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Speaker 1: Welcome to Stuff you should know, a production of iHeartRadio.

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Speaker 2: Hey, and welcome to the podcast. I'm Josh and there's

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Speaker 2: Chuck and it's just us here today to explain something

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Speaker 2: that every person in the world should know about, the

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Speaker 2: gold stand. I have an intro. I have an intro

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Speaker 2: hold on oh goud, Chuck. Yes, have you ever gone

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Speaker 2: to a bank and traded a dollar in for actual gold?

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Speaker 1: No, I've never even seen gold in person. That wasn't like,

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Speaker 1: you know, on whatever, a ring or something.

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Speaker 2: Sure, and that is a huge use for gold.

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Speaker 1: I've never seen nuggets or bars ingots.

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Speaker 2: I haven't either. I have never even seen a gold coin.

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Speaker 2: Now that I think.

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Speaker 1: About it, I don't think I have either.

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Speaker 2: But there was a point in time where you could

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Speaker 2: see gold anytime you wanted, if you went to your

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Speaker 2: bank and you took a certain amount of dollars or

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Speaker 2: pounds or francs or pesos, because countries all over the

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Speaker 2: world were on what's known as the gold standard. And

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Speaker 2: just a quick broad stroke explanation I guess is that

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Speaker 2: on a gold standard, every single one of your dollars

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Speaker 2: or pesos or francs or Deutsche marks are redeemable for gold,

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Speaker 2: which means that you have to have an equal amount

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Speaker 2: of gold in your country in safes and vaults to

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Speaker 2: cover every single dollar or paso or Deutsche mark or

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Speaker 2: frank out there. You can't just keep printing money. You

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Speaker 2: can only print as much money as can cover the

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Speaker 2: amount of gold that you have.

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Speaker 1: Yeah, which is you know, it's sort of a public

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Speaker 1: safeguard to say, hey, your dollar, your pay paper money,

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Speaker 1: or your coins are worth something because it's worth this

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Speaker 1: much of this other thing that we've also agreed is

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Speaker 1: worth money exactly.

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Speaker 2: And so for you, if you're walking around in a

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Speaker 2: country that's on the gold standard, you can go trade

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Speaker 2: your dollars in for gold, your paper currency in for gold. Right.

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Speaker 2: It also gives you a lot of stability and understanding

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Speaker 2: that when you wake up in the morning, what you

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Speaker 2: bought for one dollar yesterday, you're going to be able

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Speaker 2: to buy for one dollar today. Prices don't fluctuate very

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Speaker 2: much on the gold standard, and then on more of

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Speaker 2: a macro level, if you're a country and you're importing

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Speaker 2: tons of stuff, that means your currency is going out.

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Speaker 2: You're using your currency to buy these imports, and when

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Speaker 2: a bunch of your currency is out there, you need

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Speaker 2: it back home, so you have to use some of

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Speaker 2: that gold to buy your currency back. So the upshot

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Speaker 2: of all of this is the gold Standard is very

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Speaker 2: different from the type of currency that we have today,

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Speaker 2: and I feel like we should maybe explain a little

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Speaker 2: more eventually about how they're different.

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Speaker 1: Yeah, for sure. I mean we've been back and forth

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Speaker 1: between the gold Standard and the other, which we call

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Speaker 1: fiat currency, which is a Latin term, and that you know,

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Speaker 1: fiat currency basically is what we're working with now because

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Speaker 1: the gold Standard is basically dead. But that's where you can,

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Speaker 1: you know, where you have more you know, monetary policy

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Speaker 1: guiding the markets and stuff like that, rather than like, no,

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Speaker 1: it's like it's tied to gold like kind of end

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Speaker 1: of story. Yeah, there are people that love and you know,

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Speaker 1: we're going to talk about sort of the benefits and

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Speaker 1: the arguments for and against. But people that are into

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Speaker 1: the gold Standard as an idea, they're kind of out

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Speaker 1: of luck, but they're still around. They're called gold bugs.

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Speaker 1: They've been called that since Edgar alland Post's story that's

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Speaker 1: where it came from, about the search for buried treasure.

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Speaker 1: But you know, it's still a fight in some circles

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Speaker 1: from people who are like way into the gold standard.

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Speaker 2: Yeah, and there's I mean, they have a lot of

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Speaker 2: good points. But the problem is is that that train

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Speaker 2: has left the station in it and it's coming back,

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Speaker 2: not coming back. So why gold? Right? There's alsort. You

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Speaker 2: could pay your currency to wheat, right, and you could

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Speaker 2: take your dollar bill and go into the bank and

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Speaker 2: they'll give you like a bushel of wheat in return. Right,

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Speaker 2: why gold in particular?

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Speaker 1: Well, yeah, I said that, you know, that's something that

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Speaker 1: they all agreed was worth something, And that's kind of

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Speaker 1: the deal. Like something's only worth something if everyone agrees

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Speaker 1: that it's worth something, right, But you can't, you know,

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Speaker 1: you've got to pick something that makes sense. And gold

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Speaker 1: has always made a lot of sense for a lot

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Speaker 1: of reasons. It is, it's scarce, but not like rare rare.

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Speaker 1: It's rare enough to be precious, but not so rare

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Speaker 1: that like you know, it's impossible to find. So you've

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Speaker 1: got to have enough of it, but not too much

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Speaker 1: of the thing. It's also you can divide it up

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Speaker 1: into small things, you can melt it down, you can

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Speaker 1: make it into stuff, making it into coins, you know,

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Speaker 1: is certainly valuable. It's valuable, it's resistant to being corroded

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Speaker 1: and like rusted, it's durable. So all that stuff makes

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Speaker 1: it just sort of a valuable thing to trade.

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Speaker 2: Yeah, and you said it's durable. Like most of the

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Speaker 2: gold that's ever been mined in the history of humanity

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Speaker 2: is still around because you can change it from one

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Speaker 2: form to another, say like from a necklace into a

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Speaker 2: gold coin. But there's still that same amount of gold

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Speaker 2: on earth. And I guess as of twenty twenty five,

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Speaker 2: I think the World Gold Council says that two hundred

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Speaker 2: and nineteen thousand, eight hundred and ninety tons of gold

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Speaker 2: have been mined throughout history, and about two thirds of

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Speaker 2: those have been mined since nineteen fifty alone.

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Speaker 1: Right, And most of that is still around, Like you said,

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Speaker 1: it's still out there, which kind of proves that gold

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Speaker 1: was a pretty good pick that and silver, I mean,

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Speaker 1: silver was we'll talk about the fact that gold and

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Speaker 1: silver kind of went back and forth over the years.

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Speaker 1: There's just a lot more silver, so silver has just

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Speaker 1: been worthless, right.

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Speaker 2: But it's still worthwhile. And in fact, if we're going

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Speaker 2: to start to go back a little bit in history,

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Speaker 2: the very first, I guess currency that the United States

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Speaker 2: came up with, and the history for Great Britain tracks

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Speaker 2: very similarly. But in the US they said, we're going

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Speaker 2: to use gold and silver for coinage, and they had

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Speaker 2: to set an amount how much silver do you need

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Speaker 2: to buy you know, one unit of gold because they

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Speaker 2: are related to one another, you're using both for currency.

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Speaker 2: So they said, you know what, fifteen pieces of silver

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Speaker 2: grains I think is equal to one grain of gold.

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Speaker 1: Yeah, so like a fifteen to one ratio. But they

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Speaker 1: realized right away that like if they're going to start

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Speaker 1: setting this like thesetios in these sort of units as

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Speaker 1: being you know, kind of blocked in, it's just going

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Speaker 1: to create a lot of trouble over time, like especially

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Speaker 1: when the amount of gold and silver increases in deep well,

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Speaker 1: I guess not so much decrease, but you know, like

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Speaker 1: when there's a gold rush or when like they find

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Speaker 1: a new vein of silver somewhere that changes the amount

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Speaker 1: of gold and silver in the world. But they still

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Speaker 1: had locked into that fifteen to one ratio. It's not

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Speaker 1: like they kept changing it over and over. So I

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Speaker 1: think kind of right away people were like, oh wait

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Speaker 1: a minute, this is all a little bit artificial in

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Speaker 1: a way.

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Speaker 2: Yeah, And that's something that goldbugs have trouble with is that,

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Speaker 2: you know, it doesn't really matter how you know, honest

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Speaker 2: a gold standard keeps the government, it's still all artificial.

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Speaker 2: There's still manipulation that can happen. And yeah, when a

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Speaker 2: bunch of gold comes on the market, gold becomes less valuable.

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Speaker 2: If a bunch of silver comes on the market, relative

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Speaker 2: to gold, silver becomes less valuable. And one of the

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Speaker 2: problems with using a commodity to back your currency is

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Speaker 2: that sometimes the value of the commodity can rise beyond

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Speaker 2: the face value of the currency. So if you have

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Speaker 2: a ten dollars gold piece and the price of gold

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Speaker 2: actually puts that one ounce at twenty dollars, you're not

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Speaker 2: going to go spend that ten bucks. You're going to

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Speaker 2: melt that thing down or sell it to somebody for

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Speaker 2: twenty dollars. Yeah, So that's a there's problems here with

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Speaker 2: money that actually means something in the world.

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Speaker 1: Yeah, for sure. And that happened. And when that happened

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Speaker 1: kind of the first time, I guess for the United States,

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Speaker 1: people started doing that. They started melting gold coins or

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Speaker 1: keeping them in hoarding gold coins and they started trading

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Speaker 1: and using silver as currency. So all of a sudden

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Speaker 1: we were like, wait a minute. We thought we were

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Speaker 1: on a gold sale or we're heading toward a gold standard,

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Speaker 1: and now we're kind of on a de facto silver

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Speaker 1: standard because that's what people are using.

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Speaker 2: Yeah, so the government was like, well, let's just make

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Speaker 2: the sixteen to one, and it brought everything a little

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Speaker 2: bit more into parody. Then there was the Minor forty

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Speaker 2: nine or gold rush in California, and then there was

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Speaker 2: also another gold rush in Australia about the same time.

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Speaker 2: So the market price for gold went down again because

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Speaker 2: the supply increased, which basically made the US government throw

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Speaker 2: their hands up in the air and say, we give up.

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Speaker 2: We're going to go watch football.

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Speaker 1: Yeah, they're kind of football, I guess. Over across the pond.

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Speaker 1: Isaac Newton finished out his long, storied career as the

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Speaker 1: Master of the Mint.

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Speaker 2: Mm hm.

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Speaker 1: He did a lot of other stuff obviously before that,

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Speaker 1: but he worked as the Master of the Mint at

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Speaker 1: the end of his life until his death, and he

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Speaker 1: was all about gold. Was like he encouraged overvaluing it

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Speaker 1: and said we should really just set gold as the

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Speaker 1: gold standard for England and they adopted that in what

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Speaker 1: like eighteen nineteen.

