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Speaker 1: Markets are very good at pricing risk. They price interest rates,

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Speaker 1: credit risk, inflation, volatility, even geopolitical uncertainty. But there's one

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Speaker 1: risk that markets are terrible at pricing, and that's irrational

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Speaker 1: human behavior at scale. Now, not individual bad decisions, I

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Speaker 1: mean entire societies abandoning reason. Now, when emotion replaces thinking,

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Speaker 1: when incentives stop mattering, when narratives override reality, markets don't

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Speaker 1: just misprice things, the markets break. And that's what I

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Speaker 1: want to talk about today. Now, if you've been paying attention,

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Speaker 1: it feels like something deeper is going wrong, not just inflation,

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Speaker 1: not just debt, not just politics. It feels like it

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Speaker 1: feels like the basic assumptions that markets rely on rational actors, incentives,

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Speaker 1: cause and effect are all starting to fail.

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Speaker 2: Now.

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Speaker 1: You see it in economic policy, you see it in

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Speaker 1: the rise of socialism among young people. You see it

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Speaker 1: in cities voting for policies that clearly make them poor.

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Speaker 1: And the common thread isn't left Verst is right, it's

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Speaker 1: the collapse of rational thinking. Now. To really understand this,

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Speaker 1: have to go deeper than charts. You have to go

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Speaker 1: deeper than models, and you have to understand the moral

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Speaker 1: and physical foundations that markets actually sit on and that's

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Speaker 1: why I want to have this conversation today with today's guest,

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Speaker 1: yarn Brook. Yarn is the chairman of the iin Ran Institute,

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Speaker 1: a longtime thinker of capitalism, rationality, and moral philosophy, and

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Speaker 1: someone who spent decades studying why free markets work and

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Speaker 1: why they fail when society's abandoned. Reason. Now, this isn't

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Speaker 1: this isn't a political conversation. It's a diagnostic one because

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Speaker 1: if a rationality is spreading at a societal level, it's

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Speaker 1: not just a cultural problem, it's a market risk. So

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Speaker 1: with that, let's go ahead, just jump in right into

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Speaker 1: the conversation with Yarn. Jarn thanks for joining me today.

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Speaker 1: Now I want to open up with that markets assume

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Speaker 1: rational behavior. They don't assume, they don't assume like perfect behavior,

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Speaker 1: but at least like rational at a societal level. Though,

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Speaker 1: do you think we're becoming less rational? And if that's true,

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Speaker 1: what does an investor misunderstand or miss price when they

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Speaker 1: assume rational thinking is still the default today?

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Speaker 2: Well, so a couple of things. One is we can

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Speaker 2: only become less rational at the society level if as

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Speaker 2: individuals were becoming less rational and I think to some

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Speaker 2: extent we are. I think our educational system does not

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Speaker 2: teach rationality anymore, does not teach kids how to think.

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Speaker 2: It teaches people to emote and to feel. And I

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Speaker 2: need to a large extent, we live in a culture,

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Speaker 2: and you see this across the board, culturally poliquely, that

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Speaker 2: is really you know, focused on emotion and emotionalism rather

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Speaker 2: than reason and rational thought. Market's a little different because

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Speaker 2: most investors don't matter, right, What matters is the marginal investor.

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Speaker 2: What matters is the person willing to buy or sell

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Speaker 2: at a particular price. And there's a lot of rational people,

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Speaker 2: or at least properly incentivize people in finite markets to

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Speaker 2: try to you know, to buy and sell based on

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Speaker 2: I think, more rational parameters and more rational considerations. So

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Speaker 2: prices can deviate from what I think of fundamentals for

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Speaker 2: a while, but they won't deviate for a long for

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Speaker 2: a very long time, because there's enough money to be

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Speaker 2: made in correcting the price that it will adjust. But

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Speaker 2: we live in it. There's no question markets will become

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Speaker 2: more volatile. The more irrational we are, the more volatile

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Speaker 2: they will become. But they will correct. You won't see

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Speaker 2: them staying completely out of whack and crazy for a

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Speaker 2: long period of time. There's just too much rational money,

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Speaker 2: if you will. One of the things about money is

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Speaker 2: rational people make money, and so they're the ones who

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Speaker 2: have more influenced. The more money you have, the more

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Speaker 2: influence you have in markets, and therefore the influence tilts

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Speaker 2: towards rationality. Irrational people lose money and they get wiped

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Speaker 2: out and get the exit markets. So in the long run,

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Speaker 2: markets reflect rationally value the valuations of rational players.

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Speaker 1: In an equity based system where there's actually true cost

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Speaker 1: and consequence, then that maybe is true or happens faster.

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Speaker 1: In a debt based system where we just continue to

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Speaker 1: subsidize losses, that maybe that happens slower. But you know,

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Speaker 1: when you think about these rational actors and making money,

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Speaker 1: you think of the value investors. I think of Warren Buffett,

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Speaker 1: the Benjamin Grahams. But today what we see is people

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Speaker 1: that haven't been trained by school. They're not rational, they

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Speaker 1: don't understand economics. And what we're seeing is bud Light

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Speaker 1: does something people don't like and the price crashes, or

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Speaker 1: American Eagle brings on Sydney Sweeney and the price jumps

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Speaker 1: up and so like, it's really like people are voting

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Speaker 1: with their money on ideological reasons and not on fundamental

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Speaker 1: or economic reasons.

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Speaker 2: Yes, and you know, it really really hit home for

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Speaker 2: me with the meme stock crazed. What was the January

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Speaker 2: twenty twenty one? I think it was where you know,

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Speaker 2: just a bunch of kids on Reddit or whatever decided

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Speaker 2: that a particular stock was undervalued, no fundamental analysis, no

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Speaker 2: knowledge of the business, nothing, and it went it went crazy.

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Speaker 2: Of course, the smart money at the top shorted the

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Speaker 2: stock and made a fortune as it collapsed. I think

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Speaker 2: I think call Icon has made a lot of money

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Speaker 2: off of meme stocks as they came down. Right. So, yes,

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Speaker 2: the more irrational culture, the more volatility get, the most

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Speaker 2: stupid investing you get, the more these ridiculous things happened.

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Speaker 2: You know, I remember going back to nineteen ninety nine, right,

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Speaker 2: actually wrote a paper on this and the Journal of Investing.

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Speaker 2: I was an academic in those days, right, And in

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Speaker 2: nineteen ninety nine, there was a week in April of

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Speaker 2: nineteen ninety nine. This is the dot com bubble, right.

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Speaker 2: Any bank in the US that announced on that week

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Speaker 2: that day one day would have a website, right, that's

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Speaker 2: there were no websites to those you know, they would

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Speaker 2: have a website. Internet banking doubled in price right within

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Speaker 2: a day, right now, it lasted. It lasted a day

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Speaker 2: or two, and it completely collapsed very quickly because I

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Speaker 2: think in those days there were more people in a sense,

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Speaker 2: you know, taking advantage of the irrationality of those who

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Speaker 2: are being stupid about it. Today it can last months.

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Speaker 2: And that's scary that these meme stocks can stay in

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Speaker 2: these in crazy valuations for months. So the better the market,

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Speaker 2: the more rational the market, the more the the quicker

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Speaker 2: it corrects for irrationality. And today we're seeing that irrationality

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Speaker 2: gets corrected full way too slowly.

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Speaker 1: Yeah, because of the loss of risk and consequence.

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Speaker 2: Right.

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Speaker 1: So in this system where they have access to chief capital,

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Speaker 1: it's sort of like papers over that that.

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Speaker 2: I mean, it's part of that. But look, the hedge

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Speaker 2: funds who who short these stocks, they lose money. Nobody's

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Speaker 2: going to bail them out, Nobody cares about them. They're

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Speaker 2: not being bailed out now they have cheap source of capital.

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Speaker 2: But if they lose the capital, they lose. And indeed

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Speaker 2: the meme stock in January twenty twenty one drove one

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Speaker 2: fund into bankruptcy and and and had to to shut

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Speaker 2: their doors. So part of it is, part of it

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Speaker 2: is we socialized risk. Certainly you saw that with you know,

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Speaker 2: a Silicon Valley bank where everybody was bailed out. You

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Speaker 2: saw that in a great in the financial crisis in

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Speaker 2: two thousand and eight. We're all where a lot of

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Speaker 2: players will bailed not everybody was bailed out. It was

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Speaker 2: kind of political. Who got biois is right? Yeah, But

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Speaker 2: so there's an element of that. There's there's a lot

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Speaker 2: of cheap capital and and if Trump gets his way,

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Speaker 2: capital is going to can become a lot cheaper in

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Speaker 2: the months to come. And beware of that because cheap

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Speaker 2: capital creates morey rationality. People think that money's free and

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Speaker 2: they can do they can do whatever they want with it.

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Speaker 2: So but but what you get is volatility. But it's

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Speaker 2: also the fact that you know, people are not people

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Speaker 2: are not thinking, people are not And we've we've we've

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Speaker 2: made capital markets accessible to everybody. Like Robinhood, you can

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Speaker 2: go and trade in stocks and you'll cost a zero

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Speaker 2: literally zero. I don't think in a free market that

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Speaker 2: would happen I think that's a that's a product of regulation,

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Speaker 2: that's a product of the of the way regulations have

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Speaker 2: structure in the industry. There's a push at the SEC

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Speaker 2: to democratize markets, to make them accessible to everybody. This

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Speaker 2: should be they're probably and I don't know what would

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Speaker 2: happen in a free market. That's the beauty of markets.

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Speaker 2: You can't predict them, right, But but they you'd think

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Speaker 2: that there'd be some barrier, uh, in terms of you

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Speaker 2: need you need some minimal in order to in order

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Speaker 2: to participate, in order to in order to be here.

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Speaker 2: A transaction cost of zero seems to me can only

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Speaker 2: exist when the government is playing games through regulation.

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Speaker 1: Well, it exists because one companies can be allowed or

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Speaker 1: can actually survive running at a loss for long periods

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Speaker 1: of time, So they'll play those games. But I think

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Speaker 1: in Robinhood's case, it's the same as like the social media,

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Speaker 1: like Facebook's case, where like if you don't pay for

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Speaker 1: the product, you are the product. And so going back

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Speaker 1: to the meme stock phase like you're talking about, right,

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Speaker 1: the story was that you had these people that thought

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Speaker 1: they were going to take down Wall Street by pushing

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Speaker 1: the shorts that Wall Street had piled up, and they

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Speaker 1: drove one of the big funds, I forget the name,

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Speaker 1: to the brink to bankrupt them. And just as that

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Speaker 1: was happening, they got reinforcements, they got more investments. But

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Speaker 1: at the same time, simultaneously robin Hood Robinhood which had

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Speaker 1: been selling trade data. So all the trades are being

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Speaker 1: sold to the funds, So they confront run you. And

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Speaker 1: that's what I mean by you're not if you're not

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Speaker 1: paying for the product of the product. So all of

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Speaker 1: Robinhood trades are free, but robin is making money not

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Speaker 1: from you paying for the trade, by selling the trade data.

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Speaker 1: So those funds confront run you. And so then they

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Speaker 1: shut down the exchange and you could no longer short

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Speaker 1: the stock anymore. Uh, And they and they basically closed

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Speaker 1: the gate on everybody and forced those people to lose money.

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Speaker 1: And so then the game colluded against them. And so, sure,

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Speaker 1: you're not paying for a trade, but you're the product.

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Speaker 2: But there's there's a lot of the whole structure of

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Speaker 2: the market. The way it's structured today is dictated by regulation.

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Speaker 2: None of this would happen without that.

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Speaker 1: Sure, I agree, you.

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Speaker 2: Know, I remember I remember the days where you could

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Speaker 2: n YC stock you could only trade on n y

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Speaker 2: C and a NASDAK stock you could only trade on

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Speaker 2: today Nasdak NYC. You mean nothing. You've traded everything everywhere,

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Speaker 2: and that's because the regulator said, we're taking away your

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Speaker 2: quote monopoly power over trading in a particular thing. That

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Speaker 2: made it possible for these high frequency traders to come

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Speaker 2: in and arbitraize the difference between two exchanges. But that

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Speaker 2: wouldn't have happened in a free market, because in a

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Speaker 2: free market you wouldn't have these arbitrage opportunities. It says

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Speaker 2: so many of these little structural issues in markets that

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Speaker 2: it completely responds this to the regulatory environment in which

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Speaker 2: we live, and in a free market, the world would

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Speaker 2: look very different.

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Speaker 1: And I agree with you on that and the irrationality

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Speaker 1: of the unintended consequences. So you start putting these regulations

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Speaker 1: in and then you get all these types of distortions

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Speaker 1: and it's hard to trace them back to anything.

