shut down, Silicon Valley Bank gave very substantial bonuses 205 00:13:25,120 --> 00:13:30,520 Speaker 1: to all of its employees. They just began writing checks 206 00:13:30,559 --> 00:13:36,040 Speaker 1: to everyone hours before they were shut down. Data point 207 00:13:36,120 --> 00:13:39,840 Speaker 1: number two, in the two weeks prior to their being 208 00:13:39,880 --> 00:13:47,320 Speaker 1: shut down, the CEO and the CFO sold large amounts 209 00:13:47,320 --> 00:13:50,040 Speaker 1: of stock. The CEO ended up making over a two 210 00:13:50,040 --> 00:13:53,640 Speaker 1: million dollar profit from selling stock less than two weeks 211 00:13:53,679 --> 00:13:58,760 Speaker 1: before the bank was shut down. Both of those indicate 212 00:13:58,880 --> 00:14:02,200 Speaker 1: corrupt intent. I'll tell you I had a conference call 213 00:14:04,880 --> 00:14:08,360 Speaker 1: in the last forty eight hours with all one hundred 214 00:14:08,360 --> 00:14:12,200 Speaker 1: senators were invited to participate, and Treasury in the FDIC 215 00:14:12,520 --> 00:14:14,520 Speaker 1: was on there, and I asked, I said, look, is 216 00:14:14,559 --> 00:14:19,160 Speaker 1: it true that they gave bonuses to their employees? Number one, 217 00:14:20,040 --> 00:14:23,800 Speaker 1: If so, I think it is outrageous. And number two, 218 00:14:24,760 --> 00:14:28,360 Speaker 1: has there been any investigation into clawing back those bonuses 219 00:14:29,200 --> 00:14:32,840 Speaker 1: that because they're literally this. As far as I'm concerned, 220 00:14:32,840 --> 00:14:35,600 Speaker 1: this is like Bonnie and Clyde. They're robbing the bank 221 00:14:36,400 --> 00:14:39,280 Speaker 1: as they know their customers deposits are about to get 222 00:14:39,280 --> 00:14:43,080 Speaker 1: blown up. And much of the media coverage has ignored 223 00:14:43,920 --> 00:14:49,040 Speaker 1: the exceptionally bad conduct by the bank's officers. You look 224 00:14:49,040 --> 00:14:52,400 Speaker 1: at Joe Biden and one of the things that I 225 00:14:52,440 --> 00:14:55,480 Speaker 1: think is very concerning about this Biden bail out. That's 226 00:14:55,480 --> 00:14:58,160 Speaker 1: what it is, we should call it. That is the 227 00:14:58,600 --> 00:15:02,160 Speaker 1: question now? Is this it's a big step towards government 228 00:15:02,280 --> 00:15:05,960 Speaker 1: control of the banking system. Because if the government can 229 00:15:06,040 --> 00:15:09,280 Speaker 1: choose winners and losers, and those are supposed to be 230 00:15:09,360 --> 00:15:13,720 Speaker 1: giving oversight of the banks are not doing it. That's 231 00:15:13,760 --> 00:15:17,760 Speaker 1: another huge problem here. And many people may not understand this, 232 00:15:17,800 --> 00:15:19,760 Speaker 1: and I want you to explain it for people. The 233 00:15:19,880 --> 00:15:23,320 Speaker 1: San Francisco Fed was who was supposed to be supervising 234 00:15:23,360 --> 00:15:26,800 Speaker 1: this bank. They either were asleep at the wheel or 235 00:15:26,920 --> 00:15:31,120 Speaker 1: didn't care that they were acting this way. And if 236 00:15:31,560 --> 00:15:33,480 Speaker 1: this is what the government's going to do, is this 237 00:15:33,640 --> 00:15:36,160 Speaker 1: almost a play where they say, Hey, we're just going 238 00:15:36,200 --> 00:15:38,720 Speaker 1: to have a United States government now that is in 239 00:15:38,800 --> 00:15:42,000 Speaker 1: total control of the banking system that would be terrible 240 00:15:42,040 --> 00:15:46,520 Speaker 1: for this country. Well, the banking system right now is 241 00:15:46,560 --> 00:15:50,800 Speaker 1: already heavily regulated, and bank regulators are deeply involved in 242 00:15:50,880 --> 00:15:53,800 Speaker 1: examining the books, and they should be involved. That there 243 00:15:53,880 --> 00:15:56,440 Speaker 1: is a very important role for bank regulators to make 244 00:15:56,480 --> 00:16:01,320 Speaker 1: sure that banks are being honest in our have sufficient liquidity, 245 00:16:01,360 --> 00:16:05,200 Speaker 1: and are sufficiently financed. I will note that this crisis 246 00:16:05,280 --> 00:16:09,960 Speaker 1: Number one was heavily encouraged by government policy, and in particular, 247 00:16:10,000 --> 00:16:13,960 Speaker 1: the FED for years pursued an easy money policy of 248 00:16:14,040 --> 00:16:18,080 Speaker 1: quantitative easing of virtually zero percent interest rates that was 249 00:16:18,280 --> 00:16:23,520 Speaker 1: flooding the system with cash. Number two, the federal government 250 00:16:23,600 --> 00:16:28,320 Speaker 1: also treated long term government debt as essentially risk free, 251 00:16:28,520 --> 00:16:33,600 Speaker 1: zero risk government debt. Dodd Frank, rammed through by the Democrats, 252 00:16:33,680 --> 00:16:38,520 Speaker 1: heavily encouraged banks to invest in long term government debt. Now, 253 00:16:39,000 --> 00:16:41,960 Speaker 1: one thing that does is it helps finance the massive 254 00:16:42,040 --> 00:16:45,320 Speaker 1: debt that the Democrats are racking up on their spending spree. 