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Speaker 2: Yeah, so I think they were the first country on

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Speaker 2: an actual gold standard, and then it kind of spread

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Speaker 2: around Europe from there because they're like, this is actually

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Speaker 2: pretty good, pretty good idea because you don't need necessarily

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Speaker 2: a central bank, you don't have to have somebody figuring

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Speaker 2: out what lever to pole or whatever. The gold actually

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Speaker 2: kind of naturally flows from one place to another to

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Speaker 2: basically keep this homeostasis, this balance throughout the world among

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Speaker 2: all the countries that are on the gold standard, right. Yeah,

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Speaker 2: So the thing is is humans are humans. You can

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Speaker 2: mess up anything that is, even something that naturally flows

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Speaker 2: from one place to another. We can basically put our

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Speaker 2: foot in it and screw it up. And that was

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Speaker 2: the case usually, as we'll see throughout history, that's usually

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Speaker 2: the case when war comes along, and that happened in

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Speaker 2: the United States with the Civil War. And we've talked

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Speaker 2: many times about this about how before the Civil War

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Speaker 2: there was like eight thousand different types of currency in

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Speaker 2: use in the United States, like your general store intel

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Speaker 2: might have its own currency that you could use. And

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Speaker 2: as the Civil War came along, that all changed very quickly.

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Speaker 1: Yeah, that was I remember we took that feels like

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Speaker 1: very many years ago. We were talking about that in

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Speaker 1: a few episodes. It was kind of the hot topic

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Speaker 1: for us for a while.

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Speaker 2: It was so hot.

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Speaker 1: We were talking about all those different currencies, like one

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Speaker 1: town might have a currency and then two miles down

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Speaker 1: the road, the next town might have their own currency,

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Speaker 1: which you know within that town as long as everyone again,

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Speaker 1: if everyone agrees what something is worth, it's working out, okay.

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Speaker 1: But that's a mess if you're trying to be a country,

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Speaker 1: which we despite the Civil War, we were trying to

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Speaker 1: be a country. And so the Civil War starts and

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Speaker 1: the federal government was like hey, like you know, Josh

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Speaker 1: Clark will say one day, wars are expensive, and so

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Speaker 1: they issued war bonds. I think about half a five

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Speaker 1: hundred billion dollars in war bonds. War bonds are what

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Speaker 1: you buy to basically, you know, or you sell as

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Speaker 1: a government and people buy to kind of finance the

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Speaker 1: world and saying, a loan you money to go fight

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Speaker 1: this war. Because that bond is ensured, I know for

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Speaker 1: a fact that eventually I'm going to get repaid with

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Speaker 1: interest for lending you that money to fight this war. Right,

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Speaker 1: So it's like it's super safe on the investor side,

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Speaker 1: but it's just a long term payout.

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Speaker 2: Yeah. The thing is is when they issued those as

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Speaker 2: far as I know, they weren't backed with gold, and

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Speaker 2: then they weren't even further. They just started issuing straight

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Speaker 2: up paper currency that had it wasn't pegged to gold

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Speaker 2: or silver backed up by any of it. It was

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Speaker 2: the first fiat currency in the United States, and like

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Speaker 2: you said, is just basically the government saying this has value.

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Speaker 2: Because we say it has value. You can use this

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Speaker 2: to buy stuff, you can use this to pay your taxes.

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Speaker 2: It is currency even though it's not backed by anything.

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Speaker 2: And the reason they did that is because it was

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Speaker 2: so expensive. They literally had to print money say it

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Speaker 2: was it had worth and instead of using it to

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Speaker 2: pay their debts, to basically fight this war. And so

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Speaker 2: the market the United States, well the United States just

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Speaker 2: became flooded with all this paper currency. So the paper

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Speaker 2: currency plus all the goldback currency just became less and

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Speaker 2: less valuable. And I think the inflation that came about

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Speaker 2: after the Civil War, because inflation happens when the value

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Speaker 2: of your currency is weak because there's too much of

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Speaker 2: it like out there. Yeah, it was like twenty five

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Speaker 2: percent during the Civil War. And just for a reference,

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Speaker 2: in twenty twenty two, at the peak of the most

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Speaker 2: recent inflation in June, it was at nine percent and

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Speaker 2: that was pretty uncomfortable. I can't imagine twenty five percent.

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Speaker 1: No, we were in a pretty bad way. And this

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Speaker 1: was also a time when the country started dabbling in

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Speaker 1: national debt and saying like, hey, like, as a country,

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Speaker 1: we can go into deep debt. Yeah, and like, let's

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Speaker 1: see if anybody really cares it. Went this is these

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Speaker 1: are pretty staggering numbers. The national debt in eighteen sixty

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Speaker 1: was sixty five million. Six years later it was two

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Speaker 1: point seven six billion dollars. And this is when gold

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Speaker 1: standard or what are they called gold bugs started saying, hey,

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Speaker 1: I think you've just proved our point, Like you printed

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Speaker 1: all this money the Fiat currency, and we're in real

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Speaker 1: trouble now.

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Speaker 2: Yeah, And so Lincoln says, hold on, hold on, and

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Speaker 2: he rolls up his sleeves a little bit and gets

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Speaker 2: to work, spits in his hand, rubs them together, picks

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Speaker 2: up an ax for no reason, just to kind of

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Speaker 2: look tough.

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Speaker 1: Yeah.

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Speaker 2: Sure, there works, and he says, we're going to take

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Speaker 2: all of those, all of the bills out there, all

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Speaker 2: the dollars on the market, and just take them back

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Speaker 2: and start destroying them. Yeah, and by doing that, we're

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Speaker 2: going to actually lower the supply of dollars, which increases

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Speaker 2: their value. Right, And so problem solved. That's going to

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Speaker 2: fight inflation because the dollar is stronger again because there's

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Speaker 2: less dollars on there. And on just a basic economic

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Speaker 2: basis of supply and demand, it makes sense. But what

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Speaker 2: the government didn't realize all the way back in the

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Speaker 2: eighteen sixties is that it takes a little more finesse

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Speaker 2: than that to not just screw up the economy like

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Speaker 2: a pendulum from one problem to the opposite problem.

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Speaker 1: Yeah, Like, can you imagine being a citizen in the

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Speaker 1: United States back then, in those early days when they're

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Speaker 1: just trying to figure this stuff out, and you know,

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Speaker 1: I bet a lot of people didn't have a real

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Speaker 1: understanding of this, But if you did, could you imagine

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Speaker 1: just seeing your country be like, hey, let's print a

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Speaker 1: bunch of paper and say it's really valuable, right, and

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Speaker 1: then when they got in trouble, be like, hey, let's

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Speaker 1: burn all that stuff that we printed and said was valuable.

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Speaker 2: Yeah, Like they would just come up behind, like congressmen

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Speaker 2: would come up behind people counting their money and just

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Speaker 2: yank it out of their hands and run off and

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Speaker 2: you couldn't do anything about it.

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Speaker 1: Yeah, paper football, So that was a real hot item

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Speaker 1: at the time.

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Speaker 2: So, okay, a bunch of bills, a bunch of money

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Speaker 2: just gets taken back, burned, destroyed, taken off of the market.

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Speaker 2: It's just not there anymore, and the value of the

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Speaker 2: dollar strengthens. The problem is because the dollar is more

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Speaker 2: is worth more than it was before, and seems like

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Speaker 2: it's just going to keep going up in value. People

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Speaker 2: are like, well, I'm going to hang on to my

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Speaker 2: dollar because it's going to increase in value, so I'll

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Speaker 2: be able to buy more later. The problem is in

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Speaker 2: the current term that means that people aren't out buying stuff.

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Speaker 2: And if you're making say pre industrial televisions, which were

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Speaker 2: just boxes that you know, like somebody with a puppet

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Speaker 2: could get in and make a little show, but they

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Speaker 2: call them TVs back then, if you're making those and

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Speaker 2: people are not spending money on the pre industrial televisions,

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Speaker 2: your profits are going to start to go down, you

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Speaker 2: have less reason to produce more and more of those,

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Speaker 2: which means you need less workers, which means you start

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Speaker 2: laying people off, which means those workers have less wages

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Speaker 2: to spend money on. And the whole thing becomes this

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Speaker 2: self feeding cycle that just gets worse and worse and worse.

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Speaker 2: And we call them recessions, and when they're really bad,

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Speaker 2: we call them depressions. And that happened from the government

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Speaker 2: soaking up all of those bills after the Civil War,

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Speaker 2: and it caused what's called the Long Depression from eighteen

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Speaker 2: seventy three to eighteen seventy nine.

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Speaker 1: Yeah, and some say it almost went to like nineteen hundred,

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Speaker 1: like eighteen ninety seven before we were fully out of that.

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Speaker 1: And it was a real, like I think it was

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Speaker 1: a real wake up call early on to the United

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Speaker 1: States of like, hey, you can't There's got to be

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Speaker 1: a better way than just printing a bunch of money

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Speaker 1: when you think you need it, like kind of artificially

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Speaker 1: manipulating the value of the dollar like that is only

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Speaker 1: going to lead to trouble. So, boy, that's a great

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Speaker 1: first act, I think I think so too. Back in

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Speaker 1: form after vacation yeah.

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Speaker 2: Yeah, I feel pretty good.

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Speaker 1: Okay, you're feeling good.

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Speaker 2: Yeah, and you're doing great. You're looking sharp.

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Speaker 1: Man, I appreciate it. So let's take a break. We'll

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Speaker 1: come back and we'll talk about the Golden Age. We

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Speaker 1: love our golden ages. The golden age of the gold

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Speaker 1: standard right after.

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Speaker 2: This, so the United States just basically just stepping in

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Speaker 2: it and then stepping out of it and stepping in

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Speaker 2: another pile of it. Yeah, in the eighteen seventies, this is.

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Speaker 1: Not talking about gold either, right, No, no.

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Speaker 2: No, I couldn't come up with something that wasn't just

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Speaker 2: absolutely gross. So yeah, I'll keep moving on. But this

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Speaker 2: was the time when the world was globalizing for kind

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Speaker 2: of the first time, and so other countries are taking

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Speaker 2: note of this and they're like, yeah, this gold standard

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Speaker 2: might be a good thing. And like you said, it

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Speaker 2: kicked off a golden age from eighteen seventy one to

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Speaker 2: basically through war about to World War One. It was

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Speaker 2: a golden age for gold. There's no other way to

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Speaker 2: put it. I didn't want to say that, but there's

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Speaker 2: no other way to put it.