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Speaker 2: Yeah, and it's hard to take one regulation away without

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Speaker 2: a whole lot of cards falling. You really need to

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Speaker 2: if you're going to dismantle the regulation, you have to

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Speaker 2: do it smart. You have to figure out how they're

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Speaker 2: linked and how they connected and which one to get

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Speaker 2: rid of first. And so it's complicated to say, here's

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Speaker 2: the problem. It's the whole structure, the whole existence of

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Speaker 2: the regulations, the existence of the sec the existence of

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Speaker 2: these laws that restrain what market, but suspants can do

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Speaker 2: any kind of structures they can create.

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Speaker 1: So let's go back to a more fundamental place of

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Speaker 1: maybe how we got there, which is you mentioned earlier

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Speaker 1: that people today they're not rational. A lot of it

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Speaker 1: is because they're not thinking critically, and they're not thinking

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Speaker 1: critically because of probably the education system. Coming from southern California.

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Speaker 1: I used to listen to a lot of punk rock

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Speaker 1: music and there was a band called No Effects, and

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Speaker 1: they had a song called the Idiots Are taking Over

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Speaker 1: and they had a line that said, what's the point

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Speaker 1: of democracy when ignorance is celebrated? Right, So we have

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Speaker 1: these people who they're not educated, they haven't been taught history,

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Speaker 1: they haven't seen how things work, and so then they're

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Speaker 1: sort of just voting with their money. They're buying a meme,

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Speaker 1: stock or whatever. And one thing that I'm seeing that

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Speaker 1: i'd love your take on is that I don't say.

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Speaker 1: I can't say I'm shocked by it. But there's this

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Speaker 1: enormous seems to be swinging towards socialists today and we're

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Speaker 1: seeing it all across the world and it's been creepy.

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Speaker 1: And that's why I'm not surprised by it. But I

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Speaker 1: am surprised that one of the biggest cities in the world,

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Speaker 1: in New York City, elected a well known social and

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Speaker 1: not just a socialist, that's the key piece. But I

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Speaker 1: think he's like thirty two years old. He's never run

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Speaker 1: a business, He has no success, no nothing, And how

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Speaker 1: would you elect someone who's never even ran a business

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Speaker 1: to run one of the biggest economies in the world

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Speaker 1: on a socialist program. Every day we see headlines about

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Speaker 1: inflation and dead and diminishing control over our own money.

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Speaker 1: That's why I always come back to bitcoin because it's

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Speaker 1: it's for generations.

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Speaker 2: Well, the reality is that we live We live in

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Speaker 2: this mixed economy. We live in an economy that has

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Speaker 2: elements of freedom and elements of capitalism and a lot

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Speaker 2: of controls, a lot of socialism right, a lot of statism,

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Speaker 2: and the system is not working for people. It's frustrating it.

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Speaker 2: They can't understand it. They feel like they're being screwed

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Speaker 2: by it. You know, the cost of housing, for example,

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Speaker 2: which is easily fixable even in California, by increasing supply,

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Speaker 2: by reducing regulations, by reducing zoning, by eliminating government controls.

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Speaker 2: But nobody actually, nobody actually is going to advocate for that,

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Speaker 2: particularly if you own a home in California, you have

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Speaker 2: an interest in house is going up. You don't want competition,

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Speaker 2: you don't want other homes being built. So people are

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Speaker 2: frustrated and they really hate the status quo. And the

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Speaker 2: reality is that this mixture of statism and capitalism is

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Speaker 2: not stable. You're either going to get more statism or

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Speaker 2: significantly more capitalism. And the reality is that in the

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Speaker 2: world today nobody is advocating but certainly not in politics.

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Speaker 2: A few podcasters here and there, but nobody's advocating for

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Speaker 2: more capitalism. Certainly nobody's at gatting for a purely capitalist

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Speaker 2: system for lazofea capitalism, which is the cure for all

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Speaker 2: our you know, economic ills. So people out there, they're

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Speaker 2: trying to understand the world. Most of the explanations they

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Speaker 2: get you know, the world is you know, the reason

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Speaker 2: you're being screwed is because of greedy businessman capitalism. What

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Speaker 2: is it late stage capitalism. Capitalism is dying, and this

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Speaker 2: is this is what happens. Capitalism is screwed you. They

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Speaker 2: have no clue where the stuff, the material stuff that

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Speaker 2: benefits their lives comes from. They have no idea. You know.

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Speaker 2: I once has to a group of kids in a

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Speaker 2: high school where does food come from? And they, you know,

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Speaker 2: basically said supermarkets right that. You know, they they can't

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Speaker 2: think of and think about the supply chain that brings

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Speaker 2: I mean, you and I, I think can appreciate the

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Speaker 2: supply chain and the integration that needs to happen between

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Speaker 2: the pharma and the consumer and all the different steps

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Speaker 2: the whole supply chain to bring the food to my table.

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Speaker 2: That's an amazing, in a sense miracle that the market performs.

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Speaker 2: People have no concept of that. And then a young

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Speaker 2: guy comes along and he says, I understand your frustration.

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Speaker 2: I understand you know, and yeah, you're right, it's capitalism.

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Speaker 2: What we need is more socialism, because capitalism is the

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Speaker 2: social of the problem. As you being taught, as I've

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Speaker 2: been taught as all of us are being taught. And

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Speaker 2: you know, I'm gonna I'm gonna do something new. I'm

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Speaker 2: gonna change the system. It's going to be fresh, it's

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Speaker 2: going to be exciting. He puts out some TikTok videos

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Speaker 2: with him bouncing around the place, and I think a

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Speaker 2: lot of people go for it, and I think that's generally.

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Speaker 2: I think it's why Donald Trump got elected. People are

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Speaker 2: fed up with the status quo. They're fed up with

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Speaker 2: the system as it is, and they're willing, they're willing

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Speaker 2: to take risks and break stuff in order to shift.

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Speaker 2: And the shifts are in the wrong direction, I think,

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Speaker 2: pretty much uniformly across the board. But they want change,

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Speaker 2: they want to shift away. And it's only when they

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Speaker 2: get poorer there's a consequence of the shift that maybe

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Speaker 2: they'll realize that they're going in the wrong direction. And look,

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Speaker 2: the other thing is, MUMDONI faced opposition. I mean, who

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Speaker 2: gran against them? A completely corrupt status quo? You know

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Speaker 2: somebody who asked women? Who got away with it? Guy

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Speaker 2: from upstate? You know from New York? Who who could

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Speaker 2: get excited about this? This como guy? When you've got

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Speaker 2: this young hip exciting guy who wants who wants to

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Speaker 2: make real changes. Luckily, Mayor of New York has very

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Speaker 2: little power, so you know, he can't do too much damage,

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Speaker 2: but he can do.

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Speaker 1: Soth So is that a function of I mean, so

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Speaker 1: I said back to the beginning, that's a function of

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Speaker 1: the education system, like they just haven't shown people function

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Speaker 1: of truth.

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Speaker 2: It's function of true things. It's a function of educational system.

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Speaker 2: And it's a function of philosophy. It's a function of ideas,

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Speaker 2: the ideas that exist in our culture, and the two related.

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Speaker 2: So educational system is being corrupted, was corrupted a long

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Speaker 2: time ago, and it has only gotten worse. And you know,

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Speaker 2: it was corrupted by John Dewey and all progressive education

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Speaker 2: movement that basically believed that education is primarily socialize and

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Speaker 2: to cultivate emotion, cultivate you as a human being, as

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Speaker 2: a feeling being, not as irrational being. And that has

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Speaker 2: gotten worse and the left over the last thirty years,

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Speaker 2: you know, as the kind of hippies of the sixties

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Speaker 2: matured and matured is the wrong word. But you know,

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Speaker 2: I became the professors at the universities and became the

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Speaker 2: teachers and the schools. They brought this postmodernist, subjectivist, emotionalist

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Speaker 2: ideology to the forefront. So things have gotten a lot

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Speaker 2: worse in the last few years. And the consequence of

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Speaker 2: that in the last few decades, and the consequence of

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Speaker 2: that is your kids don't know history. They have no

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Speaker 2: clue what socialism is. They have no clue what socialism did.

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Speaker 2: They have no clue what the consequence of socialism. But

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Speaker 2: more importantly, and this is across the board, even in

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Speaker 2: places where they're not pro socialism, they don't understand capitalism.

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Speaker 2: They have no clue how the West became rich. They

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Speaker 2: don't understand the source of that wealth. They don't understand

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Speaker 2: all of an entrepreneur. They don't understand all the freedom there,

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Speaker 2: all the reason and rationality is that the source of

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Speaker 2: all wealth. The completely clues about these ideas because nobody's

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Speaker 2: taught them. And then if you look philosophically, the dominant

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Speaker 2: philosophies are either a kind of a leftist postmodern subjectivism

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Speaker 2: or religion. Now neither one of those are based on reason.

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Speaker 2: Neither one of those are teaching rationality and reason. You're

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Speaker 2: teaching either revelation or emotion. And that's what kids offer today,

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Speaker 2: And that's what philosophy has to offer them today. And

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Speaker 2: the philosopher is in the university is a talking mumbo jumbo.

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Speaker 2: Nobody can understand them anyway, and so they're left drifting.

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Speaker 2: And that's that's kind of the condition we find our

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Speaker 2: society and today it's drifting.

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Speaker 1: Yeah, have you seen that show on Prime? I don't

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Speaker 1: know if you even watched TV, but on Amazon Prime

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Speaker 1: they have a show or it is on Paramount Landman

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Speaker 1: and it's like West Texas Oil whatever, and it's like

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Speaker 1: a spin off of whatever, the other show Yellowstone or whatever. Anyway,

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Speaker 1: the premise it's West Texas and it's all oil jilli

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Speaker 1: and whatever. Right, But I mean they show these guys

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Speaker 1: like on these oil rigs, and I mean it's dangerous

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Speaker 1: and they are busting their asses and they are working hard,

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Speaker 1: and like I would never want to do that job,

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Speaker 1: and like people are losing an arm and there's people dying.

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Speaker 1: It's like it shows like how hard and dangerous is

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Speaker 1: but like that's what it takes to make this world work.

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Speaker 2: Like without oil, what world do.

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Speaker 1: You even have? So I was just thinking of that,

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Speaker 1: as you said, like people are so disconnected of like

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Speaker 1: how does food actually get to my table? Like the

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Speaker 1: world wouldn't work without those guys in West Texas, risky

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Speaker 1: in their life to get that oil out of the ground.

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Speaker 2: And with without all of that pollution, without all of that,

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Speaker 2: without all of that, you know, fossil fuels, and now

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Speaker 2: the enemy, the evil. And yet the entirest civilization we

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Speaker 2: have today is based on fossil fuels. And it's not

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Speaker 2: like there was an alternative. It's not like we could

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Speaker 2: have built civilization of something else.

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Speaker 1: No, we could have built it on well, blubber. We

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Speaker 1: could have just kept killing all the whales.

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Speaker 2: Right well ski, Yeah, but you can't build a civilization.

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Speaker 1: You can, you can, you can.

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Speaker 2: Light up stuff. Yes, Walka Fell has saved the whales.

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Speaker 2: I mean standard oil. That evil monopolists saved the whales

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Speaker 2: by making carousine cheaper than whale oil. And we use

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Speaker 2: carousine to light all our homes and stop killing whales.

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Speaker 1: So let's let's let's talk about a couple of definitions

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Speaker 1: if we can real quickly, because I feel like that's

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Speaker 1: where things get lost. A lot of people, to your

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Speaker 1: point about these youths, their disillusioned with the system. They

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Speaker 1: want change capitalism has failed us. We want something else,

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Speaker 1: so maybe we'll try socialism. But Karl Marx wrote in

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Speaker 1: the Communist Manifesto ten points of communism. Number two heavy

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Speaker 1: progressive graduate income tax number three, abolished right of inheritance

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Speaker 1: number see number five, and established a national bank, central

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Speaker 1: bank number six, nationally controlled communication and transport number number

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Speaker 1: number eight, well number eight, you know, agriculture armies number

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Speaker 1: nine or number ten, like free in public education.

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Speaker 2: So like.

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Speaker 1: That sort of sounds like seven and a of the

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Speaker 1: ten points are like what we have in the United States,

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Speaker 1: So like, are we in capitalism or what system are

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Speaker 1: we in?

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Speaker 2: Is that?

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Speaker 1: Or are we in communism?