255 00:16:45,320 --> 00:16:49,480 Speaker 1: They want banks incentivized to buy that debt. But Number two, 256 00:16:49,720 --> 00:16:54,880 Speaker 1: that may make sense in a non inflation inflationary environment, 257 00:16:54,960 --> 00:16:58,640 Speaker 1: but when inflation exploded under Joe Biden and the Fed 258 00:16:58,760 --> 00:17:03,000 Speaker 1: was forced to raise rate suddenly, that long term government debt. 259 00:17:02,760 --> 00:17:07,119 Speaker 1: You you had a spread there that severely reduced the 260 00:17:07,240 --> 00:17:10,879 Speaker 1: value of those bonds, and it was government policies that 261 00:17:11,040 --> 00:17:13,879 Speaker 1: encouraged it on the front end, but then on the 262 00:17:13,880 --> 00:17:17,200 Speaker 1: back end. You were absolutely right. The regulator of Silicon 263 00:17:17,280 --> 00:17:21,800 Speaker 1: Valley Bank was the San Francisco Fed. The San Francisco 264 00:17:21,880 --> 00:17:25,119 Speaker 1: Fed bears an enormous amount of responsibility for what happened, 265 00:17:25,119 --> 00:17:27,399 Speaker 1: because this wasn't subtle, This was out in the open, 266 00:17:28,160 --> 00:17:32,080 Speaker 1: this was it was obvious. Silicon Valley Bank was not 267 00:17:32,240 --> 00:17:36,560 Speaker 1: hiding from the regulators that it had massive amounts in 268 00:17:36,800 --> 00:17:40,320 Speaker 1: long term government debt. The FED obviously knew that the 269 00:17:40,400 --> 00:17:45,119 Speaker 1: Fed was raising interest rates, and yet this exposure, and 270 00:17:45,800 --> 00:17:51,159 Speaker 1: the Fed presumably knew that this interest rate exposure was 271 00:17:51,200 --> 00:17:54,800 Speaker 1: not hedged. And so you have to ask what the 272 00:17:54,920 --> 00:17:58,359 Speaker 1: hell happened at the San Francisco Fed. You don't you 273 00:17:58,400 --> 00:18:02,040 Speaker 1: go look at the San Francisco Fed website. They, again, 274 00:18:02,680 --> 00:18:05,680 Speaker 1: like Silicon Valley Bank, have all sorts of woke things 275 00:18:05,720 --> 00:18:09,359 Speaker 1: on there about ESG and climate change, in black lives 276 00:18:09,400 --> 00:18:13,720 Speaker 1: matter that was their priority, but actually doing their job. 277 00:18:14,800 --> 00:18:18,719 Speaker 1: It is striking that the San Francisco Fed did nothing 278 00:18:18,840 --> 00:18:22,320 Speaker 1: until it was too late. Will there be any accountability 279 00:18:22,440 --> 00:18:26,280 Speaker 1: for the government regulators, specifically in San Francisco on this, 280 00:18:26,720 --> 00:18:30,159 Speaker 1: and is there anything that Washington can actually do to 281 00:18:30,280 --> 00:18:33,920 Speaker 1: hold them accountable, Because if you basically simplify this, you 282 00:18:34,000 --> 00:18:36,840 Speaker 1: pretty much had a group of wealthy speculators that got 283 00:18:36,840 --> 00:18:40,160 Speaker 1: really upset that their money ended up being locked into 284 00:18:40,200 --> 00:18:43,160 Speaker 1: a ten year obligation at less than a two percent return. 285 00:18:43,560 --> 00:18:45,800 Speaker 1: That's how one person put it. So then they basically said, 286 00:18:45,800 --> 00:18:48,480 Speaker 1: all right, we'll convince the government it was in everyone's 287 00:18:48,520 --> 00:18:50,359 Speaker 1: best interest to help them out of their jam at 288 00:18:50,359 --> 00:18:54,479 Speaker 1: the expense of everyone else. And the Fed, who's supposed 289 00:18:54,520 --> 00:18:57,640 Speaker 1: to be looking at this, watching this bank, they just 290 00:18:57,720 --> 00:19:01,399 Speaker 1: didn't do a darn thing. Well, there needs to be accountability, 291 00:19:01,400 --> 00:19:03,240 Speaker 1: and I do have a high level of confidence that 292 00:19:03,320 --> 00:19:05,520 Speaker 1: at a minimum, there'll be accountability in the House, that 293 00:19:05,600 --> 00:19:08,840 Speaker 1: the House is going to hold the regulators to account. 294 00:19:08,960 --> 00:19:12,800 Speaker 1: What what Joe Biden and the Democrats and what the 295 00:19:12,840 --> 00:19:15,080 Speaker 1: corporate media are trying to do is, of course, blame 296 00:19:15,119 --> 00:19:17,359 Speaker 1: it all on Trump because that's the that's their answer 297 00:19:17,400 --> 00:19:19,680 Speaker 1: for everything. But if you look at who the bank 298 00:19:19,720 --> 00:19:22,200 Speaker 1: regulators were that were in charge of it, it wasn't Trump. 299 00:19:22,200 --> 00:19:24,920 Speaker 1: Trump's been out of office for over two years. It 300 00:19:25,000 --> 00:19:29,600 Speaker 1: was the Biden administration asleep at at the wheel. And 301 00:19:30,119 --> 00:19:34,560 Speaker 1: when you look at it, also look the moral hazard 302 00:19:34,640 --> 00:19:38,960 Speaker 1: this will create is dangerous and it's a basic principle. 