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Speaker 1: Yeah, It's like what forty something years where everyone was

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Speaker 1: sort of agreeing that the gold standard was the place

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Speaker 1: to be because there was debate like after the mess,

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Speaker 1: you know, post Civil War, of like what we're even

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Speaker 1: allowed to do as a country, and like can the

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Speaker 1: government even print money? Like that? The Supreme Court came

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Speaker 1: along in eighteen seventy one. They said, yes, they can

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Speaker 1: print money. Maybe they need to, you know, we need

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Speaker 1: to rethink our process, but the government printing money is okay.

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Speaker 2: Yeah, it's kind of it's legal. Yeah. Yeah, So that

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Speaker 2: I was settled, but that still didn't mean like that

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Speaker 2: the government should do that. There was still this question

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Speaker 2: should we keep going this way as supported by the

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Speaker 2: Greenback Party, who were like, yes, this actually makes a

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Speaker 2: lot of sense. Or there are other groups like the

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Speaker 2: silver movement, the gold bugs were out there who were like, no,

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Speaker 2: we need a commodity backed currency, right. Apparently the Wizard

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Speaker 2: of Oz and I'm sure we've mentioned this before, but

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Speaker 2: it was supposed to be an allegory for this debate

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Speaker 2: over whether to go with the Greenbacks and World City,

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Speaker 2: go with the gold standard, the yellow brick road, or

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Speaker 2: to go with the Ruby standard. Which were the slippers.

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Speaker 1: Right or the were wheat like you suggested that would

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Speaker 1: be the scarecrow exactly.

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Speaker 2: Yeah, So all of those scarecrow rubies, gold, the greenbacks,

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Speaker 2: all of those were part of this national bait. And

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Speaker 2: finally it was settled in nineteen hundred when William McKinley

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Speaker 2: was made president. He said, it's gold. We're just going

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Speaker 2: with gold. And even more than that, you cannot print

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Speaker 2: a dollar beyond the amount of gold. We have to

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Speaker 2: back it up.

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Speaker 1: Yeah, that was that was key to that whole declaration.

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Speaker 1: He was a pro gold candidate, pro gold standard, and

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Speaker 1: like you said, in nineteen hundred twenty one, he was like,

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Speaker 1: we got to have some real teeth behind this. I

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Speaker 1: can't just say it as president and make it so.

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Speaker 1: So they passed the Gold Standard Act of nineteen hundred,

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Speaker 1: and that had some language in there that said exactly

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Speaker 1: that is, hey, that circulation, it's got to be tied

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Speaker 1: to gold. We can't print one dollar more than we

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Speaker 1: have in equal amounts of gold. And that was it.

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Speaker 1: You know, that was the classic gold standard period. It

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Speaker 1: meant that nations were trading with one another on equal

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Speaker 1: ground and it was dependent on sending like physical gold

401
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Speaker 1: one another. If you were producing more and exporting more,

402
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Speaker 1: then you had a lot of gold, you know, stockpiled

403
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Speaker 1: in your country. If you had a trade deficit, you

404
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Speaker 1: had a lot less gold, and it was everyone kind

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Speaker 1: of knew what that meant, and it worked for a

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Speaker 1: long time.

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Speaker 2: It did work. I mean, there were dozens of nations

408
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Speaker 2: all on the gold standard at the same time, so

409
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Speaker 2: you knew how much you were going to get paid

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Speaker 2: for your shipmen of pre industrial televisions overseas, right, because

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Speaker 2: there were bonkers for them in Portugal. But the reason

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Speaker 2: why you knew is because there was such stability among

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Speaker 2: your currency and international currency pegged to gold, that when

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Speaker 2: you ship that shipment out, by the time it arrived

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Speaker 2: it was the same price. Yes, with fiat currency, the

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Speaker 2: price of stuff can fluctuate so much over a day

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Speaker 2: or a week that when you sent a shipment out,

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Speaker 2: if you hadn't already settled the contract, which you proba

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Speaker 2: probably did, but by the time it arrived, you might

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Speaker 2: be making way less than you were going to when

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Speaker 2: you shipped it out. That's not really what happened during

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Speaker 2: the classic Golden age of the gold standard. It was

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Speaker 2: all much more stable than that.

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Speaker 1: That's right. But like you said, we pegged the end

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Speaker 1: of that to basically World War One, because, as you

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Speaker 1: mentioned earlier, wars are really expensive. They're going to spike

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Speaker 1: your national debt if you get involved in one. And

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Speaker 1: in Europe and World War One, they were like, this

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Speaker 1: war's really really expensive, and our supply of gold is

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Speaker 1: being constrained, so we have to we have to leave it.

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Speaker 1: So the international gold standard dissolved basically mostly worldwide except

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Speaker 1: for the US and UK. We stayed on that gold standard.

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Speaker 1: And because of that, for a while, the British pound

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Speaker 1: and the US dollar were basically the global reserve currencies

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Speaker 1: because you know, they had gold to back them, so

436
00:23:57,760 --> 00:24:01,639
Speaker 1: they were the gold standard, the dollar in the pound.

437
00:24:01,960 --> 00:24:04,640
Speaker 2: Yeah, because it's not I mean, it's not figurative when

438
00:24:04,640 --> 00:24:06,760
Speaker 2: you're saying like you had to use your gold to

439
00:24:06,800 --> 00:24:09,800
Speaker 2: buy back your currency if you were in a trade deficit, right,

440
00:24:10,240 --> 00:24:12,960
Speaker 2: you actually had to ship gold to the country you

441
00:24:13,000 --> 00:24:15,400
Speaker 2: were buying your dollars or your pounds back from.

442
00:24:15,760 --> 00:24:16,280
Speaker 1: Yeah.

443
00:24:16,320 --> 00:24:20,119
Speaker 2: So with the US and the UK having currencies pegged

444
00:24:20,119 --> 00:24:23,200
Speaker 2: to gold and then be being the global reserve currency,

445
00:24:23,240 --> 00:24:26,240
Speaker 2: you could just ship currency overseas, which is so much

446
00:24:26,240 --> 00:24:29,600
Speaker 2: easier than shipping gold, right, So that was each lighter,

447
00:24:30,080 --> 00:24:33,800
Speaker 2: it is super light. So the US and England both

448
00:24:33,880 --> 00:24:37,080
Speaker 2: ended up with like the vast majority of the world's gold,

449
00:24:37,160 --> 00:24:40,240
Speaker 2: because you know, you could take a dollar, you could

450
00:24:40,240 --> 00:24:42,119
Speaker 2: take a pound to the US of the UK and

451
00:24:42,160 --> 00:24:45,560
Speaker 2: say give me some gold for this, and those those notes,

452
00:24:45,640 --> 00:24:49,760
Speaker 2: those the paper dollars were good as gold essentially, which

453
00:24:49,800 --> 00:24:51,879
Speaker 2: is I'm pretty sure where that came from.

454
00:24:52,280 --> 00:24:55,240
Speaker 1: Yeah, I mean that's funny. The gold standard and good

455
00:24:55,240 --> 00:24:57,160
Speaker 1: as gold, like a lot of these terms like literally

456
00:24:57,160 --> 00:24:59,320
Speaker 1: come from these weird monetary policies.

457
00:24:59,480 --> 00:25:03,560
Speaker 2: Yeah, yeah, William McKinley.

458
00:25:03,040 --> 00:25:10,840
Speaker 1: Yeah, old gold back. So things were going along okay

459
00:25:10,880 --> 00:25:14,560
Speaker 1: after that, and then the nineteen twenty nine stock market

460
00:25:14,640 --> 00:25:19,119
Speaker 1: crash came and banks started failing all over the world

461
00:25:19,600 --> 00:25:21,800
Speaker 1: and everyone you know those you know, when stuff like

462
00:25:21,800 --> 00:25:25,000
Speaker 1: this happens, there's it seems like it used to happen more,

463
00:25:25,000 --> 00:25:27,600
Speaker 1: but there can be a real panic, and people start

464
00:25:27,600 --> 00:25:30,919
Speaker 1: converting their dollars and their pounds to gold because they

465
00:25:30,960 --> 00:25:33,760
Speaker 1: were like, we know, gold is worth something I don't

466
00:25:33,760 --> 00:25:36,600
Speaker 1: want to have like this this paper currency on hand.

467
00:25:36,680 --> 00:25:39,159
Speaker 1: That's like clearly losing value very quickly.

468
00:25:39,720 --> 00:25:41,880
Speaker 2: Right, if I weigh a day, I might get less

469
00:25:41,920 --> 00:25:44,720
Speaker 2: gold than I will if I cash my bank account

470
00:25:44,720 --> 00:25:48,959
Speaker 2: into today. And remember earlier, I said, like, how this

471
00:25:49,080 --> 00:25:51,360
Speaker 2: is all. It all kind of self regulates, it all

472
00:25:51,400 --> 00:25:55,040
Speaker 2: moves naturally from one place to another. But still humans

473
00:25:55,080 --> 00:25:57,840
Speaker 2: can screw things up just because we're human. This is

474
00:25:57,880 --> 00:26:00,080
Speaker 2: how we screwed it up. There were a banking can

475
00:26:00,280 --> 00:26:03,720
Speaker 2: after banking panics, where people just made runs on banks

476
00:26:03,760 --> 00:26:05,120
Speaker 2: and said give me all my money and the bank

477
00:26:05,119 --> 00:26:07,040
Speaker 2: would be like, we don't have it. They would shell

478
00:26:07,080 --> 00:26:09,159
Speaker 2: out all their money and end up closing. And there

479
00:26:09,200 --> 00:26:13,520
Speaker 2: were like ten thousand bank closures in the early nineteen

480
00:26:13,640 --> 00:26:16,480
Speaker 2: thirties in the United States alone between nineteen thirty and

481
00:26:16,560 --> 00:26:20,080
Speaker 2: nineteen thirty two because people would run in and like

482
00:26:20,280 --> 00:26:23,040
Speaker 2: just take all their money out, and so banks were failing.

483
00:26:23,359 --> 00:26:25,960
Speaker 2: This was before the FDIIC. So if you had a

484
00:26:25,960 --> 00:26:29,960
Speaker 2: bunch of money and the bank like closed forever before

485
00:26:30,000 --> 00:26:32,840
Speaker 2: you could cash it in, you were broke. Like that

486
00:26:32,960 --> 00:26:37,040
Speaker 2: money was worthless, right, And that caused even more people

487
00:26:37,160 --> 00:26:40,280
Speaker 2: to make runs on banks, which created this huge, terrible

488
00:26:41,040 --> 00:26:43,600
Speaker 2: ripple effect. And so the UK and the US were

489
00:26:43,600 --> 00:26:46,800
Speaker 2: both faced with this challenge like what do you do.