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Speaker 2: In a mixed economy? We've got some of both. Right,

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Speaker 2: we've got all those things, but we've also got some

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Speaker 2: private property. You can go to them all and buy

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Speaker 2: stuff to your choice. Nobody's got a gun to you

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Speaker 2: could do that in Soviet Union, you know. So we've

430
00:24:03,760 --> 00:24:06,639
Speaker 2: got some freedom. We've got a lot of regulations and

431
00:24:06,680 --> 00:24:09,879
Speaker 2: controls and taxes and restrictions. And this is why I

432
00:24:09,920 --> 00:24:12,480
Speaker 2: call the system we have today mixed economy. And the

433
00:24:12,600 --> 00:24:16,560
Speaker 2: danger is when you call it capitalism and then it fails.

434
00:24:17,000 --> 00:24:20,240
Speaker 2: Capitalism gets to blame. You know, we saw that in

435
00:24:20,280 --> 00:24:21,840
Speaker 2: two thousand and eight. Two thousand and eight, when the

436
00:24:21,840 --> 00:24:25,760
Speaker 2: financial crisis happened, all the headlines were capitalism failed all

437
00:24:25,800 --> 00:24:28,600
Speaker 2: over the world, capitalism failed. And I was like, I

438
00:24:28,680 --> 00:24:31,200
Speaker 2: remember I was on TV and I was saying, no,

439
00:24:31,359 --> 00:24:34,199
Speaker 2: we don't have capitalism. It's not like yesterday we had capitalism.

440
00:24:34,520 --> 00:24:37,359
Speaker 2: What failed is the regulatory state. What failed is the

441
00:24:37,400 --> 00:24:41,119
Speaker 2: mixed economy. If we had more capitalism, the likely failure

442
00:24:41,160 --> 00:24:44,760
Speaker 2: would be smaller, not greater. The more statism we embrace,

443
00:24:45,359 --> 00:24:49,600
Speaker 2: you either fail more, or you stagnate, or you get poor. Right,

444
00:24:49,680 --> 00:24:55,160
Speaker 2: So nothing good comes from more state intervention. Nothing good

445
00:24:55,160 --> 00:24:58,720
Speaker 2: comes from more regulations and yourtrols of our lives. And

446
00:24:59,200 --> 00:25:03,320
Speaker 2: this sad thing thing is that capitalism has been blamed

447
00:25:03,359 --> 00:25:06,160
Speaker 2: for all the problems in the world. And as a consequence,

448
00:25:06,240 --> 00:25:11,240
Speaker 2: today we have a political environment in which nobody defends capitalism,

449
00:25:11,600 --> 00:25:15,560
Speaker 2: nobody defends free markets, and everybody is a statist. Everybody

450
00:25:15,600 --> 00:25:17,800
Speaker 2: wants to make the state bigger, not smaller.

451
00:25:17,960 --> 00:25:23,440
Speaker 1: Yeah, So what would you say then about people that say, well,

452
00:25:23,440 --> 00:25:25,879
Speaker 1: then if you don't have the state, then who's going

453
00:25:25,960 --> 00:25:28,680
Speaker 1: to check these greedy capitalists? Who's going to stop them

454
00:25:28,680 --> 00:25:31,560
Speaker 1: from dumping pollution into the rivers. And who's going to

455
00:25:31,560 --> 00:25:33,640
Speaker 1: take care of the poor people that can't afford to eat?

456
00:25:34,600 --> 00:25:36,399
Speaker 1: Because isn't capitalism all about greed?

457
00:25:37,680 --> 00:25:40,120
Speaker 2: Yeah, so there's a sense in which it is about greed.

458
00:25:40,160 --> 00:25:43,720
Speaker 2: But is greed bad? I mean, if it gets people

459
00:25:43,760 --> 00:25:46,200
Speaker 2: up in the morning and they go work hard because

460
00:25:46,200 --> 00:25:48,280
Speaker 2: they want to they want to do a good job,

461
00:25:48,280 --> 00:25:49,639
Speaker 2: and they want to make more money, is that a

462
00:25:49,680 --> 00:25:53,040
Speaker 2: bad thing? I mean, greed can be good, Greek can

463
00:25:53,080 --> 00:25:55,359
Speaker 2: be bad. Greed can motivate you to do bad things,

464
00:25:55,400 --> 00:25:57,600
Speaker 2: it can motivate you to do good things. Greed just

465
00:25:57,640 --> 00:26:00,480
Speaker 2: means you want more, well, all of us more. We

466
00:26:00,520 --> 00:26:02,760
Speaker 2: want our kids to have more than we have. More

467
00:26:02,920 --> 00:26:06,560
Speaker 2: is something that is part of the American dream. Capitalism

468
00:26:06,640 --> 00:26:09,760
Speaker 2: is about people pursuing the self interest. But self interest

469
00:26:10,040 --> 00:26:13,040
Speaker 2: properly understood. It's not about light and cheating and stealing.

470
00:26:13,080 --> 00:26:17,959
Speaker 2: And indeed, if you look at where there is relative freedom,

471
00:26:18,000 --> 00:26:20,720
Speaker 2: you get less of the line cheating and stealing. Where

472
00:26:20,760 --> 00:26:25,040
Speaker 2: there is no freedom, freedom brings the lack of freedom

473
00:26:25,040 --> 00:26:26,280
Speaker 2: brings out the worst in people.

474
00:26:27,080 --> 00:26:29,800
Speaker 3: So who will take care of the poor, Well, first

475
00:26:29,800 --> 00:26:31,360
Speaker 3: of all, the poor will take care of the poor.

476
00:26:31,960 --> 00:26:34,440
Speaker 3: That is, the poor will go and work and they'll

477
00:26:34,480 --> 00:26:39,800
Speaker 3: make a living. And capitalism produces so much wealth. Capitalism

478
00:26:39,840 --> 00:26:44,399
Speaker 3: produces so much, so many jobs, so much wealth, so

479
00:26:44,480 --> 00:26:47,440
Speaker 3: much money that you know, you could you can plot

480
00:26:47,480 --> 00:26:49,760
Speaker 3: this out and within a generation or two, within a

481
00:26:49,760 --> 00:26:53,280
Speaker 3: couple of generations, now no poor people. If everybody, if

482
00:26:53,280 --> 00:26:57,520
Speaker 3: everybody is willing to work hard and invest, and if

483
00:26:57,560 --> 00:27:03,639
Speaker 3: everybody is willing to be productive, then poverty goes away

484
00:27:04,280 --> 00:27:06,760
Speaker 3: just by the sheer fact that everybody's working.

485
00:27:07,880 --> 00:27:12,800
Speaker 2: Capitalism is a poverty destroyer. Indeed, the only way we

486
00:27:12,880 --> 00:27:17,080
Speaker 2: brought anybody out of poverty throughout human histories through capitalism.

487
00:27:18,040 --> 00:27:23,280
Speaker 2: So that's one. You know, private property takes care pollution.

488
00:27:24,280 --> 00:27:29,120
Speaker 2: You don't drop, You can't dump your garbage in my backyard. Well,

489
00:27:29,160 --> 00:27:31,640
Speaker 2: if I own the lake, and I know it's hard

490
00:27:31,640 --> 00:27:33,919
Speaker 2: for people to get their head around a private person

491
00:27:33,960 --> 00:27:36,800
Speaker 2: owning a lake, but imagine if private people own the

492
00:27:36,840 --> 00:27:39,560
Speaker 2: lakes and the rivers, which they did in the nineteenth

493
00:27:39,560 --> 00:27:41,880
Speaker 2: century in America before the state came in and took

494
00:27:41,920 --> 00:27:46,960
Speaker 2: it all control over it, then then you can drop

495
00:27:47,040 --> 00:27:50,400
Speaker 2: your pollution into my lake. And if I'm downstream from

496
00:27:50,440 --> 00:27:54,240
Speaker 2: you and you pollute upstream and I'm using the water downstream,

497
00:27:54,480 --> 00:27:56,920
Speaker 2: then I'll sue you and stop you from doing it

498
00:27:57,000 --> 00:28:01,480
Speaker 2: because it's property rights. So property right take care of

499
00:28:01,720 --> 00:28:05,600
Speaker 2: almost all the pollution problems, all all those issues if

500
00:28:05,600 --> 00:28:09,320
Speaker 2: we take capitalism seriously and we assign property rights to everything.

501
00:28:09,800 --> 00:28:13,320
Speaker 2: And that's what capitalism really means. It means the government

502
00:28:13,320 --> 00:28:18,919
Speaker 2: doesn't own anything, We as individuals own stuff. That property

503
00:28:19,000 --> 00:28:22,320
Speaker 2: rights are signed to pretty much everything, and we settle

504
00:28:22,400 --> 00:28:26,679
Speaker 2: disputes between us through contracts and through the legal system.

505
00:28:26,880 --> 00:28:30,240
Speaker 2: And you know, so, yes, I get all these questions,

506
00:28:30,240 --> 00:28:32,520
Speaker 2: what about monopolies, what about this? What about that? The

507
00:28:32,600 --> 00:28:35,320
Speaker 2: reality is that there's answers to all of that. Is

508
00:28:35,359 --> 00:28:40,200
Speaker 2: a robust literature in economics that answers all the objections

509
00:28:40,240 --> 00:28:41,080
Speaker 2: to free markets.

510
00:28:41,240 --> 00:28:44,600
Speaker 1: Is it almost like it's always somewhat of a spectrum though, right,

511
00:28:44,760 --> 00:28:49,120
Speaker 1: It's like we've never really had We've never tried real socialism,

512
00:28:49,240 --> 00:28:51,680
Speaker 1: they tell us. But maybe we've never really tried pure

513
00:28:51,720 --> 00:28:54,720
Speaker 1: capitalism either. Is it always somewhat of a spectrum.

514
00:28:54,160 --> 00:28:56,360
Speaker 2: Well, we've never really tried capitalism. But this is the

515
00:28:56,360 --> 00:28:59,880
Speaker 2: difference between never really tried capitalism never really tried socialism.

516
00:29:00,440 --> 00:29:03,880
Speaker 2: The closer we get to a socialist ideal. The more

517
00:29:03,920 --> 00:29:08,720
Speaker 2: people die, the more they starve, the more poor we get,

518
00:29:09,480 --> 00:29:12,600
Speaker 2: the closer we get to a capitalist ideal, I'd say

519
00:29:13,080 --> 00:29:16,600
Speaker 2: eighteen seventy to nineteen fourteen in the United States, Hong

520
00:29:16,720 --> 00:29:21,239
Speaker 2: Kong in the twentieth century. The richer we get, the

521
00:29:21,240 --> 00:29:23,680
Speaker 2: more prosperous we are, and the more immigrants we get.

522
00:29:23,880 --> 00:29:25,840
Speaker 2: You know why we get so many immigrants because they

523
00:29:25,880 --> 00:29:29,200
Speaker 2: want a part of it, Like people escape socialism and

524
00:29:29,280 --> 00:29:34,360
Speaker 2: people run towards more capitalist places. So it is a spectrum,

525
00:29:34,760 --> 00:29:37,160
Speaker 2: but that doesn't change the fact that capitalism is an

526
00:29:37,160 --> 00:29:41,160
Speaker 2: ideal that one should strive towards. The closer you get

527
00:29:41,360 --> 00:29:45,000
Speaker 2: to purely capitalist society than maybe one day will exist,

528
00:29:45,400 --> 00:29:49,520
Speaker 2: the better off you're going to be, even the fewer

529
00:29:49,560 --> 00:29:53,520
Speaker 2: poor people there will be, the more rich people they

530
00:29:53,520 --> 00:29:56,800
Speaker 2: will be, the more wealth they will be generally in

531
00:29:57,760 --> 00:29:58,960
Speaker 2: your society.

532
00:29:59,520 --> 00:30:01,840
Speaker 1: And created so much wealth. I just think back to

533
00:30:01,960 --> 00:30:04,320
Speaker 1: like when I was a kid, and we were you know,

534
00:30:04,360 --> 00:30:07,239
Speaker 1: we were firmly middle class. But even then, it was like,

535
00:30:07,360 --> 00:30:09,040
Speaker 1: you know, you had one pair of shoes and a

536
00:30:09,040 --> 00:30:10,600
Speaker 1: couple of pairs of jeans, and like that was it.

537
00:30:10,640 --> 00:30:13,600
Speaker 1: And now there's like so much money slashing around the world.

538
00:30:13,600 --> 00:30:16,920
Speaker 1: That it's like I had to like work mowing lawns

539
00:30:16,920 --> 00:30:19,000
Speaker 1: to get to help my dad pay for like a

540
00:30:19,040 --> 00:30:20,480
Speaker 1: bike that was like two hundred bucks, and now all

541
00:30:20,520 --> 00:30:22,320
Speaker 1: the kids around here are riding like three thousand dollars

542
00:30:22,320 --> 00:30:27,160
Speaker 1: e bikes. Right, So, like the bar has definitely moved up.