303 00:19:39,440 --> 00:19:45,439 Speaker 1: When you socialize the risk and you individualize the benefits, 304 00:19:46,440 --> 00:19:50,639 Speaker 1: you always get bad behavior. Silicon Valley Bank, but was 305 00:19:51,520 --> 00:19:56,080 Speaker 1: behaving according to the incentives that they were getting from 306 00:19:56,080 --> 00:19:58,959 Speaker 1: the Biden administration. They believe they'd be bailed out. And 307 00:19:59,000 --> 00:20:02,760 Speaker 1: in particular, look at it's worth noting the bailout it 308 00:20:03,280 --> 00:20:07,280 Speaker 1: is not even directed at Silicon Valley Bank, at its stockholders, 309 00:20:07,359 --> 00:20:10,480 Speaker 1: that they have not been bailed out, at least not yet. 310 00:20:11,760 --> 00:20:13,800 Speaker 1: The people who were bailed out were all of the 311 00:20:13,880 --> 00:20:18,199 Speaker 1: depositors that had tens of millions or hundreds of millions 312 00:20:18,280 --> 00:20:21,320 Speaker 1: or even billions of dollars in Silicon Valley Bank. By 313 00:20:21,320 --> 00:20:26,640 Speaker 1: the way, among many of those depositors billions of dollars 314 00:20:26,640 --> 00:20:30,320 Speaker 1: worth were Chinese companies. Silicon Valley Bank one of the 315 00:20:30,480 --> 00:20:35,000 Speaker 1: things that specialized in was was doing banking for foreign companies, 316 00:20:35,080 --> 00:20:38,439 Speaker 1: foreign investors, and so this was also a bailout of 317 00:20:38,600 --> 00:20:44,080 Speaker 1: China by the Biden administration. But you know what ordinarily 318 00:20:44,119 --> 00:20:46,760 Speaker 1: happens when a bank fails, and listen, we've seen banks fail. 319 00:20:46,840 --> 00:20:50,119 Speaker 1: That's part of how the system operates. When the bank 320 00:20:50,240 --> 00:20:54,879 Speaker 1: managers take on too much risk, the bank should fail 321 00:20:55,080 --> 00:20:57,320 Speaker 1: because you don't want to incentivize. You don't want to 322 00:20:57,320 --> 00:21:01,720 Speaker 1: have everyone taking on too much risk. K. But what 323 00:21:01,920 --> 00:21:05,239 Speaker 1: ordinarily happens when a bank fails is number one, they 324 00:21:05,240 --> 00:21:08,680 Speaker 1: try to find a private buyer, and they did try 325 00:21:08,720 --> 00:21:11,280 Speaker 1: to do that over the weekend, and apparently they were 326 00:21:11,359 --> 00:21:16,040 Speaker 1: unable to do so. There were several bids submitted, but 327 00:21:16,160 --> 00:21:18,600 Speaker 1: the Biden FDIC refused to take any of the bids. 328 00:21:18,640 --> 00:21:20,720 Speaker 1: They found the terms unacceptable. Now we don't know what 329 00:21:20,760 --> 00:21:23,440 Speaker 1: those terms were. I can tell you in the call 330 00:21:23,480 --> 00:21:26,320 Speaker 1: with the senators. We asked them and they didn't tell us. 331 00:21:26,320 --> 00:21:28,200 Speaker 1: They didn't want people to know what the terms were. 332 00:21:28,720 --> 00:21:32,000 Speaker 1: But the Biden administration turned down a private buyer that 333 00:21:32,040 --> 00:21:34,520 Speaker 1: could come in and take over the bank, which is 334 00:21:34,600 --> 00:21:39,480 Speaker 1: ordinarily what happens. Also, ordinarily what happens when a bank 335 00:21:39,560 --> 00:21:42,080 Speaker 1: fails is that everyone's deposits up to two hundred and 336 00:21:42,080 --> 00:21:47,120 Speaker 1: fifty thousand dollars get held completely harmless, and those are 337 00:21:47,119 --> 00:21:50,920 Speaker 1: guaranteed by the FDIC and the larger deposit holders. Typically 338 00:21:51,600 --> 00:21:54,480 Speaker 1: they're not blown out there. They're larger. Deposits are not 339 00:21:54,560 --> 00:21:58,119 Speaker 1: typically worthless, but they usually take a haircut somewhere in 340 00:21:58,160 --> 00:22:01,480 Speaker 1: the fifteen to twenty percent range. And that's what ordinarily 341 00:22:01,520 --> 00:22:03,919 Speaker 1: happens when you put a whole bunch of money in 342 00:22:04,000 --> 00:22:08,879 Speaker 1: one place at risk without it being insured. All of 343 00:22:08,920 --> 00:22:12,479 Speaker 1: the depositors knew that, but they also knew that with 344 00:22:12,520 --> 00:22:16,160 Speaker 1: their friends and the Biden administration that they could count 345 00:22:16,200 --> 00:22:20,280 Speaker 1: on higher returns from Silicon Valley Bank playing fast and loose, 346 00:22:20,359 --> 00:22:23,960 Speaker 1: and if things went south, I think they were confident 347 00:22:24,040 --> 00:22:28,359 Speaker 1: that Democrats in Washington would have their back. Last question 348 00:22:28,359 --> 00:22:31,640 Speaker 1: on this for you, Senator. They're obviously having two banks 349 00:22:31,680 --> 00:22:35,320 Speaker 1: back to back collapse is going to make people uneasy. 350 00:22:35,640 --> 00:22:38,360 Speaker 1: When you guys were on these calls, did anyone talk 351 00:22:38,400 --> 00:22:41,639 Speaker 1: about other banks or there's still concerns that other banks 352 00:22:41,680 --> 00:22:44,000 Speaker 1: may have been following and doing the same exact thing 353 00:22:44,040 --> 00:22:46,879 Speaker 1: that Silicon Valley Bank was doing. Before I get that, 354 00:22:46,960 --> 00:22:48,480 Speaker 1: I want to tell you real quick about our friends 355 00:22:48,480 --> 00:22:51,400 Speaker 1: that gusts of precious medals. 