490
00:26:46,800 --> 00:26:48,679
Speaker 2: Do you stay on the gold standard or do you

491
00:26:48,720 --> 00:26:51,720
Speaker 2: go off the gold standard? And the UK was.

492
00:26:51,760 --> 00:26:55,560
Speaker 1: Up first, Yeah, they abandoned the gold standard in nineteen

493
00:26:55,760 --> 00:26:59,760
Speaker 1: thirty one. Apparently there's a story that their central banker

494
00:27:00,240 --> 00:27:03,840
Speaker 1: named Monte Hugh Norman at the time, suffered a nervous

495
00:27:03,880 --> 00:27:06,080
Speaker 1: breakdown because he was you know, it's kind of up

496
00:27:06,080 --> 00:27:09,040
Speaker 1: to him to make that final call. And can you

497
00:27:09,080 --> 00:27:12,840
Speaker 1: imagine the pressure to be in charge of like a

498
00:27:13,320 --> 00:27:16,679
Speaker 1: kind of a worldwide economy, almost right, and how important

499
00:27:16,760 --> 00:27:17,640
Speaker 1: these decisions are.

500
00:27:18,680 --> 00:27:22,800
Speaker 2: So ask your question, no, no, I cannot imagine that

501
00:27:22,880 --> 00:27:23,119
Speaker 2: kind of.

502
00:27:23,119 --> 00:27:26,360
Speaker 1: Pressure it either. So the pounds value, of course, immediately

503
00:27:26,440 --> 00:27:30,159
Speaker 1: drops even further than it already was. So people that

504
00:27:30,280 --> 00:27:33,439
Speaker 1: were had lost faith in the paper money were saying, like,

505
00:27:33,480 --> 00:27:36,959
Speaker 1: see there, like good thing. We traded in our pounds

506
00:27:37,000 --> 00:27:40,200
Speaker 1: for gold and America and of course everywhere around the

507
00:27:40,200 --> 00:27:43,520
Speaker 1: world is seeing this happen, so everyone else is losing confidence.

508
00:27:43,560 --> 00:27:46,479
Speaker 1: And this is when you know, further runs on banks happened.

509
00:27:47,080 --> 00:27:50,480
Speaker 1: And we had a president, a lame duck named Herbert Hoover,

510
00:27:50,560 --> 00:27:53,560
Speaker 1: who was leaving office in nineteen thirty three and told

511
00:27:53,640 --> 00:27:57,040
Speaker 1: incoming FDR he was like, hey, you know, we're in

512
00:27:57,119 --> 00:27:59,960
Speaker 1: real trouble here. The reason we have gold is because

513
00:28:00,119 --> 00:28:04,280
Speaker 1: can't trust governments. And FDR was like you know what,

514
00:28:04,400 --> 00:28:07,320
Speaker 1: I think I've got this. So he went in office

515
00:28:07,920 --> 00:28:10,040
Speaker 1: and he said, I'm going to I'm going to fix

516
00:28:10,119 --> 00:28:11,400
Speaker 1: this crisis for good.

517
00:28:12,280 --> 00:28:14,199
Speaker 2: One of Yeah, one of the first things he did was,

518
00:28:14,440 --> 00:28:17,600
Speaker 2: I think the day after he was inaugurated, he declared

519
00:28:17,640 --> 00:28:21,080
Speaker 2: a four day banking holiday, so all the banks closed

520
00:28:21,160 --> 00:28:24,760
Speaker 2: right for four days so there couldn't be any runs

521
00:28:24,760 --> 00:28:28,520
Speaker 2: on banks. And I was watching this. There's this dude

522
00:28:28,560 --> 00:28:33,560
Speaker 2: who's a YouTuber named the Casual Historian, and he bills

523
00:28:33,640 --> 00:28:38,320
Speaker 2: himself as a Conservatorian, which I take to be in

524
00:28:38,320 --> 00:28:42,800
Speaker 2: a combination of a conservative and a vegetarian right probably,

525
00:28:43,240 --> 00:28:46,000
Speaker 2: But he was explaining that this actually didn't do much

526
00:28:46,360 --> 00:28:49,360
Speaker 2: in real terms, like the banks that were about to

527
00:28:49,440 --> 00:28:52,920
Speaker 2: fail before the banking holiday still failed afterwards. But as

528
00:28:52,920 --> 00:28:55,400
Speaker 2: far as the public was concerned, it was a huge

529
00:28:55,440 --> 00:28:58,400
Speaker 2: signal for essentially the first time that the government was

530
00:28:58,440 --> 00:29:01,120
Speaker 2: going to step in. Because there's one thing that you

531
00:29:01,200 --> 00:29:05,880
Speaker 2: cannot argue against with the gold standard is because you're constrained,

532
00:29:06,240 --> 00:29:09,200
Speaker 2: you cannot print more money than you have gold to

533
00:29:09,280 --> 00:29:12,400
Speaker 2: back it. There is nothing you can do in an

534
00:29:12,400 --> 00:29:16,280
Speaker 2: economic crisis except sit there and watch it happen. You

535
00:29:16,320 --> 00:29:18,640
Speaker 2: can't do anything there's no leverage for you to pull

536
00:29:18,680 --> 00:29:21,440
Speaker 2: the pull the country out of it. The only way

537
00:29:21,640 --> 00:29:24,240
Speaker 2: that you can pull your country out of a recession

538
00:29:24,320 --> 00:29:28,760
Speaker 2: or a depression is by printing more money and actually

539
00:29:28,880 --> 00:29:33,360
Speaker 2: devaluing the money that people are hoarding. So it's you're

540
00:29:33,400 --> 00:29:36,120
Speaker 2: basically saying, you got all this money that you're stashed

541
00:29:36,120 --> 00:29:38,520
Speaker 2: away because it's so valuable. Well, guess what, It's not

542
00:29:38,600 --> 00:29:40,920
Speaker 2: so valuable anymore, so you might as well get out

543
00:29:40,960 --> 00:29:41,800
Speaker 2: there and spend it.

544
00:29:42,640 --> 00:29:45,280
Speaker 1: Yeah, for sure. And you know, we were in big

545
00:29:45,320 --> 00:29:47,640
Speaker 1: trouble obviously in the nineteen thirties, you know, you mentioned

546
00:29:47,680 --> 00:29:52,479
Speaker 1: earlier sort of that cycle that happens when companies are

547
00:29:52,480 --> 00:29:56,960
Speaker 1: producing less and fewer customers and not hiring people or

548
00:29:57,200 --> 00:30:00,800
Speaker 1: firing people. And in nineteen thirty three, the unemployment of

549
00:30:00,800 --> 00:30:02,560
Speaker 1: the United States was twenty five percent.

550
00:30:02,760 --> 00:30:03,600
Speaker 2: That's so crazy.

551
00:30:04,280 --> 00:30:07,080
Speaker 1: I know, it's staggering. And I think worldwide, almost one

552
00:30:07,080 --> 00:30:09,440
Speaker 1: in three people were out of work in nineteen thirty two,

553
00:30:09,560 --> 00:30:12,240
Speaker 1: So it wasn't just the United States like that many

554
00:30:12,280 --> 00:30:15,240
Speaker 1: people being out at work at once, And that's the

555
00:30:15,280 --> 00:30:19,080
Speaker 1: thing that I always you know, thankfully it hasn't happened yet,

556
00:30:19,080 --> 00:30:22,680
Speaker 1: but with the AI conversations and people. I've had conversations

557
00:30:22,680 --> 00:30:25,280
Speaker 1: with people in my sphere.

558
00:30:25,040 --> 00:30:27,000
Speaker 2: Are you sure? They were people and not box.

559
00:30:28,200 --> 00:30:29,840
Speaker 1: They think it's such a great thing. And I was like,

560
00:30:29,920 --> 00:30:32,080
Speaker 1: you know, I'm not even arguing the merits of arts

561
00:30:32,200 --> 00:30:34,280
Speaker 1: or not and things like that, But I said, I

562
00:30:34,400 --> 00:30:37,440
Speaker 1: just worry about what would happen if like twenty percent

563
00:30:37,480 --> 00:30:39,360
Speaker 1: of the workforce was laid off in the span of

564
00:30:39,400 --> 00:30:41,760
Speaker 1: like a year or so because of AI. It's like,

565
00:30:41,760 --> 00:30:45,400
Speaker 1: that's what I worry about. And we haven't seen that yet, thankfully,

566
00:30:45,440 --> 00:30:46,400
Speaker 1: but I guess we'll see.

567
00:30:46,800 --> 00:30:49,000
Speaker 2: Yeah, you, me and I were talking about the same thing,

568
00:30:49,080 --> 00:30:51,440
Speaker 2: and she brought up a really great question, which is

569
00:30:51,480 --> 00:30:53,200
Speaker 2: like one of the things that a lot of the

570
00:30:53,360 --> 00:30:56,160
Speaker 2: AI proponents say is like, eventually you were going to

571
00:30:56,200 --> 00:30:58,560
Speaker 2: create this utopia where like no one has to work

572
00:30:58,600 --> 00:31:02,160
Speaker 2: and everybody's right. And her question is like, if that's

573
00:31:02,200 --> 00:31:04,600
Speaker 2: your goal, why don't we take some of that wealth

574
00:31:04,640 --> 00:31:07,040
Speaker 2: and just start now before I act? Right, do we

575
00:31:07,080 --> 00:31:08,920
Speaker 2: have to wait for AI to do that? We can

576
00:31:09,000 --> 00:31:12,520
Speaker 2: do it now? I thought, yes, rather clever. I stood

577
00:31:12,600 --> 00:31:14,280
Speaker 2: up and clapped right.

578
00:31:15,560 --> 00:31:17,640
Speaker 1: She's like, that's weird. Here, we're in our living room.

579
00:31:17,840 --> 00:31:22,320
Speaker 1: She left the room, all right, So things are bad.

580
00:31:22,840 --> 00:31:27,360
Speaker 1: They had that banking holiday. Congress passes what's called the

581
00:31:27,400 --> 00:31:31,600
Speaker 1: Emergency Banking Act at the time, which basically, like you said,

582
00:31:32,000 --> 00:31:36,040
Speaker 1: allowed them to, in an emergency issue, just start printing money. Basically,

583
00:31:36,080 --> 00:31:39,520
Speaker 1: that's not back to the gold standard, but we had

584
00:31:39,600 --> 00:31:42,280
Speaker 1: that gold standard because the gold Standard Act of nineteen hundred,

585
00:31:42,360 --> 00:31:46,320
Speaker 1: so they had to create this Banking Act, I guess

586
00:31:46,400 --> 00:31:47,320
Speaker 1: to work around that.