543
00:30:27,200 --> 00:30:29,640
Speaker 1: But what do you think today about you do have?

544
00:30:29,720 --> 00:30:33,000
Speaker 1: You know, the gen z feeling poor, revolting against the system,

545
00:30:33,400 --> 00:30:35,920
Speaker 1: but at the same time they seeming to be almost

546
00:30:36,360 --> 00:30:39,080
Speaker 1: richer than any other generation before them. And that is that.

547
00:30:39,800 --> 00:30:41,320
Speaker 1: And let me frame this up a little bit better. So,

548
00:30:41,400 --> 00:30:45,600
Speaker 1: like we have this focus on the income inequality gap.

549
00:30:46,000 --> 00:30:49,640
Speaker 1: Bezos or Musk has so much more income. But if

550
00:30:49,640 --> 00:30:51,720
Speaker 1: we looked at like what we have instead of what

551
00:30:51,760 --> 00:30:54,360
Speaker 1: we don't have, if we looked at like the quality

552
00:30:54,360 --> 00:30:56,960
Speaker 1: of our life, does that show us a different picture.

553
00:30:57,440 --> 00:31:01,840
Speaker 1: Governments will never stop printing money, so it's not going away. Now.

554
00:31:01,880 --> 00:31:04,520
Speaker 1: If your money's not earning at least ten percent a year,

555
00:31:04,760 --> 00:31:07,640
Speaker 1: you're losing purchasing power. Now, that's why I talk about bitcoin.

556
00:31:07,720 --> 00:31:10,280
Speaker 1: It's the number one way to beat inflation and secure

557
00:31:10,280 --> 00:31:13,160
Speaker 1: your future. And the question I get asked almost every

558
00:31:13,240 --> 00:31:16,520
Speaker 1: day is where do you buy your bitcoin. Now, for years,

559
00:31:16,560 --> 00:31:19,320
Speaker 1: I've personally use River dot Com and I only take

560
00:31:19,320 --> 00:31:22,200
Speaker 1: on sponsors that I use and I trust, and I

561
00:31:22,240 --> 00:31:25,280
Speaker 1: trust them because River's bitcoin only. They have one hundred

562
00:31:25,280 --> 00:31:28,480
Speaker 1: percent reserve, and they keep your bitcoin safe in cold

563
00:31:28,560 --> 00:31:31,760
Speaker 1: storage with no middlemen, and you can actually talk to

564
00:31:31,840 --> 00:31:36,200
Speaker 1: a real person, a US based support, dedicated manager. Now,

565
00:31:36,400 --> 00:31:39,480
Speaker 1: try getting that peace of mind from coinbase. Of course

566
00:31:39,520 --> 00:31:42,960
Speaker 1: you can't. Now the perks. If you set up auto buys,

567
00:31:43,200 --> 00:31:45,920
Speaker 1: you can pay zero fees plus instead of you're bank

568
00:31:45,920 --> 00:31:48,400
Speaker 1: paying you, you know, zero point four percent on cash.

569
00:31:48,720 --> 00:31:52,040
Speaker 1: River pays you three point seventy five percent on cash

570
00:31:52,400 --> 00:31:54,800
Speaker 1: paid in bitcoin. So if you're ready to build your

571
00:31:54,840 --> 00:31:58,600
Speaker 1: bitcoin position with confidence, go to River dot com, slash

572
00:31:58,800 --> 00:32:01,600
Speaker 1: Mark Moss and get up to one dollars in bitcoin

573
00:32:01,760 --> 00:32:04,800
Speaker 1: when you sign up. Because freedom starts when you own

574
00:32:04,840 --> 00:32:07,080
Speaker 1: your money, and your money starts with bitcoin.

575
00:32:07,280 --> 00:32:10,200
Speaker 2: Oh absolutely, So look that the data is pretty clear.

576
00:32:10,320 --> 00:32:13,720
Speaker 2: Gen z Is make more money than any generation before

577
00:32:13,720 --> 00:32:17,600
Speaker 2: them at that age. They're doing phenomenally well, but they

578
00:32:17,600 --> 00:32:21,200
Speaker 2: don't feel good. It's all about feelings. Going back to

579
00:32:21,280 --> 00:32:24,520
Speaker 2: original point, this is an emotional culture. It's not a

580
00:32:24,520 --> 00:32:28,520
Speaker 2: culture of data and facts and evidence. It's a it's

581
00:32:28,560 --> 00:32:31,960
Speaker 2: a it's a culture sentiment. And the sentiment out there

582
00:32:32,000 --> 00:32:36,160
Speaker 2: is that gen zs are doing badly and and look

583
00:32:36,200 --> 00:32:40,040
Speaker 2: that there's lots of economic dark clouds, right, There's a

584
00:32:40,080 --> 00:32:43,320
Speaker 2: lot of stuff that could go really really wrong, and

585
00:32:43,360 --> 00:32:45,640
Speaker 2: maybe they're feeling part of that. But all of that

586
00:32:45,720 --> 00:32:47,479
Speaker 2: has to do with statism. None of that has to

587
00:32:47,480 --> 00:32:51,920
Speaker 2: do with capitalism. But you know, you made the point

588
00:32:51,920 --> 00:32:55,520
Speaker 2: about how about incomun equality, I mean, inequality shouldn't matter.

589
00:32:57,000 --> 00:33:01,800
Speaker 2: The fact is that become a billionaire a free market,

590
00:33:02,280 --> 00:33:04,400
Speaker 2: or even in a semi free market like what we have,

591
00:33:04,440 --> 00:33:07,160
Speaker 2: which is a semi femalkeet, you have to produce values.

592
00:33:07,640 --> 00:33:09,360
Speaker 2: You have to be able to produce something that other

593
00:33:09,400 --> 00:33:11,080
Speaker 2: people want, you have to be able to sell it.

594
00:33:12,080 --> 00:33:16,520
Speaker 2: All those guys became rich because by making our lives better.

595
00:33:17,040 --> 00:33:19,320
Speaker 2: My life is so much better because of Amazon. I mean,

596
00:33:19,320 --> 00:33:21,240
Speaker 2: now live in Puerto Rico. How could I live here

597
00:33:21,280 --> 00:33:21,960
Speaker 2: without Amazon?

598
00:33:22,000 --> 00:33:24,480
Speaker 1: It would It takes like two weeks to get there.

599
00:33:24,520 --> 00:33:29,080
Speaker 2: But it's getting better. It goes up and down right now,

600
00:33:29,080 --> 00:33:31,960
Speaker 2: it's not bad, but yeah, but it still gets Yet

601
00:33:32,400 --> 00:33:34,959
Speaker 2: you know, there's no other service that matches it. So

602
00:33:35,440 --> 00:33:38,480
Speaker 2: I'm thankful to Bezos, good for him for being a gazillionaire.

603
00:33:39,040 --> 00:33:41,000
Speaker 2: And then another thing is in terms of how well

604
00:33:41,000 --> 00:33:44,200
Speaker 2: we're doing, if you look at instead of inequality of

605
00:33:44,280 --> 00:33:47,560
Speaker 2: income or wealth, if you look at inequality of consumption,

606
00:33:48,120 --> 00:33:51,160
Speaker 2: what we actually spend our money on. It's not that big,

607
00:33:51,520 --> 00:33:55,360
Speaker 2: you know, I like to say, you know, you know

608
00:33:55,360 --> 00:33:58,840
Speaker 2: Bill Gates takes a private jet. I don't know. He

609
00:33:58,880 --> 00:34:02,240
Speaker 2: can take a private jet from Seattle to Paris. You

610
00:34:02,240 --> 00:34:05,120
Speaker 2: know I do too. It's just the differences. I share

611
00:34:05,120 --> 00:34:07,760
Speaker 2: my jet with three hundred other people, but I can

612
00:34:07,800 --> 00:34:10,759
Speaker 2: take a jet to Paris, and it's not at an

613
00:34:10,800 --> 00:34:13,880
Speaker 2: astronomical price that I can't afford or the average American

614
00:34:13,920 --> 00:34:17,600
Speaker 2: can't afford. I mean, American's vacation were now than they

615
00:34:17,680 --> 00:34:20,600
Speaker 2: ever have. They travel they you know, I have a car.

616
00:34:20,640 --> 00:34:22,799
Speaker 2: Bill Gates as a car, you know, maybe is a

617
00:34:22,800 --> 00:34:24,879
Speaker 2: big yacht night of I don't have a big yacht.

618
00:34:24,960 --> 00:34:28,000
Speaker 2: But in terms of how we spend our money, it's

619
00:34:28,040 --> 00:34:30,680
Speaker 2: not that different. Our quality of life and stand up

620
00:34:30,680 --> 00:34:34,520
Speaker 2: living is so high that we're all living like million

621
00:34:34,719 --> 00:34:38,520
Speaker 2: you know, gazillion is of fifty years ago. I mean,

622
00:34:38,520 --> 00:34:41,520
Speaker 2: what would you rather be poor in America today? Or

623
00:34:41,520 --> 00:34:44,080
Speaker 2: the richest man in the world one hundred years ago. Yeah,

624
00:34:44,239 --> 00:34:47,879
Speaker 2: no question, I think poor in America today you have electricity,

625
00:34:48,440 --> 00:34:51,040
Speaker 2: you're running water in a refrigerator, you have an iPhone.

626
00:34:51,400 --> 00:34:52,960
Speaker 1: Yeah, we have an eye. The poorest people still have

627
00:34:52,960 --> 00:34:55,800
Speaker 1: an iPhone, they still have a flat screen TV, most

628
00:34:55,800 --> 00:34:58,120
Speaker 1: likely still have a car, I mean, at least in America.

629
00:34:58,360 --> 00:35:01,000
Speaker 1: The other thing is that it takes the wealthy people

630
00:35:01,200 --> 00:35:03,520
Speaker 1: to get the things that we all want. So in

631
00:35:03,560 --> 00:35:06,480
Speaker 1: the eighties you had, you know, the richest people in

632
00:35:06,520 --> 00:35:08,360
Speaker 1: the world, the Wall Street people had the big brick

633
00:35:08,640 --> 00:35:12,000
Speaker 1: mobile phone. But only because they had enough money and

634
00:35:12,120 --> 00:35:14,920
Speaker 1: enough demand were they able to afford that. And because

635
00:35:15,040 --> 00:35:17,160
Speaker 1: enough of them bought that, it made them be able

636
00:35:17,200 --> 00:35:18,879
Speaker 1: to make a little bit more. That got cheaper enough

637
00:35:18,880 --> 00:35:21,080
Speaker 1: for more people to buy it, and eventually now everybody

638
00:35:21,120 --> 00:35:22,160
Speaker 1: in the world has a mobile phone.

639
00:35:23,480 --> 00:35:25,920
Speaker 2: Absolutely, But it's more than that, right, and more importantly,

640
00:35:26,480 --> 00:35:30,520
Speaker 2: it's the rich people who invested in building all the

641
00:35:30,560 --> 00:35:35,840
Speaker 2: towers and were their investors in this. In mcgrass Cellular,

642
00:35:35,880 --> 00:35:38,560
Speaker 2: which was the first cellular company, they invested in that

643
00:35:38,640 --> 00:35:42,719
Speaker 2: company that had to grow. So it's the capital that

644
00:35:42,960 --> 00:35:47,120
Speaker 2: makes these companies possible. It's often the ideas that makes

645
00:35:47,320 --> 00:35:50,680
Speaker 2: these companies possible. You know, somebody had to fund the

646
00:35:50,719 --> 00:35:53,560
Speaker 2: first fiber optics cables in the ground in the United States.

647
00:35:53,640 --> 00:35:56,560
Speaker 2: That was a huge expense. It's similar to you know,

648
00:35:56,600 --> 00:35:59,880
Speaker 2: these these data thing that they're doing now with AI

649
00:36:00,400 --> 00:36:04,239
Speaker 2: massive infrastructure investments that everybody thought were wasteful, and we

650
00:36:04,360 --> 00:36:06,840
Speaker 2: landed up using every last fiber that they put in

651
00:36:06,880 --> 00:36:09,560
Speaker 2: the ground. But somebody had to do that. So the

652
00:36:09,680 --> 00:36:12,239
Speaker 2: rich have to buy the product uli, but they also

653
00:36:12,320 --> 00:36:15,440
Speaker 2: have to invest in making the product even possible.