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Is the policy now officially of the 383 00:24:19,000 --> 00:24:22,359 Speaker 1: Biden administration to bail out those banks ensure one hundred 384 00:24:22,400 --> 00:24:25,120 Speaker 1: percent of deposits no matter what, because of the president 385 00:24:25,200 --> 00:24:29,359 Speaker 1: that they just created out of thin air. So possibly, 386 00:24:30,400 --> 00:24:33,159 Speaker 1: but when you look at other banks, look, there's always 387 00:24:33,160 --> 00:24:36,080 Speaker 1: a risk of contagion, and that is a serious concern. 388 00:24:36,160 --> 00:24:38,560 Speaker 1: It's a concern that regulators need to take seriously. It's 389 00:24:38,560 --> 00:24:41,480 Speaker 1: a concerned that Congress needs to take seriously. We need 390 00:24:41,480 --> 00:24:45,440 Speaker 1: our banking system to be safe and secure. There are 391 00:24:45,600 --> 00:24:50,400 Speaker 1: very few off atty banks though, that are similarly situated 392 00:24:50,440 --> 00:24:55,920 Speaker 1: to Silicon Valley Bank. Number one. It was almost exclusively 393 00:24:56,119 --> 00:25:02,679 Speaker 1: big tech and venture capital companies that were deposits in 394 00:25:02,800 --> 00:25:05,359 Speaker 1: Silicon Valley Bank. And the way Silicon Valley Bank would 395 00:25:05,359 --> 00:25:10,159 Speaker 1: work is they'd they'd bank a big venture capital firm, 396 00:25:10,840 --> 00:25:14,639 Speaker 1: and the VC firm would require that all their portfolio companies. 397 00:25:14,640 --> 00:25:16,840 Speaker 1: So a venture capital firm is a firm that takes 398 00:25:16,880 --> 00:25:23,320 Speaker 1: investments from individuals and institutions and then invest typically in 399 00:25:23,359 --> 00:25:27,960 Speaker 1: the tech space early stage and startup companies, and so 400 00:25:28,080 --> 00:25:32,719 Speaker 1: a VC firm could have dozens or even hundreds of 401 00:25:33,080 --> 00:25:37,000 Speaker 1: tech startups that it's invested in, and many of the 402 00:25:37,080 --> 00:25:40,600 Speaker 1: vcs would require every one of the tech startups that 403 00:25:40,720 --> 00:25:43,479 Speaker 1: had they had to bank at Silicon Valley Bank, and 404 00:25:43,520 --> 00:25:47,600 Speaker 1: so you ended up having a very high concentration. That 405 00:25:48,280 --> 00:25:52,840 Speaker 1: degree of sector exposure makes a bank quite vulnerable, that 406 00:25:52,880 --> 00:25:56,920 Speaker 1: it was so intertwined with tech that tech has been 407 00:25:57,960 --> 00:26:00,960 Speaker 1: hard hit lately, and in particular the high interest rates. 408 00:26:01,040 --> 00:26:04,320 Speaker 1: Much when you look at startups, they are often heavily 409 00:26:04,359 --> 00:26:07,960 Speaker 1: funded by debt, and a startup it could often be 410 00:26:08,000 --> 00:26:10,840 Speaker 1: a pretty long ramp up before they have significant revenue. 411 00:26:10,840 --> 00:26:15,159 Speaker 1: And so Silicon Valley Bank had greater exposure because they 412 00:26:15,200 --> 00:26:19,959 Speaker 1: were so sector concentrated in one area. Number One. Number 413 00:26:20,000 --> 00:26:24,000 Speaker 1: two the fact that ninety six percent of their deposits 414 00:26:24,000 --> 00:26:29,280 Speaker 1: were uninsured. That is an unusually high number that they 415 00:26:29,280 --> 00:26:32,000 Speaker 1: were not their business was not having lots and lots 416 00:26:32,000 --> 00:26:35,560 Speaker 1: of depositors under the FDIC insurance camp. It wasn't a 417 00:26:35,600 --> 00:26:39,560 Speaker 1: lot of mom and pops. It was big firms with 418 00:26:39,760 --> 00:26:43,360 Speaker 1: hundreds of millions or billions of dollars and number three. 419 00:26:43,359 --> 00:26:46,159 Speaker 1: As I mentioned, they had the highest securities portfolio as 420 00:26:46,160 --> 00:26:49,560 Speaker 1: a percentage of total assets of any bank, and so 421 00:26:49,600 --> 00:26:54,000 Speaker 1: that they ended up with their investment strategy, they were 422 00:26:54,080 --> 00:26:58,640 Speaker 1: particularly vulnerable to this interest rate risk. As I mentioned, 423 00:26:58,640 --> 00:27:00,760 Speaker 1: for a year they didn't even have a risk officer. 