587
00:31:47,400 --> 00:31:51,480
Speaker 2: Right, Yeah, They basically said, Okay, this is just emergency measures,

588
00:31:51,480 --> 00:31:54,440
Speaker 2: and we're just printing this money to give to banks

589
00:31:54,880 --> 00:31:57,920
Speaker 2: to keep them from going under. So the government is

590
00:31:57,960 --> 00:32:00,520
Speaker 2: signaling all over the place, we're stepping in. We're going

591
00:32:00,600 --> 00:32:04,160
Speaker 2: to make sure that this that like, we're going to

592
00:32:04,280 --> 00:32:07,240
Speaker 2: do something about this for the first time. I think

593
00:32:07,240 --> 00:32:09,760
Speaker 2: that was my point before I got off on the

594
00:32:09,800 --> 00:32:12,000
Speaker 2: tangent for a little while a minute ago. But the

595
00:32:12,040 --> 00:32:14,480
Speaker 2: government is signaling all over the place that they're going

596
00:32:14,520 --> 00:32:16,880
Speaker 2: to back up banks so you don't have to run

597
00:32:16,920 --> 00:32:18,720
Speaker 2: and get all of your money out and just keep

598
00:32:18,760 --> 00:32:22,200
Speaker 2: making this whole thing worse. So that was like a

599
00:32:22,360 --> 00:32:25,240
Speaker 2: first step. But the problem is is there was still

600
00:32:25,320 --> 00:32:27,600
Speaker 2: plenty of gold out there that people were hoarding. They

601
00:32:27,600 --> 00:32:29,600
Speaker 2: were like, yeah, that's great, thanks a lot, but I'm

602
00:32:29,640 --> 00:32:31,760
Speaker 2: not taking this goal back to the bank right now

603
00:32:31,840 --> 00:32:35,080
Speaker 2: because I don't have any confidence in the banking system.

604
00:32:35,360 --> 00:32:37,720
Speaker 2: So the government figured out how to deal with this.

605
00:32:38,600 --> 00:32:41,680
Speaker 2: They said, well, you know what, we will put you

606
00:32:41,800 --> 00:32:45,320
Speaker 2: in jail for ten years and find you the modern

607
00:32:45,360 --> 00:32:47,960
Speaker 2: equivalent of two hundred and fifty thousand dollars. If you

608
00:32:48,000 --> 00:32:51,479
Speaker 2: don't give us your gold, we'll give you the equal

609
00:32:51,520 --> 00:32:56,320
Speaker 2: amount of paper dollars back, but you can't legally own

610
00:32:56,400 --> 00:32:57,200
Speaker 2: gold anymore.

611
00:32:58,040 --> 00:32:59,920
Speaker 1: Yeah, and that was it. That was I mean, I

612
00:33:00,080 --> 00:33:04,320
Speaker 1: think it was about a month after they sort of

613
00:33:04,360 --> 00:33:07,480
Speaker 1: restored that public confidence with the Emergency Banking Act, like

614
00:33:07,640 --> 00:33:10,920
Speaker 1: FDR was moving very quickly and said all right, we're

615
00:33:11,000 --> 00:33:14,600
Speaker 1: suspending the gold standard officially. And then the next year

616
00:33:15,200 --> 00:33:17,320
Speaker 1: was that Gold Reserve Act of nineteen thirty four that

617
00:33:17,360 --> 00:33:19,400
Speaker 1: you were talking about, where they were like, yeah, you can't.

618
00:33:19,440 --> 00:33:21,720
Speaker 1: I mean, you can keep your rings and if you

619
00:33:21,800 --> 00:33:24,640
Speaker 1: got like collectible coins and stuff, we're not coming after those. Yeah,

620
00:33:24,680 --> 00:33:27,040
Speaker 1: but you can't have bars of gold and a safe

621
00:33:27,040 --> 00:33:27,920
Speaker 1: in your house anymore.

622
00:33:28,040 --> 00:33:31,280
Speaker 2: Yeah. And Jimmy the Greek was like, whow right close.

623
00:33:33,880 --> 00:33:37,080
Speaker 2: So yeah, so now you had to have you had

624
00:33:37,120 --> 00:33:40,880
Speaker 2: to use paper currency, so this was the shift in

625
00:33:40,920 --> 00:33:43,760
Speaker 2: the United States, and this had already happened in other countries,

626
00:33:43,800 --> 00:33:46,520
Speaker 2: like you said, especially in Europe after World War One,

627
00:33:47,400 --> 00:33:52,200
Speaker 2: and the gold standard was dead. And one of the

628
00:33:52,200 --> 00:33:55,200
Speaker 2: things that demonstrated the death of the gold standard was

629
00:33:56,160 --> 00:33:59,720
Speaker 2: economists generally today say that the US being able to

630
00:33:59,800 --> 00:34:05,240
Speaker 2: print money and basically kickstar inflation to pull us out

631
00:34:05,280 --> 00:34:11,600
Speaker 2: of the deflationary spiral aka the depression. That's basically ninety

632
00:34:11,640 --> 00:34:13,840
Speaker 2: percent of the reason that the US got out of

633
00:34:13,880 --> 00:34:16,759
Speaker 2: the Great Depression. It was leaving the gold standard being

634
00:34:16,800 --> 00:34:18,960
Speaker 2: able to print money. Because if you can just print

635
00:34:19,000 --> 00:34:21,319
Speaker 2: money and take money off the market and put more

636
00:34:21,360 --> 00:34:23,880
Speaker 2: money on the market when you need it, you can

637
00:34:24,160 --> 00:34:27,680
Speaker 2: adjust the economy enough to get it out of crises

638
00:34:28,080 --> 00:34:32,319
Speaker 2: one way or the other. And that that's actually the

639
00:34:32,360 --> 00:34:35,360
Speaker 2: better way of doing it. And so the gold standard

640
00:34:35,520 --> 00:34:36,960
Speaker 2: never came back again.

641
00:34:37,800 --> 00:34:39,759
Speaker 1: That's right. And so that could be the end of

642
00:34:39,800 --> 00:34:42,920
Speaker 1: our show, but that would be weird because we haven't

643
00:34:42,920 --> 00:34:46,200
Speaker 1: had our second ad break yet. So we're gonna do that,

644
00:34:46,280 --> 00:34:48,080
Speaker 1: and we're going to come back and just say see

645
00:34:48,120 --> 00:34:50,000
Speaker 1: you later and read a listener mail, right, because the

646
00:34:50,000 --> 00:34:53,400
Speaker 1: gold standard's gone forever, gone forever, all right, we'll be

647
00:34:53,480 --> 00:35:25,680
Speaker 1: right back. Okay, we're back here for Act three, which

648
00:35:25,719 --> 00:35:27,920
Speaker 1: means this time for listener mail. Because a gold standard

649
00:35:27,960 --> 00:35:28,440
Speaker 1: is dead.

650
00:35:28,320 --> 00:35:30,080
Speaker 2: This is where the golden gun goes off.

651
00:35:30,680 --> 00:35:33,080
Speaker 1: That's right, because no, the gold standard is not dead.

652
00:35:34,520 --> 00:35:38,320
Speaker 1: It actually had another sort of brief not even stint,

653
00:35:38,440 --> 00:35:40,839
Speaker 1: like it kind of had a maybe not a Golden Age,

654
00:35:40,880 --> 00:35:45,600
Speaker 1: but maybe a heyday when the Bretton Woods Agreement came around,

655
00:35:45,640 --> 00:35:48,799
Speaker 1: which was a U in a United Nations agreement that

656
00:35:48,840 --> 00:35:52,440
Speaker 1: came around in nineteen forty four in Brettonwood's New Hampshire

657
00:35:52,920 --> 00:35:55,920
Speaker 1: that had a whole brand new system that was really

658
00:35:56,120 --> 00:35:59,040
Speaker 1: kind of like that original gold standard, with forty four

659
00:35:59,680 --> 00:36:03,040
Speaker 1: country signed on along with the US that said, all right,

660
00:36:03,120 --> 00:36:06,640
Speaker 1: the US dollar now is pegged to gold at thirty

661
00:36:06,640 --> 00:36:10,080
Speaker 1: five dollars an ounce, and everybody else that's signing on

662
00:36:10,200 --> 00:36:13,080
Speaker 1: is tying their currency to our dollar.

663
00:36:13,200 --> 00:36:17,160
Speaker 2: Right, so there's a fixed rate, like there's fifteen pesos

664
00:36:17,200 --> 00:36:19,880
Speaker 2: for one dollar and one dollar equals this much gold.

665
00:36:20,120 --> 00:36:24,320
Speaker 2: So it's essentially the world going back on a gold standard.

666
00:36:24,520 --> 00:36:27,360
Speaker 2: They just figured out a good way around it to

667
00:36:27,400 --> 00:36:31,279
Speaker 2: make it much easier, right. Yeah, and again, just like

668
00:36:31,320 --> 00:36:33,799
Speaker 2: the first time, if everybody's playing by the rules. Then

669
00:36:34,160 --> 00:36:36,680
Speaker 2: this keeps you from monkeying with interest rates to make

670
00:36:36,719 --> 00:36:40,279
Speaker 2: your exports more attractive. It prevents trade wars, it does

671
00:36:40,320 --> 00:36:44,759
Speaker 2: all sorts of calm, peaceful stuff. But the problem is

672
00:36:45,360 --> 00:36:48,319
Speaker 2: there's just and this is the same problem today. There

673
00:36:48,440 --> 00:36:51,920
Speaker 2: just wasn't enough gold in the world to cover the

674
00:36:51,960 --> 00:36:55,399
Speaker 2: increasing expense of modern life.

675
00:36:55,680 --> 00:36:57,720
Speaker 1: Yeah, for sure. And they had put things in place

676
00:36:57,800 --> 00:37:00,520
Speaker 1: because you know, they were a little smarter than time around.