654
00:36:15,719 --> 00:36:18,800
Speaker 1: Yeah, and then that makes it more affordable for the

655
00:36:19,320 --> 00:36:21,600
Speaker 1: poor people in America, and then enough Americans to get it,

656
00:36:21,600 --> 00:36:23,560
Speaker 1: and then that makes for the poor people on the

657
00:36:23,560 --> 00:36:25,200
Speaker 1: rest of the world. So then they get the wireless

658
00:36:25,280 --> 00:36:27,520
Speaker 1: over there and they get whatever. So it's like it

659
00:36:27,560 --> 00:36:30,400
Speaker 1: trickles down that way. Would you say that, you know,

660
00:36:30,440 --> 00:36:34,440
Speaker 1: there's a lot of angst back to the rich people

661
00:36:34,440 --> 00:36:36,360
Speaker 1: in the United States and all over the world. Really,

662
00:36:36,400 --> 00:36:39,160
Speaker 1: I mean, tax the rich, eat the rich whatever. And

663
00:36:39,200 --> 00:36:41,480
Speaker 1: it's almost like the rich you know, you mentioned I'm

664
00:36:41,480 --> 00:36:43,480
Speaker 1: thankful for Bezos because I have Amazon. But it's like

665
00:36:43,520 --> 00:36:47,400
Speaker 1: there's all this hate and maybe it's because it's like

666
00:36:48,280 --> 00:36:51,080
Speaker 1: the world thinks that they stole from them. Because when

667
00:36:51,080 --> 00:36:53,880
Speaker 1: you look at like very successful athletes like I don't know,

668
00:36:54,239 --> 00:36:57,879
Speaker 1: Lebron James or something, right, like he's super rich and

669
00:36:58,200 --> 00:37:00,000
Speaker 1: he's better than all that, it makes more money than

670
00:37:00,000 --> 00:37:02,439
Speaker 1: all the other basketball players, but nobody looks at him

671
00:37:02,480 --> 00:37:03,160
Speaker 1: like he cheated.

672
00:37:04,560 --> 00:37:07,760
Speaker 2: No, absolutely, I think it's it's people have a very

673
00:37:07,880 --> 00:37:12,000
Speaker 2: zero sum view of the world and and sadly they

674
00:37:12,040 --> 00:37:15,080
Speaker 2: get that from my intellectuals and our politicians. You know,

675
00:37:15,160 --> 00:37:19,040
Speaker 2: they they constantly talk about a zero sum world. Right,

676
00:37:19,160 --> 00:37:23,160
Speaker 2: trade is zero sum, I win, you lose. So when

677
00:37:23,200 --> 00:37:27,120
Speaker 2: they see somebody rich, the conception is that they got

678
00:37:27,239 --> 00:37:32,560
Speaker 2: rich by taking bye bye bye, by stealing. And you know,

679
00:37:32,640 --> 00:37:35,440
Speaker 2: there was true three hundred, four hundred, five hundred years

680
00:37:35,440 --> 00:37:39,840
Speaker 2: ago where the aristocrats got aristocratic by stealing from the

681
00:37:40,280 --> 00:37:44,600
Speaker 2: peasants and from others, being robber barons, real robber barons.

682
00:37:45,440 --> 00:37:46,920
Speaker 2: But that's the beauty and freedom.

683
00:37:47,000 --> 00:37:47,320
Speaker 1: Freedom.

684
00:37:47,360 --> 00:37:49,120
Speaker 2: You don't have to trade with them. They can't steal

685
00:37:49,160 --> 00:37:52,080
Speaker 2: for your stuff, and you only trade with them when

686
00:37:52,120 --> 00:37:55,480
Speaker 2: it makes your life better. So trade is fundamentally win win.

687
00:37:56,600 --> 00:37:58,439
Speaker 2: But look, this is something the President of the United

688
00:37:58,440 --> 00:38:01,560
Speaker 2: States doesn't understand. So it's hard to blame the common

689
00:38:01,600 --> 00:38:04,960
Speaker 2: man when they're constantly being told, even at that at

690
00:38:05,000 --> 00:38:07,120
Speaker 2: the top of the government, that you know, trade is

691
00:38:07,239 --> 00:38:11,680
Speaker 2: zero some and uh, and they're being screwed by China. Well,

692
00:38:11,719 --> 00:38:13,680
Speaker 2: if we're being screwed by China, then we're being screwed

693
00:38:13,719 --> 00:38:16,719
Speaker 2: by Bill Gates and we're being screwed by by you know,

694
00:38:16,840 --> 00:38:21,759
Speaker 2: uh at Amazon. Why is that Well, because I'm saying,

695
00:38:21,920 --> 00:38:24,040
Speaker 2: if it's zero some, then we're being screwed, right, But

696
00:38:24,080 --> 00:38:26,239
Speaker 2: it's not zeros. The fact is that it's that it's

697
00:38:26,360 --> 00:38:30,160
Speaker 2: value added right, Right. I'm better off for buying from Amazon,

698
00:38:30,400 --> 00:38:32,600
Speaker 2: and Amazon is better off for selling to me. We

699
00:38:32,760 --> 00:38:34,160
Speaker 2: both win, nobody loses.

700
00:38:34,840 --> 00:38:35,160
Speaker 1: Uh.

701
00:38:35,200 --> 00:38:37,400
Speaker 2: And by the way, that's true when you buy something

702
00:38:37,520 --> 00:38:40,120
Speaker 2: that was made by a Chinese person, you're better off

703
00:38:40,719 --> 00:38:42,920
Speaker 2: because you bought something by Chinese person and the Chinese

704
00:38:42,960 --> 00:38:45,280
Speaker 2: person is better off. It's win win, Otherwise you wouldn't

705
00:38:45,280 --> 00:38:46,400
Speaker 2: be engaging in the transaction.

706
00:38:48,080 --> 00:38:51,000
Speaker 1: So you're you think you think tariffs are a bad idea,

707
00:38:51,960 --> 00:38:54,480
Speaker 1: that's protectionism, and I.

708
00:38:54,440 --> 00:38:57,040
Speaker 2: Think taros is an awful idea, and it's a it's

709
00:38:57,080 --> 00:38:59,840
Speaker 2: an idea. I mean, people know the book by Adam Smith,

710
00:39:00,280 --> 00:39:03,120
Speaker 2: you know The Wealth of Nations, which is really the

711
00:39:03,719 --> 00:39:07,640
Speaker 2: first book on on on capitalist economics, and the whole

712
00:39:07,640 --> 00:39:09,880
Speaker 2: point of the book is free trade is good. And

713
00:39:09,920 --> 00:39:11,399
Speaker 2: the whole point of the book is it doesn't matter

714
00:39:11,400 --> 00:39:14,120
Speaker 2: if the other country subsidizes other country does are other things.

715
00:39:15,239 --> 00:39:18,840
Speaker 2: He makes the point of tauos I never justified, and

716
00:39:18,960 --> 00:39:22,800
Speaker 2: indeed taos I never justified. They only do economic calm

717
00:39:23,239 --> 00:39:27,319
Speaker 2: uh and Trump's tauts are particularly bad. They're worse than,

718
00:39:27,680 --> 00:39:31,399
Speaker 2: you know, than other forms of taos. They they there's

719
00:39:31,840 --> 00:39:33,839
Speaker 2: zero economic justification for toes.

720
00:39:33,840 --> 00:39:36,640
Speaker 1: Couldn't you say that there's a lot of nuance to things,

721
00:39:36,640 --> 00:39:38,320
Speaker 1: and that things can be good and bad at the

722
00:39:38,320 --> 00:39:42,680
Speaker 1: same time, and sometimes in order a lot of sometimes

723
00:39:42,719 --> 00:39:44,879
Speaker 1: in order to get improvement, you have to go through

724
00:39:44,920 --> 00:39:47,920
Speaker 1: pain first. So in order for the in order for

725
00:39:47,920 --> 00:39:49,719
Speaker 1: the Israelites to get out of Egypt and get to

726
00:39:49,760 --> 00:39:51,840
Speaker 1: the Promised Land, they had to go to the desert first,

727
00:39:52,520 --> 00:39:55,400
Speaker 1: and so like it could be terrible in the short

728
00:39:55,480 --> 00:39:58,719
Speaker 1: term but good in the long term, for example. And

729
00:39:58,760 --> 00:40:02,440
Speaker 1: then also you could say that like there's no justification

730
00:40:02,520 --> 00:40:04,640
Speaker 1: for teriffs. Well, there's a lot of justifications for tariff.

731
00:40:04,960 --> 00:40:07,200
Speaker 1: Whether they're good or not, that's debatable.

732
00:40:08,480 --> 00:40:11,200
Speaker 2: But you there's no justification for TEF's in the sense that,

733
00:40:11,640 --> 00:40:14,080
Speaker 2: and it's true sometimes you have to go through pain,

734
00:40:14,800 --> 00:40:18,120
Speaker 2: but here there's no long term positive consequence to TeV

735
00:40:18,239 --> 00:40:23,120
Speaker 2: I mean literally none. TAV saw a lose lose, lose, lose, lose.

736
00:40:23,200 --> 00:40:26,239
Speaker 1: What about what about I mean, what about if we

737
00:40:26,360 --> 00:40:28,080
Speaker 1: sort of take a little bit of the economic side

738
00:40:28,080 --> 00:40:30,600
Speaker 1: out of it. What we saw during COVID was the

739
00:40:30,719 --> 00:40:34,400
Speaker 1: US couldn't even come up with medical stuff. We couldn't

740
00:40:34,400 --> 00:40:39,040
Speaker 1: even get medicines. We couldn't we had no ppe or whatever.

741
00:40:39,160 --> 00:40:42,040
Speaker 1: We had no like medical equipment, no mass like again,

742
00:40:42,120 --> 00:40:44,000
Speaker 1: like most of our antibotics couldnt even come here. So

743
00:40:44,120 --> 00:40:47,319
Speaker 1: isn't there somewhat like obviously I'm a I mean, I'm

744
00:40:47,360 --> 00:40:49,880
Speaker 1: for free trade as well, but sometimes it's like, well, shoot,

745
00:40:49,960 --> 00:40:55,040
Speaker 1: maybe we should probably make some stuff here because there's

746
00:40:55,080 --> 00:40:57,480
Speaker 1: a national imperative, a security initiative about that.

747
00:40:57,600 --> 00:41:01,480
Speaker 2: No, no, I mean, and I anytime people use national

748
00:41:01,560 --> 00:41:03,960
Speaker 2: security reasons, I'm suspicious.

749
00:41:04,040 --> 00:41:06,320
Speaker 1: Right, Well, we couldn't get anibtsics. That'd be pretty dangerous

750
00:41:06,320 --> 00:41:07,640
Speaker 1: for all of Americans.

751
00:41:07,200 --> 00:41:12,560
Speaker 2: Right sure so sure, so the companies that make anybodoty

752
00:41:12,600 --> 00:41:19,520
Speaker 2: except a strong a strong profit motive to diversify their

753
00:41:19,600 --> 00:41:23,080
Speaker 2: sources of things, and maybe they didn't realize that, and

754
00:41:23,080 --> 00:41:26,120
Speaker 2: when COVID happened, they learned a lesson, and then they're

755
00:41:26,120 --> 00:41:30,680
Speaker 2: going to diversify. I trust pharmaceutical companies to diversify the

756
00:41:30,760 --> 00:41:32,920
Speaker 2: sources that they chemicals much more than I trust the

757
00:41:32,920 --> 00:41:36,920
Speaker 2: federal government to figure out which taalists and which products

758
00:41:36,920 --> 00:41:39,200
Speaker 2: and which countries, when to do and how to do it.

759
00:41:40,160 --> 00:41:42,600
Speaker 2: The reality is that during COVID, well, yeah, there was

760
00:41:42,640 --> 00:41:45,400
Speaker 2: no masks in the United States. Nobody expected anything like this.