424 00:27:01,080 --> 00:27:04,400 Speaker 1: They didn't hedge significantly against this risk, and so their 425 00:27:04,440 --> 00:27:09,760 Speaker 1: behavior invited this. Now there is a risk of other, 426 00:27:09,920 --> 00:27:13,080 Speaker 1: particularly midsize banks, facing a run on the bank, and 427 00:27:13,160 --> 00:27:16,280 Speaker 1: so we don't want that any any bank is potentially 428 00:27:16,359 --> 00:27:19,680 Speaker 1: vulnerable to a run on the bank. We want people 429 00:27:19,720 --> 00:27:23,919 Speaker 1: to have confidence in our banking system. But you asked 430 00:27:23,920 --> 00:27:27,560 Speaker 1: about the moral hazard. Will others behave recklessly because of this? 431 00:27:27,600 --> 00:27:31,879 Speaker 1: And I think the odds are are quite high now. 432 00:27:32,320 --> 00:27:36,560 Speaker 1: A second element that was created is what's called a 433 00:27:36,600 --> 00:27:39,960 Speaker 1: FED Emergency Lending Facility. It's also known as a thirteen 434 00:27:40,080 --> 00:27:43,639 Speaker 1: three facility because that's where the authority appears in the 435 00:27:43,640 --> 00:27:48,360 Speaker 1: Federal Reserve Act, in which case the Feds said they 436 00:27:48,400 --> 00:27:54,000 Speaker 1: will loan money for a year to back up long 437 00:27:54,200 --> 00:27:59,600 Speaker 1: term government debt, and they will value that money not 438 00:28:00,160 --> 00:28:03,359 Speaker 1: its current market value, but at its original purchase price. 439 00:28:04,440 --> 00:28:06,920 Speaker 1: That's yet another bailout. I mean, let's let's be clear 440 00:28:07,040 --> 00:28:12,960 Speaker 1: that that is billions and billions of cash that is 441 00:28:12,960 --> 00:28:15,439 Speaker 1: on the hook to go out from the FED, and 442 00:28:15,560 --> 00:28:19,119 Speaker 1: it really is striking. Look, we could have a reasonable 443 00:28:19,119 --> 00:28:23,320 Speaker 1: public policy debate listening to economist examining what needs to 444 00:28:23,320 --> 00:28:28,040 Speaker 1: be done to ensure stability in the banking system. But 445 00:28:28,119 --> 00:28:31,600 Speaker 1: the Biden administration didn't want that that that reasonable debate. 446 00:28:31,640 --> 00:28:33,720 Speaker 1: It didn't want the input of Congress, it didn't want 447 00:28:33,720 --> 00:28:36,080 Speaker 1: the public to have any say in it. It just 448 00:28:36,200 --> 00:28:40,400 Speaker 1: wanted political cronies to make that decision. And I think 449 00:28:40,440 --> 00:28:46,080 Speaker 1: that is a very dangerous dynamic. Yeah, it is concerning, 450 00:28:46,080 --> 00:28:48,120 Speaker 1: and it seems like the new policy of the Biden 451 00:28:48,120 --> 00:28:51,840 Speaker 1: administration is be a woke bank and support an advocat 452 00:28:51,880 --> 00:28:55,200 Speaker 1: and give donations to woke ideology and we'll back you 453 00:28:55,320 --> 00:28:57,040 Speaker 1: up no matter what. And if that's what they're going 454 00:28:57,120 --> 00:28:58,880 Speaker 1: to do for the next two years, that's going to 455 00:28:58,960 --> 00:29:01,720 Speaker 1: be very concerning. Should be an issue moving into the 456 00:29:01,720 --> 00:29:04,120 Speaker 1: next presidential election, no doubt about that. I want to 457 00:29:04,120 --> 00:29:09,200 Speaker 1: talk also about China and really what's happening with climate 458 00:29:09,360 --> 00:29:14,960 Speaker 1: change and with regulations. There are a couple of different 459 00:29:15,080 --> 00:29:19,960 Speaker 1: Biden administration clips that have emerged recently highlighting just how 460 00:29:20,040 --> 00:29:26,120 Speaker 1: much the Democrats are in bed and idolizing the Chinese 461 00:29:26,160 --> 00:29:30,640 Speaker 1: Communist Party. These were moments that when you hear them, 462 00:29:30,840 --> 00:29:34,520 Speaker 1: you're kind of in shock because you've got the Biden 463 00:29:34,520 --> 00:29:39,400 Speaker 1: administration officials who are actually saying that they think China 464 00:29:39,480 --> 00:29:43,480 Speaker 1: is amazing. You have Jennifer Granholm, you also have another 465 00:29:43,520 --> 00:29:46,800 Speaker 1: individual with a Biden administration and here's a montage of 466 00:29:46,840 --> 00:29:50,640 Speaker 1: what they've been saying. We're hopeful that, you know, we 467 00:29:50,640 --> 00:29:52,680 Speaker 1: can all learn from what China is doing. But the 468 00:29:52,680 --> 00:29:56,000 Speaker 1: amount of money that they're investing in clean energy is 469 00:29:56,040 --> 00:30:09,360 Speaker 1: actually you know, encouraging. This isn't about decoupling. Now, that's 470 00:30:09,400 --> 00:30:13,440 Speaker 1: not the only Democrats that seem to be idolizing the 471 00:30:13,480 --> 00:30:16,560 Speaker 1: Biden at ministration or excuse me, China from the Biden team, 472 00:30:17,200 --> 00:30:20,120 Speaker 1: you have former Speaker of the House Nancy Pelosi, who 473 00:30:20,240 --> 00:30:24,520 Speaker 1: also came out saying this about China. But here's the thing. 474 00:30:25,440 --> 00:30:28,880 Speaker 1: You can't just go after China with a cudgel. You 475 00:30:28,960 --> 00:30:32,160 Speaker 1: have to say, we have to live on this planet together. 