677
00:37:00,560 --> 00:37:03,240
Speaker 1: They were like, all right, we'll create the International Monetary Fund,

678
00:37:03,719 --> 00:37:06,560
Speaker 1: We'll create the World Bank. So that means that there's

679
00:37:06,640 --> 00:37:10,520
Speaker 1: their official worldwide bodies kind of coordinating this monetary policy

680
00:37:11,000 --> 00:37:13,399
Speaker 1: between all the countries to make sure that no one's

681
00:37:13,440 --> 00:37:15,960
Speaker 1: doing hinky stuff. And it took a long time. This

682
00:37:16,080 --> 00:37:18,840
Speaker 1: wasn't like, you know, they reached this agreement in nineteen

683
00:37:18,880 --> 00:37:21,080
Speaker 1: forty four and by nineteen forty five it was all

684
00:37:21,160 --> 00:37:23,880
Speaker 1: set in stone. I think it didn't actually take effective

685
00:37:24,120 --> 00:37:28,720
Speaker 1: fourteen years later in nineteen fifty eight. By the nineteen sixties,

686
00:37:28,719 --> 00:37:33,080
Speaker 1: like shortly thereafter, the US was was spending like a

687
00:37:33,360 --> 00:37:37,319
Speaker 1: like a drunk ten year old military spending was in

688
00:37:37,440 --> 00:37:41,880
Speaker 1: foreign aid. We're all just like ramping up spending on imports,

689
00:37:42,320 --> 00:37:44,960
Speaker 1: foreign investment. There are a lot of dollars from the

690
00:37:45,040 --> 00:37:48,919
Speaker 1: United States and worldwide circulation. And even though we held

691
00:37:48,920 --> 00:37:51,200
Speaker 1: a lot of the world's gold reserves, like seventy five

692
00:37:51,239 --> 00:37:53,640
Speaker 1: percent at the time, like you said, we still didn't

693
00:37:53,680 --> 00:37:55,400
Speaker 1: have enough gold to cover all that kind of money.

694
00:37:55,800 --> 00:37:57,840
Speaker 2: No, and this is the I mean, this is what

695
00:37:58,000 --> 00:38:01,240
Speaker 2: keeps governments honest. There is a possibility of a worst

696
00:38:01,280 --> 00:38:04,680
Speaker 2: case scenario where all of the people holding those dollars

697
00:38:04,719 --> 00:38:07,080
Speaker 2: can all come back at once and say, hey, we

698
00:38:07,120 --> 00:38:10,680
Speaker 2: want this, we want our goal. We're turning in our currency,

699
00:38:11,000 --> 00:38:13,839
Speaker 2: give us our gold. And you know it's bad enough

700
00:38:13,840 --> 00:38:17,400
Speaker 2: when you're talking about citizens making runs on banks. If

701
00:38:17,440 --> 00:38:21,640
Speaker 2: you're talking about entire foreign governments bringing all of their

702
00:38:21,680 --> 00:38:24,040
Speaker 2: cash reserves to you and saying we want gold, you

703
00:38:24,160 --> 00:38:28,000
Speaker 2: got a really big problem. And finally, in nineteen seventy one,

704
00:38:28,440 --> 00:38:31,359
Speaker 2: Nixon admitted, like, we don't have enough gold to cover

705
00:38:31,440 --> 00:38:35,319
Speaker 2: the currency out there. Sorry, guys, you can't turn that

706
00:38:35,440 --> 00:38:39,200
Speaker 2: in for gold anymore. Sorry, and just kind of backed

707
00:38:39,200 --> 00:38:39,839
Speaker 2: out of the room.

708
00:38:40,760 --> 00:38:44,000
Speaker 1: Yeah, he backed out of the room. And it was

709
00:38:44,080 --> 00:38:47,040
Speaker 1: it was a big deal because this isn't the kind

710
00:38:47,080 --> 00:38:50,320
Speaker 1: of thing that we could we had pegged our dollar

711
00:38:50,440 --> 00:38:53,719
Speaker 1: to like worldwide value, so we couldn't just say that

712
00:38:53,760 --> 00:38:59,520
Speaker 1: by ourselves. In nineteen seventy three, the Monetary Fund they

713
00:38:59,560 --> 00:39:02,040
Speaker 1: went off the gold standard. They basically kind of came

714
00:39:02,040 --> 00:39:05,160
Speaker 1: along for the ride, yeah, and said, all right, everybody

715
00:39:05,200 --> 00:39:08,200
Speaker 1: should kind of go to this fiat currency system, and

716
00:39:08,480 --> 00:39:11,280
Speaker 1: like that was the true real end of the gold standard,

717
00:39:11,320 --> 00:39:14,640
Speaker 1: and like there's this that ship is so far out

718
00:39:14,680 --> 00:39:16,840
Speaker 1: of the harbor now, there's no way they could go back.

719
00:39:16,680 --> 00:39:19,279
Speaker 2: To it now. And it eventually kind of became a

720
00:39:19,440 --> 00:39:24,239
Speaker 2: fringe right wing position for some reason. They just kind

721
00:39:24,239 --> 00:39:26,759
Speaker 2: of adopted it. But that doesn't mean all of the

722
00:39:26,840 --> 00:39:29,759
Speaker 2: right wing agrees with it. In fact, Milton Friedman, who's

723
00:39:29,800 --> 00:39:34,680
Speaker 2: a right wing conservative economist hero, he was even like,

724
00:39:34,760 --> 00:39:37,200
Speaker 2: that's a terrible idea to go back on it. He

725
00:39:37,239 --> 00:39:39,359
Speaker 2: wrote a paper, and I think nineteen ninety or co

726
00:39:39,440 --> 00:39:42,279
Speaker 2: wrote one that basically demonstrated just how bad of an

727
00:39:42,320 --> 00:39:45,680
Speaker 2: idea it would be. But there's still plenty of people

728
00:39:45,719 --> 00:39:48,120
Speaker 2: who are like, no, gold is where I want to

729
00:39:48,160 --> 00:39:52,000
Speaker 2: put my faith in. One of the reasons why it's

730
00:39:52,040 --> 00:39:56,799
Speaker 2: still around is because people believe that if there's a

731
00:39:57,080 --> 00:40:02,520
Speaker 2: social collapse right afterward, people will still accept gold. They

732
00:40:02,560 --> 00:40:06,239
Speaker 2: won't accept dollars or pounds or euros, but they'll take

733
00:40:06,320 --> 00:40:09,200
Speaker 2: gold in return. So that's one reason a lot of

734
00:40:09,200 --> 00:40:12,120
Speaker 2: people still have faith in goals and investment. There's other

735
00:40:12,160 --> 00:40:14,239
Speaker 2: people who are like, gold's always going to become more

736
00:40:14,280 --> 00:40:18,000
Speaker 2: and more valuable because there's a finite amount of it, right,

737
00:40:18,920 --> 00:40:23,959
Speaker 2: And that actually is the same thing for bitcoin. There's

738
00:40:24,000 --> 00:40:27,000
Speaker 2: a finite amount of bitcoins, which means that over time

739
00:40:27,120 --> 00:40:29,960
Speaker 2: it's going to become more and more valuable. It's going

740
00:40:30,040 --> 00:40:32,600
Speaker 2: to buy more and more stuff, which makes it a

741
00:40:32,640 --> 00:40:36,160
Speaker 2: deflationary currency, which actually makes it dangerous because that means

742
00:40:36,200 --> 00:40:39,080
Speaker 2: people are more likely to buy in HORD bitcoins or

743
00:40:39,120 --> 00:40:43,000
Speaker 2: buy in HORD gold because eventually it's going to become

744
00:40:43,239 --> 00:40:45,600
Speaker 2: more valuable, and that's how you go into a recession.

745
00:40:46,560 --> 00:40:50,759
Speaker 1: Yeah. I've never I'm just you know, me and economics

746
00:40:50,800 --> 00:40:53,200
Speaker 1: and money. I'm just a big dummy with all that.

747
00:40:53,800 --> 00:40:57,759
Speaker 1: So cryptocurrency is something that even though we've podcasted on it,

748
00:40:57,960 --> 00:40:59,759
Speaker 1: I just it's not like I'm saying like I don't

749
00:40:59,800 --> 00:41:02,120
Speaker 1: try cryptocurrency. I just I don't understand it and I

750
00:41:02,160 --> 00:41:04,000
Speaker 1: have no interest in understanding it.

751
00:41:04,239 --> 00:41:07,600
Speaker 2: Yeah. Yeah, although it does seem to have gained a

752
00:41:07,600 --> 00:41:11,600
Speaker 2: lot of legitimacy, especially Yeah coin sure, but I mean

753
00:41:11,640 --> 00:41:15,200
Speaker 2: it's a wild ride, like it was at like sixteen

754
00:41:15,280 --> 00:41:18,719
Speaker 2: thousand earlier this year, early like last year, and now

755
00:41:18,760 --> 00:41:21,480
Speaker 2: it's at like sixty one, and sixty one is down

756
00:41:21,480 --> 00:41:25,080
Speaker 2: from ninety something a month or two ago. Like maybe

757
00:41:25,080 --> 00:41:27,799
Speaker 2: it's a long term thing, but that's not something you

758
00:41:27,880 --> 00:41:29,680
Speaker 2: want to I mean, you would have to be so

759
00:41:29,760 --> 00:41:32,600
Speaker 2: insane to trade that stuff on a daily basis.

760
00:41:33,120 --> 00:41:35,040
Speaker 1: I don't have the stomach for I'm just that's not

761
00:41:35,160 --> 00:41:37,920
Speaker 1: who I am either. You know, I want to I

762
00:41:37,920 --> 00:41:39,239
Speaker 1: want to sit around and you and I want to

763
00:41:39,280 --> 00:41:44,680
Speaker 1: sit around listen to elevator music, not track the currency cryptocurrency.

764
00:41:44,760 --> 00:41:46,720
Speaker 2: No, but for some people that is quite thrilling.

765
00:41:47,400 --> 00:41:49,440
Speaker 1: Oh I bet it is. Have fun with that if

766
00:41:49,440 --> 00:41:54,799
Speaker 1: that's your thing for Larry David. Right, So, like we said,

767
00:41:55,040 --> 00:41:57,600
Speaker 1: I think an act one that you know, there are

768
00:41:57,640 --> 00:41:59,600
Speaker 1: still people that argue for the gold standard and people

769
00:41:59,640 --> 00:42:01,840
Speaker 1: that aregue against it, even though that ship is sailed,

770
00:42:02,640 --> 00:42:04,719
Speaker 1: and there are you know, some pretty good arguments each way.

771
00:42:05,880 --> 00:42:10,879
Speaker 1: If you're for the gold Standard, you know you can say,

772
00:42:10,960 --> 00:42:14,000
Speaker 1: like hey, that's going to definitely put a lid on

773
00:42:14,040 --> 00:42:16,960
Speaker 1: this crazy government spending that we have had going on,

774
00:42:17,640 --> 00:42:20,279
Speaker 1: and it'll stabilize the money supply. We've seen it do

775
00:42:20,360 --> 00:42:25,040
Speaker 1: that literally, so you know, that's a pretty decent like

776
00:42:25,040 --> 00:42:27,320
Speaker 1: they got a lot of data to back those claims

777
00:42:27,360 --> 00:42:28,000
Speaker 1: up for sure.