761
00:41:46,400 --> 00:41:51,920
Speaker 2: Very quickly, people converted factories into mask making people. People changed,

762
00:41:52,400 --> 00:41:55,719
Speaker 2: you know, retooled their machines, and you got masked. We

763
00:41:55,760 --> 00:41:59,360
Speaker 2: had an abundance of masks. A lot of times we

764
00:41:59,719 --> 00:42:03,480
Speaker 2: feel like we have constraints and products. It's because we

765
00:42:03,560 --> 00:42:06,279
Speaker 2: have too many constraints in trade. So for example, I

766
00:42:06,280 --> 00:42:08,040
Speaker 2: don't know if you remember a few a couple of

767
00:42:08,080 --> 00:42:10,520
Speaker 2: years ago, there was this thing of baby formula. You

768
00:42:10,560 --> 00:42:13,680
Speaker 2: couldn't get baby formula in America, and the reason was

769
00:42:13,719 --> 00:42:17,840
Speaker 2: the FDA won't approve the sale of European baby formula

770
00:42:17,880 --> 00:42:22,239
Speaker 2: in America unless it's inspected by the FDA. Even though

771
00:42:22,280 --> 00:42:26,120
Speaker 2: it's inspected already by food authorities in Europe. And if

772
00:42:26,160 --> 00:42:27,759
Speaker 2: you're a parent and you go to Europe and you

773
00:42:27,760 --> 00:42:29,680
Speaker 2: buy a bunch of baby food and you bring it

774
00:42:29,719 --> 00:42:34,120
Speaker 2: to America, they're going to confiscate it at the border. So,

775
00:42:36,080 --> 00:42:38,560
Speaker 2: you know, the solution of all these problems is not

776
00:42:39,400 --> 00:42:42,200
Speaker 2: This is the principle in politics. My principle in politics,

777
00:42:43,400 --> 00:42:47,719
Speaker 2: it never makes sense to move away from freedom. That is,

778
00:42:48,120 --> 00:42:52,120
Speaker 2: every bill, every decision a politician needs to make should

779
00:42:52,120 --> 00:42:54,799
Speaker 2: always be in the direction of freedom. And that, by

780
00:42:54,840 --> 00:42:58,200
Speaker 2: the way, might cause pain sometimes. So for example, if

781
00:42:58,200 --> 00:43:01,080
Speaker 2: we undo the banking them, if we talk like we

782
00:43:01,120 --> 00:43:04,160
Speaker 2: did before, you know, completely do regulate. If we deregulate

783
00:43:04,200 --> 00:43:06,360
Speaker 2: the banking system and have a proper banking system in

784
00:43:06,360 --> 00:43:08,960
Speaker 2: the United States, that will cost some pain. Investors will

785
00:43:09,000 --> 00:43:11,439
Speaker 2: lose money, some people lose their accounts. There'll be some pain,

786
00:43:12,000 --> 00:43:13,719
Speaker 2: but a good thing will come of it at the end.

787
00:43:13,760 --> 00:43:17,319
Speaker 2: But we're moving towards more freedom, not less. Tariffs are

788
00:43:17,320 --> 00:43:20,839
Speaker 2: moving us towards less freedom, not more. So you could

789
00:43:20,920 --> 00:43:23,800
Speaker 2: see if you want to say, you know, a national

790
00:43:23,800 --> 00:43:27,360
Speaker 2: security issue, China is an enemy and we shouldn't be

791
00:43:27,400 --> 00:43:29,239
Speaker 2: trading with them, because every time we trade with them,

792
00:43:29,239 --> 00:43:31,760
Speaker 2: they get richer and then they can build more weapons

793
00:43:31,760 --> 00:43:35,200
Speaker 2: and attack us. Then okay, then embargo China. Then they

794
00:43:35,200 --> 00:43:37,359
Speaker 2: should be an embargo. You shouldn't be allowed to trade

795
00:43:37,360 --> 00:43:40,960
Speaker 2: with China. It's trading with the enemy. It's treason. Tariffs

796
00:43:41,440 --> 00:43:44,319
Speaker 2: are not a tariffs. Don't do that, And they're kind

797
00:43:44,320 --> 00:43:47,239
Speaker 2: of a silly way of achieving that goal. And it's

798
00:43:47,280 --> 00:43:49,800
Speaker 2: a cowardly way because you're afraid to call them an enemy.

799
00:43:50,160 --> 00:43:52,360
Speaker 2: So call them an enemy, put an embargo on, and

800
00:43:52,400 --> 00:43:55,160
Speaker 2: stop trading with them. But if if they're not an enemy,

801
00:43:55,320 --> 00:43:57,680
Speaker 2: then we should I should be an As an American,

802
00:43:58,360 --> 00:44:01,080
Speaker 2: I have a right to trade with whoever one. I

803
00:44:01,080 --> 00:44:03,400
Speaker 2: should be able to trade with a Chinese or Mexican

804
00:44:03,480 --> 00:44:06,560
Speaker 2: of you know, why is it any of my government's

805
00:44:06,600 --> 00:44:07,719
Speaker 2: business who I trade it?

806
00:44:07,880 --> 00:44:11,960
Speaker 1: So, I can't agree with you more about continue to

807
00:44:11,960 --> 00:44:14,520
Speaker 1: move towards freedom. And I also agree with you that

808
00:44:15,000 --> 00:44:17,200
Speaker 1: most of these problems all come down to the regulations

809
00:44:17,239 --> 00:44:19,400
Speaker 1: that were imposed, and if you peel back their regulations,

810
00:44:19,400 --> 00:44:23,279
Speaker 1: the America could be much more competitive again, absolutely, you know,

811
00:44:23,760 --> 00:44:26,080
Speaker 1: if only it was that simple. But I do think

812
00:44:26,120 --> 00:44:29,120
Speaker 1: that some of the things back to you know, if

813
00:44:29,160 --> 00:44:32,720
Speaker 1: everybody was in a free trade society then obviously it

814
00:44:32,760 --> 00:44:35,880
Speaker 1: works more freely. But if some people are trying to

815
00:44:35,920 --> 00:44:38,520
Speaker 1: be evil in the system, then what do you do

816
00:44:38,600 --> 00:44:43,200
Speaker 1: about that? Right? So for example, so for example, the

817
00:44:43,280 --> 00:44:46,279
Speaker 1: Chinese and fill in the blank for xyz country, But

818
00:44:46,400 --> 00:44:50,799
Speaker 1: the Chinese are able to subsidize and print money to

819
00:44:52,280 --> 00:44:54,919
Speaker 1: have a competitive advantage on these industries to hollow out

820
00:44:54,960 --> 00:44:57,120
Speaker 1: and hurt these industries over here for example.

821
00:44:57,200 --> 00:44:59,000
Speaker 2: Right, that's great for us.

822
00:44:59,040 --> 00:44:59,719
Speaker 1: Why is that great?

823
00:44:59,760 --> 00:45:03,320
Speaker 2: I mean because because we get the benefit from subsidized

824
00:45:03,360 --> 00:45:04,240
Speaker 2: goods the Chinese.

825
00:45:04,280 --> 00:45:06,000
Speaker 1: Right, But now all of a sudden, we don't have

826
00:45:06,120 --> 00:45:09,440
Speaker 1: rare earth elements and we can't even mobilize a military

827
00:45:09,560 --> 00:45:10,200
Speaker 1: without China.

828
00:45:10,239 --> 00:45:12,680
Speaker 2: Now we don't have rare earth element now because the

829
00:45:12,760 --> 00:45:16,160
Speaker 2: Chinese are subsidizing. We don't have rare earth elements. Because

830
00:45:16,160 --> 00:45:21,319
Speaker 2: of our environmentalists, crazy environmentalist policies, and the fact that

831
00:45:21,400 --> 00:45:22,839
Speaker 2: we are basically.

832
00:45:22,360 --> 00:45:23,680
Speaker 1: Banned mining in this country.

833
00:45:23,840 --> 00:45:26,440
Speaker 2: And if you want to build, you know, and if

834
00:45:26,480 --> 00:45:28,480
Speaker 2: you want to build a factory to take real earth

835
00:45:28,560 --> 00:45:32,360
Speaker 2: minerals and refine them, it's quote polluting and therefore you

836
00:45:32,400 --> 00:45:35,880
Speaker 2: can't build it. So all the damage in all the

837
00:45:35,960 --> 00:45:39,319
Speaker 2: damage has been done in America has been done by Americans,

838
00:45:39,360 --> 00:45:41,719
Speaker 2: not by the Chinese. And if the you know, if

839
00:45:41,760 --> 00:45:45,520
Speaker 2: the Chinese are willing to subsidize the production of T

840
00:45:45,680 --> 00:45:50,520
Speaker 2: shirts and therefore we get cheap T shirts. Yes, some

841
00:45:50,560 --> 00:45:53,080
Speaker 2: people in the T shirt industry in the United States lose,

842
00:45:53,520 --> 00:45:56,240
Speaker 2: they lose their jobs, but we are so much wealthier

843
00:45:56,239 --> 00:45:59,840
Speaker 2: because we're buying cheaper T shirts. Then more jobs are created,

844
00:46:00,040 --> 00:46:02,600
Speaker 2: filling they get. This is exactly what Adam Smith talked

845
00:46:02,600 --> 00:46:05,600
Speaker 2: about in the Wealth of Nations. Other countries doing stupid

846
00:46:05,680 --> 00:46:09,040
Speaker 2: things like subsidizing industries which we know as free marketers

847
00:46:09,160 --> 00:46:12,480
Speaker 2: is stupid, right, don't They don't get richer from subsidizing,

848
00:46:12,560 --> 00:46:17,360
Speaker 2: they get poorer from subsidizing. Then then you know, we

849
00:46:18,440 --> 00:46:23,040
Speaker 2: we shouldn't mimic this stupidity. That is you know, I

850
00:46:23,520 --> 00:46:25,360
Speaker 2: was talking to an economists the other day and he

851
00:46:25,480 --> 00:46:29,040
Speaker 2: was saying, look, if America reached tariffs in Canada, the

852
00:46:29,160 --> 00:46:33,759
Speaker 2: response of Canada should have been to lower tariffs, like

853
00:46:33,880 --> 00:46:35,720
Speaker 2: to say, the United States, you want to shoot yourself

854
00:46:35,760 --> 00:46:37,640
Speaker 2: in the foot, shoot yourself in the foot. We're not

855
00:46:37,680 --> 00:46:39,880
Speaker 2: going to shoot ourselves in knee because you want to

856
00:46:39,920 --> 00:46:41,960
Speaker 2: do something stupid. We're not going to do something stupid.

857
00:46:42,440 --> 00:46:46,040
Speaker 2: Tallis the only trade policy that makes any sense for

858
00:46:46,200 --> 00:46:51,000
Speaker 2: any country anyway, with exception of national security issues. That

859
00:46:51,440 --> 00:46:54,000
Speaker 2: real national security, I mean not pretend national security, but

860
00:46:54,080 --> 00:46:59,840
Speaker 2: real national security is unilateral zero tariffs the best policy

861
00:46:59,880 --> 00:47:01,399
Speaker 2: for the United Stations. If we want to be rich,

862
00:47:01,480 --> 00:47:03,040
Speaker 2: if we want to have jobs, if we want to

863
00:47:03,120 --> 00:47:06,279
Speaker 2: raise the poor, then we should just say, yeah, bring

864
00:47:06,480 --> 00:47:09,120
Speaker 2: all your products in the world here, whatever you want.

865
00:47:09,800 --> 00:47:11,839
Speaker 2: You know, they'll be cheap in the United States. We'll

866
00:47:11,920 --> 00:47:15,120
Speaker 2: invest in what we have a competative advantages in, which

867
00:47:15,200 --> 00:47:18,160
Speaker 2: is a lot of things. Uh, and we'll become richer.

868
00:47:18,560 --> 00:47:25,840
Speaker 2: And again this is not controversial economically, Taos saw. You know,

869
00:47:26,000 --> 00:47:29,680
Speaker 2: with all the attempts of the administration to justify them,

870
00:47:30,320 --> 00:47:31,759
Speaker 2: they just don't make any sense.

871
00:47:31,960 --> 00:47:35,879
Speaker 1: You said unilateral. So if ever, unilatterally dropped them to zero.

872
00:47:35,960 --> 00:47:38,600
Speaker 1: But what if another other nations are charging US twenty

873
00:47:38,640 --> 00:47:41,240
Speaker 1: five percent, then should we universally charge twenty five percent

874
00:47:41,320 --> 00:47:42,080
Speaker 1: doing themselves.

875
00:47:42,640 --> 00:47:45,680
Speaker 2: We're benefiting in this crewing themselves. We get cheap goods.

876
00:47:46,200 --> 00:47:47,879
Speaker 2: We get to benefit from those cheap goods.

877
00:47:48,719 --> 00:47:52,360
Speaker 1: So what if what if China subsidize the pharmaceutical industry

878
00:47:52,680 --> 00:47:55,160
Speaker 1: and they're shooting themselves in the foot? To your points. Now, hey,

879
00:47:55,200 --> 00:47:57,880
Speaker 1: they're helping us get cheap goods, so we stop producing

880
00:47:57,960 --> 00:47:59,960
Speaker 1: those because hey, why would we produce them? They can

881
00:48:00,000 --> 00:48:02,279
Speaker 1: we can get them for twenty five percent cheaper over there.