476 00:30:32,960 --> 00:30:36,160 Speaker 1: How can we work together to save the planet from 477 00:30:36,280 --> 00:30:40,680 Speaker 1: climate change? They're essential in that discussion. How can we 478 00:30:40,760 --> 00:30:44,000 Speaker 1: try to work together with them on issues where we 479 00:30:44,080 --> 00:30:48,440 Speaker 1: can find common ground center China. Just so people understand this, 480 00:30:49,000 --> 00:30:51,200 Speaker 1: they're one of the biggest, if not one of the biggest, 481 00:30:51,200 --> 00:30:55,320 Speaker 1: polluting industrialization in the world. They don't ever play by 482 00:30:55,360 --> 00:30:57,880 Speaker 1: the rules that we are that these Democrats are trying 483 00:30:57,920 --> 00:31:00,520 Speaker 1: to force us to play by. And not only are 484 00:31:00,840 --> 00:31:04,720 Speaker 1: the Chinese laughing at us on all of our global 485 00:31:04,800 --> 00:31:09,040 Speaker 1: warming issues that are just stifling our economy and manufacturing, 486 00:31:09,320 --> 00:31:13,040 Speaker 1: but they're making money off of these bad policies and 487 00:31:13,360 --> 00:31:17,160 Speaker 1: polluting at record levels that we've never seen before, and 488 00:31:17,280 --> 00:31:21,040 Speaker 1: now you've got Democrats praising them. You know, it really 489 00:31:21,160 --> 00:31:24,200 Speaker 1: is striking that in the same week that the Biden 490 00:31:24,240 --> 00:31:29,560 Speaker 1: administration does a bailout for their politically connected friends in tech, 491 00:31:31,040 --> 00:31:35,320 Speaker 1: including billions of dollars of a bailout for Chinese tech 492 00:31:35,360 --> 00:31:40,760 Speaker 1: companies and Chinese investors, that you have a coordinated pivot 493 00:31:41,120 --> 00:31:45,600 Speaker 1: from the Democrats to embrace China. Those three clips you played, 494 00:31:45,680 --> 00:31:48,600 Speaker 1: the first one was from Jennifer Granham, the Energy Secretary, 495 00:31:49,320 --> 00:31:52,760 Speaker 1: the second one was from Gina Raimondo, the Commerce Secretary, 496 00:31:53,320 --> 00:31:55,840 Speaker 1: and the third one was from Nancy Pelosi, the former 497 00:31:55,880 --> 00:31:58,920 Speaker 1: Speaker of the House. All of them are saying almost 498 00:31:59,000 --> 00:32:01,840 Speaker 1: exactly the same thing. They're all saying we've got to 499 00:32:01,880 --> 00:32:06,600 Speaker 1: work with China as our partner in fighting climate change. Now, 500 00:32:07,320 --> 00:32:09,959 Speaker 1: those are the talking points, and I will give Democrats credit. 501 00:32:10,560 --> 00:32:14,040 Speaker 1: Democrats have incredible message discipline. The fact that you see 502 00:32:14,080 --> 00:32:16,640 Speaker 1: all three of them saying almost word for word the 503 00:32:16,680 --> 00:32:19,520 Speaker 1: same thing is clear. They got a message. They're sticking 504 00:32:19,560 --> 00:32:24,360 Speaker 1: to it. It just so happens the message is laughably absurd. 505 00:32:24,520 --> 00:32:27,800 Speaker 1: So never mind all the human rights abuses, the torture, 506 00:32:27,880 --> 00:32:31,200 Speaker 1: the murder, the genocide, the concentration camps. Never mind the 507 00:32:31,240 --> 00:32:36,240 Speaker 1: culpability for COVID and millions of lives lost and trillions 508 00:32:36,280 --> 00:32:41,080 Speaker 1: in damage done to the global economy. Never mind the 509 00:32:41,120 --> 00:32:46,400 Speaker 1: intellectual property theft that China pursues as a business as 510 00:32:46,400 --> 00:32:50,480 Speaker 1: a state policy. Set all that aside, just focus on 511 00:32:50,520 --> 00:32:55,640 Speaker 1: the environment. Communist China is the single biggest polluter on 512 00:32:55,640 --> 00:32:59,120 Speaker 1: the face of the planet, year after year after year. 513 00:32:59,160 --> 00:33:01,920 Speaker 1: It's the biggest pollution pollutor on the face of the planet. 514 00:33:01,960 --> 00:33:05,160 Speaker 1: But wait, pen, you might say, Nancy Pelosi just says 515 00:33:05,320 --> 00:33:09,360 Speaker 1: they're doing great things on the environment. Let me read 516 00:33:09,360 --> 00:33:14,280 Speaker 1: you an amazing statistic. China right now is in the 517 00:33:14,400 --> 00:33:21,880 Speaker 1: process of building more new coal capacity than all of 518 00:33:21,920 --> 00:33:27,360 Speaker 1: the existing US coal plants combined. I want you to 519 00:33:27,400 --> 00:33:30,560 Speaker 1: pause and think about that for a second. So US 520 00:33:30,640 --> 00:33:35,800 Speaker 1: capacity right now, we have one hundred and ninety eight 521 00:33:35,840 --> 00:33:41,200 Speaker 1: gigawatts of coal fired electricity generation capacity. That's of the 522 00:33:41,320 --> 00:33:45,080 Speaker 1: end of twenty twenty two, one hundred and ninety eight gigawatts. 