778
00:42:28,800 --> 00:42:32,200
Speaker 2: Yeah, one of them is it's just basically throwing shade

779
00:42:32,239 --> 00:42:35,840
Speaker 2: at how out of control government spending gets when the

780
00:42:35,880 --> 00:42:38,560
Speaker 2: government is allowed to literally just print money when it

781
00:42:38,600 --> 00:42:42,600
Speaker 2: wants to. One of those things that you'll see a

782
00:42:42,640 --> 00:42:46,640
Speaker 2: lot is that the purchasing power of the dollar has

783
00:42:46,680 --> 00:42:50,839
Speaker 2: declined by more than eighty five percent since the US

784
00:42:50,960 --> 00:42:53,560
Speaker 2: left the gold standard in nineteen seventy one. And the

785
00:42:53,600 --> 00:42:56,320
Speaker 2: reason why is because the government just keeps printing money

786
00:42:56,320 --> 00:43:01,040
Speaker 2: anytime it likes, which causes inflation. Well, that's purposeful, like

787
00:43:01,320 --> 00:43:05,239
Speaker 2: a fiat currency is an inflationary currency as opposed to

788
00:43:05,280 --> 00:43:09,320
Speaker 2: a deflationary currency like gold. They want inflation to happen

789
00:43:09,360 --> 00:43:12,600
Speaker 2: because inflation you can keep on top of. It's deflation

790
00:43:12,719 --> 00:43:15,560
Speaker 2: that's really hard to come out of. So yeah, it's

791
00:43:15,600 --> 00:43:19,239
Speaker 2: not really a problem if you can buy less with

792
00:43:19,320 --> 00:43:22,880
Speaker 2: a dollar than you did before because you're adjusting for inflation.

793
00:43:23,280 --> 00:43:25,359
Speaker 2: It's not a problem as long as your wages are

794
00:43:25,440 --> 00:43:28,280
Speaker 2: keeping up with it. The problem is is wages haven't

795
00:43:28,360 --> 00:43:30,359
Speaker 2: kept up with it, and so people are being paid

796
00:43:30,400 --> 00:43:32,439
Speaker 2: the same amount as before and are able to buy

797
00:43:32,520 --> 00:43:35,160
Speaker 2: less because they have less money. Even though the cost

798
00:43:35,160 --> 00:43:38,919
Speaker 2: of living has increased their wages are wages haven't gone

799
00:43:39,000 --> 00:43:40,200
Speaker 2: up commensurate to it.

800
00:43:41,120 --> 00:43:42,920
Speaker 1: Yeah, for sure. And if you want to talk about

801
00:43:42,960 --> 00:43:44,440
Speaker 1: like you know, we're talking about printing money and a

802
00:43:44,440 --> 00:43:49,000
Speaker 1: spike in the cash supply, here's a pretty staggering statistic.

803
00:43:49,960 --> 00:43:53,319
Speaker 1: The supply of money in nineteen seventy, this is what

804
00:43:53,360 --> 00:43:55,200
Speaker 1: they call the M two money supply, which is all

805
00:43:55,200 --> 00:43:58,200
Speaker 1: the cash, all the money and checking accounts, all the

806
00:43:58,239 --> 00:44:02,280
Speaker 1: travelers checks, was about six hundred billion dollars in nineteen seventy,

807
00:44:02,520 --> 00:44:07,080
Speaker 1: the year before I was born. In August of last year,

808
00:44:07,560 --> 00:44:12,520
Speaker 1: it was twenty two trillion dollars, which is an increase

809
00:44:12,560 --> 00:44:15,680
Speaker 1: of three thousand, five hundred and sixty six percent over

810
00:44:16,120 --> 00:44:21,279
Speaker 1: whatever fifty four years, and twenty percent of that was

811
00:44:21,560 --> 00:44:23,319
Speaker 1: created in twenty twenty.

812
00:44:23,600 --> 00:44:24,759
Speaker 2: Yeah, just that year.

813
00:44:25,480 --> 00:44:25,760
Speaker 1: Yeah.

814
00:44:26,400 --> 00:44:30,399
Speaker 2: Yeah, So there's this, I mean, there's clear evidence that

815
00:44:30,440 --> 00:44:32,839
Speaker 2: like the government will just print money as much as

816
00:44:32,840 --> 00:44:35,560
Speaker 2: it can whenever it wants to. Part of the problem

817
00:44:35,600 --> 00:44:39,040
Speaker 2: is is that also increases the national debt because for

818
00:44:39,200 --> 00:44:41,720
Speaker 2: money out there, if you can print money, make new money,

819
00:44:41,920 --> 00:44:45,239
Speaker 2: you can spend that new money if you're the organization

820
00:44:45,440 --> 00:44:48,800
Speaker 2: that is creating the money. So the national debt increased

821
00:44:48,840 --> 00:44:52,480
Speaker 2: tremendously too over that same time period from nineteen seventy

822
00:44:52,560 --> 00:44:54,800
Speaker 2: to twenty twenty five.

823
00:44:55,600 --> 00:44:59,719
Speaker 1: Yeah, it could increase nine thousand percent. It was three

824
00:44:59,800 --> 00:45:02,319
Speaker 1: hund undred ninety eight billion back then and now it

825
00:45:02,400 --> 00:45:06,240
Speaker 1: is over thirty six trillion dollars, and it's a number

826
00:45:06,280 --> 00:45:10,400
Speaker 1: that is just hard to even comprehend. That seemingly nobody,

827
00:45:11,040 --> 00:45:14,440
Speaker 1: well not nobody, but the right people aren't concerned enough.

828
00:45:14,280 --> 00:45:17,480
Speaker 2: About So gold bugs are like, see, if you let

829
00:45:17,480 --> 00:45:19,480
Speaker 2: the government print money, they're going to print money and

830
00:45:19,520 --> 00:45:22,520
Speaker 2: they're going to spend more money. The gold standard keeps

831
00:45:22,560 --> 00:45:23,920
Speaker 2: them from being able to do that.

832
00:45:24,239 --> 00:45:29,000
Speaker 1: And of story, that's right. But there are anti goldbugs.

833
00:45:29,040 --> 00:45:31,480
Speaker 1: There are people who prefer fiat currency and the ability

834
00:45:31,480 --> 00:45:34,520
Speaker 1: for the government to step in and throw levers and

835
00:45:34,920 --> 00:45:41,040
Speaker 1: control monetary policy through debate and decision making. And that's

836
00:45:41,120 --> 00:45:43,120
Speaker 1: one of the big arguments. It's like, hey, we need

837
00:45:43,160 --> 00:45:47,799
Speaker 1: to be able to make these decisions sort of on

838
00:45:47,840 --> 00:45:51,440
Speaker 1: the fly and move quickly to save ourselves in times

839
00:45:51,440 --> 00:45:54,640
Speaker 1: of doubt and in times of economic stress, and they

840
00:45:54,640 --> 00:45:56,840
Speaker 1: can also combat a lot of those a lot of

841
00:45:56,880 --> 00:45:59,239
Speaker 1: that data too. They can also say, well, yeah, but

842
00:45:59,280 --> 00:46:01,240
Speaker 1: you really should look at these numbers instead.

843
00:46:02,239 --> 00:46:08,120
Speaker 2: Yeah. So goldbugs always say that that there's stability in

844
00:46:08,680 --> 00:46:11,239
Speaker 2: gold currency, right, But the problem is is that if

845
00:46:11,280 --> 00:46:15,640
Speaker 2: you look at the gold markets, they fluctuate tremendously, so

846
00:46:15,719 --> 00:46:18,520
Speaker 2: that's actually kind of out the window. Another one, this

847
00:46:18,560 --> 00:46:20,839
Speaker 2: one I couldn't find an answer to that. I can't

848
00:46:20,840 --> 00:46:24,520
Speaker 2: wrap my head around those. And the total value of

849
00:46:24,600 --> 00:46:27,880
Speaker 2: all the gold in the world is thirty six trillion dollars,

850
00:46:28,239 --> 00:46:30,040
Speaker 2: which is eye popping, but.

851
00:46:29,960 --> 00:46:33,799
Speaker 1: That's the debt. But yeah, exactly ironically.

852
00:46:33,320 --> 00:46:37,799
Speaker 2: But if you took the entire global economy and valued that,

853
00:46:37,800 --> 00:46:40,680
Speaker 2: that's more like one hundred and twenty six trillion dollars.

854
00:46:41,000 --> 00:46:43,960
Speaker 2: So if the world went on a gold standard again,

855
00:46:44,520 --> 00:46:47,360
Speaker 2: how would you shrink one hundred and twenty six trillion

856
00:46:47,400 --> 00:46:50,359
Speaker 2: dollars into thirty six trillion? That right there, that's what

857
00:46:50,360 --> 00:46:52,480
Speaker 2: we've been saying. The ship has left the harbor, that

858
00:46:52,560 --> 00:46:56,120
Speaker 2: train has left the station. It's just there's again, there's

859
00:46:56,160 --> 00:46:58,920
Speaker 2: not enough gold to cover the value of everything in

860
00:46:58,960 --> 00:46:59,480
Speaker 2: the world.

861
00:47:00,360 --> 00:47:04,000
Speaker 1: Yeah, for sure. Another big sort of argument that people

862
00:47:04,120 --> 00:47:06,239
Speaker 1: against the gold standard point too, is like, hey, look

863
00:47:06,239 --> 00:47:09,200
Speaker 1: at our stock market. People aren't putting their money in

864
00:47:09,239 --> 00:47:12,640
Speaker 1: their mattress anymore and making runs on banks. They're shifting

865
00:47:12,640 --> 00:47:16,359
Speaker 1: that money. They're cash dollars into the stock market, and

866
00:47:16,520 --> 00:47:19,239
Speaker 1: those dollars have grown and grown and grown. I mean,

867
00:47:19,280 --> 00:47:22,600
Speaker 1: there are always dips in the stock markets, and even

868
00:47:23,719 --> 00:47:26,480
Speaker 1: you know, there have been some very bad days in

869
00:47:26,520 --> 00:47:29,759
Speaker 1: a row with the stock market, and you know, the

870
00:47:30,000 --> 00:47:31,839
Speaker 1: crash of two thousand and eight and the dot com

871
00:47:31,840 --> 00:47:34,840
Speaker 1: bubble and all that stuff always affects the stock market,

872
00:47:34,880 --> 00:47:38,040
Speaker 1: but it's proven to be a pretty stable thing over time.

873
00:47:39,200 --> 00:47:43,239
Speaker 2: It has. And in fact, if you there's this comparison

874
00:47:43,280 --> 00:47:44,920
Speaker 2: I found I can't remember where I found it, but

875
00:47:45,080 --> 00:47:49,120
Speaker 2: if you took five thousand dollars in nineteen seventy one

876
00:47:49,480 --> 00:47:54,000
Speaker 2: to celebrate the birth of Chuck, Yeah, and you said,

877
00:47:54,040 --> 00:47:56,840
Speaker 2: I'm going to go buy five thousand dollars worth of gold,

878
00:47:56,840 --> 00:47:58,879
Speaker 2: It's going to be a great present for Chuck. I'm

879
00:47:58,880 --> 00:48:01,680
Speaker 2: also going to bring a little I'm a little frank incense.