882
00:48:02,640 --> 00:48:05,120
Speaker 1: They're screwing themselves because they're printing money cause in inflation,

883
00:48:05,160 --> 00:48:06,840
Speaker 1: they're giving us cheap goods. That's great, and then they

884
00:48:06,880 --> 00:48:07,799
Speaker 1: don't provide them to us.

885
00:48:08,160 --> 00:48:11,120
Speaker 2: But that's their pharmaceutica. It's exactly what happens, right. So

886
00:48:12,120 --> 00:48:15,280
Speaker 2: after a certain period of time, a pharmaceutical becomes generic.

887
00:48:15,560 --> 00:48:17,920
Speaker 2: And our generic drugs that are made in the United States,

888
00:48:17,960 --> 00:48:19,719
Speaker 2: I'm made in India, that made all over the world

889
00:48:20,120 --> 00:48:21,960
Speaker 2: because it doesn't make any sense. There's not a profit

890
00:48:22,000 --> 00:48:23,839
Speaker 2: in a generic drug to make it in the United States.

891
00:48:23,920 --> 00:48:27,200
Speaker 2: So it's happening today. What's our comparative advantage. Our comparative

892
00:48:27,200 --> 00:48:31,480
Speaker 2: advantage is new drugs. Our comparative advantage is science and

893
00:48:31,600 --> 00:48:36,040
Speaker 2: discovery and new stuff, and that the Chinese can't subsidize.

894
00:48:36,080 --> 00:48:38,640
Speaker 2: You can't subsidize new stuff that you need freedom, you

895
00:48:38,760 --> 00:48:42,160
Speaker 2: need thinking, you need innovators, you need science. That's our strength,

896
00:48:42,640 --> 00:48:46,000
Speaker 2: that's what we're good at. So let's get our generic

897
00:48:46,080 --> 00:48:48,040
Speaker 2: drugs and the rest of what we do anyway, and

898
00:48:48,200 --> 00:48:51,560
Speaker 2: let's make the real complicated stuff the sophisticate it the same.

899
00:48:51,760 --> 00:48:54,799
Speaker 2: Look at an iPhone, right, where's an iPhone made? Right? Well?

900
00:48:54,840 --> 00:48:58,680
Speaker 1: Six six continents in the six continents continents.

901
00:48:58,640 --> 00:49:00,000
Speaker 2: But where's the most added value?

902
00:49:00,480 --> 00:49:01,680
Speaker 1: The design, the idea?

903
00:49:02,560 --> 00:49:05,080
Speaker 2: Yeah, it's the United States. It's the design. It's the

904
00:49:05,200 --> 00:49:08,200
Speaker 2: chip design, you know, chips, all the chips we get

905
00:49:08,280 --> 00:49:11,160
Speaker 2: off of Taiwan, all the chips we give Taiwan. But

906
00:49:11,239 --> 00:49:15,000
Speaker 2: who designs all the designers in the US. Where's that

907
00:49:15,040 --> 00:49:17,200
Speaker 2: add of value? It's in the design. So why do

908
00:49:17,320 --> 00:49:19,960
Speaker 2: we now we care about the chips coming here from

909
00:49:20,040 --> 00:49:22,839
Speaker 2: Taiwan because we're afraid that China will go to war,

910
00:49:23,560 --> 00:49:26,000
Speaker 2: and so it's a real national security issue. So so

911
00:49:26,280 --> 00:49:29,120
Speaker 2: so we need to figure out how to protect our

912
00:49:29,160 --> 00:49:31,800
Speaker 2: supply chains. I'm all for that, I'm all for national security.

913
00:49:32,400 --> 00:49:34,640
Speaker 2: But that's not the reason we have tarists. We don't

914
00:49:34,640 --> 00:49:37,600
Speaker 2: have taists in Canada because of national security. We don't

915
00:49:37,600 --> 00:49:41,000
Speaker 2: have taxis on steel because of national security, because most

916
00:49:41,040 --> 00:49:43,280
Speaker 2: of us steel comes from our allies, not for my enemies.

917
00:49:44,200 --> 00:49:49,280
Speaker 2: These tarots are completely irrational and and and are based

918
00:49:49,360 --> 00:49:52,640
Speaker 2: on a on a view of trade that is. I

919
00:49:52,640 --> 00:49:55,239
Speaker 2: mean Trump is literally said when we have a trade

920
00:49:55,239 --> 00:49:59,160
Speaker 2: deficit with with Canada, you know they are exploiting us,

921
00:49:59,560 --> 00:50:02,239
Speaker 2: which is which is completely zoos. I'm thinking it's just

922
00:50:02,440 --> 00:50:07,160
Speaker 2: it's just uh, just wrung from every dimension.

923
00:50:07,719 --> 00:50:11,040
Speaker 1: How are you thinking about AI And you mentioned earlier

924
00:50:11,120 --> 00:50:12,520
Speaker 1: with the tariff thing, and if we can get T

925
00:50:12,680 --> 00:50:14,920
Speaker 1: shirts from China cheaper, then so be it. And then

926
00:50:15,080 --> 00:50:16,520
Speaker 1: you know it's tough for the T shirt maker.

927
00:50:16,920 --> 00:50:17,040
Speaker 2: Uh.

928
00:50:17,080 --> 00:50:18,480
Speaker 1: And of course I agree with that. I mean, the

929
00:50:18,600 --> 00:50:21,320
Speaker 1: US used to make textiles here and we sent that

930
00:50:21,440 --> 00:50:23,080
Speaker 1: to Asia and as now their chance to come up.

931
00:50:23,440 --> 00:50:27,480
Speaker 1: But AI is is a big disruptor. A lot of

932
00:50:27,520 --> 00:50:30,000
Speaker 1: people are afraid that it's going to wipe out all

933
00:50:30,040 --> 00:50:32,640
Speaker 1: the jobs, and there's a lot of calls for UBI

934
00:50:32,840 --> 00:50:34,800
Speaker 1: and things like that. How are you looking at that?

935
00:50:36,280 --> 00:50:38,640
Speaker 2: I mean, it's gonna it's gonna destroy a lot of jobs,

936
00:50:38,680 --> 00:50:42,320
Speaker 2: there's no question about it, you know. And and but

937
00:50:42,440 --> 00:50:45,680
Speaker 2: it also will create tons of jobs. I don't know

938
00:50:45,719 --> 00:50:49,239
Speaker 2: what those all. You can ever predict these things, but

939
00:50:50,400 --> 00:50:54,320
Speaker 2: you know, when can project the jobs that relate to

940
00:50:54,760 --> 00:50:58,160
Speaker 2: human contact are gonna are going to rise in value.

941
00:50:59,239 --> 00:51:03,040
Speaker 2: I don't know, no jobs, kids give a jobs things

942
00:51:03,120 --> 00:51:07,560
Speaker 2: like that. There's certain jobs that involve creativity that AI

943
00:51:07,640 --> 00:51:09,800
Speaker 2: will not be able to do. AA is not creative.

944
00:51:09,920 --> 00:51:16,040
Speaker 2: It can mimic, but it can't create. But look jobs,

945
00:51:17,320 --> 00:51:19,560
Speaker 2: millions and millions and millions of of ten, you know,

946
00:51:20,040 --> 00:51:23,319
Speaker 2: billions of jobs are going to be restructured, are going

947
00:51:23,400 --> 00:51:26,319
Speaker 2: to have to change, people are going to be doing

948
00:51:26,360 --> 00:51:29,160
Speaker 2: them differently, and a lot of jobs are going to disappear. Now,

949
00:51:29,239 --> 00:51:32,440
Speaker 2: this is what scares me. That doesn't scare me. What

950
00:51:32,640 --> 00:51:35,840
Speaker 2: scares me is that the more status we are, the

951
00:51:35,920 --> 00:51:38,240
Speaker 2: most socialist we are, the more the government is involved,

952
00:51:38,719 --> 00:51:43,640
Speaker 2: the less flexible we are in adapting. Capitalism is an

953
00:51:43,680 --> 00:51:46,759
Speaker 2: amazing system. You know, they call it creative destruction, but

954
00:51:46,800 --> 00:51:50,840
Speaker 2: it's an amazing system of adaptation of Okay, that industry

955
00:51:50,840 --> 00:51:53,279
Speaker 2: doesn't work, fine, we'll shift to another industry. That job

956
00:51:53,360 --> 00:51:55,040
Speaker 2: doesn't work, I'll get in my car and I'll drive

957
00:51:55,120 --> 00:51:57,960
Speaker 2: to another town and get a different job. But we

958
00:51:58,160 --> 00:52:01,080
Speaker 2: have inculcated in people this expertation that the jobs will

959
00:52:01,080 --> 00:52:02,759
Speaker 2: come to them, that they don't have to change, they

960
00:52:02,760 --> 00:52:05,719
Speaker 2: don't have to train. There's still people in Cleveland waiting

961
00:52:05,760 --> 00:52:08,200
Speaker 2: for the steel jobs to come back. They'll be waiting

962
00:52:08,200 --> 00:52:11,040
Speaker 2: in a hundred years if that's a standard. Right, So

963
00:52:13,200 --> 00:52:16,520
Speaker 2: we need more freedom, more liberty so that we can

964
00:52:16,600 --> 00:52:21,880
Speaker 2: adapt faster and more effectively to this change. And people,

965
00:52:22,120 --> 00:52:25,000
Speaker 2: you know, individuals need to start thinking about is my

966
00:52:25,120 --> 00:52:27,920
Speaker 2: job threatened by AI? In what way? What way can

967
00:52:28,000 --> 00:52:32,840
Speaker 2: I embrace AI so that, you know, so that I

968
00:52:32,960 --> 00:52:35,799
Speaker 2: can use AI in my job rather than the AI

969
00:52:35,960 --> 00:52:39,440
Speaker 2: replacing me. But look, there'll be a lot more entertainers,

970
00:52:40,640 --> 00:52:44,040
Speaker 2: there'll be a lot more podcasters. They'll be you know,

971
00:52:44,200 --> 00:52:47,160
Speaker 2: the things that are uniquely human, that is what there

972
00:52:47,160 --> 00:52:47,719
Speaker 2: will be more.

973
00:52:48,600 --> 00:52:51,319
Speaker 1: If you've seen Google Notebook ll M, you can grab

974
00:52:51,440 --> 00:52:53,640
Speaker 1: some articles thrown in it creates a podcast for you

975
00:52:53,760 --> 00:52:56,600
Speaker 1: and it's really really good. But you know, I would

976
00:52:56,600 --> 00:52:58,880
Speaker 1: agree with you and somebody I've studied, you know, all

977
00:52:58,920 --> 00:53:01,800
Speaker 1: these technology cycles going back to the Industrial Revolution, and

978
00:53:02,160 --> 00:53:04,800
Speaker 1: you know, the first mechanized machines did the work of

979
00:53:04,880 --> 00:53:06,640
Speaker 1: five thousand men in the field. And what do those

980
00:53:06,680 --> 00:53:08,759
Speaker 1: five thousand men in the field do, well, they go

981
00:53:08,840 --> 00:53:11,520
Speaker 1: do something different like science and medicine, something higher value.

982
00:53:11,960 --> 00:53:13,520
Speaker 1: And so I think we tend to look at things

983
00:53:13,600 --> 00:53:15,680
Speaker 1: like sort of like in a vacuum, like all these

984
00:53:15,760 --> 00:53:17,439
Speaker 1: jobs will be wiped out. But We don't think about

985
00:53:17,440 --> 00:53:19,000
Speaker 1: all the jobs to the point that you made. We

986
00:53:19,040 --> 00:53:20,880
Speaker 1: don't know, but all these jobs that will be created.

987
00:53:21,120 --> 00:53:23,200
Speaker 1: I mean, just think about like the invention of the iPhone.

988
00:53:23,320 --> 00:53:26,120
Speaker 1: Think about like how many companies are now making like

989
00:53:26,400 --> 00:53:29,160
Speaker 1: covers for them and screen protectives or kind of like

990
00:53:29,400 --> 00:53:31,719
Speaker 1: holders to go in my car, on my dashboard and

991
00:53:31,880 --> 00:53:33,880
Speaker 1: on my magnet, you know what I mean, Like like

992
00:53:33,960 --> 00:53:35,920
Speaker 1: none of those were available before, right, we didn't think

993
00:53:35,920 --> 00:53:36,600
Speaker 1: about those things.