523 00:33:45,080 --> 00:33:48,520 Speaker 1: How much do you think China is building, has planned, 524 00:33:48,520 --> 00:33:52,400 Speaker 1: and is building right now, No clue. So it has 525 00:33:52,520 --> 00:33:57,560 Speaker 1: one hundred and fifteen gigawatts under construction, and it has 526 00:33:57,560 --> 00:34:02,280 Speaker 1: another two hundred and fifty gigawatts plant and so all told, 527 00:34:02,600 --> 00:34:05,360 Speaker 1: that is three hundred and sixty five It is nearly 528 00:34:05,680 --> 00:34:10,760 Speaker 1: double the current US capacity. That's what they are building 529 00:34:11,080 --> 00:34:15,040 Speaker 1: and planning right now. And these plants are designed to 530 00:34:15,160 --> 00:34:19,640 Speaker 1: last forty years or longer. And so to watch the 531 00:34:19,719 --> 00:34:22,040 Speaker 1: Democrats pivot in, Look, this has nothing to do with 532 00:34:22,080 --> 00:34:26,520 Speaker 1: the environment. We've talked before about how today's Democrat party 533 00:34:26,800 --> 00:34:32,720 Speaker 1: is structurally pro China. Why because they're major stakeholders, big tech, 534 00:34:32,880 --> 00:34:36,640 Speaker 1: big business, big university's, big Hollywood, all of them are 535 00:34:36,680 --> 00:34:40,000 Speaker 1: in bed with China. And so when you have Pelosi 536 00:34:40,040 --> 00:34:44,000 Speaker 1: in the Democrats reading the CCP's talking points about how 537 00:34:44,040 --> 00:34:48,960 Speaker 1: great they are on the environment, it is both deeply 538 00:34:49,080 --> 00:34:53,920 Speaker 1: dishonest and laughably absurd. One other thing on China. You 539 00:34:53,960 --> 00:34:56,960 Speaker 1: look at this moment and in history, I think this 540 00:34:57,120 --> 00:34:59,320 Speaker 1: is going to go down as an extremely pivotal moment 541 00:34:59,360 --> 00:35:04,640 Speaker 1: because it's not just this administration basically fan boing over 542 00:35:04,920 --> 00:35:09,320 Speaker 1: China and rewriting history of what China's doing on climate change, 543 00:35:09,600 --> 00:35:14,239 Speaker 1: but they're also allowing for China to really take advantage 544 00:35:14,520 --> 00:35:18,040 Speaker 1: of what's happening with Russia and Ukraine. You can bine 545 00:35:18,080 --> 00:35:20,919 Speaker 1: these two things together on top of what they're doing 546 00:35:20,920 --> 00:35:24,440 Speaker 1: with TikTok and spying, and what they've been able to 547 00:35:24,480 --> 00:35:27,120 Speaker 1: do with just stealing anything they can get their hands 548 00:35:27,160 --> 00:35:30,400 Speaker 1: on through hacking in this country and stealing trade secrets. 549 00:35:30,400 --> 00:35:32,640 Speaker 1: The list goes on and on. Before we go through that, 550 00:35:32,680 --> 00:35:34,680 Speaker 1: I want to tell people about Patriot Mobile real quick. 551 00:35:34,920 --> 00:35:38,320 Speaker 1: Patriot Mobile is the only Christian conservative cell phone company 552 00:35:38,400 --> 00:35:41,040 Speaker 1: in the US. And if you're sick and tired of 553 00:35:41,040 --> 00:35:43,799 Speaker 1: what companies that you pay money to every month and 554 00:35:43,840 --> 00:35:47,279 Speaker 1: then they actually go against your values, You've got an 555 00:35:47,280 --> 00:35:50,280 Speaker 1: option now in the cell phone industry. You can actually 556 00:35:50,320 --> 00:35:52,839 Speaker 1: switch Patriot Mobile, and it's easy. You can keep your 557 00:35:52,840 --> 00:35:55,319 Speaker 1: same cell phone number, you can keep your same cell 558 00:35:55,320 --> 00:35:57,400 Speaker 1: phone or switch to a new phone. Maybe you want 559 00:35:57,400 --> 00:35:59,680 Speaker 1: to upgrade, you can do that. The other great thing 560 00:35:59,719 --> 00:36:02,719 Speaker 1: about Patriot Mobile is when you pay your bill every month, 561 00:36:02,760 --> 00:36:05,680 Speaker 1: they take a portion of that bill and they give 562 00:36:05,719 --> 00:36:10,680 Speaker 1: it back to conservative causes and organizations that actually stand 563 00:36:10,880 --> 00:36:13,200 Speaker 1: for what we believe in. We're talking about First and 564 00:36:13,239 --> 00:36:16,200 Speaker 1: Second Amendment right organizations, standing up for the rights of 565 00:36:16,320 --> 00:36:20,319 Speaker 1: unborn children, and even helping people with adoptions. If you're 566 00:36:20,360 --> 00:36:22,960 Speaker 1: ready to have a company stand with you and what 567 00:36:23,040 --> 00:36:25,320 Speaker 1: you believe in, you're gonna have a cell phone anyway, 568 00:36:25,360 --> 00:36:27,399 Speaker 1: you might as well support what you believe in. When 569 00:36:27,400 --> 00:36:30,280 Speaker 1: you pay your bill, call them age seven eighth Patriot. 570 00:36:30,560 --> 00:36:34,920 Speaker 1: That's eight seven eight Patriot eight seven eight Patriot. Use 571 00:36:34,960 --> 00:36:37,479 Speaker 1: a promo verdict you get the best deals of the day. 572 00:36:37,800 --> 00:36:42,040 Speaker 1: Patriotmobile dot com slash verdict now center. This administration so 573 00:36:42,080 --> 00:36:45,080 Speaker 1: far and correct me if I'm wrong, has still to 574 00:36:45,239 --> 00:36:49,240 Speaker 1: date not one time stood up to China on any 575 00:36:49,520 --> 00:36:54,920 Speaker 1: significant issue. I would even say probably any basic issue. 