880
00:48:01,680 --> 00:48:04,960
Speaker 2: It is going to get biblical in the year. The

881
00:48:05,600 --> 00:48:09,240
Speaker 2: gold actually would have increased about seventy five hundred percent.

882
00:48:09,880 --> 00:48:12,640
Speaker 2: And this is gold prices are so all over the place.

883
00:48:12,680 --> 00:48:15,600
Speaker 2: This is probably already out of date. But I think

884
00:48:15,840 --> 00:48:18,960
Speaker 2: in the end of twenty twenty five, you would have

885
00:48:19,000 --> 00:48:22,360
Speaker 2: had three hundred and seventy nine thousand, five hundred dollars

886
00:48:22,360 --> 00:48:25,279
Speaker 2: worth of gold from that five thousand dollars worth of

887
00:48:25,280 --> 00:48:28,040
Speaker 2: gold you bought in nineteen seventy one. So that makes

888
00:48:28,080 --> 00:48:30,880
Speaker 2: it seem like, okay, great, gold's a good investment. What

889
00:48:31,000 --> 00:48:33,080
Speaker 2: happens if you invested it in the stock.

890
00:48:32,800 --> 00:48:36,680
Speaker 1: Market, Well, if you had had that same five grand

891
00:48:36,760 --> 00:48:38,440
Speaker 1: after my birth and put it in the S and

892
00:48:38,480 --> 00:48:41,600
Speaker 1: P five hundred, you would have made two hundred and

893
00:48:41,680 --> 00:48:45,360
Speaker 1: seventy one thousand, five hundred dollars. So the gold standard

894
00:48:45,440 --> 00:48:47,719
Speaker 1: wins in that case. But that is if you were

895
00:48:48,280 --> 00:48:50,640
Speaker 1: just taking those dividends, if you're taking the money that

896
00:48:50,680 --> 00:48:52,600
Speaker 1: you're making from the stocks and saying like, all right,

897
00:48:52,640 --> 00:48:55,640
Speaker 1: that's that's my income or whatever. If you had kept

898
00:48:55,719 --> 00:48:58,680
Speaker 1: reinvesting all that from the five grand, it would be

899
00:48:59,239 --> 00:49:05,960
Speaker 1: one point one eight five million plus what five hundred bucks. Yeah,

900
00:49:06,320 --> 00:49:09,360
Speaker 1: So that's a return of almost twenty four thousand percent

901
00:49:09,480 --> 00:49:11,719
Speaker 1: rather than seventy five hundred percent.

902
00:49:11,480 --> 00:49:13,359
Speaker 2: Right, And even if you're like, okay, we'll wait a minute,

903
00:49:13,360 --> 00:49:16,280
Speaker 2: adjusting for inflation, how much is that? So I looked

904
00:49:16,280 --> 00:49:18,880
Speaker 2: it up. I went on our beloved west Egg, and

905
00:49:19,000 --> 00:49:21,719
Speaker 2: something that costs five thousand dollars in nineteen seventy one

906
00:49:22,040 --> 00:49:27,240
Speaker 2: would cost you forty thousand dollars today. So even after

907
00:49:27,280 --> 00:49:29,480
Speaker 2: you bought that five thousand dollars thing, you'd still have

908
00:49:29,920 --> 00:49:33,359
Speaker 2: one point one million and change left over. So it

909
00:49:33,440 --> 00:49:36,160
Speaker 2: would be much better to invest it in the market.

910
00:49:36,239 --> 00:49:38,840
Speaker 2: As volatile as it is, as unpredictable as it is,

911
00:49:39,120 --> 00:49:41,480
Speaker 2: as as easy as it is to lose your shirt

912
00:49:41,719 --> 00:49:45,799
Speaker 2: over the course of time, the ability to unleash the

913
00:49:45,800 --> 00:49:48,319
Speaker 2: stock market that having a fiat currency and being able

914
00:49:48,320 --> 00:49:52,240
Speaker 2: to print money creates is a it's a better return

915
00:49:52,440 --> 00:49:53,200
Speaker 2: on investment.

916
00:49:53,280 --> 00:49:56,439
Speaker 1: Yeah, I'm surprised I got through this one.

917
00:49:56,480 --> 00:49:57,160
Speaker 2: You did great.

918
00:49:58,080 --> 00:49:58,759
Speaker 1: Well, you did great.

919
00:49:58,880 --> 00:49:59,600
Speaker 2: You did great.

920
00:50:00,080 --> 00:50:01,880
Speaker 1: Who wrote the original article here? Who is this?

921
00:50:02,000 --> 00:50:03,719
Speaker 2: That was Olivia Joint She did great.

922
00:50:03,920 --> 00:50:06,000
Speaker 1: Yeah, she did great too. And you did a lot

923
00:50:06,000 --> 00:50:08,400
Speaker 1: of great supplemental research. Everyone's doing great, everybody.

924
00:50:08,520 --> 00:50:11,799
Speaker 2: It was just great up in here. We should also

925
00:50:11,840 --> 00:50:13,560
Speaker 2: say we probably got a lot of stuff frong. We

926
00:50:13,560 --> 00:50:15,680
Speaker 2: probably walked past a lot of stuff. This is such

927
00:50:15,719 --> 00:50:20,360
Speaker 2: a detailed nuance discussion that people who are like monetary

928
00:50:20,400 --> 00:50:23,120
Speaker 2: policy walks this is one of their favorite things to do,

929
00:50:23,239 --> 00:50:25,960
Speaker 2: is to point out all of these nitpicky little things

930
00:50:26,239 --> 00:50:30,520
Speaker 2: based on mind boggling economics that are really hard to describe.

931
00:50:30,719 --> 00:50:34,160
Speaker 2: We just glanced over the surface of this, but I think, yeah,

932
00:50:34,160 --> 00:50:36,920
Speaker 2: probably we got more right than you'd think.

933
00:50:37,640 --> 00:50:39,960
Speaker 1: Yeah, it's tough to tackle something like this because there

934
00:50:39,960 --> 00:50:42,280
Speaker 1: are people that know a gazillion times and more about

935
00:50:42,280 --> 00:50:43,080
Speaker 1: this kind of thing than we do.

936
00:50:43,400 --> 00:50:47,040
Speaker 2: Yep, and Chuck just said tackle, so he unlocked listener mail.

937
00:50:49,600 --> 00:50:53,279
Speaker 1: I'm going to call this this was from our crowd's episode,

938
00:50:53,440 --> 00:50:56,640
Speaker 1: and this is a classroom hack, a question hack from

939
00:50:56,680 --> 00:50:59,720
Speaker 1: a I think a teacher. Hey, guys, love the episode

940
00:50:59,719 --> 00:51:02,560
Speaker 1: about Yeah, I'm a middle school teacher and crowds are

941
00:51:02,600 --> 00:51:05,879
Speaker 1: my standard environment. Your comments about being afraid to ask

942
00:51:05,920 --> 00:51:07,759
Speaker 1: a question in class really spoke to me because a

943
00:51:07,760 --> 00:51:10,040
Speaker 1: big part of my job is navigating the power of

944
00:51:10,120 --> 00:51:13,320
Speaker 1: language with crowds in my students. There's a simple teacher

945
00:51:13,360 --> 00:51:16,680
Speaker 1: hack that is most effective and easiest, the easiest change

946
00:51:16,680 --> 00:51:19,800
Speaker 1: I've ever made to my communication with students and Aaron

947
00:51:20,000 --> 00:51:22,319
Speaker 1: from New Brunswick, Canada. I will go ahead and say that,

948
00:51:22,400 --> 00:51:25,080
Speaker 1: like anyone speaking in front of a crowd where you

949
00:51:25,120 --> 00:51:28,120
Speaker 1: like source questions, I think this is a pretty good

950
00:51:28,120 --> 00:51:31,560
Speaker 1: way to go. And here it is. Instead of saying

951
00:51:31,880 --> 00:51:35,120
Speaker 1: does anyone have any questions? What I say instead is

952
00:51:35,200 --> 00:51:38,480
Speaker 1: what questions do you have? There must be questions. It

953
00:51:38,600 --> 00:51:43,040
Speaker 1: really works a completely different response from the students. Guys.

954
00:51:43,080 --> 00:51:47,040
Speaker 1: The assumption that questions are expected always prompts at least

955
00:51:47,040 --> 00:51:49,400
Speaker 1: one kid to get the courage, which opens up the

956
00:51:49,400 --> 00:51:52,799
Speaker 1: gates for everyone else who is too apprehensive. Thanks for

957
00:51:52,840 --> 00:51:55,840
Speaker 1: being my first podcast in twenty twelve and for continuing

958
00:51:55,880 --> 00:51:58,520
Speaker 1: to bring joy and relaxation to a tire but satisfied teacher.

959
00:51:58,920 --> 00:52:00,960
Speaker 1: Peace and love and again that is from Aaron with

960
00:52:01,000 --> 00:52:03,480
Speaker 1: an E from New Brunswick, Canada.

961
00:52:03,600 --> 00:52:05,839
Speaker 2: Thanks Aaron, Peace and love back to you too, and

962
00:52:05,880 --> 00:52:06,760
Speaker 2: thanks for teaching.

963
00:52:07,760 --> 00:52:08,399
Speaker 1: It's a good hack.

964
00:52:08,719 --> 00:52:11,640
Speaker 2: It's a great hack. Questions who's got them? I know

965
00:52:11,680 --> 00:52:15,360
Speaker 2: there's some? Don't lie right, and then just get more

966
00:52:15,400 --> 00:52:18,560
Speaker 2: aggressive right huh huh, give me a question?

967
00:52:19,360 --> 00:52:20,480
Speaker 1: Yeah that works.

968
00:52:20,560 --> 00:52:22,279
Speaker 2: If you want to be like Aaron and send us

969
00:52:22,320 --> 00:52:24,600
Speaker 2: a great email and say peace and love that's awesome.

970
00:52:24,719 --> 00:52:27,560
Speaker 2: You can send it off again via email to the

971
00:52:27,760 --> 00:52:34,600
Speaker 2: email address stuff podcast at iHeartRadio dot com.

972
00:52:35,600 --> 00:52:38,520
Speaker 1: Stuff you Should Know is a production of iHeartRadio. For

973
00:52:38,600 --> 00:52:42,759
Speaker 1: more podcasts my heart Radio, visit the iHeartRadio app, Apple Podcasts,

974
00:52:42,880 --> 00:52:44,720
Speaker 1: or wherever you listen to your favorite shows.