994
00:53:37,840 --> 00:53:39,520
Speaker 2: I mean the one I the one I like is,

995
00:53:41,080 --> 00:53:43,919
Speaker 2: you know, thirty years ago, to get your nails done,

996
00:53:44,440 --> 00:53:46,919
Speaker 2: like to get a pedicure, manicure, it was like only

997
00:53:47,160 --> 00:53:50,800
Speaker 2: only you know, rich women did that, and it was

998
00:53:50,960 --> 00:53:53,880
Speaker 2: it was very unusual and very rare. Today, there's not

999
00:53:53,960 --> 00:53:57,200
Speaker 2: a strip mall in California that doesn't have a a

1000
00:53:57,280 --> 00:53:58,400
Speaker 2: pediculere manicure.

1001
00:53:59,239 --> 00:53:59,400
Speaker 1: You know.

1002
00:53:59,480 --> 00:54:02,040
Speaker 2: The employer is, you know, a bunch of Vietnamese working

1003
00:54:02,120 --> 00:54:05,759
Speaker 2: and it's a thriving business. And that didn't exist. Those

1004
00:54:05,840 --> 00:54:08,560
Speaker 2: jobs didn't exist three years ago. But we get wealthy

1005
00:54:08,680 --> 00:54:11,879
Speaker 2: enough suddenly we want on nails done. Like imagine going

1006
00:54:11,960 --> 00:54:14,520
Speaker 2: to somebody in the eighteenth century and saying, oh, there's

1007
00:54:14,520 --> 00:54:16,600
Speaker 2: a whole industry of people getting their nails done. They'd

1008
00:54:16,600 --> 00:54:19,040
Speaker 2: look at you like you and nuts the billy eating.

1009
00:54:19,120 --> 00:54:20,000
Speaker 2: The billy survived well.

1010
00:54:20,040 --> 00:54:21,640
Speaker 1: I mentioned earlier, like when I was a kid, I

1011
00:54:21,680 --> 00:54:23,320
Speaker 1: had to go mow lawns to get enough money to

1012
00:54:23,360 --> 00:54:26,680
Speaker 1: get a bike. But nobody here mows their lawns anymore.

1013
00:54:26,719 --> 00:54:28,840
Speaker 1: We don't even have lawnmowers because we have gardeners that

1014
00:54:28,880 --> 00:54:32,520
Speaker 1: could do it for us. Now we're talking about my kid,

1015
00:54:32,680 --> 00:54:34,719
Speaker 1: and I like, she says, not like my wife's like,

1016
00:54:34,800 --> 00:54:36,360
Speaker 1: she says, not a clean the toiler. Are you kidding me?

1017
00:54:36,480 --> 00:54:38,840
Speaker 1: But it's like, but we have people come clean the toilets.

1018
00:54:39,400 --> 00:54:40,560
Speaker 1: When I was a kid, I had to go clean

1019
00:54:40,560 --> 00:54:42,960
Speaker 1: the toilets. Now they don't have to anymore. And see

1020
00:54:43,080 --> 00:54:45,359
Speaker 1: to your points that it creates those jobs. I want

1021
00:54:45,360 --> 00:54:47,800
Speaker 1: to I want to kind of wrap this up. You know,

1022
00:54:49,160 --> 00:54:51,799
Speaker 1: there's the way that we think things could be better,

1023
00:54:52,000 --> 00:54:55,200
Speaker 1: and I think we both agree more freedom would be better,

1024
00:54:56,400 --> 00:55:00,120
Speaker 1: freedom to choose as opposed to coercion, and and and

1025
00:55:00,120 --> 00:55:03,880
Speaker 1: and because of the prosperity. However, the direction of the

1026
00:55:03,920 --> 00:55:06,280
Speaker 1: world is is going the opposite direction. The education system

1027
00:55:06,400 --> 00:55:11,040
Speaker 1: is getting worse and doctrinating people the wrong way. One

1028
00:55:11,160 --> 00:55:12,480
Speaker 1: topic I wanted to talk to you about, but we

1029
00:55:12,520 --> 00:55:15,040
Speaker 1: didn't cover. But like what's being called is like this

1030
00:55:15,120 --> 00:55:19,080
Speaker 1: suicidal empathy of the West. We see all these ideas,

1031
00:55:19,200 --> 00:55:23,960
Speaker 1: all this happening, and uh, how how do you You're

1032
00:55:24,000 --> 00:55:27,160
Speaker 1: you're very strong into like individual, So how does the

1033
00:55:27,280 --> 00:55:32,160
Speaker 1: individual then navigate this? Think about uh, protecting themselves, growing

1034
00:55:32,239 --> 00:55:34,840
Speaker 1: through this and maybe even for their future generation. So like,

1035
00:55:35,160 --> 00:55:37,759
Speaker 1: how if I can't change the whole world, how do

1036
00:55:37,840 --> 00:55:40,440
Speaker 1: I protect myself and my family and my future generation.

1037
00:55:41,040 --> 00:55:45,480
Speaker 2: Well, I mean that that requires uh Wookie, you know,

1038
00:55:45,600 --> 00:55:48,800
Speaker 2: Wookie had making sure you have the financial resources to

1039
00:55:48,920 --> 00:55:53,359
Speaker 2: take care of yourself. Uh, you know, protecting those resources. Uh.

1040
00:55:53,840 --> 00:55:55,640
Speaker 2: You know, I don't see the end of the world

1041
00:55:55,719 --> 00:55:57,239
Speaker 2: out there. I don't think things are going to just

1042
00:55:57,280 --> 00:55:59,239
Speaker 2: fall off a cliff. I think we're much more likely

1043
00:55:59,360 --> 00:56:02,799
Speaker 2: to enter a period of stagnation. I was just looking

1044
00:56:02,800 --> 00:56:05,880
Speaker 2: at some graphs today about the amount of innovation and

1045
00:56:05,920 --> 00:56:08,919
Speaker 2: the amount of profitable tech companies in the United States

1046
00:56:08,920 --> 00:56:11,120
Speaker 2: compare to any other country in the world, and we

1047
00:56:11,280 --> 00:56:14,359
Speaker 2: still outdo everybody in the world by by by big,

1048
00:56:14,560 --> 00:56:18,800
Speaker 2: huge margins. So you know, I'm not I'm pessimistic about

1049
00:56:18,800 --> 00:56:21,440
Speaker 2: the culture. I'm the less pessimistic about the economy in

1050
00:56:21,520 --> 00:56:24,719
Speaker 2: a sense that we still have an economy that's so

1051
00:56:24,840 --> 00:56:29,120
Speaker 2: flexible it can adapt to the craziness coming out of Washington.

1052
00:56:29,239 --> 00:56:34,239
Speaker 2: I think everything pretty much every administrations for the last

1053
00:56:34,239 --> 00:56:37,000
Speaker 2: one hundred years have done from an economic perspective, has

1054
00:56:37,040 --> 00:56:40,000
Speaker 2: been destructive. And this administration is no different. They're all

1055
00:56:40,400 --> 00:56:44,400
Speaker 2: anti capitalists, basically, and that includes Reagan and includes all

1056
00:56:44,440 --> 00:56:46,800
Speaker 2: of them. None of them have actually moved us towards,

1057
00:56:47,880 --> 00:56:50,719
Speaker 2: you know, in any significant way towards freedom. And yet

1058
00:56:50,760 --> 00:56:53,160
Speaker 2: we survive, and yet we thrive, right, we do. Okay,

1059
00:56:53,560 --> 00:56:58,080
Speaker 2: So I say, will cuts save money, invest that money

1060
00:56:59,040 --> 00:57:02,480
Speaker 2: in things that are really productive and things that actually

1061
00:57:03,080 --> 00:57:06,200
Speaker 2: create stuff that that you know, that's the best investment

1062
00:57:06,320 --> 00:57:09,160
Speaker 2: is in, is in building and creating stuff in as

1063
00:57:09,239 --> 00:57:13,959
Speaker 2: long as civilization survives. You know, that'll that'll give that'll

1064
00:57:14,040 --> 00:57:16,880
Speaker 2: get you a return. Right, It's not I'm not quite

1065
00:57:16,960 --> 00:57:20,800
Speaker 2: ready yet to say, you know, go buy gold and

1066
00:57:20,880 --> 00:57:23,000
Speaker 2: bury it in the backyard. I mean, maybe you want

1067
00:57:23,040 --> 00:57:25,160
Speaker 2: a little bit of that, and you know, I know,

1068
00:57:25,280 --> 00:57:27,480
Speaker 2: you're a big, big, big coin. Maybe he wants a

1069
00:57:27,520 --> 00:57:30,920
Speaker 2: bitcoin as well. But my point is bitcoin is not

1070
00:57:31,000 --> 00:57:34,560
Speaker 2: a productive asset and gold is not a productive asset.

1071
00:57:34,920 --> 00:57:38,320
Speaker 2: Well you really if you want to grow your wealth, uh,

1072
00:57:40,000 --> 00:57:42,120
Speaker 2: what you need are productive assets and and and that

1073
00:57:42,240 --> 00:57:44,720
Speaker 2: means businesses and investing in business. You need to be productive.

1074
00:57:46,040 --> 00:57:49,640
Speaker 1: And then that's the ultimate message. Beginning as we were

1075
00:57:49,640 --> 00:57:51,760
Speaker 1: talking Earlier'm gonna have two two teenage daughters. And so

1076
00:57:51,840 --> 00:57:54,160
Speaker 1: I talked to all their their friends and there the boys,

1077
00:57:54,600 --> 00:57:56,440
Speaker 1: and the first thing I tell them is like, you

1078
00:57:56,560 --> 00:57:58,040
Speaker 1: get paid for the value you provide.

1079
00:57:58,440 --> 00:57:58,720
Speaker 2: That's it.

1080
00:57:59,120 --> 00:58:03,960
Speaker 1: Absolutely be productive and and then save in non productive assets.

1081
00:58:05,560 --> 00:58:09,640
Speaker 2: And right now, given give an ai, as you said,

1082
00:58:10,600 --> 00:58:14,440
Speaker 2: really think through and and really invest time in thinking

1083
00:58:14,480 --> 00:58:18,160
Speaker 2: about how to be productive and what what being productive

1084
00:58:18,200 --> 00:58:21,160
Speaker 2: will mean in ten years and twenty years, and how

1085
00:58:21,320 --> 00:58:24,200
Speaker 2: you can position yourself to best exploit the best take

1086
00:58:24,200 --> 00:58:28,240
Speaker 2: advantage of the opportunities. And they'll be massive opportunities that

1087
00:58:28,360 --> 00:58:32,160
Speaker 2: are created by new technology. I mean. And but yeah,

1088
00:58:32,200 --> 00:58:35,320
Speaker 2: there are too many mouchas that too many people who

1089
00:58:35,320 --> 00:58:37,320
Speaker 2: are not productive out there and expect to be taken

1090
00:58:37,400 --> 00:58:40,200
Speaker 2: care of. And don't be one of those.

1091
00:58:40,280 --> 00:58:43,040
Speaker 1: Yeah, And while that's all going one way, you can

1092
00:58:43,080 --> 00:58:46,520
Speaker 1: take care of yourself. You can become productive. You can

1093
00:58:46,600 --> 00:58:50,040
Speaker 1: navigate this. You can set your family up that's the message.

1094
00:58:50,080 --> 00:58:52,800
Speaker 1: But Jarren, thanks so much. I love your perspective. Man,

1095
00:58:52,840 --> 00:58:54,600
Speaker 1: there's so many ways we could dig into this. But

1096
00:58:55,080 --> 00:58:56,840
Speaker 1: but but really, really good. I know you've got all

1097
00:58:56,920 --> 00:58:58,680
Speaker 1: kinds of books behind you. I mean, you teach, you

1098
00:58:58,720 --> 00:59:01,000
Speaker 1: do lectures all the time. What's people be paying attention

1099
00:59:01,040 --> 00:59:02,760
Speaker 1: to to follow you? Anything you want to call out?

1100
00:59:03,760 --> 00:59:06,919
Speaker 2: I mean, I've got my YouTube show you on Brooks Show.

1101
00:59:07,000 --> 00:59:09,720
Speaker 2: So just look up my name. I've got a bunch

1102
00:59:09,760 --> 00:59:11,680
Speaker 2: of books out there that all on Amazon. If you

1103
00:59:11,840 --> 00:59:16,080
Speaker 2: just again search the name, you'll find them. And yeah,

1104
00:59:16,080 --> 00:59:17,920
Speaker 2: if anybody wants to hire me to come and give

1105
00:59:17,920 --> 00:59:21,080
Speaker 2: a lecture, that's my favorite thing to do, is public speaking.

1106
00:59:21,200 --> 00:59:22,840
Speaker 2: So I love that.

1107
00:59:23,040 --> 00:59:24,160
Speaker 1: Thanks so much, John, appreciate it.

1108
00:59:24,280 --> 00:59:25,920
Speaker 2: Good. Good to see them. Mark, thank you.