576 00:36:55,800 --> 00:36:58,480 Speaker 1: What is the reasoning behind them being so obsessed with 577 00:36:58,480 --> 00:37:01,719 Speaker 1: allowing China to just continue to grow, do whatever they 578 00:37:01,760 --> 00:37:04,920 Speaker 1: want to do and putting American second to China in 579 00:37:05,040 --> 00:37:08,840 Speaker 1: this policy? Well, Number one that's been Joe Biden's policy 580 00:37:08,920 --> 00:37:13,240 Speaker 1: his entire life. He has been an advocate on behalf 581 00:37:13,239 --> 00:37:16,400 Speaker 1: of China for decades. If you remember the video of 582 00:37:16,480 --> 00:37:20,200 Speaker 1: him saying, come on man, China's our friend, Come on man. 583 00:37:21,320 --> 00:37:24,640 Speaker 1: He has been arguing that for a long time. Number two, 584 00:37:24,719 --> 00:37:28,279 Speaker 1: by the way, he's also been perfectly happy to be 585 00:37:28,360 --> 00:37:32,040 Speaker 1: personally enriched and for his family to be personally enriched, because, 586 00:37:32,040 --> 00:37:34,600 Speaker 1: as we've talked about at length on this podcast, Hunter 587 00:37:34,640 --> 00:37:39,920 Speaker 1: Biden made millions of dollars monetizing his father's political connections, 588 00:37:40,320 --> 00:37:43,280 Speaker 1: and that included, as we know from the Hunter Biden laptop, 589 00:37:43,360 --> 00:37:45,840 Speaker 1: ten percent for the big guy, for Joe Biden himself. 590 00:37:46,080 --> 00:37:49,680 Speaker 1: So he's had a personal financial stake in doing business 591 00:37:49,680 --> 00:37:53,040 Speaker 1: with China for a long time. But number three is 592 00:37:53,480 --> 00:37:57,759 Speaker 1: the structural reality of the Democrat Party today. They're not 593 00:37:57,880 --> 00:38:01,000 Speaker 1: willing to stand up to China because the people who 594 00:38:01,200 --> 00:38:05,960 Speaker 1: fund them depend upon China. The people who form the 595 00:38:06,040 --> 00:38:10,880 Speaker 1: core of the Democrat Party today are deeply intertwined with China, 596 00:38:10,960 --> 00:38:15,520 Speaker 1: and actually the Silicon Valley Bank situation illustrates that perfectly. 597 00:38:16,680 --> 00:38:20,720 Speaker 1: Biden was all too eager to bail out his buddies 598 00:38:20,760 --> 00:38:24,440 Speaker 1: in tech, but in doing so, he's providing billions and 599 00:38:24,560 --> 00:38:29,160 Speaker 1: bailouts for China as well, and that's because the two 600 00:38:29,239 --> 00:38:33,680 Speaker 1: are deeply intertwined. I'll point out on top of that, 601 00:38:34,960 --> 00:38:37,239 Speaker 1: if you say, well, we'll wait a second. You know, 602 00:38:37,920 --> 00:38:43,720 Speaker 1: isn't that an exaggeration. In the last Congress, I forced 603 00:38:43,719 --> 00:38:48,840 Speaker 1: to vote on the Senate floor on my amendment that 604 00:38:49,000 --> 00:38:52,440 Speaker 1: said the federal government should be prohibited from buying electric 605 00:38:52,520 --> 00:38:59,720 Speaker 1: vehicles or batteries manufactured using slave labor in concentration camps 606 00:38:59,719 --> 00:39:02,799 Speaker 1: and China. You would think this would be an easy vote. 607 00:39:02,800 --> 00:39:04,239 Speaker 1: You would think this would be one hundred and nothing. 608 00:39:05,440 --> 00:39:09,200 Speaker 1: Every single Democrat except one, Every Democrat except Joe Mansion 609 00:39:09,440 --> 00:39:15,040 Speaker 1: voted no. And that is a structural dynamic of how 610 00:39:15,080 --> 00:39:19,000 Speaker 1: today's Democrat Party is organized. Yeah, it's certainly not looking 611 00:39:19,000 --> 00:39:21,680 Speaker 1: out for the American people first and foremost, and we're 612 00:39:21,680 --> 00:39:23,600 Speaker 1: seeing that. Whether it's the bank, whether it's China, whether 613 00:39:23,600 --> 00:39:26,040 Speaker 1: it's climate change. The list goes on and on. Senator, 614 00:39:26,080 --> 00:39:28,200 Speaker 1: Always a pleasure. Don't forget if you're listening. We do 615 00:39:28,239 --> 00:39:30,000 Speaker 1: this show three days a week, so make sure you 616 00:39:30,040 --> 00:39:33,520 Speaker 1: have that subscribe and or the auto download button so 617 00:39:33,560 --> 00:39:36,000 Speaker 1: you get each and every episode. When we're dealing with 618 00:39:36,320 --> 00:39:39,319 Speaker 1: what's really happening in Washington, with what's happening with the 619 00:39:39,320 --> 00:39:41,640 Speaker 1: banks right now. You won't get this anywhere else, so 620 00:39:41,719 --> 00:39:44,919 Speaker 1: makes you subscribe, Hit that auto download button and rute 621 00:39:44,960 --> 00:39:47,400 Speaker 1: us to five story review. It helps us reach a 622 00:39:47,480 --> 00:39:49,960 Speaker 1: lot of new listeners. When you do that, it matters 623 00:39:50,239 --> 00:39:53,200 Speaker 1: a whole lot and how they rate podcasts. So if 624 00:39:53,200 --> 00:39:55,000 Speaker 1: you'll please rite us a five star review as well, 625 00:39:55,040 --> 00:39:57,480 Speaker 1: we'd greatly appreciate that, and we'll see you back here 626 00:39:57,560 --> 00:39:58,400 Speaker 1: in a couple of days.